KAP LIMITED - Updated trading statement for the year ended 30 June 2026

Updated trading statement for the year ended 30 June 2026

KAP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1978/000181/06)
Share code: KAP
ISIN: ZAE000171963
Company Alpha Code: KAP
LEI code: 3789001F51BC0045FD42
('KAP' or 'the Company' or 'the Group')

UPDATED TRADING STATEMENT FOR THE YEAR ENDED 30 JUNE 2026

On 12 June 2026, the Company published an operational update and initial trading statement in which (among
other things) it advised shareholders that, if trading conditions persisted, a reasonable degree of certainty existed
that headline earnings per share ('HEPS') was expected to increase by more than 50% for the year ended
30 June 2026 ('FY26').

The Company is in the process of finalising its FY26 financial results and confirms that a reasonable degree of
certainty now exists that, for FY26:

 •    HEPS will be between 43.8 cents and 46.2 cents, representing an increase of between 82% and 92%
      compared to the HEPS of 24.1 cents reported for the year ended 30 June 2025 ('FY25'); and
 •    Earnings per share ('EPS') will be between a loss of 6.2 cents and 3.8 cents, which is a decrease from the
      EPS of 0.4 cents reported for FY25.

HEPS and EPS benefited from higher operating profit, lower net finance costs and increased tax incentives related
to PG Bison's new medium density fibreboard ('MDF') line. The Company also reduced net debt by more than
R1 billion, ahead of its R500 million target, driven mostly by stronger cash generated from operations. The FY25
comparative performance was adversely affected by increased operating costs, largely associated with the ramp-
up of PG Bison's new MDF line, as well as lower domestic new vehicle assembly volumes, as outlined in the
operational update. EPS was further impacted by impairments of goodwill and intangible assets, as set out below.

In accordance with IFRS requirements, the Group conducts annual impairment assessments on all goodwill and
intangible assets with indefinite useful lives, as well as on property, plant and equipment where impairment
indicators exist. As a result of these assessments, goodwill recognised on the acquisition of Sleep Group's bedding
operations, Restonic, was impaired due to the continued deterioration in domestic bedding market conditions,
characterised by subdued consumer demand and increased competitive pressures. The remaining intangible
assets recognised on the acquisition of Safripol were impaired, primarily because of a stronger forecast rand
relative to the US dollar and limited recovery in forecast polymer prices and margins as the current global cyclical
low is expected to persist, with improvement only expected beyond 2030. The remaining intangible assets
recognised on the acquisition of Optix were also impaired, due to the continued underperformance of the division's
Australian operations relative to expectations, primarily due to sub-optimal sales pipeline conversion, which led to
revised expectations of future performance.

The Company's results for FY26 are expected to be announced on SENS on or about 1 September 2026 wherein
the performance, financial position and outlook will be presented in more detail.

Shareholders are advised that the Company's auditors have not yet finalised their audit of the financial information
on which this trading statement is based and that the information and guidance set out above have not been
audited, reviewed or otherwise reported on by the Company's auditors.

Stellenbosch
14 August 2026

Equity and Debt Sponsor
PSG Capital

Date: 14-08-2026 02:00:00
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