By Kayode Tokede
Two listed cement manufacturing companies on the Nigerian Stock Exchange (NSE) have reported N306.25billion profit before tax in unaudited nine months results for period ended September 30, 2020.
This is about 41 per cent increase in profit before tax reported in the period, when compared to N217.8billion, reported in nine months ended September 30, 2019.
The breakdown revealed that Dangote Cement’s profit before tax gained 37.6 per cent to close at N271.96billion in period under review as against N197.68billion reported in prior nine months while Lafarge Africa reported 70 per cent increase in profit before tax to N34.29billion as against N20.14billion reported in prior nine months results submitted to the Nigerian Stock Exchange (NSE).
Our correspondent gathered that Dangote Cement continued to dominate the sector in terms of revenue in the first nine months of 2020.
As Dangote Cement reported 12 per cent increase in revenue to N761.4billion in nine months of 2020 from N679.79billion in nine months 2019, Lafarge Africa’s revenue also gained 10.3 per cent to N179.9billion in nine months of 2020 as against N163.1billion reported in nine months of 2019.
Lafarge Africa sold N176.75billion worth of cement in nine months of 2020 as against N158.6billion in nine months of 2019, while Dangote cement generated N761.4billion Revenue from sales of cement & clinker in nine months of 2020 as against N679.6billion reported in nine months of 2019.
The CEO of Lafarge Africa , Khaled El Dokani stated in a statement said it delivered considerable improvement in recurring EBIT, net income and free cash flow, despite the impact of the COVID-19 pandemic and Naira devaluation, particularly in Q3.”
In its outlook, he said market demand is expected to remain strong in Q4; Naira devaluation and inflation remain a concern in Q4; The implementation of our “Health, Cost & Cash” initiatives would continue to deliver improvement in our performance; We will maintain a healthy balance sheet.
The Group Chief Executive Officer, Dangote cement, Mr. Michel Puchercos in a statement also announced sales totaling 19.21 million tonnes for the period which ended on Sept. 30, 2020 as against 18.02 million in 2019, showing a 6.6 per cent increase for the period.
Puchercos, who expressed delight over the achievements of the company in terms of EBITDA and strongest third quarter volumes, said: “The Cement Group’s revenue went up by 12 per cent to N761.4 billion compared to N679.8 billion in 2019 with domestic operations accounting for N535.51 billion which compared to N467.88 billion up by 14.5 per cent.
“Pan-Africa operations contributed N232.61 indicating a 9.1 percent increase over N213.20 billion in 2019.
“Despite a challenging environment, Group volumes for the nine months were up by 6.6 per cent and group EBITDA was up 17.1 per cent, at a 46.6 per cent margin.
“This quarter has really shown the ability of Dangote Cement to meet the strong recovery of the cement market in Nigeria and Pan-Africa after a challenging Q2. In Nigeria, we have witnessed a strong appetite for real estate investment and the recovery of infrastructure spending, including more concrete roads.
“Sales volumes in Nigeria were up 40 per cent in the quarter and Pan-Africa reached a record high EBITDA margin of 24 per cent in the quarter.
“We continue to focus on our export strategy and are on track to ensure West and Central Africa become cement and clinker independent, with Nigeria as the main supply hub. Clinker exports have steadily been ramping up in Q3 after our maiden shipment in June 2020, whilst land exports have also resumed,” he said.
“In the period under consideration, Dangote Cement has exported 7 clinker vessels from Nigeria via the Apapa export terminal, while plans are on track to commission the Port Harcourt export terminal before the end of the year,” he added.
Puchercos said: “Dangote Cement’s strategy to offer high quality products at competitive prices is meeting customers’ expectations in Nigeria and across the continent, where we continue to deploy excellent marketing initiatives and operational excellence.
“We remain committed to protecting our staff and communities by being fully compliant with health and safety measures in all our territories of operation. We are focused on adapting to the rapidly evolving markets in which we operate.”