Dangote Cement reported a profit after tax of N200 billion representing a massive 49% drop in profits from a year earlier. The drop in profits was mostly driven by stunted growth in its local and Pan African businesses.
Nigeria: The cement giant reported revenues of N610.2 billion in 2019 compared to N618.3 billion a year earlier. Profit after tax was N275.1 billion in 2019 compared to N491.6 billion in 2018. EBITDA, a notable performance measure for institutional investors was N361 billion down from N397 billion placing operating expenditure as the major drivers of profitability drop.
Pan Africa: The cement giant reported revenue of N891.7 billion compared to N901 billion a year earlier. Revenue from business outside Nigeria was N282.7 billion compared to N283.2 billion a year earlier. However, it continued to report losses from its Pan African business with a loss after tax of N85.2 billion compared to N87.8 billion in losses.
Border closure to blame: A report from Reuters revealed Dangote Cement blamed the border closure for affecting exports to other African countries thus hurting top and bottom-line growth. Outgoing Dangote Cement CEO, Joseph Makoju reportedly blamed border closure for leading a drop in exports from 0.7 million tonnes in both 2018 and 2017 to 0.5 million tonnes in 2019.
“We undoubtedly faced several challenges last year,” Makoju told an analyst call. “We are very optimistic about the market in 2020 and we expect to see some increase especially for infrastructure project.” Joseph Makoju.
Joseph Makoju also said total production volumes last year were flat at 14.1 million tonnes and that Higher discounts, marketing and haulage cost caused core profit to fall 9.1%, while margins slid 59.2%, he said.
Dangote Cement had before now reported only one profitability drop in 2016 when Nigeria fell into a recession. Profits went from N153.2 billion in 2015 to N142.2 billion in 2016. The company bounced back in 2017 and 2018 with profits of 204.2 and N390 billion respectively. 2019 is the first time Dangote Cement in reporting a revenue drop since we started tracking its results in 2011.
Presidency dismisses allegation of Osinbajo receiving N4 billion from recovered loots
The accusation was described to be an obvious campaign of lies and calumny.
The office of the Vice President has reacted to a series of tweets accusing Professor Yemi Osinbajo of instructing the embattled acting Chairman of the EFCC, Ibrahim Magu, to release the sum of N4 billion out of N39 billion that was recovered from alleged looters.
These allegations have been described as “false and baseless”.
A statement that was signed by the Senior Special Assistant to the Vice President on Media and Publicity, Laolu Akande, said, “with all emphasis at our disposal, let it be firmly stated that these are totally false and baseless fabrications purposing to reflect goings-on at the probe panel investigating Mr Ibrahim Magu”.
Ibrahim Magu was relieved of his duties this week, after a probe was conducted on his activities as Acting Chairman of the nation’s anti-graft agency. He has since been replaced with Mohammed Umar.
Meanwhile, the statement by the Presidency also complained about the recent rise in people being paid to “peddle blatant falsehoods” against the Vice President and says Mr Osinbajo “will not be distracted by these obvious campaigns of lies and calumny”.
The statement added that the online publications “being criminally defamatory in nature” have been referred to law enforcement agencies for investigation.
OFFICE OF THE VICE PRESIDENT
— Presidency Nigeria (@NGRPresident) July 8, 2020
Stanbic IBTC observes closed period, as directors set to consider H1 results
The directors will also consider a proposal to pay an interim dividend to shareholders.
Stanbic IBTC Holdings Plc announced earlier today that its board of directors will meet on Wednesday, July 29, as part of preparations towards the release of the company’s consolidated and separate audited financial statements for half-year 2020. The directors will also consider a proposal to pay the company’s shareholders an interim dividend.
A statement issued by the Stanbic IBTC to the Nigerian Stock Exchange (NSE) noted that the scheduled board meeting is in tandem with guidelines contained in section 1.2 of the NSE’s rules book.
In the meantime, the bank Hold-Co has already commenced observing its closed period ahead of the release of the half-year financial statements. Specifically, Stanbic IBTC began observing its closed period on June 1st, 2020, the implication being that all insiders and their relatives have been prohibited from trading the company’s shares for more than one month now.
