Nigeria decorative paints industry

Content� Nigeria Macroeconomic indicators P. 4� What will drive the construction boom in Nigeria ? P. 6� Real Estate Overview.

� Key figures P. 8� Residential segment P. 9� Commercial segment P. 12

� Construction Overview.� Performance P. 14� Market structure P. 15� Clients P. 16� The major contractors P. 17� Large projects P. 19 .� Paint market in Nigeria P. 24� Overall Market value P. 25� Market value by type of paints. P. 26� Forecast and future outlook 2013 to 2017. P. 27� Imported paints origin and value overview 2011 P. 28� Decorative paint market P. 29� Decorative segment analysis P. 30� Facts P. 31� Industry overview P. 32� The routes to the deco market P. 33� Market share of major players P. 34� Local manufacturing industry players P. 35� Local manufacturing industry players ASP/Brand structure P. 36� Local manufacturing industry players ASP by range and type P. 37� Imported paints overview P. 38� Imported Paints SUVINIL P. 39� Dulux Trade Range products 2013 prices in color centers P. 40• CAP PLc overview and financial performance P. 41

Nigeria Macroeconomic indicators

3

Africa Second

LARGEST Economy

Africa Most

POPULOUSCountry

41% of

Africa Regions GDP

6.1% Economic Growth Per Annum


Population

Population of Nigeria 2006/2012

GDP

Gross domestic product of Nigeria 2006/2012 US Dollars 2013/2017 US Dollars

Gross domestic product per capita2006/2012 US Dollars 2013/2017 US Dollars

2006 2007 2008 2009 2010 2011 2012

Millions

of people

140,0 143,9 147,8 151,9 156,1 160,3 164,8

2013 2014 2015 2016 2017

Millions of

people

169,3 173,9 178,7 183,6 188,7

Population of Nigeria 2013/2017

2013 2014 2015 2016 2017

Billions of

Dollars

293.1 312.5 334.6 360.1 388.4

2006 2007 2008 2009 2010 2011 2012

Billions of

Dollars

145.4 165.9 207.1 168.6 228.6 244.1 272.6

2006 2007 2008 2009 2010 2011 2012

Dollars 1,038 1,153 1,401 1,110 1,465 1,522 1,654

2013 2014 2015 2016 2017

Dollars 1,731 1,796 1,871 1,961 2,058

4


Inflation

Inflation in Nigeria 2006/2012

Unemployment

Gross domestic product of Nigeria 2006/2012 2013/2017

2006 2007 2008 2009 2010 2011 2012

Inflation

rate

8.2% 5.4% 11.6% 12.5% 13.7% 10.8% 11.4%

2013 2014 2015 2016 2017

Inflation

rate

9.5% 8.2% 7.0% 7.0% 7.0%

Inflation in Nigeria 2013/2017

2013 2014 2015 2016 2017

Rate 28.7% 31.3% 33.8% 36.3% 38.8%

2006 2007 2008 2009 2010 2011 2012

Rate 12.3% 12.7% 14.9% 19.7% 21.1% 23.9% 26.2%

5

What will drive the construction boom in Nigeria ?

� Rapid urbanization.

• Nigeria is one of the fastest urbanizing countries in sub Saharan Africa

� 50% of the population is living in urban areas (20% in 1980)

� Demographic and housing demand.

� With median age of 19 years and 55% in working age bracket Nigeria s population is showing strong potential for growth in housing demand.

� Middle class increasing in Nigeria.

� According to the African Development Bank, the lower middle class constitutes 6.2% of the Nigerian population while the upper middle class constitutes 3.8% of the population.

� The new Nigerian middle class has emerged along with the expansion of the private sector in industries like banking, telecommunication, consulting, etc.…

� Strong economic growth.

� Nigeria has enjoyed relatively strong economic growth over the past seven years with a 7.36% rate in 2011.

� Reform of the banking system and Development of Mortgage Banking.

� Increasing capacity in cement production.

� Development of Public Private Partnerships (PPP)

6

Real Estate Overview.

7

• Real estate sector entered in 2011 in a state of flux

• After witnessing rapid price rises leading up to 2008, the global turndown and more rigorous lending criteria in the banking sector have brought prices correction.

• As a result property prices in some upmarket areas of Lagos such as Ikoyi and Victoria Island fell by 10% to 20% in 2010.

• Lagos residential real estates prices are subject to less volatility while prices in Abuja of Abuja are comparable to Lagos.

