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Investors Stake N598.12bn on Dangote Cement in 9 Months, Stock Hits 52-week High

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Dangote Cement - Investors King

Domestic and foreign investors have invested N598.12 billion in the stock of Dangote Cement Plc on the Nigerian Exchange Limited (NGX) in the first 9 months of 2021.

With impressive earnings in half year ended June 30, 2021, the cement manufacturing company stock price on the NGX hits 52-week high yesterday.

This means the stock of the cement manufacturing company has appreciated by 14.3 per cent to N280 (N4.77trillion) as at September 30, 2021 from N244.90 (N4.17trillion) it opened for trading this year.

Appreciation in Dangote Cement share price impacted positively on NGX Industrial index that gained nearly two per cent 2,089.38 basis points as at September 30, 2021 from 2,052.33 basis points it closed in 2020.

With a dividend of N272.65billion in 2020 financial year, Dangote Cement made the highest returns to investors on the NGX.

The company’s unaudited result and accounts for half year ended June 30, 2021 (H1) showed impressive performance in revenue and modest performance in net finance that impacted positively on profit before tax and profit after tax.

The company’s double-digit increase in revenue was largely driven by higher sales volumes, as well as improved cost management during the period, which drove margin expansion.

The cement manufacturing recorded increase in volume of both cement and clinker volumes to 14,550,000 tonnes in H1 2021 from 11,674,000 tonnes to drive revenue from sales of cement & clinker to N690.55billion in H1 2021 from N476.84billion reported in H1 2020.

During the H1 2021 period, Dangote Cement revenue increased by 44.8 per cent to N690.5billionn from N476.85billion recorded in H1 2020, supported by a 26.1per cent surge in volumes sold to 15,277 metric tonnes in H1 2021 from 12,114 metric tonnes and 14.5 per cent increase in revenue-per-tonne to N45,133.66 which was attributed to lower rebates and price increment during the period.

The impressive growth was reflected in both the Nigerian and Pan-African market segments, as sales volumes were up by 33.2per cent and 15.5 per cent, respectively.

With decline in finances, Profit Before Tax rose by 72.7 per cent to N281.3billion in H1 2021 from N162.85 billion in H1 2020.

Notably, a 141.2 per cent increase in tax income to N89.6biillion in H1 2021 from N36.71billion in H1 2020, dragged profit to N181.6billion in H1 2021 from N126.14billion reported in H1 2020.

Earnings per share (EPS) increased to N11.21 kobo in H1 2021 from N7.45 kobo in H1 2020.

According to analysts at United Capital, “Going into H2 2021, we remain optimistic on Dangote Cement and expect the company to sustain double-digit growth, albeit at a slower pace relative to H2 2020, given the relatively high base from the period.

“On a macro-scale, we are optimistic about economic recovery in Nigeria and Sub-Saharan Africa, as well as sustained cement demand, which has driven capacity expansion plans. Additionally, price increases in the first half of the year will help sustain top line growth and margins, as costs remain pressured.

“Furthermore, we see further room for price increments during H2-2021 as demand remains strong and inflationary pressures persist. However, risks to a more robust H2 2021 performance include disruptive rains in Q3-2021, an intensified third wave of Covid-19 in SSA and attendant lockdowns, persistent disruptions in global supply chains, higher freight prices, further naira devaluation and elevated inflationary pressures.However, we observe that Dangote cement has done particularly well in the face of rising expenses and this bolsters our optimistic outlook.Specifically, we project FY 2021 Revenue growth of 28.7per cent to N1,330.9billion (prev. N1,168.3billion) and expect EPS to grow by 31.9 per cent to N21.4/s in FY 2021.

They, however, recommended that investors should HOLD the stocks of Dangote Cement with upgraded target price.

“We updated our forecasts for Dangote cement in light of the H1 2021 numbers which exceeded our expectations, as well as our optimistic prognosis for cement demand in H2-2021.Accordingly, we raise our target price on Dangote cement to N270.28 (previous: N253.70). This revision reflects our expectation of upbeat sales volumes, further price increases and sustained cost management, as well as favourable adjustments in computing the cost of equity. Our target price implies a HOLD rating and an upside potential of 11.9 per cent, ”they said.

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

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Meta Fires Employees For Using Office Free Meal Vouchers to Buy Household Items

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Facebook Meta

The parent company of Facebook, Instagram, and WhatsApp, Meta, has allegedly relieved about 24 staff members at its Los Angeles office of their jobs.

