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Dangote Cement Grows Profit After Tax by 18% to N106 Billion in Q1, 2022

Dangote Cement reported a 24% jump in gross revenue t0 N413 billion in the first quarter (Q1) of 2022

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Dangote Cement - Investors King

Africa’s largest cement manufacturer, Dangote Cement has reported a 24% jump in gross revenue t0 N413 billion in the first quarter (Q1) of 2022. Owned by the richest man in Africa, Aliko Dangote, the leading cement manufacturer grew profit after tax by 18% to N105.9 billion.

The company disclosed this in its unaudited financial statement obtained by Investors King.

A further breakdown of the firm activities in the period under review revealed that 7.2 metric tonnes (mt) of cement were sold in Q1 2022. Nigerian operations, however, accounted for 4.8mt while 2.4mt were sold in other African countries it operates.

Commenting on the company’s performance, Michel Puchercos, said Dangote Cement kickstarted the year on a positive note despite the tough operating environment and uncertainty in the global financial market.

According to him, “increases recorded in revenue and profitability drove strong cash generation across the Group. Profit after Tax rose to N105.9bn, up 18 percent compared to last year while Group EBITDA rose to N211.0bn, by 18.6 percent with an EBITDA margin of 51.1 percent.

“On the operational side, we are ramping up production at our Okpella plant and are progressing well to deploy grinding plants in Ghana and Cote d’Ivoire. Demand remained strong across all markets, and we remain confident that Dangote Cement is positioned to meet customers’ expectations despite these temporary challenges.

“Continuing our efforts to deliver shareholder value, Dangote Cement completed the second tranche of its buyback programme. Following the completion of both tranches, Dangote Cement has now bought back 0.98 percent of its shares outstanding. This share buy-back programme reflects the Company’s commitment in finding opportunities beyond dividend to return cash to shareholders,” Puchercos said

On rising energy prices and global uncertainty, he said “the volatile international context is strengthening our efforts to ramp up the usage of alternative fuels and execution of our export-to-import strategy. Reducing our dependence on imported inputs and making our markets self-sufficient has never been more relevant from a regional perspective.”

“Our continuous focus on efficiency, meeting strong market demand and maintaining our cost leadership drives our ability to consistently deliver superior profitability and value to all shareholders,” Puchercos added. 

About Dangote Cement

Dangote Cement has a combined installed capacity of 51.6 metric tonnes per annum and it is the largest cement manufacturer in Africa. Nigeria’s production unit has a production capacity of 35.25mta with the Obajana plant in Kogi State accounting for 16.25Mt across five lines.

Ibese plant in Ogun State has four cement lines with a combined installed capacity of 12Mta while Gboko plant in Benue state has 4Mta; and Okpella plant in Edo state has 3Mta.

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Merger and Acquisition

Otedola Moves to Sell Part of Geregu Power Plc to FEDA

Afreximbank to acquire part of Geregu Power plant

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Geregu Power

Billionaire Femi Otedola-owned energy company, Geregu Power Plc is in talks with the Fund for Export Development in Africa (FEDA) for the acquisition of part of the energy company.

The company stated in a statement signed by Akinleye Olagbende, Company Secretary and made available on the Nigerian Exchange Limited (NGX).

Geregu Power hereby notifies “Nigerian Exchange Limited (the Exchange) and the investing public of its discussions with the Fund for Export Development in Africa (FEDA) for the acquisition of a portion of Geregu Power Plc shares. FEDA is the impact development arm of the Africa Export and Import Bank (Afreximbank),” the company stated.

According to the energy firm, talks are presently ongoing and “where these talks progress to a more advanced stage, the company will notify the Exchange and the investing public in line with the rules of the Exchange.”

In October, Geregu Power listed 2.5 billion shares at N100 a unit on the Main Board of the NGX. This puts the company’s market value at N250 billion and also in a better position it to raise capital to bid for Geregu II as it is presently doing.

Speaking on the listing, the Chairman, Board of Directors, Mr. Femi Otedola, CON, said “the listing of the company was the actualization of a vision to bring world-class standards in governance sustainability, and business processes to the Company and the Nigerian electricity sector.”

He added that “listing on the Main Board of the Exchange will ensure that the long-term growth of the company is assured and its benefits will be passed on to our esteemed shareholders”.

Otedola is the largest shareholder in FirstBank and also holds a 99% stake in Amperion Power, the owner of the Geregu Power Plant.

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Merger and Acquisition

Access Bank Acquires Indirect Stake in Sigma Pensions

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Access bank

Access Holdings on Friday announced it has completed the acquisition of an indirect equity stake in Sigma and the merger of its subsidiary, First Guarantee Pension Limited (FGPL) with Sigma.

According to the bank, following the sanction of the Scheme of Merger between Sigma and FGPL by the Federal High Court on December 1, 2022, FGPL has been dissolved without winding up leaving Sigma as the surviving entity, according to Access Holdings.

Commenting on the transaction, Dr Herbert Wigwe, Group Chief Executive of the Corporation, said “Following the successful completion of the merger, our plan is to leverage the synergies of these entities, as well as the Corporation’s expansive distribution network, strong risk management culture and best-in-class governance standards to create a formidable pension funds administration business.”

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Company News

Dangote Group Dismisses Rumours of Plan to Rise Cement Price

Dangote Cement says no price increase

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Africa’s leading cement producer, Dangote Cement Plc has dismissed the rumor that it plans to increase the price of its products.

The clarification became necessary following a recent publication that Dangote Cement plans a fresh increase.

Recently, there has been some publication (Not Investors King) about a potential increase in the price of cement. The publications noted that the increase will be a result of the high cost of fuel among other prevailing issues. 

According to the Senior Manager, branding and communication, Dangote Industries Limited, Mr Sunday Esan, “Dangote Cement is not embarking on a price increase”, stating that the increase is mere speculation.

Meanwhile, Dangote Cement in the third quarter of 2022, recorded an increase in the overall volume of cement sales by 6.2 percent to 20.8 metric tons in the third quarter of 2022.

According to the company’s Chief Executive Officer, Michel Puchercos, this was achieved, despite the elevated inflation caused by a very volatile global environment.

Similarly, while speaking on the increase in the price of fuel, Puchercos said “to mitigate the impact of the significant increase in energy and AGO costs, we are strengthening our efforts to ramp up the usage of alternative fuels”.

“We are on track to commission our Alternative Fuel feed system at Obajana lines I and V, and Ibese line II in November. In addition, we are ramping up our investment in Compressed Natural Gas (CNG), to reduce our AGO usage,” he added. 

Investors King understands that Dangote Cement is Africa’s leading cement producer with nearly 51.6Mta capacity across Africa. Although it has a few competitors which include BUA Cement, the company supplies most parts of Nigeria.

In addition, Dangote Cement has operations in 10 African countries. 

Its production plant in Obajana, Kogi state, is the largest in Africa with 16.25Mta of capacity across five lines while the Ibese plant in Ogun state has four cement lines with a combined installed capacity of 12Mta.

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