Rapid cement capacity build-up over the last two decades and further new additions on the way mean that by next year, Nigeria will have the second-larg.
• FCCPC keeps mum despite consumer complaints
• LCCI blames input costs on inflation, forex
While costs of input appear a good alibi for cement manufacturers and dealers to justify high costs of the commodity, regulatory lapses in checking price gouging in the value chain, costly logistics driven by inflation and cyclic demand for real estate, fuelled by currency weakness and low yields from financial instruments are factors aggravating cement prices nationwide. x
Although the demand for residential properties, particularly from the low-and-middle-income earners, is expected to remain weak due to rising inflation, according to a recent CBN survey, many investors continue to push funds to real estate businesses to hide unexplained wealth and conserve value for the local currency.
• FCCPC keeps mum despite consumer complaints • LCCI blames input costs on inflation, forex While costs of input appear a good alibi for cement manufacturers and dealers to justify high costs of the commodity, regulatory lapses in checking price gouging in the value chain, costly logistics drove by inflation and cyclic demand for real estate, fuelled by currency weakness and low yields from financial instruments are factors aggravating cement prices nationwide.
Although the demand for residential properties, particularly from the low-and-middle-income earners, is expected to remain weak due to rising inflation, according to a recent CBN survey, many investors continue to push funds to real estate businesses to hide unexplained wealth and conserve value for the local currency. Already, the logistics arm of the cement business has already been outsourced by some of the players to avoid recurring issues on safety and fleet maintenance.
Dangote Cement’s revenue and earnings grow in first quarter of 2021 Written by Global Cement staff
05 May 2021
Nigeria: Dangote Cement’s revenue grew by 35.5% year-on-year to US$874m in the first quarter of 2021 from US$655m in the same period in 2020. Cement sales volumes rose by 18.7% to 7.5Mt from 6.3Mt. Earnings before interest, taxation, depreciation and amortisation (EBITDA) increased by 56% to US$468m from US$300m. Revenue and sales volumes increased fastest in Nigeria but earnings increased faster in the rest of Africa.
“We took the strategic decision to pause our clinker exports to ensure we meet the rapid volume growth in the Nigerian domestic market. We are improving the output of our existing and new assets and aim to recommence clinker exports in the second quarter,” said Michel Puchercos, the company’s chief executive officer. He added that the company had also ramped-up its new 3Mt/yr Obajana Line 5.
The taxation amount is 47.3 per cent higher this quarter than the N27.42bn paid in Q1 2020.
Dangote Cement currently pays over N240 million Value Added Tax (VAT) daily to the government, making it one of the biggest private-sector taxpayers, it stated.
The company also said it opted to provide funding for the construction of major roads in Lagos and Kogi states. “The roads are the critical Lagos Apapa Port road leading to the old toll gate and the Lokoja-Obajana-Kabba road straddling Kogi and Kwara states.”
According to the report, the company ramped up production capacity in the Obajana Line 5 and resumed production at the Gboko plant to meet rising demands.