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Company Results

BUA Cement shows resilience to marginally improve bottom line

BUA Cement Plc have doubled cash generated from operations, markedly improving their net cash flow position.



CCNN utilising inorganic growth against Dangote Cement with Obu cement merger approval  

BUA Cement Plc is busy taking pole position in the Nigerian cement industry. The company is the product of a recent merger which boosted the market capitalization of the Nigerian Stock Exchange by N1.3 trillion, making it the most capitalized company after MTN Nigeria and DANGOTE Cement.

The cement giant saw revenue improve by 25% Y-o-Y in Q1 2020 compared to the amount earned in 2019. Revenue in the cement industry is generally so reliant on capital expenditure and economic infrastructural developments. This encapsulates the resilience shown by BUA Cement in Q2 when it managed to record a 1% growth from N46.7 billion in Q2 2019 to N47.2 billion in Q2 2020. Note that construction activities slowed in Q2 2020 due to the COVID-19 lockdown.

READ MORE: BUA Cement Plc Releases audited Financial Results for 2019; Revenue Increased by 47.5% to N175.52 billion

Nigeria’s economy advanced only 1.87% year-on-year (Y-o-Y) in the first quarter (Q1) of 2020 compared to a 2.55% growth in the previous period, against the backdrop of restricted international trade, COVID-19, and a fall in oil prices. The economic adverse effects of these are crystal-clear, having spiralled across sectors of the economy.

Narrowing and streamlining the analysis of BUA Cement’s performance strictly to the first two quarters of 2020 highlights the financial impacts and brings to shore the regressions it has experienced.

  • Revenue plunged by 12.2% from N53.9Billion Q1 to N47.3Billion Q2
  • Gross profit downed by 9% from N24.5Billion to N22.3Billion
  • Admin expenses had a 2% increase from N2.43Billion to N2.48Billion, further plummeting operating profit.
  • 6% and 24.7% reduction in PBT and PAT were noted in Q2, from N20Billion and N19.8Billion in Q1 to N18.9Billion and N14.9Billion in Q2 respectively.

READ MORE: CAP Plc is running at a risk of increased bad debts

The management of BUA Cement expects the bottom line to improve subsequently and is poised to expand the plants’ capacities. The company owns the Obu and Edo Cement Company Limited situated in the southern part of Nigeria. The plant has an installed capacity of 3.4 million metric tonnes (MT). Also, about a month ago, the chairman of BUA Group, Alhaji Abdul Samad Rabiu disclosed during a courtesy visit to the Adamawa State governor Ahmadu Umaru Fintiri, that there are plans to establish a 3 million MT cement plant and a 50 megawatts power plant in Guyuk and Lamurde local governments of the state.

In terms of regular business activities, BUA Cement Plc has doubled the cash generated from operations, markedly improving its net cash flow position. N64 billion was generated in 2020 half-year compared to N28.7 billion generated at the end of  2019. Investments also showed signs of improvement, as BUA Cement spent N42.7 billion in the purchase of property plants and equipment (PPE), a remarkably high number when we observe that only N22.8 billion was expended in the full financial year of 2019. The increased expenditure on PPE worsens the possibility of positive net cash flow but nevertheless, could posit confidence to investors and perhaps attract more funding. It paints BUA Plc as ‘forward-thinking’ and ‘bullish’.


BUA did not do so well as regards its liabilities. The statement of financial position showcased a sporadic jump from N434Million in Q1 to over N19Billion in Q2. This is attributable to obligations due to related parties. BUA must ensure it covers for and eliminates this item from its books in subsequent quarters to dispel negative investor concerns.

Debt to asset for BUA Plc rests at 5% with total liabilities standing at N120 billion and total asset at N519 billion. The import of this is that presently the company may possess more than enough assets to effectively cater for all its interest-bearing liabilities. BUA Plc is seemingly low-geared, and this directly sponsors the school of thought that room exists to take on more debts for capital expenditure (CAPEX).

The low yield environment in the Nigerian debt market emphasizes this point further. Now companies are being able to raise the lower cost of debt capital as compared to preceding years where interest rates were relatively higher due to high rates of government securities.

Ekene Onyeama is a Chartered Accountant currently plying one of the Tier one Banks in Nigeria. He started out his career at Ideascorp Limited, a private company in the hospitality industry where he served as the accountant before switching to banking. Ekene enjoys analyzing companies. He likes to write and is very excited by company valuations. He can be reached on Twitter @Ekenergy_

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Company Results

MTN post N385.3 billion in revenues in 3 months as Nigerians guzzle data

MTN posted revenue of N385.3 billion representing a 17% increase from the N329.1 billion reported in the same period in 2020.



UACN appoints Toriola as new Director 

Nigeria’s largest telecoms network, MTN posted revenue of N385.3 billion representing a 17% increase from the N329.1 billion reported in the same period in 2020.

