Dangote Cement raises 50 billion naira through Commercial Papers to support short-term funding

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Dangote Cement is raising 50 billion naira in the fifth, sixth and seventh series of its 150 billion naira Commercial Paper (CP) programme.

The series 5 is for 93 days tenor with effective yield of 12.38 percent, while series 6 is for 178 days and has effective yield of 13.08 percent. The series 7 is for 269 days and has a yield of 13.16 percent.

The offer, which closes today, opened last Wednesday and the minimum subscription for each series is 5 million naira and multiples of 1,000 naira thereafter.

The company said proceeds of the Commercial Paper would be used to support its short term financial requirements.

Last year, the cement manufacturing firm, recorded a revenue of 901.21 billion naira, with Nigerian operations accounting for 618.30 billion naira, representing an increase of 11.9 percent over 552.36 billion naira in 2017.

Pan-African operations recorded revenues of 263.26 billion naira, an increase of 9.6 percent over 258.44 billion naira posted in the corresponding period in 2017. Profit after tax stood at 390.32 billion naira, up from 204.25 billion naira, while earnings per share rose from 11.65 naira to 22.83 naira. The company directors are proposing a dividend of 16 naira per share.

Further analysis of the performance showed that Dangote Cement maintained its dominance of the Nigerian market, accounting for 65 percent of the total volume sold in the domestic cement sector in 2018.

The company also exported 800,000 metric tonnes (MT) of cement to West African countries, strengthening Nigeria’s position as a cement exporting country, creating jobs in the economy, and earning foreign exchange.

The Group Chief Executive Officer, Dangote Cement, Joe Makoju, who commented on the results, said “this is a record financial performance by Dangote Cement, driven by a strong increase in our home market, Nigeria, despite heavy rains and uncertainties about the election. Although Pan-African volumes were unchanged in 2018, I am confident that we will see an increase in 2019, driven by higher volumes in Tanzania, Ethiopia, Congo and Sierra Leone”.

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