As audited accounts start to trickle in, companies will propose dividend payments to their shareholders as recommended by their respective boards of directors. It is also important to track these announcements to know who is eligible to collect the dividend, when it will be approved and when it will be paid. Dividend payment also affects share prices.

This page will be updated from time to time.

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Legend

Date Announced – The date the company announced dividends evidenced by a corporate action published on the website of the NSE.

Qualification date – Shareholders who own shares as of this date will receive dividends. If you buy shares and want to receive dividends make sure it is at least three days before this date. Shares get transferred to you on the basis of the T+3 rule (the date you bought plus 3 working days).

Payment date – This is when the dividend will be paid to you, either via post (dividend warrants) or direct credit to your bank accounts (e-dividend).

Calculate Dividends

Closure of Register – Only shareholders who own shares listed in their register before this date will be paid dividends.

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READ MORE: How to read stock market tables

2020 Dividends from companies quoted on the Nigerian Stock Exchange

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Lafarge Africa Plc, a unit of LafargecHolcim Group – one of the biggest building and concrete solutions companies in the world, has had a pretty long run in the construction sector. With projected growth in urbanization and inevitable population expansion, the leading producer of building materials and construction solutions has its stake in the huge Nigerian housing market. The company had served customers in Nigeria and South Africa (now discontinued) for decades, their customer base cutting across individuals requiring small building projects to major construction and infrastructure projects. All of these do well to place the company as an active participant in the economic growth of Africa.

Yet, so much has plagued the company in the past few years, curtailing its success with avoidable losses and below-par profits. While it, no doubt, has a series of challenges to worry about – like most organizations – three of its biggest Achilles’ heels had been its failing South African operations, its incessant changes in its corporate leadership, and of course, the one pandemic threatening to rip the global economy to shreds – COVID-19.

Lafarge South Africa

The company’s experience with its South African subsidiary gives credence to the phrase, “If anything is not serving you well, cut it off.” After years of dragging the African cement-maker down, the subsidiary was eventually spun off in July last year – not before it incurred a final loss of N3.2 billion in the first quarter of 2019. It was only after, when Lafarge restated its accounts by adjusting figures from the discontinued operations from its books, that the company set off on a positive growth trajectory.

Following the sale of Lafarge South Africa Holdings (LSAH) in Q3, there was a remarkable improvement in gross and operating margins, clearly showing that the sale of LSAH was valued accretive to shareholders. For one, the total debt reduced drastically. Short term loans and long term loans also had a drop of 79% and 75% respectively in comparison with the first quarter of last year. Other financial assets increased significantly from N1.7 billion in 2019 to N4.8 billion in Q1 2020. Also resulting from the sale was the increase in EPS from Q1 2019 of 0.36 to Q1 2020 of 0.93.

(READ MORE: Analysis: Total Nigeria needs a financial overhaul)

Khaled El Dokani, CCEO of Lafarge Africa had stated, “Our turnaround and cost-reduction strategy in FY 2019 and the divestment of the South African business, have delivered strong results. The decrease in net debt has significantly strengthened our balance sheet and has placed us in a vantage position to face the future.”

Its Changing Leadership

In 2018 alone, the firm appointed four directors in the space of three months. 9 months ago, in September, former CFO of Lafarge Africa Plc., Bruno Bayet, resigned.  Just a month later, the board had announced the appointment of Lolu Alade Akinyemi as the new CFO. Next, the group CEO, Michel Puchercos, also resigned leaving Khaled Abdelaziz El Dokani in charge. Even amidst the challenges of 2020, Jean-Philippe Benard resigned from being a Non-Executive Director in January 2020 and by April, the retirement of two Non-Executive Directors was announced, as well as the appointment of three new directors. The high turnover of its leadership means one (or both) of two things. The first is the possibility that there could be more than meets the eyes within the company and the second is the truth that the newer leadership will need time to adjust to the company’s operations before the wins.

COVID-19

Just when things started looking up, COVID-19 came with all its challenges and it didn’t help that the first carrier of the virus – an Italian man, had been visiting Lafarge Africa’s factory in Ogun State. The loss in the demand for cement with the stalled construction activities will pose an additional challenge for the organization. In the performance summary released alongside the financials, the company had noted that the pandemic “will adversely affect the company’s results in Q2, 2020.” This is also coupled with the burgeoning competitive landscape with bigger brands like BUA and Dangote owning larger market shares.

While the company seems to be moving in the right direction, it might take a while for things to pick up. At its current price of N11.65 juxtaposed with its indicative dividend yield of 8.58%, the company could serve as an easy buy capable of yielding dividend income while investors wait patiently and hopefully for its wins to come.

Dangote Cement reported a 3.8% y/y growth in Revenue to N249.2bn in Q1 2020. The growth in group revenue was solely driven by an improvement in revenue from its Nigerian operations (up 5.6% y/y to N179.3bn) amidst a flattish performance from Pan African operations (down 0.6% y/y to N69.8bn). We expect the impact of COVID-19 to have a more profound impact on Nigeria Sales in Q2-2020, given that Lagos, Ogun, and the FCT went on full lockdown from 30 March. Although the lockdown measures were relaxed on 4 May, economic activities are yet to return to pre-COVID-19 levels.