• Affordable housing : Future demand for housing in Nigeria is not confined to the high end sector.

� According to Mortgage Bank of Nigeria, Nigeria s estimated 170 millions of population is growing at 2.8% per year which means that the country needs to produce 720,000 housing units to achieve its millennium Development Goals on housing.

� As per capita income in Nigeria is $2,748, the vast majority of the 16 millions shortfall in housing stock will have to be met with affordable housing.

� Federal Housing Authority is aiming to add around 100,000 housing units by 2013.

� End of 2010, Minister of Land and Urban Development has announced a second program to last four years and to add 3 millions housings.

� The Federal Capital Territory of Abuja has launched a $ 502,5 millions housing program with the Federal Mortgage Bank of Nigeria with a view to add 5000 units end of 2011.

� Lagos State announced in 2010 a plan to provide low cost housing in the coming years establishing a mortgage scheme under which beneficiaries are required to pay 30% of the value of the house before taking possession compared to 50% which is the norm industry.

Real Estate Overview Key figures

8

• The residential segment in Nigeria largely account for the larger chunk of real estate and housing demand

• According to the Federal Housing Authority housing deficit is reported to be about 16 millions units.

• About 70% of Nigerians live in single room in urban slums or thatched houses in rural areas.

• Government indolent in housing delivery though the Federal Mortgage Bank is inadequate to meet housing demand.

• Nigeria’s mortgage industry remains underdeveloped with interest rates on mortgage funds very high, making the mortgage business in Nigeria unattractive

• High and Upper middle class have access to residential estates (5% of the population)

• As some strata of the Nigeria society become more affluent, demands for new housing and the infrastructure to support it, grow more accurate.

Real Estate Overview / Residential segment

9

LAGOS POPULATION

2011 2015

25 millions

18 millions

UPPER

CLASS

LOWER UPPER CLASS

UPPER MIDLLE CLASS


LOWER MIDDLE CLASS

LOWER CLASS / VERY POOR

LOWER CLASS

Housing microfinance (HMF)

Housing microfinance & rental housing

HMF& Mortgages

Social Housing

Mortgages

Outright cash/Mortgage loans

INCOME CLASS PYRAMID VERSUS ACCCESS TO HOUSING FINANCE.

16.32%

3.68%

28.79%

1.21%

30.00%

20.00%

10


68.10%

15.00%

0.80%15.80%

0.30%

Urban

Single room Duplex whole building

flat Others

66.30%

0.30%

27.20%

5.80%0.40%

National


flat Others

Percentage distribution of households by type of housing units in Nigeria 2008.

65.70%

0.20%

31.20%

2.50% 0.40%

Rural


flat Others

11

4.60%

93.30%

0.50% 1.60%

Percentage distribution by type of real estate in Nigeria 2008

Commercial Residentail Industrial Others

Real Estate Overview / Commercial segment

• Demand for commercial real estates in Nigeria is highly concentrated in commercial cities like Lagos, Abuja and Port Harcourt.

• This segment accounts less than 20% of real estate demand.

• Julius Berger, HFP Engineering and Costain W.A are the major construction companies with focus in construction of commercial real estate.

• Demand in Commercial segment outpace supply as available properties are premium priced.

• Lagos has the fifth highest office rent in the world.

12

Construction Overview.

13

• Building and construction sector has shown a consistent growth in 2009 and 2010, 11.76% in 09 and 10.72% in 2012 in same period.

• In cash terms he building and construction sector contributed $20.97 m to total GDP third quarter 2009 and $22.3 m during the same period 2010.

• The sector has contributed to a modest portion of GDP in 2010 with 1.56% and USD 22.3 millions which reflects the largely informal nature of the industry.

• Only seven companies operating in the formal sector are listed in the Nigerian Stock Exchange.

• Large contractors operating in Nigeria s formal sector have benefitted from the continued pipeline of public sectors projects.

• Construction company Costain West Africa with USD 6.97 millions pre tax profit in 2008/2009 fiscal year has recorded a 54% gain on the previous period.

• Cappa d Alberto and Roads Nigeria posted a 60% and 16% rise over the same period respectively.

• Source Central Bank of Nigeria

Construction Overview / Performance.

Building & construction GDP, 2009/2010

Q3 2009

Q4 2009

Q1 2010

Q2 2010

Q3 2010

Q4 2010

GDP (N bn)

3.78 3.9 3 3.51 3.33 4.37

Share %

1.9 1.9 2.7 2 1.56 1.91

Growth rate

11.76 12.87 13.5 12 10.72 12.12

14

• Judging construction market size of this sector is made difficult by the prominent role of the informal segment.

