Cement Companies Grow Revenue To N3tn

Cement Companies Grow Revenue To N3tn

The three cement manufacturing companies listed on the Nigerian Exchange Limited improved their incomes by 30.65 per cent to N3.07tn in 2023.

The financial statements of Dangote Cement, BUA Cement and Lafarge Africa for 2023 showed a revenue of N2.35tn for the previous year.

Dangote Cement brought in the highest amount of revenue at N 2.21tn, boosting the figures for the industry.

BUA Cement saw its revenue increase to N459bn from N360bn in 2022 and Lafarge Africa’s revenue rose to N405bn from N373bn.

In the period under review, the profit after tax of BUA Cement declined by 31.24 per cent to N69.45bn from N101.01bn in the previous year.

Lafarge Africa’s post-tax profit dipped by 4.7 per cent to N51.14bn, due to the depreciation of the naira.

Also, the company recorded a higher effective tax rate in 2023 following the expiry of the pioneer status incentive in 2022.

However, Dangote Cement bucked the decline trend as its PAT appreciated by 19.17 per cent to N455.58bn from N382.31bn in the previous financial year.

It also paid the highest amount of dividends to its investors at N511.22bn higher than N340.81bn paid in 2022.

BUA Cement followed with N67.72bn dividend, lower than N94.82bn a year earlier while Lafarge Africa had proposed N30.60bn dividend, lower than it paid N32.22bn in 2022.

According to Lafarge in its outlook for 2024, the Nigerian infrastructure and construction sector is expected to continue growing despite inflationary pressure and currency depreciation affecting the economy.

“As a result, we maintain our positive outlook, expecting increased demand in 2024 as the economy picks up. We will continue to maximise volume opportunities across our markets and actively manage our costs. The Company remains committed to its sustainability ambitions and strategy of ‘Accelerating Green Growth’ through innovative building solutions and delivering stakeholder value,” the company said.

The Chief Executive Officer of Lafarge Africa, Lolu Alade-Akinyemi, lamented the impact of the naira devaluation on business.

He noted, “In the face of very material FX devaluation losses and higher effective tax rate, profit after tax declined YoY by 4.7 per cent. Our performance was largely impacted by spiralling inflation and unprecedented naira devaluation, with the attendant pressure on energy and supply chain costs.

“Despite these challenges, we continue to maintain a strong free cash flow position and a strong balance sheet, positioning us for sustainable growth over the medium to long term.”

In his comments, the CEO of BUA Cement, Yusuf Binji, blamed the forex challenges in the country for the firm’s challenges.

Binji said, “Clearly, the operating environment in 2023 was challenging, given the different headwinds confronted with at the start of the year and especially with the devaluation of the naira. During the year, we launched the maiden edition of the BUA Cement Scratch and Win promo, among other initiatives, which saw BUA Cement further increase, its share of the market and resulted in a 27.4 per cent rise in revenues to N460bn from N361bn in the prior year.

According to BUA Cement’s Chief Financial Officer, Jacques Piekarski, the firm’s financial performance in 2023 was resilient given the economic environment, led by the devaluation of the naira.

“But despite the reported foreign exchange loss, EBITDA increased by 9.6 per cent to N169.3bn from N154.5bn in 2022. We are confident about the business, together with the evolving strategy to thrive,” he averred.

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