N89.52bn Tax Credit Lifts Dangote Cement 2018 Profit 91% Up, Offers N16 Div

N89.52bn Tax Credit Lifts Dangote Cement 2018 Profit 91% Up, Offers N16 Div

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Post Views: 534 The board of Dangote Cement Plc, the biggest company on the Nigerian Stock Exchange (NSE), on Wednesday presented its audited financia...

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The board of Dangote Cement Plc, the biggest company on the Nigerian Stock Exchange (NSE), on Wednesday presented its audited financials for the full-year ended December 31, 2018, with highlights such as slow revenue growth, just as management successfully reined in on production costs, among others, despite which net profit recorded triple digit rise in net profit.
A further look at the financials showed that the 91.1% increase in net profit was propelled by the income tax credit of N89.519bn, compared to the tax expense of N85.342bn in the corresponding period of 2017.
The directors have proposed a dividend per share of N16 from Earnings Per Share of N22.91; compared to prior year’s N10.50 per share from N11.99 EPS.
Turnover for the period inched 11.87% from N805.582bn in 2017 to N901.213bn, mainly from direct sale of cement, with the sale to the largest customer amounting to N31.61bn, down from N35.7bn in 2017.
A breakdown of the turnover showed that N618.301bn was generated by from its Nigerian operations, while N283.262bn came from its pan-African operations, the largest of which was South Africa’s N58.993bn, slightly higher than the previous N57.302bn. Dangote Cement’s operations in Cameroon yielded N48.709bn, up from N43.186bn; Senegal, N34.986bn, up from N28.75bn; and Zambia, N33.121bn from N25.145bn; among others.
Of the sales revenue, production cost crawled 9.12% to N383.311bn from N351.29bn, boosted by the N122.581bn cost of materials consumed, up from N111.559bn; and the N133.528bn spent on fuel and power consumed, up from N111.569bn in 2017; leaving gross profit at N517.902bn, up from N454.292bn, an increase of 14%.
Administrative expenses increased by 15.69% from N45.38bn to N52.501bn; selling and distribution expenses climbed 24.57% up from N109.917bn to N136.925bn. Other income climbed 96.09% to N10.222bn from N5.213bn, with N6.439bn from the Pan-African business and N3.783bn from Nigeria, comprising mainly the N6.872bn ‘sundry income’ and N2.368bn from Export Expansion Grant (EEG) on export sales for 2014-2017, compared to N4.426bn and N376m respectively. This resulted in operating profit of N338.698bn, compared to N304.208bn in the preceding full year.
Finance income (interests) rose by 23.94% from N9.136bn to N11.323bn; finance income (others) was nil, compared to N26.79bn in 2017 while finance costs dropped 5.56% from N52.711bn in 2017 to N49.778bn.
Share of profit from associate dropped to N563m in 2018, from N2.167bn, representing a 74.02% drop; leaving profit before tax at N300.806bn, which was just 3.87% up from N289.59bn; while the tax credit left net profit at N390.325bn, as against N204.248bn.
A further breakdown of the net profit showed that N491.615bn was recorded in Nigeria; even as the pan-African operations recorded N87.899bn loss, in addition to N11.178bn central administrative costs.

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