Dangote Cement records N158bn profit, declares N6 dividend

Dangote CementPlc on Thursday reported a profitafter tax(PAT) of N159.5 billion for the year ended December31, 2014, down by about 20 per centcomparedwith N201.2 billion postedI 2013.
Executive Director, Dangote Group, who oversaw operations of the cementunit until recently, Mr. DevakumarEdwin, was quoted byBloomberg as saying in a statementthat performance was affectedby erratic fuel supply and prolonged rainy season.
“Despitethechallenging conditions of the erraticfuel supply and prolonged rainy season that affectedrevenuesand profitability in Nigeria, the company is confident about the future,” Edwin said.
However, an analysis of the resultsshow that otherfactors such as high finance chargesand otheroperational expenses.
Dangote Cementended 2014 with a revenue of N392 billion up from N386 billion in 2013. Grossprofit stoodatN248.6 billion, compared with N255.7 billion in 2013.
Administrative expensesrose from N25.9 billion to N274 billion, while sales/distribution expensesincreasedfrom 35.6 billion to N37.4 billion. Finance costsoared by 140 per cent fromN13.7 billion to N32.9 billion. Profit beforetax stoodat N184.7 billion, compared with N191 billion.
Butthe company paid an incometax of N25.2 billion in 2014, as against a tax creditof N10.5 billion 2013. The N25 billion tax charge resultedfrom the expirations of the tax exemptionson some lines of thecompany’s business.
Consequently, the company ended theyear a PATof N159.5 billion, compared with N201 billion in 2013.
Basedon the performance, the directors have recommended a dividend of N6.00 per share, which translates to a yield of 3.9 per cent and pay out ratio of 63.5 per cent.
Dangote Cement, controlled by billionaire Chairman Aliko Dangote, is expanding in new African countries totap demand for building materials as governmentsinvest in infrastructure.The company plans to raise capacity to as muchas 60 million metrictons by 2016 from 29 million tons.
Meanwhile, the Nigerian stock market maintained its bullish trend as the NSE All Share Index (ASI) gained 0.6 per centclose at 30,067.90 driven by gains sustained in large cap stockssuch as Nigerian Breweries Plc, Guaranty TrustBank Plc and Zenith Bank Plc. Similarly, marketcapitalisation added N59.4 billion to close N10 trillion.
At the closeof market, the Oil & Gas and Banking Indices continued their positiveouting appreciating 2.0 per centand 1.0 per centrespectively. Also, the ConsumerGoods index returned 2.3 per centon the back of increasedappetite for Unilever Nigeria Plc. The renewed demand for Unilever Nigeria could belinked tothe plans by parent firm,Unilever Overseas Holdings B.V, to increase itsstake in the Nigerian unit from 50.05 per centto75 per cent.