Lafarge Africa Plc, Nigeria’s second largest maker of Cement says its Q2 2016 results are expected to be affected by the impact of naira devaluation against the dollar (USD) resulting in unrealised exchange loss.
The firm in a statement today said impact of naira devaluation is expected to be a N28 billion unrealised exchange loss arising from USD borrowings of $310 million shareholder loans and $85 external loans.
Lafarge Africa also said current gas supply shortage from bombings of infrastructure in the Niger Delta is expected to impact volumes for this quarter.
The announcement is based on the unaudited financial statement for the Q2, 2016 period, according to Lafarge.
According to the statement posted on the website of the Nigeria Stock Exchange (NSE) and signed by the firm’s Company Secretary Uzoma Uja:
“These loans relate to United Cement Company of Nigeria (Unicem) and were mainly set up prior to the acquisition by Lafarge Africa Plc of its original 35 percent stake in Unicem.”
Lafarge Africa Plc has since then increased its stake in Unicem and held at the time of the devaluation, 50 percent of Unicem, which was fully consolidated. Lafarge now holds 100 percent of Unicem and says the unrealised exchange loss will have no immediate impact on cash flow.
Lafarge says it is assessing refinancing part of Unicem’s dollar debts.