• This segment is made of thousands of small construction companies that often resort to sub standards practices.

• Their customers is generally restricted to private clients, usually individuals while larger private sectors clients and government bodies both turn to Nigeria s growing formal construction sector for their building requirement.

• Foreign contractors are dominant in the formal sector.

• Last decade has seen increasing maturation in the sector.

• Emergence of property developers who are producing well planned real estates aimed at the high end of the market.

• Some Nigeria real estate developers also operate a construction division within their business.

• Others are acting as coordinator and eventual operator of Nigeria s larger developments.

• Sustained demand for high quality housing has led to some of the most ambitious projects seen in Nigeria.

Construction Overview / Market structure

15

• The Federal Sate and local governments are still the major client s of Nigeria s construction companies accounting for more than half of all projects.

• The National development plan launched by former president of Nigeria would need $6bn to $10bn to be invested in infrastructure over the next decade.

• Private sector meanwhile have largely come from the hydrocarbons sector with multi national such as Total, Exxon Mobil, Shell and Chevron establishing a steady demand for infrastructure, office space, and housing stock.

• However the growth of economy and middle class of recent years has resulted in greater demand for others sectors

� Banks

� Shopping malls

� Hotels

� Large real estate

• The combination of rising private sector demand and ongoing government spending will drive the construction sector s future growth.

Construction Overview / Clients

16

• Capa D Alberto is one of the oldest firms operating in Nigeria is established in 1932 by Italians..

• The firm has understaken a number of major projects such as the UN premises n Abuja, and in 2011 won the $9.5 millions contract to construct headquarters of Cornerstone Insurance in Lagos.

• Julius Berger is the largest construction company in Nigeria, the local subsidiary of the German firm Bilfinger Berger, incorporated in 1970.

• It is the largest private employer in the country with 16,000 staff.

• Its signature developments include the $360 millions stadium in Abuja. In 2010.

• Setraco with 5,000 employees is another heavyweight focusing mainly on large infrastructural projects and traditionally operating in the southern part of the country.

• Dantata and Sawoe construction is another firm that entered the market during the oil boon of the 1970s, 60% owned by a Nigerian consortium and 40% by CEC of Germany.

• They have build their reputation on large infrastructures projects while it has moved in the areas of low rise commercial, residential and office buildings.

• PW Nigeria established in 1974 has succeeded in landing multimillion dollar contracts for building, water and civil engineering projects.

• Churchgate Group

• Jagal

Construction Overview / The major contractors.

17

Construction Overview / The major contractors.

• C & C Construction (Chagoury Group Construction Division) is part of Chagoury Group Lebanon owned company , founded in 1979.and has since grown to be one of the leading construction and civil engineering contractors in Nigeria.

• The company is a holding formed by 3 distinctive companies ITB for building construction, HIGHTECH for civil engineering and Fleetwood Transportation.

• ITB successfully completed many prestigious projects in Nigeria including:

� The National Assembly Complex in Abuja, northern Nigeria

� A residential development project of 13 floors on Victoria Island, Lagos

� The design and construction of a staff housing complex of 800 units for client ALSCON’s Aluminum Smelter Plant

� The new Intercontinental Hotel on Victoria Island, Lagos

� The new headquarters and office complex for TOTAL oil company in Port Harcourt

� Ocean Parade Towers, a residential development on Banana Island in Lagos Lagoon.

� The Nigerian Defense Academy

• More recent entrants to the sector includes

• Drascom Group Construction.

• China Civil Engineering Construction corporation.18

• Despite recent downturn in prices, sustained economic growth and a growing middle class form the basis of a long term expansion in real estate sector, and a number of large projects aim to capitalize on these trends.

• The most ambitious of them is Eko Atlantic is taking shape off Lagos coastline and is effectively a planned city, prime residential area.

Construction Overview/Large projects

� Project developed by Chagoury Group � $ 3.5 billion investment project with financing coming from

BNP Paribas and 3 local banks.� The project involves reclaiming over eight square kilometers of

land along Bar Beach on Victoria Island in Lagos and building a mix of residential, commercial, financial and tourist accommodation.

