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Dangote takes lead, declares N808bn in revenue as BUA, Lafarge report 375bn in H1

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By Seun Ibiyemi

Both Dangote cement, BUA cement and Lafarge cement are popular amongst cement producers in Nigeria. Also they are all listed on the Nigerian stock exchange.

The similarity ends here, however,for the 2022 half year review, Dangote cement led the two in all the profitability ratio examined, making it clear winner in respect to this comparison analysis

Turnover growth rate

For the 2022 financial half year, Dangote Cement reported N808.04 billion revenue in H1 2022, representing an increase of 17 per cent from N690.5 billion earned in H1 2021. On its part, BUA Cement recorded a revenue of N188.56 billion in H1 2022, representing an increase of 51.7 per cent over N124.3 billion reported in H1 2021.

Also, Lafarge Africa announced N186.6 billion revenue in H1 2022 from N146.02 billion recorded in H1 2021, representing an increase of 29 per cent.

Analysis of the three companies’ H1 unaudited results for the period under review showed that revenue grew by 23.3 per cent to N1.18 trillion from N959.84billion reported in Half year ended June 30, 2021.

With about 14,206,000 tonnes sales volume in H1 2022 from 15,277,000 tonnes reported in H1 2021, Dangote Cement maintained lead in revenue generation, followed by BUA Cement and Lafarge Africa Plc.

Capacity

In terms of capacity, Dangote Cement is Africa’s leading cement producer with nearly 51.6 million metric tonnes/pa capacity across Africa, followed by BUA Cement, the largest producer of cement in North-West, South South and South-East regions; with a combined installed capacity of 11million metric tonnes/pa and with plans underway to increase existing capacity to 20 million metric tonnes/pa, through the commissioning of three new lines.

Lafarge Africa has a current installed cement production capacity of 10.5 metric tonnes/pa and its cement operations in the South West (Ewekoro and Sagamu in Ogun State), North East (Ashaka, in Gombe State), South East (Mfamosing, Cross Rivers State) with Ready-Mix operations in Lagos, Abuja and Port Harcourt.

Specifically, Dangote Cement reported 16.8 per cent increase in cost of sales to N322.46 billion in H1 2022 from N276.12 billion in H1 2021, driven primarily by 31.3 per cent hike in fuel & power consumed that closed H1 2022 at N129.96 billion from N98.98 billion in H1 2021.

The leading cement company also suffered N40.66billion foreign exchange loss in H1 2022 from N4.94billion reported in H1 2021, attributable to dwindling Naira at the foreign exchange market.

For BUA Cement, its production cost rose by 47.4 per cent to N97.5 billion in H1 2022 from N66.16 billion in H1 2021, while Lafarge Africa announced N90.52billion in production cost of sales in H1 2022, representing an increase of 25 per cent from N72.54billion reported in H1 2021.

As a result of increase in production cost and finance expenses, Dangote Cement closed H1 2022 with profit of N172.1billion, representing a decline of 10.2 per cent from N191.63billion in H1 2021.

Contrarily, BUA Cement’s grew its profit by 41.4 per cent to N61.36billion in H1 2022 from N43.4 billion in H1 2021, while Lafarge Africa announced N37.4 billion profit in H1 2022 from N28.32 billion reported in H1 2021.

Reacting on the results, Dr Muda Yusuf said that marginal increase in price of cement impacted on these companies profit declaration in the period under review.

He stressed that these companies might surpasses 2022 performance, given demands by government and domestic use of their products.

According to him,“The demand in the construction sector has contributed to these companies revenue which eventually impacted on profit in the H1 2022. Since there is improvement in government spending as a result of hike in global oil prices and non-oil revenue, we have seen government spending more in infrastructure and it is expected to grow cement sales.

“I know also that some of these companies export to neighbouring countries and it also contributed to their price. Mind you, we have seen hike in prices of cement which is responsible for an impressive profit.”

Analysts at Vetiva research in a report titled, ‘Nigeria H2’22 Outlook: A strange labyrinth,’ explained that over the past six months, overall cement demand has increased, owing to the significant rise in real estate activities from private sector housing constructions as well as ongoing infrastructure construction by the Federal Government.

According to the report, “This was reflected in the sector’s contribution to GDP which improved 4.08ppts q/q to 9.57 per cent in Q1’22. Another factor underpinning this growth is investors’ renewed interest in alternative investment outlets, due to the lowered yields in the Fixed Income market. Consequently, cement producers recorded double-digit revenue growth in Q1’22. For context, backed by increased real estate activities by the private sector, Julius Berger’s building works increased by 85 per cent.

