Dangote Takes Lion’s Share As Cement Companies Earned N1.37trn In 6 Months

Dangote Cement Plc, BUA Cement Plc, and Lafarge Africa Plc have cashed in on the construction boom in the first six months of 2023 as the three listed cement makers raked in N1.37 trillion.

The fortunes came despite the vulnerability of the Nigerian market induced by the naira scarcity of the first quarter and the removal of subsidy and floating of the naira late in the second quarter.

Analysis by THE WHISTLER shows that Dangote Cement took the lion’s share among the listed companies to rake in N950.8bn which is 69.4 per cent of the N1.37trn revenue in six months.

BUA Cement got N221bn or 16.14 per cent share of revenue while Lafarge declared N197.7bn (14.4 per cent share) from sales of cement and clinker.

Last year, the three companies posted N1.18trb revenue between January to June.

During the period, the manufacturers hit a combined profit of N277.69 in the first half of this year which is a marginal rise from N270.88 in the first half of 2022.

A further breakdown showed that Dangote, the market leader posted a profit after tax of N178.6bn up from N172.1bn in the corresponding period of 2022, while BUA made N63.6bn profit, an improvement from the N61.36bn posted in 2022.

Lafarge saw a slide in its profit from N37.4bn in 2022 first half to N35.47bn in 2023.

The cement makers also succeeded in building their assets base to a combined N4.87trn during the period. They had recorded a total asset base of N4.09trn in the corresponding period of 2022.

Dangote also led in terms of assets which grew to N3.19trn from N2.62trn held in December 2022, while BUA followed with N1.03trn assets which rose from N874bn in 2022 end.

Lafarge assets rose by N54bn to N654.69bn from N600bn recorded in December 2022.

On the downside, the companies incurred losses on foreign exchange denominated transactions resulting from the new Central Bank of Nigeria policy which led to the floating of the naira and harmonization of the forex windows at the Investors’ and Exporters’ window.

Naira fell from an average of N465 to the dollars to around N760.

Based on their books, Dangote Cement suffered the most shock with a loss of N116.1bn which is a rise from the N40.65bn loss encountered during the same period of last year.

BUA did not post net foreign exchange loss due to the floating of the naira but declared N1.7bn loss as an effect of unrealised exchange (trade payables).

Lafarge posted no foreign exchange loss.

Finance cost which is the cost, interest, and other charges involved in the borrowing for the manufacturers rose to a combined N61.32bn, a surge of 49.1 per cent from N41.1bn in the corresponding period of 2022.

Dangote spent N49.42bn on finance cost, up from N34.57bn, while BUA’s finance cost was N10.5bn, up from N2.84bn recorded in 2022 half year.

But Lafarge’s finance cost dropped to N1.4bn from N1.85bn recorded in the same period of last year.