Dangote sees revenue advance 15% YoY in 9M22
Dangote Cement has reported group revenue of NGN1177.3bn (US$2.68bn) in the first nine months of 2022, up 15.2 per cent YoY. Group EBITDA over the same period advanced by 0.2 per cent to NGN515.9bn, with an EBITDA margin of 43.8 per cent. Profit after tax fell 23.4 per cent YoY to NGN213.1bn, mainly due to exchange losses from the depreciation in the CFA and cede. Group sales volumes in the 9M22 came in at 20.8Mt, down 6.2 per cent YoY.
“To mitigate the impact of significant increase in energy and automotive gas oil (AGO) costs, we are strengthening our efforts to ramp up the usage of alternative fuels. So far this year, we co-processed 101,553t of waste representing a 77 per cent increase over 9M21.We are on track to commission our alternative fuel feed system at Obajana Lines I and V; and Ibese Line II in November. In addition, we are ramping up our investment in compressed natural gas (CNG), to reduce our AGO usage,” said Michael Puchercos, chief executive officer, Dangote.
The company has also commissioned its power plant at Okpella and work is “progressing well” to deploy grinding plants in Ghana and Côte d'Ivoire. The group thermal substitution rate is estimated at 3.8 per cent as at 9M22, compared to 2.3 per cent in 2021.
Nigeria
In Nigeria Dangote sold 13.5Mt of cement and clinker in the 9M22, down 4.7 per cent YoY. Domestic sales alone came in at 12.8Mt, slightly lower than the previous year due to significant inflation, rising interest rates and energy supply disruptions, which impacted production.
Revenue for the Nigerian operations advanced by 22.1 per cent YoY to NGN890.7bn, supported by price increases. The rapidly increasing price of AGO resulted in a 77.9 per cent YoY rise in selling and distribution costs in Nigeria. Despite this, a strong EBITDA of NGN479.9bn, up 4.5 per cent YoY, was reported. During the period, the company exported 581,000t of cement, up 10 per cent YoY, and 56,000t of clinker.
Pan-Africa
The pan-African regions (all operations outside Nigeria) sold 7.4Mt of cement and clinker in the 9M22, down 9.7 per cent YoY as global supply chains continued to be disrupted and commodity prices continued to climb. This was exacerbated by a shutdown of the company’s Congo plant for over two months for maintenance and repairs, along with extended power plant maintenance in Senegal.
In Cameroon, Ghana and Sierra Leone, freight costs remains elevated causing volatility in the landing cost of cement and clinker. Total pan-African volumes accounted for 35.4 per cent of group volumes over the nine-month period.
Pan-African revenue fell 3.1 per cent YoY to NGN288.5bn in the 9M22, on the back of lower volumes sold. This accounted for 24.5 per cent of total group revenue. Pan-African EBITDA stood at NGN47.8bn (before central costs and eliminations), down 28.6 per cent due to the inflationary pressure on costs, high freight charges and lower volumes sold. The depreciation of the CFA and cede resulted in significant exchange losses of NGN72.4bn, impacting the group’s bottom line.
