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Wednesday, December 6, 2023

Dangote Cement Pan-African Operations Post Net Losses Since 2014

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While Dangote Cement Plc has been thriving in Nigeria, its Pan-African operations are flattering, posting recurring losses since 2014, but the good tidings are that these subsidiaries have been magnifying sales volumes.

Data from MoneyCentral intelligence shows the Dangote Cement Pan-African operations recorded loss after taxes of (N54.34 billion) as at September 2023; 2022, (N127.66 billion); 2021, (N6.46 billion); 2020, (N61.08 billion); 2019, (N65.02 billion); 2018, (N50.51 billion); 2017, (N14.64 billion); 2016, (N13.70 billion); 2015, (N23.58 billion), and 2014, (N15.45 billion).

Analysts say the recurring net losses by the subsidiaries is due to protracted unstable macroeconomic environment such as currency volatility, rising inflation, and political instability that continues to balloon cost of production,

However, the Pan-African operations that consists of Ghana, Cameroun, South Africa, Congo, Senegal, Tanzania, Ethiopia, Sierra Leone, and Zambia continued to deliver strong sales volumes, growing by 22.22 percent year on year (yoy) as at nine months (9M) 23.

A breakdown of the numbers shows Senegal posted a 66.90 percent increase in sales volume; Congo plant, (60.50 percent); Zambia, (18 percent); Zambia, (15.50 percent); South Africa, (18.50 percent), while Ethiopia and Tanzania recorded increases of 6.50 percent respectively.

It is noteworthy that Pan-Africa operations’ EBITDA margin rose to 28.90 percent in September 2023 from 16.58 percent as at September 2022.

Dangote Cement has been facing challenges with its Pan African expansion due to draconian laws in host countries, but the company has struggled off these challenges as it has continued to pursue its aggressive expansion with a view to increasing its share of the market. ‘

“Looking ahead, we are at the final stage in the completion of our 1.5Mta grinding plant in Cote d’Ivoire, having commissioned our 0.45Mta Takoradi plant in the first half of the year. We are focused on improving our value proposition, anchored on our promise to deliver strong and superior cement to our unwavering customers. I am very pleased with the direction of our business and confident we will finish the year strong,” said Arvind Pathak, Chief Executive Officer of Dangote Group.

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