Lafarge Africa expects second-quarter sales to drop
Lafarge Africa Plc will freeze capital expenditure this year, the Chief Executive Officer, Khaled El Dokani, said on Tuesday after the cement company forecast a drop in second-quarter sales as the coronavirus pandemic hits demand.
Major infrastructure projects have been put on hold, El Dokani said, citing Nigeria’s lower oil revenue because of a slump in oil prices, with the company’s sales volumes also hit by the country’s coronavirus lockdown.
The Nigerian unit of Franco-Swiss building materials group LafargeHolcim did not provide a sales figure for the second quarter. Sales for the corresponding period last year were N81.78 billion ($227.2 million), Reuters reported on Tuesday.
“COVID-19’s impact on the 2020 results cannot be reasonably estimated at this stage, but long-term prospects remain positive,” El Dokani said on an analysts call, adding that the company has implemented cash-control measures.
Capital expenditure in the first three months of the year stood at N2.9 billion, down from N6.9 billion in the same period last year.
According to El Dokani, Lafarge Africa is aiming to ensure there is no further capital expenditure for the rest of the year.
At the start of the year, the company had forecast growth in its main Nigerian market as well as targeted exports.
Cement volumes in the first-quarter rose by eight percent and overall sales of 63.7 billion naira were up 9.8 percent, El Dokani said, helped by a two percent price rise that had taken effect in December.