(Agence Ecofin) – Dangote Cement, the largest market capitalization of the NSE, marched on water in 2020, supported by strong demand for cement. The African giant is offering a dividend per share up almost 37% to 16 naira for a total to be distributed of 272 billion naira.
Despite the impact of the covid-19 pandemic, 2020 has been a record year for Dangote Cement at all levels, the cement maker unveiled on Tuesday, March 23, 2021, as its turnover increased by 16%. for the first time in history the 1 trillion naira mark to stand at 1,034.2 billion naira (over $ 2.7 billion).
The year of the firsts
This rise in turnover is mainly driven by strong demand for cement throughout the year, explained the cement company, which increased its capacity by 3 million tonnes in 2020 in Nigeria. In fact, Nigerian sales performed the best in terms of volume. Up 12.9% to 15.9 million tonnes, they brought the group’s total sales to 25.7 million tonnes.
An increase of 8.6% to which the African subsidiaries have also contributed. Sales in Africa excluding Nigeria were up, but more slowly, by 4.4% to 10 million tonnes, maintaining the continent’s largest economy as the main market for Africa’s largest cement producer.
“Several exceptional factors made 2020 a productive year, such as our first export of clinker, our first bond issue and our successful buyback program. We have increased our capacity by 3 million tonnes in Nigeria, commissioned our two export terminals and our gas plant in Tanzania ”, congratulated Michel Puchercos, CEO of the group.
Increased profit, investment, cash and dividend
Not the only bundle of satisfaction from the group of Africa’s first fortune. The company also reported pre-tax profit of 373.3 billion naira ($ 980 million) and after-tax profit of 276 billion naira ($ 724 million), up 37.7%, the highest since 2018. .
“Profitability was bolstered by our disciplined cost control measures during what we thought was a highly inflationary and volatile year. These measures resulted in a 37.7% increase in after-tax profit to 276.1 billion naira. I am delighted to report that Dangote Cement had its best year in terms of EBITDA.»
Indeed, in a difficult environment marked by the crisis and the additional costs that companies had to bear, Dangote was able to contain its costs, in the face of an increase in volumes. Gross operating surplus (EBITDA) – cash flow from operations – improved 20.9% to 478 billion naira ($ 1.25 billion), or 46.2% of its turnover.
The only downside of an exceptional year, Dangote Cement’s net debt increased by half, reaching 337.3 billion naira ($ 885 million), thus causing a deterioration in its financial leverage. In its presentation of the main indicators to investors, the cement company attributes this increase to its first bond issue successfully carried out in April 2020 (100 billion naira mobilized) and to its commercial paper issue, the largest issue of this commercial paper on the Nigeria’s debt capital market.
Dangote Cement thus closed the year with 145.8 billion naira ($ 383 million) in net cash against 123.9 billion naira in 2019, after having invested 224 billion naira in acquisitions of tangible fixed assets and released 272 billion naira ($ 714 million) for the dividend payment.
“For the fiscal year 2020, the directors are pleased to recommend a dividend of ₦ 16.00 per common share of 50 kobo”, can we read in its consolidated financial statements.
Dangote and taxes
Nigerian tycoon Aliko Dangote, long criticized in Nigeria for not paying enough taxes despite her mega-profits, by virtue of her pioneering status – a tax holiday on paying corporate tax – has postponed for his group has a tax charge of 97 billion naira ($ 254 million) in 2020. This is double the amount that appeared in its accounts in 2019.
According to the accounts of the company, consulted by theEcofin Agency, 21 billion naira out of 97 billion in taxes incurred for 2020 were liquidated (effective payment) during the year against 4.6 billion paid out of the 49 billion naira in taxes due in 2019. Dangote benefits heavily from Nigeria’s tax credit system, which offsets its tax payments. In 2018, the group obtained a tax credit of 89.5 billion naira.
Fiacre E. Kakpo
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