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Dangote Cement reports 1Q14 results

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World Cement,

Dangote Cement achieved pre-tax profit of N53.01 billion in 1Q14 and gross earnings of N103.56 billion. Pre-tax profit was down 1.25% y/y, while earnings were up from N95.42 billion in 1Q13.

The cost of sales increased by 26.21% to N37.096 billion. Speaking at the AGM in Lagos, Aliko Dangote said, “We never envisaged that the cost of production will rise to this extent when we said that the price of cement will fall…” He attributed the increase to rising foreign exchange rates and the high cost of gas and diesel. He maintained that Dangote Cement is comparatively cheaper than its competitors and the company will continue to boost its market share by increasing direct-to-customer deliveries, which are now available to order online.

Mr Dangote added, “Between eight to ten weeks, our company will pump in 9 million t of cement, representing a growth of 45% to the market. We want to serve our shareholders by giving you better returns on your investment.” Shareholders received a dividend of N7 per 50 kobo share at year end, a 133% increase y/y.

Mr DVG Edwin, Group Managing Director, said, “Dangote Cement made excellent progress in 2013 with a turnover growth of 27.2% to N386.2 billion.” Sales of cement in Nigeria in 2013 grew 28.2% to 13.3 million t.

Looking ahead to the rest of the year, Mr Dangote confirmed work on the 2.5 million t plant in Mugher, Ethopia, is well underway with production expected before the end of the year. The Mtwara plant in Tanzania is set to be fully operational in 2015. The Ndola plant in Zambia is expected to enter production in the second half of this year. He added, “We are reviewing plans for Kenya with a view to increasing the scale of our proposed factory from 1.5 to 3 million tpa because we are confident there will be sufficient demand both in Kenya and neighbouring countries.”

Edited from various sources by

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