Similarly, we expect weaker Revenue from Pan African Operations driven by weakness in South Africa (poor macro conditions, lockdown in the last week of March amidst weak infrastructure spending by the government), Tanzania (production challenges and unfavorable weather conditions) and Zambia (the economy slipped into recession in Q1, leading to a decline in the cement market) to have a material impact on overall Pan African sales volumes. As such, we have made marginal adjustments to our forecasts.

We retain our target price of N182.4/s and maintain our Buy recommendation largely due to attractive valuations. Trading at FY 2020 EV/EBITDA of 7.0x compared to its EM peer average of 9.2x and its 5-year average of 7.7x, we believe the company’s valuation remains attractive. We arrived at our target price using a blend of DCF valuation and relative valuation in the ratio 60:40. We also note that the company’s planned share buyback has been approved by SEC and management will review the opportunity to deploy the programme in due time. We believe this remains a catalyst for an upward re-pricing of its shares.

READ ALSO: Dangote Cement’s Q1 Result: Weak topline and higher OPEX drive weak earnings

Review of Q1 2020 performance

Q1 2020 Revenue grew 3.8% y/y to N249.2bn. The growth in group revenue was solely driven by an improvement in revenue from its Nigerian operations (up 5.6% y/y to N179.3bn) amidst a flattish performance from Pan African operations (down 0.6% y/y to N69.8bn). On a q/q basis, we note that group revenue grew stronger, up 17.6% q/q, again on the back of a sturdy growth from Nigerian operations (up 26% q/q). We believe the growth in revenue from Nigerian operations reflects stronger demand for cement particularly in the months of January and February which more than compensated for the slowdown in March due to headwinds triggered by the outbreak of the global pandemic. Notably, cement sales volumes grew by 0.7% y/y to 4.0MT, the highest Q1 volume in the last four years. However, we note that the momentum in sales volumes has slowed down, following the lockdown implemented in states such as Lagos, Ogun, and the Federal Capital Territory (FCT).

EBITDA grew 2.2% y/y to N114.2bn. The low single-digit growth in EBITDA was due to a higher increase in cost of sales adjusted for depreciation (up 6.3% y/y) compared to the growth in revenue (up 3.8% /y). The increase in cost of sales adjusted for depreciation was largely driven by growth in salaries and related staff costs (up 13% y/y) and other production expenses (N4.0bn in Q1 2020 vs N1.5bn in Q1 2019). However, the company reported a sub-inflationary growth in OPEX (up 4% y/y to N47.7bn). We highlight that expenditure on advertisement and promotion was up 96% y/y to N3.7bn- we believe this was due to the continued implementation of sales promotional activities to drive sales volume. Overall, EBITDA margin weakened marginally by 0.7ppts to 45.8% in Q1 2020.

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Net Finance Cost dipped significantly, down 60.5% y/y t0 N3.7bn in Q1 2020, due to a decline in Finance Cost (down 23% y/y to N9.0bn) alongside foreign exchange gains of N3.7bn recorded in Q1 2020. However, Finance Income was down 32.6% y/y to N1.5bn, reflective of the decline in Cash and Bank Balances (down 41% y/y to N101.8bn) and a lower yield environment. We note that the decline in Finance Cost was due to the absence of Foreign exchange loss in Q1 2020 compared to N3.1bn recorded in Q1 2019.

Pre-tax Profit grew 11.5% y/y to N88.1bn in Q1 2020. A higher effective tax rate of 31% in Q1 2020 compared to 24% in Q1 2019 led to a flattish growth in Profit after tax, up 0.6% y/y to N60.6bn in Q1 2020. Earnings per share rose to N3.60/s in Q1 2020 from N3.54/s in Q1 2019.

Looking ahead, we expect the deterioration in the macroeconomic narrative of Nigeria, caused by the outbreak of COVID-19 and significantly lower oil prices to constrain activities in the construction industry as fiscal spending on capital projects weakens, on the back of lower oil revenue. In a similar fashion, we expect private sector investment in gross fixed capital formation to slow down as businesses cut down on their CAPEX plans given fragile macro conditions, which will weaken aggregate demand.

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Similarly, we expect weaker Revenue from Pan African Operations driven by weakness in South Africa (poor macro conditions, lockdown in the last week of March amidst weak infrastructure spending by the government), Tanzania (production challenges and unfavorable weather conditions) and Zambia (the economy slipped into recession in Q1, leading to a decline in the cement market) to have a material impact on overall Pan African sales volumes. Considering the 1.4% decline in Pan African Sales Volumes in Q1 2020, we have revised downwards our forecast on Pan-African volumes to 9.25MT (previously; 9.82MT) in 2020.

Valuation; BUY rating maintained

We retain our target price of N182.4/s and maintain our Buy recommendation largely due to attractive valuations. Trading at FY 2020e EV/EBITDA of 7.0x compared to its EM peer average of 9.2x and its 5-year average of 7.7x, we believe the company’s valuation remains attractive. Furthermore, we highlight that the proposed share buyback is a positive catalyst for upward re-pricing of the shares. We arrived at our target price using a blend of DCF valuation and Relative valuation in the ratio 60:40.

CSL Stockbrokers Limited, Lagos (CSLS) is a wholly-owned subsidiary of FCMB Group Plc and is regulated by the Securities and Exchange Commission, Nigeria. CSLS is a member of the Nigerian Stock Exchange.