Chemical and Allied Products Plc increase Net Income by 37.10% for Q1 2025
Chemical and Allied Products Plc reported its unaudited Q1 2026 results with a solid year-on-year performance, driven by steady revenue growth, controlled operating costs, and a recovery in finance income. Revenue increased by 14.90% y/y to N11.59bn. Compared to the previous quarter, however, revenue declined by 8.80% from N12.71bn in Q4 2025, indicating a softer start to the year relative to the strong finish in 2025.
Cost of goods sold rose by 14.50% y/y, broadly in line with revenue growth. As a result, gross profit grew by 15.40% y/y to N5.08bn, with gross margin remaining largely stable at 43.90% (+21bps y/y). Compared to Q4 2025, gross profit declined by 11.70%, with gross margin contracting by 144bps from 45.30%. This suggests that while cost and revenue moved in tandem on a yearly basis, there was some margin pressure relative to the prior quarter.
Operationg Performance
Operating performance showed stronger improvement, supported by relatively slower growth in operating
expenses. OPEX increased by 3.60% y/y, significantly below revenue growth, and declined by 8.80% compared to Q4 2025. This cost discipline supported a 40.00% y/y increase in EBIT to N2.12bn. Consequently, EBIT margin expanded to 18.30%, up by 328bps y/y. Relative to Q4 2025, EBIT declined by 14.90%, with margin moderating by 132bps from the prior quarter, reflecting the impact of lower revenue in the period.
Below the operating line, finance income provided additional support to earnings. Net interest income increased by 37.10% y/y to N0.27bn. More notably, the company recorded a positive turnaround compared to Q4 2025, moving from a net finance cost of N(0.52bn) to a net finance income position in Q1 2026. This shift contributed meaningfully to overall profitability.
Net Income
Profit before tax rose by 39.60% y/y and increased by 20.90% compared to Q4 2025 to N2.39bn, reflecting both stronger operating profit and improved finance income. Net income increased by 37.50% y/y to N1.58bn and grew by 19.10% compared to the previous quarter, indicating that bottom-line performance remained resilient despite the softer revenue trend. Earnings per share followed the same pattern, rising to 1.94 kobo (+37.50% y/y, +19.10% vs Q4 2025).
The effective tax rate increased slightly to 34.00% (+101bps y/y and +99bps vs Q4 2025), which modestly tempered net income growth. Nevertheless, net profit margin improved to 13.60%, expanding by 224bps y/y and 320bps relative to the previous quarter, reflecting stronger conversion of revenue into profit.
Overall, CAP’s Q1 2026 performance reflects a business that delivered solid year-on-year growth, supported by stable gross margins, improved operating efficiency, and a recovery in finance income. While comparisons with Q4 2025 show some moderation in revenue and margins, profitability remained resilient, underpinned by cost control and gains below the operating line. SOURCE: Coronation Asset Management
