Dangote Cement reports N732.537 billion pre-tax profit in 2024, sustains dividend per share of N30 

According to the annual report and financial statements reviewed by Naijaonpoint, the company’s full-year revenue surged by 62.16% YoY to N3.581 trillion, driven by strong revenue from Nigeria (57%) from the sale of cement and clinker.

In line with its dividend policy, the Directors have recommended a dividend of N30.00 for the 2024 financial year (same as in 2023). The Board considers this dividend appropriate and aligned with the company’s strategic growth objectives, reinforcing investor confidence and shareholder value.

Revenue growth and key drivers: The 62.16% YoY increase in revenue to N3.581 trillion was primarily driven by strong performance across key markets:

This indicates that while both segments experienced robust growth, Nigeria remains the dominant revenue contributor, accounting for approximately 58% of total revenue.

Despite the impressive revenue growth, total production capacity remained at 52 million tons, suggesting that the company is operating within its existing infrastructure without major capacity expansions.

The modest increase in production and sales volumes (both under 2%) suggests that the revenue surge was not volume-driven, but rather influenced by higher pricing, improved product mix, and possibly foreign exchange effects.

The 57% YoY growth in Pan-African revenue shows the company is successfully expanding outside Nigeria.

This diversification helps mitigate risks associated with overreliance on the Nigerian market, especially given macroeconomic uncertainties like inflation and currency fluctuations.

The cost of sales grew faster than revenue, driven by rising raw material costs and high fuel expenses. These two components account for over 67% of the total cost of sales.

Despite this, the gross profit margin remains strong at 54%, indicating that cost of sales consumes about half of the revenue.

Selling, distribution, and administrative expenses increased significantly, collectively absorbing 56% of gross profit, leading to a decline in operating profit margin to 32% (3.24% lower than in 2023).

However, the margin of 32% is still solid, reflecting the company’s ability to maintain profitability despite cost pressures.

Finance income surged to N169 billion, supported by gains on the net monetary position. However, this was overshadowed by soaring finance costs of N700.299 billion, mainly due to:

The high interest expense can be attributed to the 286% increase in net debt, which rose to N2.182 trillion in 2024.

As a result, the interest coverage ratio declined to 2.57x from 5.08x in 2023, indicating a reduced ability to cover interest obligations.

As a result, the interest coverage ratio declined to 2.57x from 5.08x in 2023, indicating a reduced ability to cover interest obligations.

The balance sheet expanded significantly, with total assets growing by 62%, while shareholders’ funds also increased.

This resulted in a stable leverage ratio of 2.94x, suggesting a relatively balanced financial position.

However, the asset turnover ratio declined by 0.56%, indicating a reduced efficiency in utilizing assets to generate revenue.

With the declines in asset turnover and net profit margin, return on equity (ROE) fell to 23.14%, despite a marginal increase in leverage.

Nonetheless, ROE remains at a decent level, reflecting sustained profitability.

Retained earnings remain strong at N1.027 trillion, supporting the company’s ability to increase its dividend payout.

However, the Board has declared a dividend of N30 per share for the 2024 financial year, maintaining the same level as in 2023.

How this will impact on share price performance will depend on market sentiment, as the stock has only returned 0.25% YtD as of February 2025.