Dangote Cement, the largest cement producer in Africa, has reported an unprecedented peak in quarterly revenue for the first quarter of the year, reaching ₦817.4 billion.
Naija News reports that this significant growth comes at a time when cement prices have nearly doubled across Nigeria, with costs rising from ₦5,000-₦6,000 in January to ₦10,000-₦12,000 in February.
The sharp increase in revenue was propelled by a robust 26.1 per cent expansion in production output within Nigeria.
This expansion was further enhanced by a notable increase in exports, with seven ships of clinker dispatched to neighbouring countries like Cameroon and Ghana, marking an 87.2% surge in Nigerian exports.
Despite the impressive revenue figures, the company faced several challenges, including soaring production costs and a dramatic 551.4 per cent rise in net exchange losses due to a weakening naira.
“Despite elevated cost pressures and increased borrowing costs, our first-quarter results reflect our commitment to navigating challenges effectively,” CEO Arvind Pathak said.
Operating profit was adversely affected by a substantial increase in selling and distribution expenses, which rose by 111.4 per cent to ₦145.3 billion, driven by a significant uptick in haulage costs.
This increase comes as Nigeria is experiencing its highest inflation rate in 28 years, prompting concerns that the Central Bank of Nigeria will increase rates further to address the ongoing cost-of-living crisis.
Profit before tax increased modestly by 13.3 per cent to₦166.4 billion, while profit after tax improved by 2.9 per cent to ₦112.7 billion.
However, the net profit margin fell to 13.8 per cent from nearly 27 per cent in the same period last year, indicating the heavy burden of increased costs on the company’s bottom line.
In a notable financial highlight, Dangote Cement reported extraordinary income from its pan-African investments, generating ₦410.4 billion due to favourable currency translations following a significant devaluation of the naira earlier this year.
As a result, total comprehensive income for the quarter escalated to N523 billion, a substantial increase from the previous year.
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