Dangote Cement, Sugar’s 2023 H1 sales hit 13.4 metric tonnes
By Ibidunni Banjoko
Dangote Cement has reported its pan-African performance for the half year ended June 30, 2023, with sales volume hitting 5.4 metric tonnes. The pan-African region includes all the cement plant’s operations outside Nigeria. The total sales volume for the Group within the period was 13.4 metric tonnes.
According to the company’s six months unaudited results, sales volume for the pan-African operation was up 11.6 percent compared to 4.9 metric tonnes in H1 2022.T he total pan-African volume accounts for 40.4 percent of Group volumes in the half year. The pan-African operations performance is attributable to robust demand, particularly from Ethiopia, Senegal, Zambia, and Congo.
Hence pan-African revenues grew by 81.8 percent to ₦336.4 billion. Group revenue rose by 17.7 percent to N950.8 billion. Recurring profit after tax was up by 37.4 percent to ₦292.2 billion while Profit after tax (PAT) rose by 3.8 percent to N178.6 billion.
Arvind Pathak, Chief Executive Officer of Dangote Cement, described the results as heartwarming and said: “Dangote Cement delivered positive results in the first half of the year. Our Nigeria operations achieved a 22.6% recovery in sales over the first quarter, which was impacted by the general elections and the cash crunch. However, the steep currency devaluation in mid-June slowed this volume recovery and increased already inflated operating costs.”
He added: “We navigated the tough terrain, thanks to our strong operational framework and rigorous focus on cost management. I am pleased with the remarkable improvement witnessed in our pan-Africa operations.”
Pathak stated that the 0.4Mta grinding plant in Ghana has commenced operation while the completion of a 1.5Mta grinding plant in Cote d’Ivoire is on track.
He said: “We will continue to focus on our strategic growth priorities, hinged on our vision of transforming Africa and building a sustainable future. I am optimistic that our business remains resilient and well positioned to overcome unforeseen macroeconomic headwinds.”
Dangote Cement is Africa’s leading cement producer with 52.0Mta capacity across Africa. A fully integrated quarry-to-customer producer, it has a production capacity of 35.25Mta in the home market, Nigeria.
Obajana plant in Kogi State, Nigeria, is the largest in Africa with 16.25Mta of capacity across five lines; Ibese plant in Ogun State has four cement lines with a combined installed capacity of 12Mta; Gboko plant in Benue state has 4Mta; and Okpella plant in Edo state has 3Mta.
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.
Dangote Cement has operations in Cameroon (1.5Mta clinker grinding), Congo (1.5Mta), Ghana (2.0Mta import), Ethiopia (2.5Mta), Senegal (1.5Mta), Sierra Leone (0.5Mta import), South Africa (2.8Mta), Tanzania (3.0Mta), Zambia (1.5Mta).
Meanwhile, Dangote Sugar (Dangsugar) in its H1 2023 results also reported a 9.3%y/y growth in Revenue to N202.78bn from N185.46bn in H1 2022.
Its topline performance was driven by growth in sales of sugar (50kg), sugar (retails), and molasses to N194.19bn (+8.3% y/y), N5.86bn (+70.8% y/y) and N1.54bn (+7.9%) respectively in H1 2023 while Freight Income declined by 13.2 y/y to N1.19bn in the period.
Quarterly, the company’s Revenue waned by 1.6% q/q to N100.56bn in Q2 2023 from N102.26bn in Q1 2023 as the realities of inflationary pressures kick in.
The Cost of Sales pared by 9.3% y/y to N144.60bn in H1 2023 from N146.64bn in H1 2022 resulting in a growth of 7.9ppts in its gross profit margin to 30.4% from 22.5%
y/y in H1 2022.
Operating Expenses (adjusted for depreciation) closed the period at N4.66bn (+24.1% y/y) from N3.76bn in H1 2022.
Thus, the company’s OPEX margin settled at 2.3% in H1 2023 from 2.0% in H1 2022. Depreciation and Amortisation was up by 18.0% y/y to N4.90bn from N4.15bn in H1 2022.
The company’s Other Income declined by 51.90% y/y to N145m from N301m in H1 2022 while its Earnings Before Tax (EBIT) surged by 53.0% y/y to N52.20bn in H1 2023 from N34.12bn in H1 2022.
The devaluation of the nation’s currency largely contributed to the jump in the company’s Finance Cost as it came in at N90.66bn from N7.31bn in H1 2022.
The company’s Finance Income of N4.85bn in H1 2023 (+148.9% y/y from N1.95bn in H1 2022) was unable to offset the decline in Net Finance Cost as it closed at N85.81bn in H1 2023 from N5.36bn in H1 2022.
The company’s change in fair value adjustment resulted in an inflow of N2.25bn, a 31.6% y/y growth from N1.71bn in H1 2022.
Overall, Dangote Dugar reported a Loss Before Tax of N31.37bn compared with a Profit Before Tax of N30.46bn in H1 2022 and a Loss After Tax of N27.99bn in H1 2023 (vs Profit After Tax of N20.97bn in H1 2022).
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