Dangote Cement Plc’s 2024 Financial Performance: A Year of Significant Growth and Expansion
Dangote Cement Plc, a leading cement producer in Africa, experienced robust financial growth in 2024, marked by a substantial increase in revenue and expansion in its operational capacity. The company’s financial statement revealed a remarkable 62% surge in revenue, reaching N3.58 trillion compared to N2.21 trillion in 2023. This impressive growth underscores the company’s dominant market position and its ability to capitalize on increasing demand for cement in its operating regions. While the cost of sales also increased proportionately, the company maintained a healthy gross profit of N1.93 trillion, representing a 61% increase from the previous year. This indicates effective cost management strategies despite escalating input prices.
The company’s operating expenses witnessed significant increases, with administrative expenses rising by 74% and selling and distribution expenses surging by 69.5%. These increases can be attributed to factors such as inflationary pressures, expansion into new markets, and increased marketing efforts to maintain market share. However, other income also experienced substantial growth, rising by 129% to N57.07 billion, contributing to the overall profitability of the company. The profit from operating activities saw a healthy 57% growth, demonstrating the company’s operational efficiency and strong market demand for its products.
Dangote Cement’s financial performance also highlights the impact of financing activities on its bottom line. Finance costs witnessed a significant 125% increase, reaching N700.3 billion. This surge in finance costs is likely attributed to increased borrowings for capacity expansion and working capital needs, reflecting the company’s aggressive growth strategy. However, a substantial 515% increase in finance income, driven by investments and interest earned on deposits, partially offset the increased finance costs. The company also recorded a N109.4 billion net monetary gain, further bolstering its financial position.
The resulting profit before tax for the period under review was N732.54 billion, representing a 32% increase from the previous year. While tax expenses rose significantly by 135%, reflecting higher profitability and changes in tax regulations, the company still managed to achieve a 10.5% increase in profit after tax, reaching N503.25 billion. This demonstrates the company’s resilience in a challenging economic and regulatory environment. The reported earnings per share also saw an increase, further reinforcing the positive financial performance of the company.
A deeper dive into the company’s operational segments reveals the strong performance of its Nigerian operations, which generated N2.19 trillion in revenue and recorded a profit after tax of N1.18 trillion. However, the Pan-African operations faced some challenges, recording a loss of N24.37 billion. This underscores the complexities and varying market dynamics across different African regions. Despite this setback, the overall performance of the group remained positive, driven by the strong performance of the Nigerian operations.
Dangote Cement’s growth trajectory is further underscored by its strategic investments in expanding production capacity. The company secured a $675 million loan from Afreximbank to support its ongoing expansion projects. This financing will enable the company to enhance its production capabilities and strengthen its market position. Furthermore, the company’s $400 million investment to restart a second production line at its Mugher cement plant in Ethiopia demonstrates its commitment to expanding its Pan-African footprint and capturing growth opportunities in new markets. Doubling the plant’s annual output to 5 million tonnes signifies the company’s ambition to become a dominant player in the East African cement market.
The company’s total assets stood at N6.4 trillion, highlighting its significant asset base and financial strength. However, total liabilities also increased to N4.23 trillion, reflecting the company’s increased borrowings for expansion activities. The substantial net additions to non-current assets, excluding deferred tax, amounting to N1.97 trillion, further emphasize the company’s focus on long-term growth and investment in productive assets. This strategic investment will likely contribute to increased production capacity and future revenue growth.
Overall, Dangote Cement Plc’s financial performance in 2024 paints a picture of a company experiencing robust growth and strategically positioning itself for future success. The significant increase in revenue, coupled with investments in capacity expansion and strategic financing, sets the stage for continued growth in the coming years. While challenges remain in certain operational segments, the company’s strong financial position, market leadership, and ambitious expansion plans suggest a positive outlook for its future prospects. The company’s continued success will be crucial for meeting the growing demand for cement in Africa and contributing to the continent’s infrastructure development.
