Dangote Cement - March 2016
Dangote Cement has reported a 14 per cent rise in profit in 2015, up from NGN159.5bn (US$801m) in 2014 to NGN181.32bn (US$910m), driven by new plants and price reductions. The last two years have seen the company open six new facilities across Africa, all of which have performed well, increasing sales volumes by 35 per cent as well as gaining valuable market share.
September 2015 saw Dangote implement a price cut in its home market of Nigeria to boost consumption and compete with imports. This is believed to have bolstered domestic sales last year, which rose by 3.2 per cent YoY to 13.3Mt, despite the company facing what it calls “the worst economic crisis our country has faced in many years.” 2016 has already started well with total sales volumes up by 55 per cent YoY in January and February.
Elsewhere rumours that Dangote has shelved its plans to construct a new 3Mta cement plant in Okpella, Nigeria, and an additional 6Mta works in Itori, Ogun state, caused widespread condemnation among the local youth who were hoping to secure employment at the new plant. The new works were expected to boost the company’s local cement output to over 38Mta.
Dangote has also come under fire in Ghana amid allegations of unfair competition. According to cement company workers in Ghana’s Volta region, imports of Dangote cement into the region has caused local cement producers to cut production, resulting in job losses. The Ghanaian government has now imposed a limit on the volume of imported cement with all companies wishing to import bagged cement into the country being given until the end of March this year to register with the Ministry of Trade and Industry for a permit to do so.