The sales volume rise is said by Dangote Cement to indicate the sector giant’s growing gains in the Pan-African market.
Revenues from operations in Nigeria increased by 34.5% to ₦291.4 billion, while Pan-Africa revenue increased by 63.7% to ₦124.4B from ₦76.0B mainly as a result of increased volumes and foreign exchange gains when converting the sales from country local currency into Naira.
Analysis of the half year result revealed that sales volumes of African operations increased by 12.6% to 4.7 million tonnes with Sierra Leone making a 53kt maiden contribution.
Record of sales from its operations scattered around the African continent revealed that a total of 1.1million tonnes of cement was sold in Ethiopia, almost 0.7 million tonnes sold in Senegal, 0.6 million tonnes sold in Cameroon, and 0.5 million tonnes in Ghana.
Also, 0.4 million tonnes of cement was sold in Tanzania and 0.3 million tonnes in Zambia. Sales volumes from Nigerian operations fell from 8.8 million tonnes to 6.9 million tonnes, due, Dangote Cement says, to the onset of rains which stalled many construction projects.
Reflecting on the half year results, Dangote Cement’s chief executive officer, Onne van der Weijde, expressed satisfaction that the company’s revenues have continued to grow despite low sales from the Nigerian operations.
“Our revenues have continued to grow despite the lower volumes seen in Nigeria, especially because of the recent heavy rains. Our margins have improved significantly, helped by improved efficiencies and a much better fuel mix in Nigeria.
“We are using much more gas and increasing our use of coal mined in Nigeria, thus reducing our need for foreign currency and supporting Nigerian jobs.
”Our Pan-African operations are growing well and increasing market share. We saw our the first sales from Sierra Leone in the first quarter and our new plant in the Republic of Congo will be in production at the end of July, further increasing our footprint across Africa and strengthening our position as its leading manufacturer of cement.”
Dangote Cement estimates that Nigeria’s total market for cement was 10.2 million tonnes in H1 2017, 23.2% lower than the estimated 13.3 million tonnes sold in Nigeria in the first half of 2016. Of total market sales in the first half of 2017, just 0.1 million tonnes was imported.
“As a result of the slower market, our Nigeria operation sold nearly 6.9 million tonnes of cement, down 21.8% on the 8.8 million tonnes sold in the first half of 2016. We estimate our market share to have been about 64.5% during the first six months of 2017,” said van der Weijde.
