Nigeria’s largest sugar producer Dangote Sugar Refinery PLC released its 2015 9 months to September 30th interim results reporting pre-tax profits rose 2.3% year on year to N9.34 billion. The company also reported a group revenue of N73 billion for the period representing a 1% year on year growth.
The DMD explained the reason for the poor results as follows;
“After a good pick up in the second quarter, we struggled to sustain the pace of improvement in the third quarter as we continued to face challenges getting our sugar out of the Apapa area to our customers which constrained our overall operations in the quarter. We have begun to explore alternate means of product evacuation including the rail and additional warehouses to fulfil the growing demand of our sugar in the Northern parts.
I am pleased that despite these challenges we were still able to improve our profit margins and bagged additional market share from the sugar smugglers and competition as the quarter ended.
The company also released the following highlights of the result
- Sugar production at Savannah 6,610 tonnes (2014: 6,245 tonnes) +6.4%
- Refinery production at Apapa 523,693 tonnes (2014: 664,792 tonnes) -19% YoY
- Group Sugar sales volume 530,925 tonnes (2014: 609,765 tonnes tonnes) -13%
From the above it appears the gridlock with Apapa road must have negatively impacted on volumes of goods sold. Production dropped by 19% during the year whilst sales fared worse with a 28% drop.
Dangote Sugar closed at N6.51 today and has returned 2.62% year to date (YTD).
Note: 2014 Sugar volumes was 609,765 tonnes tonnes and not 737,671 tonnes as earlier reported. Error was from the press release sent to us by the company. They sent an update to correct this. The error is regretted.
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