Lafarge Africa Profit Drop By 20%

Lafarge Africa Profit Drop By 20%

Oladejo Amos

Lafarge Africa Plc has reported a dip in its key performances in the group consolidated and separate financial statements for the financial year ended December 31, 2015.

The group’s profit after tax dropped N6.547 billion, a decline of 19.52 per cent, from N33.545 billion recorded in the same period of 2014 to end the current year at N26.998 billion.

According to the results presented to the Nigerian Stock Exchange, profit before tax stood at N29.275 billion at the end of 2015 from N40.358 billion of 2014, this is N11.083 billion which is 27.46 per cent decline.

The cement producing company’s spent 69.12 per cent of its revenue on cost as its cost of sales rose to N184.703 billion against N177.783 billion which is 68.17 per cent of revenue spent on the same purpose during the 2014 financial year.

Lafarge Africa revenue slightly increased by N6.424 billion translating to 2.46 per cent at the end of 2015 year end.

Its earnings per share slumped by 138 kobo or 17.99 per cent from 767 kobo in 2014 to 629 kobo in 2015.

The total equities and liabilities of the group increased by N37.065 billion from N415.947 billion of 2014 to N453.012 billion it made at the end of 2015 financial year.

In the same vein, Lafarge Africa declared N3.60 kobo dividend for their shareholder, which is lower than N3.60 kobo paid last year.

 Commenting on the results, the Chief Executive Officer of the company, Mr. Peter Hoddinott maintained that the company continues to deliver good performance with significant upsides to come as new cement and power generation capacities come on stream and synergy benefits from the merger in Nigeria flow through.

He said, “Our company’s business integration process has been successful and as a company we are optimistic to deliver improving performances in 2016 and beyond, improving value to our shareholders”.

On the future outlook, he explained that the company’s overall Nigerian cement market is foreseen to grow robustly in 2016 behind a strong individual home building segment.

He stressed that the Federal Government of Nigeria has also shown strong indications to support Infrastructure growth in the coming year.

“Lafarge Africa will be able to leverage its unique footprint in 2016 with Ashaka returning to growth, ReadyMix securing high volume contracts to support its 8 existing, and new plants to be commissioned as well as the new 2.5 million tons cement line due to be commissioned in Mfamosing in half year,” he added.

He noted that the South African market will remain challenging, but Lafarge Africa will leverage the 2015 investments within the cement operations with a revamped sales team and route to market.

“In aggregates, the company will continue to benefit from its strong network delivering results with two new quarries, being opened in the Gauteng market and Ready-Mix growth. Overall, new strategies in penetrating retail, new geographies and the technical segment are expected to allow Lafarge Africa volumes to grow above a flat market in all three product lines.

“Overall, the Lafarge Africa group will continue to seek innovative ways of improving product offerings in the Nigerian cement, concrete and aggregate market in 2016,” he said.