Dangote Sugar Refinery Plc’s full-year 2018 financial results did not reflect the expectations of stakeholders and analysts alike. This is because the company’s over all performance was affected by the activities of smugglers.
The company also claimed that delayed delivery of its product to customers, which was caused by bad roads and gridlocks, hindered performance last year.
Dangote Sugar Refinery complained that smugglers’ activity affected its selling price and growth in the market, even as the company’s revenue dropped by 26 percent. Its net income fell by 44 percent.
As we reported, the company’s revenue dropped to N150.4 billion ($418 million) in 2018, while net income retreated 44 per cent to N22.2 billion.
How the company intends to curb smugglers impact
In a statement, the company said “Sales and production volumes were constrained” by smugglers. And to curb the illegal activities of smugglers and prevent a repeat, Dangote Sugar will “work with the regulatory agencies to combat smuggled sugar’’.
Government’s effort in curbing smugglers activities: Nigeria recently banned the importation of packaged sugar in a bid to support the growth of local producers in the country. This is part of the Government’s diversification efforts.
However, Nigeria’s poor border security has not helped the Government’s effort. This is because smugglers now make use of the porous borders to illegally bring in the contraband.
Other contributing factor to Dangote Sugar‘s revenue decline is the traffic gridlock experienced at the production site in Lagos. Lagos port handle about 80 percent of shipping activities in the West African nation. Yet, traffic gridlock has continue to affect distribution of products across the country.
Dangote Group recently disclosed that it will build more storage facilities for finished products at Dangote’s refinery this year, in order to better optimise its production cycle, which has been hampered by the unavailability of trucks due to the traffic gridlock.
Dangote Sugar declares final dividend
Dangote Sugar Plc has declared a final dividend of N1.10 per 50 kobo ordinary share, for the financial period ended Monday, December 31st, 2018.
Come Wednesday, June 19, 2019, the dividends will be paid electronically to shareholders
whose names appear on the Register of Members as at Friday, May 31, 2019.
Also, dividends will only be paid to shareholders who have completed their e-dividend registration and mandated the Registrar to pay their dividends directly into their bank accounts.