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Business News

BUA Cement profits in 2020 increases by 19.4% to N72.34 billion

The cement company revenue increased by 19.33% year-on-year.

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BUA Cement pays N129 billion in 3 years

BUA Cement Plc, one of the leading Cement manufacturers in Africa declared in its audited financial statement, an 19.4% year-on-year growth in profit to N72.34 billion for the financial year of 2020, compared to last year’s figure of N60.34 billion.

The double-digit growth in profit was a testament to the cement maker’s focus on efficiency, excellent cost optimization strategies, newer technologically advanced plants, and lastly the strong growth in revenue which was driven by the rising demand for cement.

READ: BUA Cement to commission second Kalambaina Cement Line in July 2021

BUA Cement’s revenue expanded by 19.33% in 2020, this growth in revenue was the highest among other cement manufacturers in 2020, as the company’s revenue growth of 19.33% beats, Dangote’s 16%, and Lafarge’s 8.3% year-on-year growth.

  • Revenue generated from the sale of bagged and bulk cement grew by 19.33%, driven by 19.52% growth in the sales of bagged cement, while revenue generated from the sales of bulk cement declined by 32.59%.
  • The company’s profit surged by 19.4% year-on-year to N72.34 billion.
  • The Board of BUA Cement Plc proposed a N2.067 kobo per share dividend, driven by the increase in profits and cash flow generated from operations.
  • BUA’s net cash flow generated from operations soared by 146.09% year-on-year to N65.11 billion.
  • The Cement maker spent a total of N127.12 billion on the purchase of property, plant, and equipment in 2020.

READ: Market price of cement is 20% higher than ex-factory price because of logistics issues – BUA Group

The company in 2020 was able to increase its revenues by more than 19% to N209 billion, with sales volumes climbing up by more than 13%. This translates to about 600,000 tons to 5,100,232 tons in 2020.

BUA Cement Plc is Nigeria’s second-largest cement company, its impressive 2020 financial performance is a reflection of the continued value and strength of the brand and product offerings as well as a testament to the cement maker’s focus on efficiency, excellent cost optimization strategies, and newer technologically advanced plants.

All these ensured that BUA Cement was able to weather the storm from its operating environment in 2020, which was stirred by the COVID-19 pandemic.

What you should know

  • BUA Cement is the fourth largest listed entity on the Nigerian Stock Exchange, with a market capitalization in excess of N2.4 trillion.
  • At yesterday’s market close, the market value of the company’s shares was put at N73.5 per share, down by about 13.5% YTD. BUA Cement’s dividend yield at this price is put at 2.8%.

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Omokolade Ajayi is a graduate of Economics, and a certificate holder of the CFA Institute’s Investment Foundation Program. He is a business analyst, and equity market researcher, with wealth of experience as a retail investor. He is a business owner and a stern advocate of Financial literacy, who believes in the huge economic prospect of the Nigerian Payment channels and Fintech space.

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Business News

ABCON asks CBN to check impact of cryptocurrencies on diaspora remittances

The association also noted that the apex bank needs to address other issues driving the patronage of cryptocurrency exchanges for remittance transfers.

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ABCON disagrees with those calling for naira devaluation

The Association of Bureau De Change Operators of Nigeria (ABCON) has asked the Central Bank of Nigeria (CBN) to introduce measures that will neutralize the positive effects of cryptocurrencies as a channel for diaspora remittances.

This is to redirect diaspora remittances away from cryptocurrency exchanges to official channels and also protect such against potential disruptions.

This call was made by ABCON during its Quarterly Economic Review for the first quarter of 2021 where it commended the CBN for the N5/$ rebate scheme introduced to encourage diaspora Nigerians to use official channels to remit their funds.

However, the association noted that the apex bank needs to address other issues driving the patronage of cryptocurrency exchanges for remittance transfers.

READ: Nigeria among worst countries to start a career, and they all don’t accept crypto

What ABCON is saying in their statement

The association in its statement said, “It is noteworthy that public acceptability for cryptocurrency exchanges are rising which could be quite accountable for the wide drop in diaspora inflows to Nigeria. Insecurity in the country is giving it greater prominence as investors and citizens are finding Cryptocurrency a safe haven for their wealth in case of any eventuality.

In most Emerging Markets Bitcoin transfers surged last year, as the pandemic exposed the cheaper and more efficient digital remittance services. Migrants sending money across borders to their families prefer the minimal transaction costs of cryptocurrency exchanges against the exorbitant costs of traditional money transfer companies like Western Union.”

