Dangote Cement’s quarterly sales drop 25% in Nigeria

Dangote Cement Plc said on Friday that its Nigerian operations sold 3.6 million tonnes of cement in the first quarter of 2023, down 24.6 percent compared to the same period in 2022.

Africa’s largest cement producer disclosed this in its unaudited results for the three months ended March 31, 2023.

It said the decline in volume was due to cash crunch and negative sentiments around the elections. 

“The cash unavailability impacted construction workers’ daily wages and retailers’ ability to pay for cement in cash,” it said. “Revenues for the Nigerian operations declined by 12.9 percent to N280.3B, due to the uncertainties during the period.”

The company said the increased prices of Automotive Gas Oil, also known as diesel, resulted in a 7.9 percent year-on-year increase in selling and distribution cost. 

Although its group revenue was down 1.6 percent to N406.7 billion as sales volume dropped by 13.5 percent to 6.3Mt, its profit after tax rose 3.4 percent to N109.5 billion.

“Strong operational delivery, rigorous focus on costs and capital discipline has enabled us to  deliver  strong  profits  for  the  first  quarter,  despite  the  volatile  macroeconomic environment,” the Chief Executive Officer, Arvind Pathak, said.

He said the company’s Africa strategy continued to yield the needed gain, with pan-African delivering strong growth in revenue and EBITDA of 38.5 percent and 71.0 percent, respectively. 

“In Nigeria, the cash crunch coupled with the uncertainty around the general elections led to a slowdown in key private and public  infrastructure investments,” he added.

Pathak said Dangote Cement had received  regulatory approval for its second  buyback  programme.  “We will continue to monitor the evolving business environment and market conditions, in making decisions on tranches of the share buy-back programme,” he said.

He said the company was progressing well  to deploy grinding plants in Ghana and Cote d’Ivoire, adding that it had announced plans to strengthen its local production capacity in Nigeria.