Dangote Cement PLC posted a pre-tax profit of N293 billion in the 2024 half-year, reflecting a 22% year-on-year growth from the N239.9 billion posted in H1 2023.
The group posted a revenue of N1.76 trillion during the period, marking an 85% year-on-year growth from N950.8 billion revenue posted in H1 2023.
However, the revenue growth was accosted by a 118% YoY growth in production cost of sales to N833.3 billion, from N383.1 billion as of H1 2023.
The cement manufacturer posted a net profit of N189.9 billion during the period, marking a marginal 6% YoY growth from the N178.6 billion posted in H1 2023.
Tax reported for the period under review rose to N103 billion from N61.2 billion same period last year.
Despite an overall impressive financial performance during the period, the company felt the touch of inflation as its operating expenses increased by 103% year-on-year to N403.2 billion, from N198.7 billion.
Key Highlights H1 2024 vs H1 2023
Revenue: N1.76 trillion, +85% YoY
Production cost of sales: N833.3 billion, +118% YoY
Gross profit: N926.8 billion, +63% YoY
Operating profit: N551.6 billion, +45% YoY
Operating margin: 31%, -900 bps YoY
Finance costs: N332.5 billion, +104% YoY
Profit before tax: N293 billion, +22% YoY
Profit for the period: N189.9 billion, +6% YoY
Earnings per share: N11.26, +8% YoY
Total assets: N5.4 trillion, +36% YoY
Commentary: During the period, the company’s production volume hit 13.792 million tonnes, representing a 4% improvement from the 13.249 million tonnes production volume of H1 2023.
Also, Dangote Cement recorded a revenue of N807 billion from its entities operating outside Nigeria, marking a 140% improvement from the N336.4 billion revenue posted by these entities in H1 2023.
However, the group posted a N68.5 billion net loss from these entities during the period.
The group posted a gain on its monetary position of N49.1 billion in H1 2024, a significant improvement from the N6.7 billion gain posted in H1 2023. However, during the period, the group posted a net foreign exchange loss of N201.3 billion, marking a 77% increase from the N113.6 billion net FX loss posted in H1 2023.
The group is also feeling the brunt of a high interest environment, with its interest expenses appreciating to N130 billion, marking a 167% YoY growth from N48.8 billion as of H1 2023.
Dangote Cement’s power cost appreciated by 139% year-on-year in H1 2024 to hit N374.8 billion, from N157 billion as of H1 2023. The group’s raw materials cost also hit N201 billion during the period, an increase of 95% from N102.8 billion as of H1 2023.
The group has a current tax liability of N194.6 billion, marking an increase of N20.3 billion from N174.3 billion as of FYE 2023.
The group’s financial liabilities
Dangote Cement Plc has trade and other payables of about N928.8 billion, marking a 50% increase from N620 billion as of FYE 2023.
The payables majorly consist of trade payables of N292 billion, marking a 59% increase from the N184 billion trade payables at the end of 2023.
The group also has a withholding tax liability of about N140 billion, up from N64.6 billion at the start of the year.
According to the financial statement, Dangote Cement’s reliance on bank loans for financing is on the decline.
The group’s bond and commercial paper liabilities at the end of the 2024 half-year declined to N434.4 billion from N462.2 billion at the start of the year.
The primary source of financial liabilities for the group during the period was letters of credit. Dangote Cement increased its letters of credit significantly, reaching N501.2 billion, up from N116.7 billion at the beginning of the year. [Nairametrics]
