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HomeNewsDangote cement’s operations in Nigeria generate N933b in revenue

Dangote cement’s operations in Nigeria generate N933b in revenue

Dangote Cement has posted impressive earnings of nearly N1tn from its Nigerian operations in the first nine months of this year. The unaudited interim financial statements for the period ending September 2023, filed with the Nigerian Exchange Limited, reveal that Dangote Cement recorded N933.08 billion in earnings during this period, representing a significant 4.76% increase compared to N890.65 billion for the same period in 2022.

During this period, the company’s Pan-African operations generated N588.24 billion in revenue, reflecting an extraordinary 103.89% increase over the N288.51 billion in revenue recorded in 2022.

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Profit from Dangote Cement’s Nigerian operations surged to N856.45 billion by the end of September 2023, compared to N336.25 billion in 2022. However, its Pan-African operations reported a loss of N54.35 billion, an improvement from the N127.67 billion loss recorded in 2022.

Overall, the cement group experienced a substantial 28.63% increase in its revenue, totaling N1.51 trillion for the period ending September 2023, compared to N1.18 trillion in September 2022.

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With a finance cost of N20.67 billion, a loss on foreign-denominated transactions at N99.02 billion, and an income tax expense of N127.34 billion, the group’s profit for the period reached N277.55 billion, marking a 30.24% increase from N213.10 billion recorded in 2022.

For the third quarter, Dangote Cement reported revenue of N563.77 billion, an increase from the N369.22 billion reported in Q3 2022. Profit for Q3 2023 reached N98.95 billion, reflecting a substantial 141% increase from N40.99 billion.

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Earnings per share increased by 29.6%, reaching N16.08, and the company’s net debt amounted to N507.7 billion.

Dangote Cement attributed its net exchange loss on foreign-denominated transactions to the significant devaluation of the Nigerian Naira in June 2023, with the Naira falling from N465 per dollar at the end of May 2023 to N756/$ in June 2023, leading to a net exchange loss of N116.1 billion from third-party loans and payables in the Nigerian entities.

The company also mentioned that its cash and cash equivalents included restricted cash used for unclaimed dividends, letters of credit, and debt service reserve accounts.

As of September 2023, Dangote had publicly issued bonds amounting to N266 billion, with coupon rates ranging from 11.25% to 13.5%, with tenures between 3 and 10 years. Additionally, commercial papers were issued under a program with a face value of N170 billion, with tenures ranging from 176 days to 267 days and discounts ranging from 10% to 13%.

Speaking on the results, Chief Executive Officer, Arvind Pathak, said “This positive nine-month result is a combination of our strong value proposition, improved operational efficiency and a sustained drive to contain cost amidst an accelerating inflationary environment. We achieved double-digit growth in Group revenue at N1.514.6bn, while EBITDA rose to an all-time high of N662.8bn, up 28.5 per cent. Again, we continue to show the strength in the diversity of our operations. Our pan-African operations generated a record revenue and EBITDA growth of 103.9 per cent and 255.4 per cent, respectively, contributing 41.9 per cent to Group volumes. This unprecedented growth was driven by sustained demand across our countries of operation.

“We will continue to explore emerging opportunities and export strategies around the region to further consolidate the Group performance. Albeit the current inflationary environment and its impact on operating costs, we have flagged off the ‘distributors promo’ across various regions in Nigeria. This, we believe would support our customers by creating a positive income effect for purchasers of Dangote Cement.”

In terms of outlook, Pathak, said, “Looking ahead, we are at the final stage in the completion of our 1.5Mta grinding plant in Cote d’Ivoire, having commissioned our 0.45Mta Takoradi plant in the first half of the year. We are focused on improving our value proposition, anchored on our promise to deliver strong and superior cement to our unwavering customers. I am very pleased with the direction of our business and confident we will finish the year strong.”

Dangote Cement is Africa’s leading cement producer with 52.0Mta capacity across Africa.