The board of Dangote Sugar Refinery Plc, last weekend urged the Federal Government to faithfully follow through its Backward Integration Policy in the sugar industry by faithfully implementation of the Sugar Master Plan to boost its foreign exchange.
Speaking at the annual general meeting of Dangote Sugar Refinery in Lagos on Thursday7, Aliko Dangote, the company’s chairman said implementation of the masterplan can earn the country as much as $700m yearly, while becoming self-sufficient.
“If the National Sugar Master Plan is followed strictly and the players all follow the rules, the country will be better for it as Nigeria will save between $600million and $700 million annually as forex,” he stressed.
Addressing shareholders at the meeting, Dangote said despite the disruptions in the economy occasioned by the Covid-19 pandemic, Dangote Sugar Refinery recorded a 13.7% increase in production volume to 743,858 tonnes in the financial year ended December 31, 2020, compared to 654,071 tonnes in 2019.
Consequently, he said the company recorded a turnover of N214.3 representing a 33% growth, compared to the N161.1bn in 2019, as sales revenue improved by 6.9% increase from 684,487 tonnes in 2019 to 731,701 tonnes in 2020. Following which, he noted, the company’s revised its sugar production target to 550,000 metric tonnes by 2024 in line with the revised plan on the BIP by the federal government.
Dangote attributed the improvements which led to operations optimization strategy despite disruption caused by civil unrest in last quarter of the year, following which gross profit increased by 40.4% to N53.75bn, from N38.29bn in 2019.
Profit after taxation for the year increased by 33.2% to N26.7bn, as against N22.36bn in 2019, reflecting what he called management’s unrelenting goal to deliver consistent shareholder value.
Also addressing the shareholders, the Group Managing Director/Chief Executive, Ravindra Singhvi, said the sugar group continued the growth path with commitments to improve performance and generate value for all stakeholders.
He explained that this was reflected in the sales volume delivery of 731,701 tonnes, and production of 743,858 tonnes being 6.9% and 13.7% increase in volumes over the comparative year 2019.
He said the company would meet the targeted 550,000tonnes projected to be achieved by 2024, given its Backward Integration goal is to become a global force in sugar production, by producing 1.5M MT/PA of refined sugar from locally grown sugar cane for the domestic and export markets.”
According to him, “our focus on the implementation of our key strategies in the face of the several challenges posed by the COVID Pandemic, the peculiarities of the Apapa traffic situation amongst others we achieved a topline growth in revenue of N214.3bn, a 33.0% increase over 2019; a 53% YOY increase in PBT, and 33.2% increase in PAT.
“2020 was indeed very eventful for our company ranging from the weak macroeconomic fundamentals caused by the underlying impact of COVID-19 pandemic which saw to the steady rise in forex rate, high inflation and the significant rise in our cost of production, to the worsening traffic gridlock on the Apapa Wharf Road which led to delays and at times disruption of the distribution and deliveries to customers.”
He noted that one of the key highlights of during the year was the successful completion of the Scheme of Arrangement – merger of Dangote Sugar Refinery Plc (DSR) and Savannah Sugar Company Limited (SSCL) with effect from September 1, 2020, to operate under one unified entity.
He expressed confidence that “the merger will enable us to achieve operational, administrative and governance efficiencies resulting in increased shareholder value. We will continue to pursue our Backward Integration Projects, and other key initiatives to grow our sales volumes, market share, optimize cost and operational efficiencies.”
Also speaking, Dr. Farouk Umar, President, Association for the Advancement of the Rights of Nigerian Shareholders commended the management of Dangote Sugar for the impressive performance of the company despite the hiccups in the year 2020.
He said the shareholders expect more robust results next year since the economy is already picking up and for them to have performed excellently under pandemic, then next year will be greater for us all. The leadership of the company has been very wonderful.”
The National Coordinator emeritus, Independent Shareholders Association, Sir Sunny Nwosu applauded the management for the steady growth, especially as it has been executing its BIP projects as this will afford it the opportunity to meet its target within it projected timelines.
Photo caption: From left, Non-Executive Director, Dangote Sugar Refinery Plc, Bennedikter Molokwu; Company Secretary/Legal Adviser, Temitope Hassan; the company’s chairman, Aliko Dangote; Non-Executive Director, Olakunle Alake; and Group Managing Director/CEO, Ravindra Singhvi; during its 15th Annual General Meeting (AGM) in Lagos on Thursday, May 27, 2021.