• Sand filling and infrastructure expected to be completed by 2014.� The city targets 300,000 residents and at least 200,000 visitors

daily.• The developer Energyx Nigeria Limited, will be entitled to grant leasehold to

buyers of any plot of land. Although the company will add infrastructure to area, it will be the investors responsibility to construct whatever they wish on their plots of land.

19


� Pinnacle Point Lagos Keys is a luxury leisure and residential development project that will break ground in Badagry, Lagos West, Nigeria in January 2009. The area is set on 14 kilometers of sand keys.

• The Pinnacle Point Lagos Keys project is a partnership between the Unibright Group and Pinnacle Point Holdings, a South African company.

Pinnacle Point Lagos Keys Leisure Resort – Phase Two expected to be completed in 2016.Marina and Waterfront; 150 vessel mooring, Yacht Club and boat lockers, Waterfront shops, ferry terminal. Staff village and facilities

• A 60-suite Beachcomber style hotel

• A 160-room ‘Ziggurat’ Beach Resort Hotel

• A 60-suite Banyan Style Hotel

• A sports and cultural center

• A sports and concert venue that can accommodate 50 000 people

Pinnacle Point Lagos Keys . $ 190 millions project.

20


World trade Centre residential Abuja. N156 billion project.

• The Churchgate Group is developing the World Trade Centre project in Abuja.

• The project divided into three phases has commenced, with Churchgate Construction Company Limited leading the construction team as the main contractor.

• WTC is a 8 towers complex the project would consist of luxury offices, serviced apartments, hotel, and the 40,000 sq. meters Capital City Mall. Other components are a leisure center, cinema and convention facility.

• First phase should be completed in 2013

• Project rendered on 6,102 hectares.

• Consultants are Woods Bagot Limited (concept architect), Edifice Consultants PVT. Limited (executive architect), WSP Consultants (Structural Consultant and MEP Consultant),

• Hancock Ogundiya & Partners are the Local MEP & C&S Consultant and Space Designers Limited (Local Architectural Consultant). 21


� Rainbow Town Port Harcourt . $255 millions project.

Ado Bayero Mall, Kano. . $70 millions project. Completed

22

Project name Location

ITC PARK KANO

KWARA MALL ILORIN

ADO BAYERO MALL KANO

WORLD TRADE CENTER ABUJA

ABUJA MALL ABUJA

NIGERIA CULTURAL CENTER ABUJA

LEKKI FREE TRADE ZONE LEKKI

FESTAC MALL LAGOS

LAKE POINTS APPARTMENTS LAGOS

TEJUOSHO MARKET MALL LAGOS

LAGOS LIGHT RAIL PROJECT LAGOS

4th MAINLAND BRIDGE LAGOS

GLOVER GREEN DEVELOPMENT LAGOS

SANDY SHORES APPARTMENT LAGOS

Project name Location

LE MERIDEN GRAND HOTEL LAGOS

IBADAN MALL IBADAN

UYO STADIUM AKWA IBOM

DELTA LEISURE PARK OLERI

TOWER HOTEL AND CONF.CENTER YENAOGA

NEW CINEMA COMPLEX AND RETAIL PARK YENAOGA

NEW MEGA BED HOSPITAL PROJECT YENAOGA

GARDEN CITY SPORTS CENTER PORT HARCOURT

RAINBOW TOWERS PORT HARCOURT

KANTI TOWERS LAGOS

CENTRAL BANK OF NIGERIA LAGOS

LAKE POINT TWIN TOWERS IKOYI LAGOS

LG WORLD ANIDS MALL AWKA

ANAMBRA STATE CENTER HOTEL CONV. CENTER ANAMBRA

Large projects overview.

23

Paint market in Nigeria

World trade Centre Abuja January 2013

24

� Overall Market value :

Paint Market in Nigeria

2006 2007 2008 2009 2010 2011 2012

Millions of

Dollars

101.7 137.3 133.3 163.0 128.0 165.6 160.1

Growth - 35% - 2.9% 22.3% - 21.5% 29.3% - 3.3%

101.7

137.3 133.3

163

128

165.6 160.1

0

20

40

60

80

100

120

140

160

180

Nigeria paints market value 2006/2012 Millions USD

20088 2011 2012

2006 2007 2009 2010

25

� Overall Market value by type of paint

� Solvent borne paints :

� Water borne paints :


