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KAP INDUSTRIAL HOLDINGS LIMITED - Covid-19 Related Trading Update

Release Date: 22/04/2020 13:00
Code(s): KAP     PDF:  
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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
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