Dangote Sugar Refinery, on Friday presented its unaudited account for the half year ended June 30, 2017, with net profit soaring by 131.68%, on the back of a 68.4% growth in sales revenue, with the company becoming the first to offer an interim dividend in this financial year.
Revenue for the period rose by N48.205bn from N70.471bn to N118.676bn, 95.82% of which was derived from the sale of refined sugar in 50kg bags; just as the Lagos regional market accounted for N55.934bn of the sales, followed by the North- N41.927bn, West, N14.456bn and N6.357bn from the Eastern flank. A further breakdown of the numbers shows that “there is a single customer who buys industrial non-fortified sugar that represents more than 10% of total sales during the year,” just as there are large corporates, including manufacturers of confectioneries and soft drinks, which it noted, typically accounts for 30% of its sales revenue.
Cost of sales equally rose to N91.786bn, representing an increase of about N35.233bn or 62.3% from the previous N56.553bn; the lion’s share- N76.324bn, up from N47.664bn of which went into raw materials; following which gross profit stood at N26.89bn, as against the N13.918bn reported in the 2016 half-year.
Selling and distribution expenses for the period stood at N411.147, from N488.233m; administrative expenses was also curtailed at N2.993bn from N2.26bn, leaving operating profit at N23.613bn, a rise from N11.286bn in the prior half year.
Investment income for the period increased from just N126.382, to N1.658bn, fair value adjustment was positive at N283.92m, from a negative of N7.533m. Finance costs rose to N30.1457, from N249.291m, as profit before tax climbed to N25.253bn from N11.155bn.
The impressive growth in net profit was also despite the N4.378bn or 116% rise in income tax expense, which left net profit for the period at N17.101bn, representing a N9.72bn growth from N7.381bn, which translated to 285 kobo earnings per share, as against the previous 123 kobo each.