Millions of Dollars 2006 2007 2008 2009 2010 2011 2012

Polyester solvent borne 27.3 29.9 14.8 45 22.6 21.2 14.8

Vinyl polymer and acrylic solvent

borne 17.5 19.6 7.7 12.6 11 10 6

Others polymer based solvent borne35.5 53.4 69.4 65.3 65.1 98.8 100.8

Total solvent born paints 80.3 102.9 91.9 122.9 98.7 130 121.6

Millions of Dollars 2006 2007 2008 2009 2010 2011 2012

Vinyl polymer and acryl water borne 5.1 16.2 21.1 16.4 12.5 14.6 18.3

Polymer based water born 12.8 15.8 19.5 20.7 14.3 12.7 14.5

Total water born21.4 34.5 41.5 40.2 29.4 35.6 38.5

Water based

paints

20.48%Solvent

based paints

75.95%

Others

paints 3.57%

OVERALL MARKET VALUE SPLIT BY TYPE OF PAINTS 1012

$ 121.6 m

$ 38.5 m $ 5.7 m

26

� Forecast and future outlook 2013 to 2017


101.7

137.3133.3

163

128

165.6160.1155.6 155.4 160.1

174.8 177.1

0

20

40

60

80

100

120

140

160

180

200

Market for paints in Nigeria 2006/2017 Millions USD

2006 2007 2008 2009 2010 201520142013 2016 2017

2013 2014 2015 2016 2017

Millions of

Dollars155.6 155.4 160.1 174.8 177.1

Growth - 2.8% - 0.1% 3% 9.2% 1.3%

20122011

27

� Imported paints origin and value overview 2011

• Total fob value of paints imported in Nigeria in 2011 is $ 45,600,000.

• USA And United Kingdom exports represent 46% of total paints value imported in 2011.


Rank Country Fob value USD

1 USA $12,828,833.00

2

United

Kingdom $7,984,375.00

3 China $4,406,451.00

4 India $3,352,252.00

5 Belgium $3,072,828.00

6 South Africa $1,807,543.00

7 Germany $1,787,295.00

Rank Country Fob value USD

9 Germany $1,787,295.00

10

United Arab

Emirates $1,567,645.00

11 France $1,567,028.00

12 Italy $1,486,570.00

13 Brazil $766,232.00

14 Netherlands $742,363.00

15 Australia $414,958.00

16 Rep. of Korea $193,047.00

28

Decorative paint market

Lake point Apartments, Lagos 29


Open Market 60%High end

12%

B 2 B28%

Deco segment market analysis

Open Market High end B 2 B

30

• Facts

� Total market estimation USD 100 millions in 2011.

� The premium market is estimated at USD 32 millions for 2011. 50% is imported.

� Market growth 8% in volume, premium segment 15 % to 20%.

� ASP breakdown: Total average is between 2.0 and 3.0 USD/Ltr.

� High Medium quality ASP produced locally is 5.53 USD/Ltr.

� High Quality ASP imported paint is USD 15.0/ltr *(Dulux Trade & Suvinil)

� Premium brands Consumer 70%, projects 30 %.

� Medium/budget products: Consumer 35 %, projects 65 %


65%25%

10%

Volume channels

Open market Projects Outlets

60%

10%

30%

Volume split

Low quality Medium quality High quality

Value split

Low quality Medium quality High quality

65%25%

10%

50%25%

25%Lagos

State

Abuja &North

Central

Port

Harcourt

Others

GEOGRAPHICAL MARKET SPLIT POTENTIAL

25%

15%

15%

45%

31

• Industry overview

• The Nigerian paint industry is not highly regulated.

• The industry has gone through various levels of development from the manual based processes to more technologically advanced production methods. However, the level of development of the sector in Nigeria is still low when compared to other countries with more advanced technical know-how

• There are over 1000 companies producing paint in the country.

• The bigger ones which are less than 10% of the total numbers of companies producing paint controls about 50% of the market while the remaining market share are divided among the rest.

• About 40 million liters of paints are produced and used in the country annually (PMA).

• In Nigeria, decorative paints have 60% of the market share, Industrial has 20%, Refinishing 10%, Wood finishing and Automotive have 5% each of the market share.

• Total investment in the industry is about $ 95 millions with an installed capacity in excess of 150 million liters of assorted paints per annum with about 10,000 people presently employed in the industry.

• The paint industry standards are presently regulated by the Standards Organization of Nigeria (SON) which has only been able to set standards for household products.


