Aliko Dangote explains reason he lost his wealth after elections

Dangote Industries Limited's president, Aliko Dangote, revealed that the company's primary challenge in 2023 was local currency devaluation.

Speaking at the Dangote Sugar Refinery Plc Annual General Meeting on Tuesday, April 30, Dangote noted that the domestic operating environment became challenging after a new administration was inaugurated on May 29, 2023, during the election year.

Dangote highlighted the impact of the depreciation of the naira against the US dollar on manufacturing firms, resulting in operational losses. He stated, "The biggest mess created was the naira devaluation from N460 to N1,400. You can see that almost 97% of companies in the food and beverage business will not pay dividends this year. But we will try and get out of it."

Impact on Dangote's Wealth

Earlier in the year, South African billionaire Johann Rupert briefly surpassed Aliko Dangote as Africa's richest person. Forbes reported Rupert's net worth as $10.3 billion on January 2, 2024, exceeding Dangote's $9.5 billion.

According to Bloomberg, Dangote's wealth, largely derived from his 86% stake in Dangote Cement, was affected by the devaluation. Most of his shares are held directly and through his conglomerate, Dangote Industries. However, Dangote regained his position as Africa's richest person by the end of the first quarter.

Impact on Major Companies

A report by The Punch revealed significant losses suffered by four of Nigeria's most valuable companies—Dangote Group, Nestle Nigeria, and MTN Nigeria—due to the naira's depreciation in 2023. These companies collectively lost N1.7 trillion, primarily due to foreign exchange losses.

Dangote Industries reported a significant foreign exchange loss of N164 billion in its 2023 financial report. The company attributed the loss to its foreign operations.

During the financial year 2023, Dangote Group recorded a group turnover of N441.5 billion, a 9.5% increase from the previous year. However, the company experienced a pre-tax loss of N108.9 billion and a post-tax loss of N73.8 billion, primarily due to non-cash foreign currency losses totaling N171.4 billion.

At the Annual General Meeting, Mariya Dangote was ratified as a director, while Prof. Konyisola Ajayi, Benedickter Molokwu, and Maryam Bashir were designated as retiring directors. Additionally, shareholders voted on managers' compensation, and the directors established the auditor's compensation.