“Cement producers have benefited from the ongoing construction of infractrucure projects, like rail and roads by the Federal Government and the demand for housing infrastructure by the private sector. During the Q1 2022 period, Real estate sector growth expanded by 2.67ppts to 4.14 per cent, reflecting the surge in housing demand.

“Furthermore, raw input costs have remained elevated, driven by persistent FX challenges and rising inflationary pressures. Also, the upward impact of the ongoing Russian-Ukraine crisis on energy prices has caused an increase in diesel and gas prices, which has emerged as a major threat to profitability. To combat these rising cost lines, cement players like Dangote Cement, through its Alternative Fuel Project, and Lafarge Africa, through its subsidiary geocycle, are tilting towards alternative fuels like biomass for cement production in their plants.

“Most of the components of the biomass fuel are locally sourced, reducing their dependence on imported and costly energy sources. Consequently, input cost worries moderated, thereby improving profitability margins. Looking ahead, as the election period draws close, we expect a sustained rise in cement demand, as the current administration aims to complete all ongoing infrastructure projects, which could drive revenue growth for cement manufacturers.”

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Caribbean PM, Sanwo-Olu mull partnership to boost economic prosperity

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The Prime Minister of Antigua and Barbuda, Hon. Gaston Alfonso Brown and Lagos State Governor, Mr Babajide Sanwo-Olu are exploring areas of partnership to foster economic prosperity for their people.

Speaking during a courtesy visit to Lagos State Governor, Mr. Babajide Sanwo-Olu, at the Lagos House, Marina, the Caribbean PM said that his country is ready to partner with Lagos State and Nigeria in general in trade and investments.

The Prime Minister was accompanied by his wife, Maria Browne; Ambassador Davin Joseph; Chairman/CEO of Air Peace Limited, Dr. Allen Onyema; Nigerian Ex-International and Air Peace Ambassador, Chief Segun Odegbami and CEO of LIAT 2020 Airlines Antigua, Mrs. Hafsah Abdulsalam.

Speaking during the courtesy visit, Prime Minister Browne said the key objective of his country is to strengthen the relationship between Antigua and Barbuda and Nigeria, as well as the Caribbean and the rest of Africa.

He said, “I believe Africa has a significant amount of resources, and literally every African country can become a developed country. I am of the view that African countries can do even better than the Republic of China.”

“Our aspiration for Nigeria is to see Nigeria become a developed country within the next decade or two. And we want to make sure that we are an early mover in the Caribbean to establish close linkages with Nigeria to increase trade and investment. The Caribbean and Africa must unite and work together to bring prosperity to our people.”

Speaking during the courtesy visit, attended by Lagos First Lady Dr. Ibijoke Sanwo-Olu and some members of the Lagos State Executive Council, Governor Sanwo-Olu said his administration will partner with Antigua and Barbuda in entertainment, arts, culture, and technology.

He said, “We are building a bridge. The Caribbean is the sixth region of Africa. We can partner in the areas of culture, tourism, arts, and entertainment because we have a lot of things in common. We can quickly begin to ship between the two regions all of the things that are common to us.

“Our tourism potential, arts and culture, and the kind of music we listen to can infuse into our economy very quickly, and we will begin to see the benefits among us and the two regions.

“Technology is very important because it knows no boundaries. We say we are the tech hub of Africa. All of the unicorns in tech start-ups have their origins in Lagos. So, technology can also be the strong handshake that we require.

“The time is now, and we all need to seize the opportunity. Mr. President has laid the background for us. He has said that he wants Nigeria to have a one trillion GDP within the next couple of years, and that is the kind of thing we are saying.

“Nigeria cannot just sit back and be a developing country. We have to take that narrative up. If China and India can do it, Nigeria can do it. We need to take charge and let the world know that indeed we are our brothers’ keepers, and distance should not be a hindrance.”

Also speaking, Chairman/CEO, Air Peace Limited, Dr. Allen Onyema, commended Governor Sanwo-Olu for receiving the Prime Minister Browne and his entourage.

He said the Prime Minister of Antigua and Barbuda is in Lagos to address Nigerian investors, noting that Lagos will benefit a lot from the business discussions.

He said Africa is the next destination for the entire world, noting that there is a second scramble going on for Africa. “The West, Asians, and everybody else want a piece of Africa. We must have Africa for ourselves and accommodate others,” he said.