32

Decorative paints companies analysis

PAINT MANUFACTURERSDirect sales Distribution

PROJECTS

INDIVIDUAL

CUSTOMERS

PAINTERS

SMALL CONTRACTORS

LARGE CONTRACTORS

APPROVED

DISTRIBUTORS

MULTI BRAND

SHOPS

MEGA DEALERS

OR DEPOTS

COLOR

CENTERS

33


11.20% 8%

4.50% 4.40… 4.27% 4.38% 1.80% 1.75% 1.50% 1.50% 1.50% 1.30% 1%

10%

84.50%

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

90.00%

MARKET SHARE OF MAJOR PLAYERS

34

• Local manufacturing industry players can be placed into three broad categories

• The first category consists of major players which control a large share of the market and have been in existence for many years.

• Some of the companies within this category include:

� CAP Plc

� IPWA Plc

� Berger Paints

� Dn Meyer

� Portland Paints

� Chemstar

• There’s a second category which consists largely of medium sized players with less control of market share. These companies are characterized by private ownerships with majority of the of the equity control in the hands of a few individuals.

� Eagle Paints

� President paints

� Apex Paints

� Star Paints

• The third tier category comprises of companies with relatively larger customer patronage than their mid tier peers (due to lower price advantage) but are restricted based on quality.


High/Medium quality

Low quality

Low quality

35

� Local manufacturing industry ASP

� High/Medium quality

o CAPLUX ASP 6.72 USD/Ltr.

o BERGER PAINTS ASP 5.76 USD/Ltr.

o DN MEYER ASP 5.25 USD/Ltr.

� Low quality

o EAGLE PAINTS ASP 3.05 USD/Ltr.

o PORTLAND PAINTS ASP 4.47 USD/Ltr.

� Imported paints ASP

� High quality

o Dulux Trade ASP 21.40 USD/Ltr.

o Suvinil ASP 8.30 USD/Ltr.


� Local manufacturing Brand structure

o The structure of paints range of local manufacturers is dominated by acrylic and vinyl coatings. Emulsion paints is the most important market in decorative paints in Nigeria.

o Most of local companies propose a premium pants range and economic one.

Water based paints

Textured paints Thick

and semi thick coating

Internal ExternalPreferred consumer pack size is 20 liters

plastic can

Textured paints are the most popular external

paints in Nigeria

Thin film acrylic matt

emulsion

Thin film vinyl silk emulsion

Thin film fungicide

Internal External primer and sealer offer is poor

Alkyd paints

Enamel gloss semi gloss

Preferred consumer pack size is 4 liters

steel can

36

Most of the local paints manufacturer propose to their customers a supply

and apply service

� Local manufacturing ASP by range and type of paints. 20 ltr for water based, 4 ltr Alkyd.

Product ASP per

ltr

Caplux Emulsion $ 3.15

Caplux Enamel Gloss

$ 6.61

Caplux Textured $ 4.20

Product ASP per ltr

Dulux emulsion $ 6.06

Dulux Enamel Gloss

$ 8.75

Textured paint $ 6.96

Silk Emulsion $ 8.14

CAPLUX

BERGER PAINTS

Product ASP per ltr

Luxol Emulsion $ 5.04

Luxol Acrylic mat $ 6.31

Luxol gloss enamel

$ 7.53

Luxol eggshell $ 10.68

Texcote $ 4.88

Product ASP per ltr

SuperstarEmulsion

$ 3.39

Superstar Enamel gloss

$ 6.35

DN MEYERPremium Range Eco Range

Product ASP per ltr

Emulsion $ 4.30

Enamel $ 6.79

Textured $ 4.87

Acrylic satin $ 6.23

Product ASP per ltr

Emulsion $ 2.56

Enamel $ 5.88

PORTLAND PAINTS

Premium Range Product ASP per ltr

Vinyl matt emulsion

$ 3.27

Intra emulsion $ 1.34

Intra gloss $ 4.07

Intratex textured $ 2.56

Eco Range

Product ASP per ltr

Vinyl matt $ 4.71

Santex enamel gloss

$ 5.98

Semi gloss matt enamel

$ 5.86

Textured paint $ 5.39

Silk emulsion $ 6.78

Wall satin $ 6.23

Premium Range

Premium Range Eco Range

Eco Range Premium Range

Dulux Eggshell $ 10.70

37


� Imported paints

� Customs duties in Nigeria on imported paints are 20% water based and solvent based, 10% on thinners.

� Imported paints are rated in the High quality segment as far as the quality of local manufactured paint is concerned.

� CAP Plc is the market leader in Nigeria, with Dulux Trade products range imported from UK, with upper / middle class individuals customers targeted though their color centers and DIY.