READ: Atsu Davoh is building ways for Africans to easily acquire and spend cryptocurrency

According to ABCON, “Cryptocurrency transactions are faster than the conventional transfers, which require passing through banks reliant SWIFT, the sluggish, half-century-old interbank messaging system that handles cross-border payments.

These exchanges override the political complications of official channels. The global reach of cryptocurrencies avoids the inflation risk inherent to official currencies, especially in politically unstable countries reliant on fickle foreign investors.

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Thus, while we commend the efforts of CBN in introducing the package of Five Naira for One Dollar transfer, it can be seen from the analysis above that the challenges exceed just non-payment of foreign currency by the IMTCs and the exchange rate. Strategies that satisfy the most sensitive of these advantages of Cryptocurrency exchanges must be introduced to redirect flows to the official channel.”

ABCON also expressed concerns over the country’s huge unemployment rate, urging the government to apply radical approaches with the use of both conventional and unconventional economic and political tools to redress the trend.

READ: Afreximbank President reveals ways Nigeria can boost diaspora participation in economy

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What you should know

  • It can be recalled that the apex bank had about 2 months ago, warned the Deposit Money Banks, Non-Financial Institutions and other Financial Institutions against doing business in crypto and other digital assets.
  • The CBN directed financial institutions to immediately close the accounts of persons or entities transacting in or operating cryptocurrency exchanges, warning of severe regulatory sanctions in the event of any breach of the directive.
  • The Securities and Exchange Commission (SEC) had a few days ago, revealed that it is working with the CBN for a better understanding and regulation of cryptocurrencies in the country.

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Companies

Unilever earmarks N62 million as remuneration to its Non-Executive Directors in 2021

Unilever Nigeria has fixed its remuneration to the Non-executive Directors of the company in 2021 at N62 million.

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Unilever Overseas increases stake in Unilever Nigeria Plc

One of Nigeria’s leading FMCG companies, Unilever Nigeria Plc, is set to pay out a total of N62 million as remuneration to its Non-Executive Directors for the year ended December 31, 2021.

This disclosure was made by the leading consumer goods company as one of the key resolutions that would be considered and passed at the Company’s ninety-sixth (96th) Annual General Meeting, which will hold on Thursday 6 May 2021 at 10.00 am.

The famed manufacturer of Sunlight detergent also revealed that in addition to the N62 million remuneration, sitting allowances will be paid at standard agreed rates for each meeting attended and the Chairman of the company will be entitled to a vehicle allowance of N12 million gross per annum.

READ: Heavy sell-off in PZ & Unilever shares leads to N6.09 billion market value loss

Short-term benefits paid by Unilever in 2020 to its Directors

Despite the fact that Unilever Nigeria Plc has not paid its shareholders dividends for about two years now, the FMCG company paid out short-term benefits of about N511 million and N73 million to its Executive and Non-Executive Directors in 2020 respectively, compared to a sum of N590 million and N59 million it paid out in 2019 respectively. The members of the leadership team, excluding the Executive Directors of the company, were paid a total of N867 million short term benefits in 2020, down from the N1.04 billion they received in 2019.

On the flip side, the total payout as wages and salaries to the company’s employee in 2020 was N5.05 billion, this is down from the N5.99 billion which the company paid out in 2019.

READ: Abdulsamad Rabiu set to earn N39.4 billion from his cement business

In case you missed it

According to a recent result by Unilever Nigeria Plc, the company made a loss of about N492 million in the first quarter of 2021. This figure is 144.1% lower when compared to the profit of N1.114 billion made by the company in the corresponding quarter of 2020.

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Unilever’s revenue however surged by 45.7% during the quarter. However, the growth in the cost of sales, and the huge 63.3% increase in marketing and administrative expenses pressured the profits down to a loss of N492 million in the first quarter of 2021.

READ: Guinness shares surge by 9.89%, lifting the brewer’s capitalization by N5.9 billion

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What you should know

  • Shares of Unilever Nigeria Plc are currently valued at N12.95 per share, placing the YTD loss in the shares of the company at -6.83%.
  • Unilever Nigeria Plc is the sixth most valuable consumer goods company listed on the Nigerian Stock Exchange, with a robust market valuation put at N74.4 billion, higher than Guinness Nigeria Plc, NASCON Allied Industries Plc and PZ Cussons.
  • The shares of the top FMCG brand is trading 23.8% lower than its 52-week high price of N17, and 23.3% higher than its 52 week low of N10.5.

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