The affected staff were accused of using their $25 (£19) meal credits to buy items such as toothpaste, laundry detergent, acne pad and wine glasses.

It was gathered that the dismissals followed an investigation that revealed the employees had been exploiting the system, including sending food home when they were not physically present at the office.

One of the terminated employees was an unnamed worker earning a $400,000 salary.

Another sacked employee anonymously shared on the messaging platform Blind, explaining how she and her colleagues maximized their dinner credits to buy other necessities when they could get food elsewhere.

The breach was discovered as part of the human resources procedure even though one of the workers admitted to it.

According to reports, employees who occasionally bent the rules received warnings but retained their positions.

Free meals have long been a benefit for employees of major tech firms like Meta, founded by Mark Zuckerberg.

Typically, staff at larger offices, including Meta’s Silicon Valley headquarters, enjoy complimentary meals from on-site canteens.

Employees at smaller locations receive daily food credits, redeemable through delivery services like UberEats and Grubhub, with allowances of $20 for breakfast, $25 for lunch and $25 for dinner.

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Flour Mills of Nigeria to Invest $1 Billion in Expansion and Restructuring Over Four Years

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flour mills posts 184% increase in PAT

Flour Mills of Nigeria Plc, a Nigerian diversified agribusiness company, has announced plans to invest $1 billion over the next four years to expand its facilities and restructure the company.

Chairman John Coumantaros, in an interview on Tuesday, said the new funding is about “doubling down on investment in Nigeria.”

This investment will further support President Tinubu’s reform efforts at a time when companies like Diageo Plc and Unilever Plc are exiting or reducing their exposure to the West African nation.

Since coming to power in May 2023, President Tinubu has introduced a series of reforms from allowing the naira to free float to fuel subsidy removal to make the country more attractive to investors and steer it away from fiscal collapse.

According to Coumantaros, $500 million of the total investment will go into its sugar operations in Niger state to boost production from the current 100,000 tons to over 400,000 tons a year.

An additional $100 million will be allocated to a cassava-processing factory to end imports of starch from the tuber and expand its breakfast cereal offerings.

The 64-year-old company will also undergo reorganization following an offer from Excelsior Shipping Company Ltd. last month to buy out minority shareholders at 70 naira per share.

The company plans to restructure its more than 22 units into five individual companies, Coumantaros said.

“We want to be able to attract technical and financial partners to help us grow our sugar operations and food business. We have a lot of ambitious plans for investment and expansion.”

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Again, NNPCL Fails to Make Port Harcourt Refinery Functional After Several Promises 

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NNPC - Investors King

The Nigerian National Petroleum Company Limited (NNPCL) has again disappointed Nigerians over the functionality of the country’s refinery in Port-Harcourt, Rivers State.

The Group Chief Executive Officer of the NNPC, Mele Kyari, had in July, this year, stated categorically that the refinery would come into operation in early August.

Kyari’s announcement made it the seventh time the petroleum company would promise Nigerians that the Port-Harcourt Refinery would restart operations.

But the company has not been able to fulfill any of its assurances as at the time of this report, even as the challenges of fuel availability facing Nigeria bite harder.

The NNPC CEO had earlier promised that the refineries would be functional before the end of former president Muhammadu Buhari’s administration in May 2023.

The most recent date was promised by the Chief Financial Officer of the NNPC, Umar Ajiya, who said the Port Harcourt refinery would commence operations in September 2024.

In a recent reply to an enquiry by legal luminary, Femi Falana, SAN, it was noted that the contractor overseeing the rehabilitation of the Port Harcourt refinery, said it would provide details on the project’s completion by or before October 2.

The contractor conveyed this through a law firm, Olajide Oyewole LLP, in response to a letter from a Senior Advocate of Nigeria, Femi Falana, who had inquired about the completion timeline for the refinery’s rehabilitation.

Falana had written to them on September 17 and 24, respectively regarding the contract with the NNPC.

Kyari had informed the Senate recently when he appeared before the red chamber that Nigeria would be a net exporter of petroleum products by the end of the year.

He had informed the lawmakers that it was impossible to have the Kaduna refinery come into operation before December and that it would get to December. He had said similar things of both Warri and Kaduna Refineries.

According to him, Port Harcourt would commence production in early August this year.

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