� Suvinil Paints has recently penetrated the Nigerian paint market opening 2 color centers in Lagos, with a products range imported from Brazil and intended to contractors / professional painters.

� South African decorative paints brands are imported too, like Crown, Marmoran and distributed though local companies.

� PPG was marketed the deco market with the Brand Seigneurie, imported from France and Cameroon, but it is not clear if they are still active in deco in Nigeria.

� PCMN the IP distributor in Nigeria is marketing a deco paints range named DECO probably imported from South Africa.

38


� Imported paints SUVINIL

� Pintar Services Limited is the official agent for BASF in Nigeria, importing and marketing SUVINIL deco paints imported form Brazil.

� 2 shops / color centers with tinting system in Lagos managed by expatriate staff.

� Professional decorative paint products range is proposed including primer, sealer, putty with standard and eco range.

� Prices positioning is higher than the local manufactured brand.

� Training of painters.

� Pricing overview Product

Pack size L

Price per Ltr

USD Product

Pack size L

Price per Ltr

USD

SUVINIL ACRYLIC PRIMER WATER BASED INT/EXT 18 $6.48 SUVINIL ANTIMOLD ACRYLIC EMULSION 18 $11.85

SUVINIL ACRYLIC SEALER INT/EXT 18 $4.81 SUVINIL PVA LATEX MAXX EMULSION 3.6 $12.59

SUVINIL PUTTY PVA INTERIOR 18 $3.33 GLASURIT ACRYLIC EMULSION INTERIOR 3.6 $8.92

SUVINIL ACRYLIC PUTTY EXTERIOR 18 $4.07 SUVINIL ACRYLIC ANTIBACTERIAL EMULSION SATIN 16.2 $11.31

SUVINIL SELATRINCA CRACK TREATMENT INT/EXT TUBE $25.00 SUVINIL ACRYLIC EMULSION SILKY TOUCH 18 $9.62

SUVINIL SELATRINCA CRACK TREATMENT INT/EXT 3.6 $57.96 SUVINIL ACRYLIC ANTIBACTERIAL EMULSION SATIN 3.6 $13.88

GLASURIT ACRYLIC SEALER INT/EXT 18 $4.25 SUVINIL ACRYLIC EMULSION SILKY TOUCH 3.6 $12.96

GLASURIT VINYL PUTTY INTERIOR 18 $3.11 SUVINIL ENAMEL FAST DRYING PRIMER WATER BASED 3.6 $12.50

GLASURIT ACRYLIC PUTTY EXTERIOR 18 $3.62SUVINIL FAST DRYING HIGH GLOSS ENAMEL WATER BSD 3.6 $14.44

SUVINIL ACRYLIC MICROFISSURE EMULSION INT/EXT 18 $12.55SUVINIL ANTIRUST PRIMER RED OXIDE SOLVENT BASED 3.6 $12.59

SUVINIL PVA LATEX MAXX EMULSION INT/EXT 18 $8.14 SUVINIL HIGH GLOSS ENAMEL SOLVENT BASED 3.6 $9.72

GLASURIT ACRYLIC EMULSION INTERIOR 18 $5.92 GLASURIT HIGH GLOSS ENAMEL SOLVENT BASED 3.6 $9.72

GLASURIT MATT ENAMEL SOLVENT BASED 3.6 $9.7239


� CAP Plc company Overview

� CAP is the market leader on HQ paint segment.

� The company is marketing in Nigeria Dulux Trade imported brand and CAPLUX/Dulux regular ranges manufactured locally.

