…As revenues rise by 19% to N209bn
By Babajide Komolafe
BUA Cement has announced gross profits of N95.4 billion in its unaudited 2020 financial accounts representing an increase of 16 percent from N82.4 billion recorded in 2019.
This follows a 19 percent increase in its full year revenue to N209 billion in 2020 from the corresponding period in 2019.
This performance, according to a statement by the company, further consolidates its position as one of Nigeria’s most profitable companies – a position it is expected to strengthen further with the commissioning of its new 3 million Metric Tonnes Sokoto Cement Plant in 2021 and the addition of 3 new lines of 9 million metric tonnes total capacity in Adamawa, Edo and Sokoto States by 2023 for which it recently signed an agreement with Sinoma CBMI. This is expected to bring BUA Cement’s total capacity to 20 million metric tonnes per annum upon completion.
Speaking recently, the Managing Director, BUA Cement Plc, Mr. Yusuf Binji, said that BUA Cement’s exceptional performance in the 2020 financial year, is a reflection of the continued value and strength of the BUA Cement brand and product offerings as well as a nod to the excellent implementation of the company’s Business Continuity Plan which ensured that BUA Cement was able to withstand the impact of the pandemic throughout 2020.
In an earlier statement, Binji said that, “despite the prevailing economic conditions in 2020, BUA Cement remains quite optimistic about the future because it affords us not only with the opportunity to further evolve our business model but also provides an opportunity for accelerated development. We will continue to push to new markets aided by a focused distribution strategy.”
The company increased its net revenues by 19 per cent to N209 billion, with sales volumes up 13 per cent by about 600,000tons to 5.1 million tons in 2020. Operating profits increased to N82.5 billion whilst Profit After Tax (PAT) rose to N70.5 billion from N60.6 billion in the corresponding year.
It should be noted that BUA Cement in 2020 entered strategic alliances for the supply of Liquefied Natural Gas (LNG) at its Kalambaina Plant, Sokoto State, and for the management of its mining operations. Given these deliberate and strategic choices amongst other cost management efforts, it is expected that BUA Cement will continue to combine development and innovation into its offerings and activities to drive efficiency, reduce operating costs and maximize profits.
In a recent interview, Chairman of BUA Cement, Abdul Samad Rabiu said that despite the strides made in the Nigerian Cement Industry in the past few years, there is still room for immense growth.
According to Rabiu, Nigeria with its population of about 200 million people is still greatly underserved by the cement industry with current consumption levels at about 130 kilogrammes per head compared to smaller African countries with consumption levels at about 170 to 180 kilograms per head. Nigeria’s cement consumption is expected to increase to about 200 kilograms per head in coming years which is one of the reasons why BUA Cement is ramping up its investments in new plants to be able to meet this potential demand as well as take advantage of regional export opportunities through the African Continental Free Trade Area (AfCFTA) agreement which came into effect in 2021.
BUA Cement is the second largest Manufacturing and Cement Company listed on the Nigerian Stock Exchange with its Headquarters based in Lagos, Nigeria. The company also operates four plants in Edo and Sokoto States with its key markets in the South-East, North-West and North East Nigeria. The Company recently completed Nigeria’s largest corporate bond offering ever of N115 billion which was oversubscribed to the tune of N137.82 billion.