Lafarge Africa annual profit surges by 98.8% to N30.8 billion in 2020

Lafarge Africa Plc, one of the largest manufacturers of cement in the country recently declared a 98.8% year-on-year growth in profit to N30.8 billion for the financial year of 2020, when compared to the N15.5 billion reported in 2019.

This strong bottom-line growth can be linked to the cost optimization strategy deployed by the cement maker to reduce loss arising from unproductive assets.

This move led to the improvement in the company’s recurring EBIT margin (Earnings Before Interest and Taxation), as it increased from 16% in 2019 to 20% in 2020.

Lafarge’s revenue expanded by 8.3% year-on-year to N230.6 billion, driven by the strong demand for cement. The growth in the company’s revenue arising from the sales of cement offset the decrease in revenue from the sales of aggregates and concrete in 2020.

Revenue generated from the sales of cement increased by 9.14%, while the revenue Lafarge generated from the sales of aggregate decreased by 25.47%.The company’s earnings per share increased by 98.9% year-on-year, from 96 kobo to 191 kobo.Free Cash Flow (FCF) increased by 2.6% year-on-year to N47.4 billion from N46.2 billion.In line with this, Lafarge announced a N1.00 per share dividend for the shareholders, subject to appropriate withholding tax and approval at the company’s AGM on Friday 30th April 2021.The cement company generated a net cash flow of N63.74 billion from its operating activities lower than 2019 figures (N80.23 billion).Commenting on the company’s financial performance Khaled El Dokani, CEO of Lafarge Africa stated:

“Our “HEALTH, COST & CASH” action plan delivered results in 2020 amidst the COVID-19 pandemic, which triggered inflationary and Naira devaluation pressures and production challenges.”

“Full-year 2020 results remained resilient, with net sales of +8.3%, recurring EBIT of +30.8% and net income of +98.8%. We are proud of our people, who stand with our communities, and of our sustainability commitments to accelerate the net-zero pledge through affordable clean energy and our agri-ecology footprint.”