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Tinubu tasks automotive manufacturers to produce quality vehicles

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…assures of passage of automotive bill

President Bola Ahmed Tinubu has tasked automotive manufacturers to produce quality vehicles that will stand the test of time.

The President made this known when he received a delegation of the African Association of Automotive Manufacturers and the Nigerian Automotive Manufacturers Association led by the Minister of Industry, Trade and Investment, Ms. Doris Uzoka-Anite at the State House.

The delegation, which was received by the Chief of Staff to the President, Rt. Hon. Femi Gbajabiamila, thanked the host for finding time to receive them and pledged their commitment to the Renewed Hope Agenda of the President.

The Delegation consisted of the Director-General of the National Automotive Design and Development Council (NADDC); representatives of the Nigerian Airspace Management Agency (NAMA), as well as Executive Directors of Stallion Group, Toyota/CEAO and NISSAN.

According to the spokesperson of one of the associations, the purpose of the visit was to apprise President Tinubu of the efforts being made to start manufacturing vehicle/spare parts in Nigeria. They informed the Chief of Staff to the President that a legislative bill to drive the automotive industry was being drafted and reviewed by the Federal Ministry of Justice.

They emphasized the need to develop the industry, which would create massive employment for Nigerian youths and ease the burden on the much-needed foreign exchange.

The Chief of Staff to the President, while thanking the delegation for the visit, assured them of the President’s commitment to Nigeria’s industrialization as evidenced by all of the policies being implemented under his administration.

He promised to assist in facilitating the speedy passage of the legislative bill. He, however, implored that locally-manufactured vehicles should be of the highest quality that will stand the test of time and complement the Federal Government’s efforts in revitalizing the industry.

He also urged the associations to look into producing vehicles that would be affordable for all categories of Nigerians at a time when President Bola Tinubu is set to provide consumer credit for millions of Nigerians to purchase vehicles and other important goods and services.

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Food security: Ogun empowers farmers, assures of mechanised farming

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By Omobolaji Adekunle, Abeokuta

The Ogun state government has organised a program to empower farmers on tools to boost food security in the state.

The 2-day training was organised by the Contec Global Agro LTD, in collaboration with the Ministry of Agriculture and Ogun State Economic Transformation Project (OGSTEP), with the theme; “Training For 2024 Planting Season and Distribution of Inputs and Seminar to the Farmers.”

Speaking, the state’s Commissioner for Agriculture and Food Security, Hon. Bolu Owotomo, said the training was another parameter and milestone in ensuring farmer’s improvement in agriculture output and their livelihood, saying that it would enhance their productivity and agricultural value chain.

He said that about two thousand farmers across the state were empowered with the agriculture inputs and herbicides to boost their farming methods, noting that the government would rest on its oars in ensuring food security across the state.

“Indeed, food security is our top priority in the state, as the administration-led by Dapo Abiodun has ordered the massive empowerment of farmers across the state, including women farmers, so the state had distributed both crop inputs, herbicides and birds to the farmers, in order to boost their productivity and make food available for people’s consumption,” Owotomo said

He further said that over 500 women farmers were given N50 thousand each to boost their food products, as well as providing them agricultural equipment, in terms of mechanised farming to boost and increase their farming outputs.

He added that it was imperative to make use of the training in order to make a great and positive impact in their daily activity, so as to increase their productivity and enhance their livelihood.

Also, speaking the OGSTEP Project Coordinator, Mrs. Mosunmola Owo-Odusi, said that the training was set aside to improve capacity building of the state farmers and their practice, saying agricultural sector was one the OGSTEP core programme in ensuring that farmers were adequately motivated and empowered.

She said that training of farmers was imperative, especially in achieving food security in the state and boosting of food value chain, noting that it would also increase the state government Internally Generated Revenue (IGR).”As you can see that OGSTEP is an agency of change, it encourages extension officers, farmers, empowers them through training and retraining, and also to educate them on new method to use in their farming productivity and outputs of their food production,” Odunsi said

In her remarks, the Project Manager, Agricultural Development Sector in OGSTEP, Mrs. Oluseyi Olugbire, said that the training was designed to promote the farmers, especially in the area of innovative technologies and climate friendly, noting that it was to training them on how to use fertiliser organic bio-friendly products.

She added that it was also to provide support to farmers in the area of fertiliser and environmental friendly products, as the training was towards empowering the extension officers in the state, so as to be able to use the products and step it out to farmers.

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