- Dangote Cement to Raise Fund from Capital Market
The Board of Directors of Dangote Cement Plc has approved the company to raise capital for medium-term debt funding from the capital market.
In a statement issued by the company through the Nigerian Stock Exchange and signed by Edward Imoedenhe, the Deputy Company Secretary, Dangote Cement, the company said: “The process of obtaining requisite approvals from the Securities and Exchange Commission for issuance of the series 1 bonds has begun. The management of the DCP has disclosed that the proceeds of the series 1 bonds will be used to refinance existing short-term debt previously applied towards cement expansion projects, working capital and general corporate purposes. Book building for the series 1 will commence following approval of the transaction by SEC.”
According to the statement, Dangote Cement intends to issue its maiden series of bonds (the “Series 1 Bonds”) imminently, subject to obtaining regulatory approvals and favourable market conditions.
The company, however, said the book building for the Series 1 bonds will commence immediately after the Security Exchange Commission approval of the transaction.
Dangote Cement Plc (DCP) is Nigeria’s largest listed company by market capitalisation and the largest cement manufacturer in Sub-Saharan Africa with an installed capacity of 45.6 metric tonnes per annum. The company’s operations spread across 10 African countries.
Dangote Cement reported a profit after tax of N200.5 billion for the financial year ended December 31, 2019, 48.63 percent below the N390.325 billion reported in the previous year.
While experts have attributed the decline to the Nigerian government policy on border closure, the company have said it was not true as the company’s operations spread across 10 African nations, therefore, border closure in Nigeria would not have impacted its revenue or growth as it can meet demand via any of its 10 operations.
Dangote Cement said, “The company’s investment across Africa is also bearing the desired results as pan-African sales volume grew in the year 2019, hitting 9.6Mt from 9.4Mt.
“Dangote Cement Plant, Mtwara, Tanzania, recorded an increase of 94 per cent increase in volume within the review period. Dangote Cement Plant, Pout, Senegal put up a remarkable performance with sales up more than 100 per cent of rated capacity.”
Commenting on the report, Joe Makoju, the Chief Executive Officer, said, “Dangote Cement maintained strong financial performance despite a low growth environment, pricing pressure and increasing competition in key markets. The Nigerian operations maintained volume and revenue performance in a challenging environment. Export sales were affected by the border closure in the second half of 2019. Looking ahead, I expect an increase in volumes in 2020 as we commence clinker exports via shipping from Nigeria.