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Lafarge Africa is still playing catch up



Cement maker Lafarge Africa intends to expand its factories in the South West and Northern parts of the country once it cuts down on its debt. Chairman of the company, Bolaji Balogun disclosed this in a chat with Bloomberg.

“As soon as the debt becomes more comfortable, we don’t sit there, we will put the foot down on the next round of expansion”

He did not, however, disclose the volume by which the company plans to expand.

Lafarge has a production capacity of 10.8 million tonnes in Nigeria as at FY 2017.

Balogun also disclosed that the company is targeting a leverage ratio between 60-70% from its current levels of a 100%.

Proceeds from a ₦131 billion rights issue last year were used to pay down its debt.

Still playing catch up

The company’s expansion plans come after its competitors have rolled out theirs. BUA Cement has completed a 1.5 million tonne expansion of its Kalambaina cement plant in Sokoto, at an estimated cost of $350 million.

Dangote Cement, Nigeria’s largest cement producer in July last year unveiled plans to expand its plants in Nigeria.

The company currently has a production capacity of 29.3 million tonnes per annum in Nigeria, according to its FY 2017 investor presentation. Dangote Cement sold 12.9 million tonnes of cement last year.

Profit ratios tell the same story

Lafarge had gross profit margins of 16.97% and a net profit margin of 11.57%. Return on equity was 32.64%

CCNN had a gross profit margin of 33.94% and a net profit margin of 12.69%. Return on equity was 20.73%

Dangote Cement had a gross profit margin of 56.39% and a net profit margin of 25.35% and a Return on Equity (ROE) of 26.35%.

Gross profit margin is the percentage of revenue left after deducting the cost of goods sold.

Net profit margin is the amount of revenue left after all expenses have been deducted from sales.

Return on Equity is how much Naira the company generates as profit for every ₦1 of shareholders funds.

Q1 2018 results tell the same story

Q1 2018 results show the company is lagging behind its competitors. Revenue dropped from ₦81 billion in 2017 to ₦80 billion in 2018.

Jaiz bank

Revenue for Dangote Cement (the company) increased from ₦152 billion in 2017 to ₦173 billion in 2018.

Revenue for Sokoto Cement increased from ₦4.3 billion in 2017 to ₦5.3 billion in 2018.

Lafarge Africa PLC (Lafarge Africa) was incorporated in Nigeria on 26 February 1959 and commenced business on 10 January 1961.

The Company formerly known as Lafarge Cement WAPCO Nigeria Plc changed its name, following the acquisition of shares in Lafarge South Africa Holdings (Proprietary) Limited (LSAH), United Cement Company of Nigeria Limited (UNICEM), AshakaCem PLC (AshakaCem) and Atlas Cement Company Limited (Atlas).

Lafarge Africa shares are currently trading at ₦38.50, down 4.94% in today’s NSE trading session.

Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training.He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE).He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy.You can contact him via [email protected]

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Airtel Nigeria announces appointment of Surendran as new Chief Executive Officer

Airtel Nigeria, has announced the appointment of Mr C. Surendran as the new MD/CEO with effect from August 1, 2021.



Like MTN, is Airtel Nigeria considering listing?

Telecommunications giant, Airtel Nigeria, has announced the appointment of Mr C. Surendran as the new Managing Director and Chief Executive Officer with effect from August 1, 2021.

Surendran would be replacing the outgoing Managing Director and Chief Executive of Airtel Nigeria, Olusegun Ogunsanya, who has been elevated to the position of Chief Executive Officer of Airtel Africa Plc with effect from October 1, 2021.

According to a report from the News Agency of Nigeria, this disclosure is contained in a statement issued by Airtel on Wednesday, May 5, 2021, in Lagos.

READ: Airtel Africa signs new $500 million loan with Bank of America, HSBC, others

The statement says that Surendran would also be appointed to the Executive Committee (ExCo) as Regional Operating Director, reporting to the CEO of Airtel Africa plc, and onto the Board of Airtel Networks (Nigeria) Limited.

Airtel in its statement said, “Surendran has been with Bharti Airtel since 2003 and has contributed immensely in various roles across customer experience, sales and business operations.

He was the Chief Executive Officer of Karnataka, which is the largest circle in Airtel India, with over one billion dollars in revenue.

Surendran delivered an exceptional performance with significant movement in Revenue Market Share (RMS) over the last few years, currently at 54 percent. He has over 30 years of business experience, including 15 years at Xerox.’’


Airtel said that Surendran would transition into his new role from June 1, 2021, and spend the time onboarding into the business until July 31, 2021.

READ: Meet the latest billionaires on the Nigerian Stock Exchange

In case you missed it

It can be recalled that a few days ago, Airtel Africa Plc, a leading provider of telecommunications and mobile money services in Nigeria and 13 other countries, announced the appointment of Mr Olusegun Ogunsanya as the new Chief Executive Officer, following the notice of retirement given by the current Managing Director/Chief Executive Officer, Raghunath Mandava, to the Board.

In the notification sent by Airtel Africa to the Nigerian Exchange, Ogunsanya is expected to join the board of Airtel Africa with effect from October 1, 2021.

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Our First Bank loan is being serviced, reduced by 30% in 2 years – Honeywell Group

The credit facilities accessed from First Bank were granted after due negotiations, with the necessary documentation and in line with regulatory policies and industry standards.



Billionaire watch: Oba Otudeko’s stakes in Firstbank and Honeywell are worth N10.3 billion

The Honeywell Group has said that its loan with First Bank is being serviced as the conglomerate had reduced the facility by 30% in the last two and half years.

This was disclosed by the Group via a statement issued on Sunday and seen by Nairametrics.

According to the statement, the company and the bank have had a professional business relationship since 1975, which preceded the group’s investment in the bank over a decade later.

According to the Honeywell Group, the credit facilities accessed from First Bank were granted after due negotiations, with the necessary documentation and in line with regulatory policies and industry standards.

The Group further explained that following agreed terms, its facilities are adequately secured with First Bank with collaterals in place at over 170% of forced sales value and 230% at open market value.

It stated, “In 2015, First Bank under the directive of the Central Bank of Nigeria, drew our attention to a 2004 circular (BSD/9/2004) which requires that insider related facilities must not exceed 10% of paid-up share capital.

Based on this directive we subsequently entered negotiations with the bank to agree on an appropriate repayment structure and the final negotiated position was duly approved by the CBN.

In addition to the above, First Bank, on the directive of CBN, requested additional security in the form of FBN Holdings Plc shares held by the Chairman of Honeywell Group, Dr Oba Otudeko citing a 2001 circular. This was duly provided through an authorisation to place a lien on the shares.”

Honeywell Group has continued to meet all its obligations on its facilities with the bank according to agreed terms and has reduced its exposure by nearly 30% in 2.5 years. The facilities were charged at market rate and the bank continues to earn significant interest therefrom.”

What you should know

  • Nairametrics had reported when the Central Bank of Nigeria directed Honeywell to fully repay its obligations to First Bank within 48 hours, warning that failure to do so would cause the CBN to take regulatory measures against the insider borrower and the bank.
  • The Chairman of Honeywell Group, Oba Otudeko, also served as Chairman of FBN Holdings Plc until he was asked by the apex bank to go along with other directors on Thursday.
  • The apex bank had noted in a letter last Wednesday that First Bank had yet to comply with regulatory directives on divesting its interest in Honeywell despite several reminders.
  • Also, the CBN asked First Bank to forward evidence involving the divestment of interest in Honeywell Flour Mills and Bharti Airtel Nigeria Ltd within 90 days.

Download (PDF, 525KB)

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