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Good News – Cement giants file revenue decline

by Good News

Good News – Nigeria’s cement corporations non-public reported a decline in revenue in the third quarter in comparison with the second quarter of 2021. The trio of Dangote Cement, BUA Cement and Lafarge Cement reported a mixed N469 billion in the third quarter, a 5.27% decrease when in comparison with the N495 billion reported in the outdated quarter.On the other hand, Yr-on-Yr (YoY), primarily based on the trio’s 9-month efficiency, they were in a position to enlarge their revenue by 30.10% from N1.1 trillion generated in the 9 months of 2020 to at masks stand at N1.4 trillion.Even supposing the near alternate began to recuperate from the COVID-19 pandemic in the third quarter of 2020 and went on to publish three consecutive quarters of trusty GDP boost rate, the second-quarter GDP file published that the near alternate declined by 23.08% when in comparison with the first quarter of 2021. The Right Property alternate moreover replicated a equivalent pattern as it recorded its second consecutive quarterly decline of 0.72% when in comparison with the first quarter of 2021.All three cement corporations posted impressive third-quarter performances when in comparison with the third quarter of 2020, with Dangote Cement leading the pack, accounting for 70.80% of the final revenue generated. BUA and Lafarge accounted for 13.37% and 15.84% respectively.Dangote Cement Plc generates N331.6 billion in Q3Dangote Cement Plc, Nigeria and Africa’s supreme indigenous cement producer posted its supreme revenue of the trio. QoQ, the cement huge’s revenue declined by 7.34%, from N357.9 billion generated in the second quarter to N331.6 billion generated in the third quarter.On the other hand, attempting at its 9 months efficiency, the cement producer has generated ₦1.02 trillion, ravishing 1.16% beneath what it generated in its paunchy-year 2020 file. Compared with the 9 months of 2020, the corporate elevated its revenue by 34.24%. It accounts for 71.57% of the final revenue generated by the trio this year.The company’s financials demonstrate a decline in cement sales, when in comparison with the second quarter of 2021. In Q3, Dangote sold 6.89 MT of cement and clinker quantity which when in comparison with Q2, represents a decline of 11.22% as the corporate sold 7.76 MT.Diving deeper into their sales quantity, sales in each Nigeria and Pan-Africa declined. Compared with Q2, the sales quantity in Nigeria declined by 13.83% from 4.96 MT to 4.38 MT in Q3 2021 whereas for Pan-Africa, sales quantity moreover declined by 5.4% from 2.85 MT recorded in Q2 to 2.70 MT recorded in the third quarter of 2021. This decline in quantity affected the corporate’s revenue in the third quarter no matter the marginal enlarge in the tag of cement in the quarter.In step with Nigerian Charge, Dangote cement now goes for a retail tag of N3,900 per 50kg internet. In April, Dangote cement used to be being sold for N3,800. This represents a 2.63% between the second quarter and the third quarter.Michel Puchercos, Neighborhood Chief Govt Officer, acknowledged, “We’re contented to file a stable do of the outcomes for the first 9 months of the year. Neighborhood volumes for the 9 months were up 15.4% in comparison with the first 9 months of 2020 and Neighborhood EBITDA used to be up 45.0%, at a 50.4% margin. “Given the stable rebound in Q3 2020 following the impact of COVID-19 in the first half of the year, volumes in Q3 2021 were a tiny decrease than Q3 2020, as anticipated, even though worsened by heavier rains. On the other hand, the final boost pattern continues, supported by our ability to meet the stable market demand all over all our countries of operation. The industrial efficiency and effectivity initiatives all over the Neighborhood enabled the offsetting of inflationary pressures on some of our tag lines.”Lafarge Plc’s QoQ revenue grew marginally by 0.86%Of the trio, Lafarge used to be the supreme one to develop its revenue when in comparison with the second quarter of 2021. The company, touted to be the second-supreme cement company, generated a entire of N74.1 billion in the third quarter of the year. When in comparison with the N73.5 billion generated in Q2 2021, it represents a 0.86% enlarge. its 9 months efficiency, the corporate grew its revenue by 21.86% from N180 billion generated in the first 9 months of 2020 to N220 million generated in the first 9 months of 2021. It accounts for 15.35% of the final 9 months revenue generated by the trio.As reported by Nairametrics, in April Lafarge elevated its cement tag from N2,400 to N3,600, representing a 50% enlarge in the tag of cement. The company acknowledged that tag increment used to be principal to offset some of the inflationary pressures, no matter the original tag carve worth initiatives the corporate has taken comparable to the use of LNG fueled autos. In step with Nigerian Charge, Lafarge’s Elephant Cement now goes for N3,750. This represents a 4.16% enlarge.BUA generates N187 billion up to now in 2021BUA Cement Plc generated the least of the three cement corporations, producing supreme roughly N62.6 billion in the third quarter of the year. When in comparison with its efficiency in Q2 2021, its revenue generation declined by 0.73%. its 9 months efficiency, the corporate’s revenue accounted for supreme 13.09% of the final revenue generated by the trio. Even supposing it accounted for the bottom of the three, the corporate smooth recorded an enchancment as it generated N187 billion in the 9 months of 2021, which represents a 19.39% enlarge when in comparison with the N156.5 billion generated in the first half of 2020.After the corporate acknowledged that they would no longer enlarge the tag of cement, it can possibly appear fancy they did a U-flip on this decision. In April, Nairametrics reported an announcement made on the BUA Cement’s reliable Twitter tale which acknowledged that the ‘timing is rarely any longer ravishing,’ for any enlarge in the tag of its cement. At the time, BUA cement used to be promoting for N3,250. In step with Nigerian Charge, BUA cement now goes for N3,750, a 15.38% enlarge.The incomes presentation call disclosed that the revenue per ton recorded between the second and third quarter of 2021 finds a 1.64% enlarge from N45,479.14/ton to N46,224/ton, moreover reflecting the enlarge in the tag of cement.The CEO of BUA Cement Plc explained that the quarterly decline used to be no longer a outcomes of a decline in demand nonetheless used to be a outcomes of annual repairs on the vegetation. Yusuf Binji acknowledged, “The enlarge in revenue resulted from tag enlarge along with lifting bonus changes… The cement demand has remained stable in the previous 365 days and of route you can non-public united states of americaand downs. The runt decrease witnessed quarter on quarter is mostly in consequence of the shutdown for the annual repairs, by which our manufacturing a tiny dipped and it’s some distance rarely any longer for the reason that demand used to be no longer there. We continued to experience very very stable demand even in the low season historically from July to September.”Even supposing the trio collectively posted declines in revenue when in comparison with the outdated quarter, they smooth desire a collective market capitalization of N7.73 trillion as of the conclude of market on Tuesday, November 9, 2021.

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