Dangote Cement posts N390bn post-tax profit in 2018

Africa’s largest cement producer, Dangote Cement Plc, has released its audited results for the year ended December, 31, 2018, with profit after tax at N390.32 billion, up from N204.25 billion in the corresponding period of 2017.

The result showed that pan-African operations recorded revenues of N263.26 billion, an increase of 9.6 percent over N258.44 billion posted in 2017. Earnings per share rose from N11.65 to N22.83. The company directors are proposing a dividend of N16 per share.

Overall, the company maintained its dominance of the Nigerian cement market, accounting for 65 percent of the total volume sold in the domestic cement sector in 2018.

The company, in a statement, indicated that it exported 800,000 metric tonnes (MT) of cement to West African countries, strengthening Nigeria’s position as a major cement exporting country, while creating jobs and earning foreign exchange.

During the period under review, the company sold a total of 23.54 MT of cement across Africa, indicating an increase of 7.4 percent over 21.92 MT sold in 2017. The Nigerian operations accounted for 14.18 MT; representing an increase of 11.4 percent over 12.72 MT sold during the preceding year. The increase in the Nigerian volume is attributable to higher building activities as the economy recovered from recession.

The sales volume in Nigeria is quite significant given the turbulent market situation as the election period approached and people usually hedge in the construction industry during such periods.

Group Chief Executive Officer, Dangote Cement Plc, Mr. Joe Makoju, in his remarks said: “This is a record financial performance by Dangote Cement, driven by a strong increase in our home market, Nigeria, despite heavy rains and uncertainties about the election. Although Pan-African volumes were unchanged in 2018, I am confident that we will see an increase in 2019, driven by higher volumes in Tanzania, Ethiopia, Congo and Sierra Leone. Now that we have gas turbines operating in Tanzania we will also see increased profitability in the Pan-Africa region and this will help to improve overall Group margins.”

Across Africa, the cement Group posted a combined revenue of N901.21 billion, with Nigerian operations doing N618.30 billion, representing an increase of 11.9 percent over N552.36 billion in 2017. The Nigerian economy was earlier projected to have grown by 1.9 percent in 2017, meaning that Dangote Cement outperformed the domestic economy.

Dangote Cement is Africa’s leading cement producer with nearly 46Mta capacity across Africa. It is a fully integrated quarry-to-customer producer, with a production capacity of 29.3Mta in the home market, Nigeria. The Obajana plant in Kogi state, Nigeria, is the largest in Africa with 13.3Mta of capacity across four 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.

Through recent investments, Dangote Cement has eliminated Nigeria’s dependence on imported cement and has transformed the nation into an exporter of cement serving neighbouring countries. It has operations in Cameroon (1.5Mta clinker grinding), Congo (1.5Mta), Ghana (1.5Mta import), Ethiopia (2.5Mta), Senegal (1.5Mta), Sierra Leone (0.5Mta import), South Africa (2.8Mta), Tanzania (3.0Mta), Zambia (1.5Mta).