KAP Limited has released its unaudited results for the six months ended 31 December 2023, showcasing a mixed performance marked by revenue and earnings declines.
Financial Overview
According to the released data, KAP Limited experienced a 2% decrease in revenue, amounting to R15,028 million compared to R15,265 million in the corresponding period. Operating profit before capital items also saw a notable decline, dropping by 17% to R1,252 million from R1,515 million in the same period last year. Both headline earnings per share and earnings per share suffered significant decreases, with headline earnings per share plummeting by 36% to 21.8 cents per share and earnings per share declining by 37% to 21.2 cents per share.
Restatement of Prior Period Error
The financial report also highlighted a restatement of prior period figures due to an error discovered by management. It was revealed that a raw material supplier had incorrectly applied a contractual pricing formula from 1 February 2022 to 30 September 2023. This resulted in overcharges amounting to R183 million for raw material purchases, with R163 million attributed to the 2023 fiscal year, including R107 million relating to the first half of 2023. The error was promptly rectified, and the overcharges were recovered from the supplier. As a consequence, prior period earnings were adjusted to reflect the correction.
Conclusion
While KAP Limited has faced challenges resulting in revenue and earnings declines for the six-month period ending December 2023, steps have been taken to address discrepancies and ensure transparency in financial reporting. The upcoming webcast presents an opportunity for stakeholders to gain further insights into the company’s performance and future outlook.
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