Dangote Cement net profit boosted by increased capacity

Dangote Cement Plc, Nigeria’s largest cement producer said full-year profit gained 24 per cent attributed to increased capacity improving sales.

Net income for the year through December advanced to NGN149.6bn (US$941.8m) from NGN120.9bn earlier, the company said in an e-mailed statement.  Revenue rose 24 per cent to NGN298.5bn. Chairman Aliko Dangote, said new capacity accounted for a 20 per cent increase in sales.

“By the end of 2012 we were preparing to make Nigeria an exporter of cement to neighbouring countries and in the first quarter of 2013 we realised that goal,” Chief Executive Officer Devakumar Edwin said in the statement. “Soon, we hope to be manufacturing cement in Senegal as we expand into other African countries to supply a basic but profitable commodity.”

Dangote Cement had capacity of 19.2Mta by the end of 2012, with a further 1Mta of capacity to complete in 2013 to take its capacity to 20Mta. Three new cement lines were commissioned in Nigeria with a total capacity of 9Mta in 2012. Three additional lines are under construction, with a total installed capacity of 9Mta of cement.  A cement plant with a capacity of 1.5Mta of cement is being constructed in Senegal and in February of this year was reported to be in the pre-commissioning stage.

On the Nigerian market, Mr Edwin believes the outlook remains strong: “We estimate that demand for cement in Nigeria increased by almost 16 per cent in the first quarter of 2013 and I am pleased to report that our volumes rose by substantially more than the market’s growth rate.”