� Distribution channels

40

FACTORY/DIRECT SALES

DYI DYI COLOR

CENTERS

COLOR

CENTERSManufacturing

of CAPLUX regular range

CAPLUXCAPLUX

DULUX TRADE RANGE

DULUX TRADE RANGE

DULUX TRADE RANGE

DULUX TRADE RANGE

CAPLUXCAPLUX

Approved distributors

CAPLUX TINTED 20LTR 10 DAYS

AVAILABILITY IN COLOR CENTERS

CAPLUX TINTED 20LTR 10 DAYS

AVAILABILITY IN COLOR CENTERS

GAME SHOP LAGOS

GAME SHOP LAGOS

15 COLOR CENTERS IN NIGERIA

SHOP DESIGN BY CAP

TINITNG SYSTEM OWNED BY CAP

18% DISCOUNT TO COLOR CENTRES BY

CAP

CAPLUX 20L RANGE NOT TINTED IN

COLOR CENTERS

Importation of DULUX TRADE

Range

PROJECTS

MULTIBRAND SHOP

DULUX TINTING SYSTEM FOR

TRADE RANGE

WHITE ONLY FOR CAPLUX

RANGE

STRONG MARKETING

SUPPORT

1L 2.5L 4 L

PACK SIZES

20L 4L PACK SIZES

DECORATIVE PAINT MARKET

� Dulux Trade Range products 2013 general prices in color centers

�

PRODUCTPACK SIZE ltrs

PRICE USD PER

PACK

PRICE USD PER

LTR

DULUX TRADE VINYL MATT

PURE BRILLANT WHITE 5 88.87 17.77

LIGHT BASE 5 88.87 17.77

MEDIUM, EXTRA DEEP BASES 5 88.87 17.77

LIGHT BASE 2.5 49.95 19.98

MEDIUM, EXTRA DEEP BASES 2.5 49.95 19.98

LIGHT BASE 1 20.43 20.43


DULUX TRADE SOFT SHEEN


LIGHT BASE 5 96.03 19.21


LIGHT BASE 2.5 56.62 22.65


LIGHT BASE 1 25.08 25.08


DULUX TRADE VINYL SILK


LIGH BASE 5 97.83 19.57


LIGH BASE 2.5 51.60 20.64


LIGH BASE 1 20.78 20.78


DULUX TRADE WXD MAXIMUM EXPOSURE

LIGHT BASE 5 96.39 19.28


PRODUCTPACK

SIZE ltrs

PRICE USD PER

PACK

PRICE USD PER

LTR

DULUX TRADE WSD SMTH MASONRY

LIGHT BASE 5 99.98 20.00


DULUX TRADE WSD TEX MASONRY

LIGHT BASE EXTRA DEEP BASES 5 79.05 15.81

DULUX TRADE GLOSS

WHITE 5 87.43 17.49

LIGHT, MEDIUM, YELLOW BASE 5 87.43 17.49

WHITE, LIGHT, MEDIUM, YELLOW BASE 2.5 49.95 19.98

DULUX TRADE EGGSHELL BASES 5 108.22 21.64

HAMMERITE METAL FINISH

BLACK, GOLD, SILVER, GREY, COPPER, 1 18.00 18.00

BLACK, SILVER, COPPER, DEEP GREEN 2.5 38.16 15.26

DULUX TRADE SATIN WOOD

LIGHT, MEDIUM, DEEP&/DEEP BS 5 108.33 21.67

DULUX SPECIAL EFFECT

ACRYLIC SCUMBLE GLASE CLR BS 1 37.67 37.67

ACRYLIC SCUMBLE GLAZE SILVER BS 1 42.00 42.00

ACRYLIC SCUMBLE GLAZE GOLD BS 1 42.00 42.00

DULUX PROT W/SHEEN

DULUX PROT W/SHEEN NAT. COLOURS 5 120.00 24.00

DULUX PROT W/SHEEN LIGHT OAK 5 122.67 24.53

DULUX PROT W/SHEEN TEAK 5 122.67 24.53

DULUX PROT W/SHEEN WALNUT 5 122.67 24.53

DULUX PROT W/SHEEN ROSEWOOD 5 122.67 24.53

DULUX PROT W/SHEEN R/MAHOGAN 5 122.67 24.53

DULUX PROT W/SHEEN YELLOW 5 122.67 24.53

DULUX PROT W/SHEEN RED BS 5 122.67 24.53

DULUX PROT W/SHEEN BS 2.5 65.80 26.32

41

CAP Plc Financial performance 2008 to 2011

Source CAP Plc annual report

1 USD = 150 Nairas.

Philippe Puerta April 2013

DECORATIVE PAINT MARKET

US dollars 2008 2009 % change 2010 % change 2011 % change

Turnover $ 17,865,706 $ 20,184,026 13% $ 24,300,000 20% $ 28,751,826 18%

Profit before taxation $ 6,648,506 $ 4,128,646 (38%) $7,593,426 84% $ 8,668,833 14%

Profit after taxation $ 4,904,280 $2,273,206 (54%) $ 5,885,706 159% 6,701,880 14%

Dividend interim $ 2,800,000 $ 0 (1,866,666) $ 0

Profit retained $ 2,104,000 $2,273,206 8% $ 4,019,040 77% 6,701,880 67%

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Nigeria decorative paints industry

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