Amid harsh operating environment, Dangote Cement Plc has posted Group revenues of ₦891.7 billion and volumes of 23.7 million metric tonnes of cement production capacity in its 2019 operations.
Reviewing its performance at the 11th Yearly General Meeting (AGM), in Lagos, yesterday, the Chairman of Dangote Cement Plc, Aliko Dangote, linked the improved performance to “The Bag of Goodies promotion,” launched in July, which increased Nigerian volumes in the third quarter performance.
He also noted that the innovative marketing effort enabled the company to maintain its market share despite the 4.5 metric tonnes (MT) new capacity, which came on stream during the year.
According to him, the cement manufacturer recorded strong Earnings before interest, taxes, depreciation, and amortization (EBITDA) margin of 44.3 per cent during the period under review.
Besides, shareholders approved a dividend of N16 per ordinary share of 50 kobo due to every investor of the company for the 2019 financial year.
Dangote said: “Nigeria’s cement market grew slightly in 2019. We estimate that total market consumption was up between two per cent and three per cent on the 20.7MT estimated in 2018.”
He noted that the modest performance was despite that the market generally was impacted negatively by disruptions related to the 2019 election cycles, heavy rains, and the loss in land export volumes due to the border closure.
“Dangote Cement’s Nigerian operations remained at 14.1MT in 2019, including export sales of 0.45MT. Domestic sales in Nigeria were nearly 13.7MT, compared to 13.4MT in 2019. This implies a two per cent growth mirroring the estimated GDP growth for the year. However, land exports reduced to 0.45MT from 0.7MT for the full year owing to the border closure in the last few months of 2019.”
Furthermore, he revealed that the firm has commenced export of clinker (residue) via shipping from the Apapa and Onne ports to the West and Central Africa, adding that the management was encouraged by the performance of its offshore operations.
He continued: “Including clinker, Pan-Africa volume was 9.6MT. The total Pan-African volume represents 40.1 per cent of Group volumes. Pan-African revenues of ₦282.7 billion were 0.2 per cent lower than FY 2018, and represented 31.7 per cent of total Group revenues.
“The region’s EBITDA contribution of ₦47.9 billion (before central costs and eliminations), represented 12.1 per cent of Group EBITDA, at a regional margin of 16.9 per cent, compared to a margin of 17.3 per cent in 2018.”
He added that the company also achieved improved performance in Tanzania, Senegal, and Sierra Leone.
“Looking ahead, we expect to further deploy our clinker and cement export strategy across West and Central Africa. The completion of our 1.5MT grinding plant in Cote d’Ivoire is expected by the end of 2020.
“As Africa’s largest cement manufacturer, we take seriously our role of social responsibility and we have taken deliberate steps to deploy resources to help our communities overcome hardships in this crisis,” he added.
The National Coordinator, Independent Shareholders Association of Nigeria, Sunny Nwosu, expressed shareholders’ with the performance and dividend payout amid disruption to businesses globally.
“Coming at this time when coronavirus has wreaked havoc everywhere, any shareholder that receives dividend alert within the next 24 hours would be happy and that would be a worthwhile palliative coming from Dangote Cement.”