Mixed half-year results for Dangote Cement

Dangote Cement, Africa’s largest cement manufacturer, continued to experience a slowdown in performance at home in Nigeria and other key African markets such as Ethiopia and South Africa in the first half of this year, but recorded remarkable improvement in Tanzania.

The group’s half-year revenues declined by three per cent to $1.2 billion from $1.3 billion during the same period in 2018, largely blamed on lower volumes and net average prices in Nigeria.

The cement maker’s pan-African operations posted a 2.7 per cent rise in sales to 4.7 million tonnes, up from 4.6 million tonnes over the same period in 2018. The total pan-African volumes represented 38.2 per cent of group sales volumes.

But the group operating profit declined by 15 per cent to $464.6 million, from $546.5 million in 2018, due to the depreciation of the Nigerian naira.

“Our variable costs continue to be affected by foreign exchange effects as well as higher fuel and distribution costs,” said Dangote Group chief executive Joe Makoju.

Dangote, however, tripled its market share in Tanzania to 22 per cent from seven per cent last year, after resolving operational challenges that resulted in a significant rise in sales.