Covid-19 Related Trading Update KAP INDUSTRIAL HOLDINGS LIMITED (Incorporated in the Republic of South Africa) (Registration number: 1978/000181/06) Share code: KAP ISIN: ZAE000171963 (“KAP” or “the Company”) COVID-19 RELATED TRADING UPDATE The Coronavirus (“COVID-19”) pandemic continues to impact all aspects of global society with serious ramifications for the global economy. OPERATIONAL REVIEW In view of the lockdown imposed by President Cyril Ramaphosa on 26 March 2020 and the extension thereto, the Company has undertaken various measures to reduce its operating costs and to optimise cash flows in order to ensure continued liquidity during the lockdown period and thereafter. These measures include the suspension of all non-essential operating expenditure and uncommitted capital expenditure and a targeted reduction in working capital. In addition to this, the Company has implemented certain salary and wage cost reduction measures throughout its operations which are detailed on the Company’s website at https://www.kap.co.za/wp-content/uploads/2020/04/kap-covid-19-update-22-april.pdf. LIQUIDITY REVIEW Financial and cash-flow forecasts to the Company’s year-end on 30 June 2020 continue to indicate that the Company will not deplete its existing banking facilities and will not breach relevant debt covenant ratios. In addition, these forecasts indicate that the Company will have sufficient banking facilities and liquidity to settle corporate bonds KAP009 and KAP010 in May and September 2020, upon maturity. DIVIDEND The board has for a number of years followed a practice of declaring a dividend in the region of 37% of headline earnings per share, thereby providing approximately 2.7 times cover. The practice is generally to declare a dividend during August and to pay the dividend during September/October each year. In view of the COVID-19 pandemic and the impact thereof on the economy, the Company and its employees, and in terms of the JSE Listings Requirements, shareholders are advised that it is highly unlikely that the board of directors will declare a dividend during 2020. The current situation is unprecedented, uncertain and constantly evolving and as such may affect certain assumptions that have been made in the preparation of the financial and liquidity forecasts. The financial information on which this announcement is based, has not been reviewed or reported on by the Company’s auditors. By order of the Board KAP Secretarial Services Proprietary Limited Stellenbosch 22 April 2020 Sponsor PSG Capital Date: 22-04-2020 01:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.