The double-digit growth is happening at a time when Nigerians have put the Covid-19 lockdown behind them and returned fully to work across the country. It is also happening on the back of tumultuous three months of SIM card registration bans and government mandates for all Nigerians to register to obtain their NIN and link the numbers to their SIM Cards.

MTN reported an 8% growth in Voice related revenue topping N208 billion for the period under review. Data revenue continued to lead revenue growth printing at N105.7 billion, a 42.6% growth year on year, showing heavy reliance on data by MTN’s 61.5 million internet subscribers, the highest in the country.

MTN commands the market share for internet subscriptions owning about 42% of the market. MTN also controls 40% of the Voice market share, the highest compared to any other competitor.

READ: Banks, MTN reach agreement, restore suspended USSD services

Commenting on the result, MTN’s CEO, Karl Toriola explained that “the effects of customer churn and the restrictions on new SIM sales and activations arising from changes in SIM registration regulations” had resulted in a decline of its subscriber base. This reduction led to a marginal drop of 71,000 in Q1 active data subscribers to 32.5 million but this did not affect growth. Rather they recorded an 86.7% increase in data traffic and a 48.5% increase in usage (MB per user) from the existing base.

Toriola explained that “the improvement in data services was supported by the completion of our acquisition and activation of an additional 800MHz spectrum” enabled the company to further increase traffic by 10% and enhance throughput by 79%.

MTN also doubled its revenue from Digital business rising to N3.7 billion during the quarter while FinTech related revenue rose 28.5% to N14.6 billion.


“Digital revenue grew by 101.0% and fintech revenue by 28.5% as customers continued to adopt more digital products and services, a trend accelerated by the pandemic. As of the end of March 2021, we had 449,100 registered MoMo agents and 4.6 million fintech customers.”

MTN also revealed it was being owed N40.3 billion by deposit money banks (DMBs) on services provided for under its USSD product. MTN did not recognize any revenue for its USSD business resulting in a flat year-on-year revenue for its enterprise business.

What next for MTN?

The GSM behemoth maintains it will continue to pursue double-digit revenue growth in 2021 through its 4G network expansion and positioning its FinTech Business for “accelerated growth” to unlock its full potential.

MTN also revealed it will continue to push for a revised commission paid to banks on its air time sales and is exploring other options of selling its airtime outside of banks.

“We will continue to sustain our expense efficiency programme to strengthen our financial position and support margins. We remain in dialogue with the DMBs on a pricing option for airtime sales commission while diversifying our airtime recharge channels to offer our subscribers more options to purchase airtime and stay connected.”

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Company Results

Dangote Cement incurs N97 billion taxes in 2020

The cement giant incurred its taxes on record.



One of Nigeria’s largest indigenous companies and the largest by market capitalization incurred a company income tax of N97 billion for the financial year ended December 2020.

This s according to the information contained in its full-year audited financial statements for the period under review.

Dangote Cement Taxes. 2018 was a tax credit.
Source: Nairalytics Research

Why this matters?

Dangote Cement has enjoyed Pioneer Status over the years and has often been criticized for not paying enough taxes despite its mega-profits.

  • The N97 billion incurred in 2020 is the highest company income tax reported by Dangote Cement since it became listed on the Nigerian Stock Exchange.
  • It incurred N49 billion in taxes in 2019 and got a tax credit of N89.5 billion in 2018.
  • Despite incurring N97 billion in taxes during the year, Dangote Cement’s actual tax paid was just N20.9 billion in 2020 compared to N4.6 billion paid a year earlier.
  • Tax incurred in the profit and loss statement is an accounting provision and is not always the actual tax paid in cash.
  • Putting it into context, the dividend paid during the year is N272 billion and interest payments to its creditors totals N48.2 billion.

Improved Cement Revenues

Despite the Covid-19 Pandemic, the Cement Giant reported full-year revenue of N1 trillion, the highest it has ever recorded since it was privatized almost 20 years ago. The company also reported a profit before tax of N373.3 billion only and a profit after tax of N276 billion, its highest since 2018.

Nigeria like most countries in the world has faced a challenging 2020 due to the impact of Covid-19 on the economy, especially the private sector. However, mega-corporations like Dangote Cement appear to have even performed better during the year. The cement industry in general also appears to have performed well during the year as the combined revenue of the top 3, Dangote Cement, Lafarge, and BUA rose to N1.47 trillion from N1.28 trillion.

The impressive result nonetheless, Dangote Cement’s margins remained strong during the year posting a gross profit margin of 57% in line with its 3-year averages. However, the higher taxes incurred in 2020 dropped profit margins to 26.7%. When compared to 2018 when it still enjoyed Pioneer status, the company posted profit margins of about 43%.

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