Note that the Stanbic IBTC’s closed period will continue until the half-year financial statements are released. Part of the statement which was signed by Chidi Okezie (Company Secretary), said:
“In accordance with the provisions of Section 1.2 of the Rules of The Nigerian Stock Exchange (The NSE) relating to Board Meetings and General Meetings of Issuers, we would like to notify The NSE and our Shareholders, that a meeting of the Board of Directors of Stanbic IBTC Holdings PLC (the Company) is scheduled to hold on Wednesday 29 July 2020 at 1:00 pm. The meeting will discuss amongst other items, the Company’s Consolidated and Separate Audited Financial Statements for the Half-year ended 30 June 2020 as well as a proposed interim dividend.
“In view of the above, the closed period for the release of half-year results, which commenced on Monday, 01 June 2020 will continue to be in effect until the release of the Company’s Half-year audited financial statements.”
Recall that the last earnings report that was released by Stanbic IBTC Holdings Plc was for Q1 2020. The unaudited report showed that gross earnings stood at N61.4 billion as against N58.7 billion in Q1 2019, even though interest income for the period declined by 12% year on year to N27.5 billion. Meanwhile, profit for the period stood at N20.6 billion, an increase when compared to N19.2 billion in Q1 2019.
Stanbic IBTC Holdings’ share price closed at N30.25 at the end of today’s trading session on the Nigerian Stock Exchange. Year to date, the stock has declined by nearly -20%.
Minister of Petroleum explains reasons for subsidy removal
The Minister said it was unrealistic for the government to continue with the subsidy regime.
The Federal Government has explained the reason for the deregulation of the downstream sector of the oil industry. The government said that this was to ensure economic growth and development of the country.
This was disclosed by the Minister of State for Petroleum Resources, Timipre Sylva, in a press statement on Thursday, July 9, 2020, in Abuja.
Sylva said that it was unrealistic for the government to still continue with the subsidy regime, especially with the Premium Motor Spirit (PMS) otherwise known as petrol, as it had no economic value.
He asked Nigerians to ignore the misinformation and misguided comments that have been in the public space on the issue.
According to the Minster, ‘’It has become expedient for the Ministry of Petroleum to explain misconceptions around the issue of Petroleum Products Deregulation. After a thorough examination of the economics of subsidizing PMS for domestic consumption, the government concluded that it was unrealistic to continue with the burden of subsidizing PMS to the tune of trillions of Naira every year.’’
“More so, when the subsidy was benefiting in large part the rich rather than the poor and ordinary Nigerians. Deregulation means that the Government will no longer continue to be the main supplier of Petroleum Products, but will encourage private sector to take over the role of supplying Petroleum Products.”
He pointed out that in line with global best practices, the price of petroleum products will be determined by market forces. He, however, added that the government will continue to play its traditional role of regulation and ensure that it was not priced arbitrarily by private sector suppliers.
Sylva said that the regulatory function will be similar to that played by the Central Bank of Nigeria in the banking sector where they try to make sure that deposit money banks do not charge arbitrary interest rates on its customers.
The minister noted that the government has earlier revealed that an increase in crude oil prices would also reflect at the pump price of petroleum products.
Going further Sylva said, ‘’Indeed, one of the reasons we have been unable to attract the level of investments we desire into the refining sector has been the burden of fuel subsidy. We need to free up that investment space so that what happened in the Banking Sector, Aviation Sector and other Sectors can happen in the Midstream and Downstream Oil Sector.’’
” We can no longer avoid the inevitable and expect the impossible to continue. There was no time government promised to reduce Pump Price and keep it permanently low. Let us, therefore, ignore the antics of unscrupulous middlemen who would want status quo ante to remain at the expense of the generality of Nigerians.,” he added.
He disclosed that the deregulation policy will attract more investments into the oil sector, create more jobs and opportunities and free up trillions of naira to develop infrastructure instead of enriching a few Nigerians.
The minister noted that government who is mindful of the impact of higher PMS prices on Nigerians is working to roll out the auto gas scheme which will provide citizens with alternative sources of fuel at lower cost.