Cement Firms Post N984.4bn Pre-tax Profits On Price Increases

Listed cement companies on the Nigerian Exchange Limited have posted significant pre-tax profits of N984.432 billion, driven by volume growth and strategic price adjustments.

This growth was driven by broad-based price adjustments in response to inflationary pressures and macroeconomic reforms. Cement products in the country have been on the rise in 2024, with prices rising as high as N8,000 per bag.

The listed companies, which are the top cement producers in the country, Dangote Cement, Lafarge Africa and BUA Cement, in their audited results for the year ended December 31, 2024, showed a combined profit of N984.432 billion, representing 45.93 per cent increase from the previous year of N674.574 billion.

Dangote Cement recorded a profit before tax of N732.537 billion, an increase of 32.33 per cent from N533.104 billion in 2023.

Lafarge Africa achieved a pre-tax profit of N152.265 billion, a 93.27 per cent rise from N78.781 billion during the same period in 2023, while BUA Cement also saw its PBT increase by 48.20 per cent, reaching N99.630 billion compared to N67.228 billion in 2023.

The Nigerian cement industry experienced significant growth in 2024, driven by increased demand and strategic expansions by major players. As of June 2024, the industry’s combined production capacity stood at 62.8 million metric tons per annum (MMTPA), spread across five geopolitical zones.

Industry majors are expanding their manufacturing plants to support export activities, which could boost growth as this indicates a resilient and growing cement industry in Nigeria, driven by strategic investments and expanding demand.

Speaking, the vice president of Highcap Securities Limited, David Adonri said that it reflects the high demand for infrastructure development.

Adonri noted that Nigeria’s cement companies have posted significant profits, driven by volume growth and strategic price adjustments, saying that “the cement companies’ strong performance can be attributed to increased demand, driven by government infrastructure projects and private sector construction activities. Additionally, strategic price adjustments helped the companies to maintain profitability despite rising operational costs and inflationary pressures.”

The chief operating officer of InvestData Consulting Limited, Ambrose Omordion, said that Nigeria’s listed cement companies had a profitable 2024 despite economic challenges, saying that these impressive financials are attributed to the cement companies’ strategic decision to increase prices, which helped them navigate economic challenges and maintain profitability.

On the 2025 outlook, Comercio Partners stated that, “the expected reduction in interest rates by the Central Bank of Nigeria in 2025 is set to lower borrowing costs, benefiting capital-intensive industries such as cement manufacturing and infrastructure development.”

It added that, “for cement producers such as Dangote Cement, BUA Cement, and Lafarge, the stabilisation of inflation is likely to ease operational cost pressures, enhancing profit margins. Additionally, cost-saving initiatives such as Dangote’s transition to compressed natural gas (CNG) trucks will support profitability. BUA Cement is expected to benefit from improved transparency and stability in the foreign exchange system, boosting profitability.”

The chief executive officer of Dangote Cement, Arvind Pathak, said, “we wrapped up 2024 with strong momentum, driven by our focus on operational efficiency and excellence. Our Group volumes grew by 1.6 per cent year-on-year, reaching 27.7 million tonnes, driven by a strong recovery in Nigeria, where we improved efficiency and boosted sales growth by 7.9 per cent.”

Also, speaking on the performance, the CEO of Lafarge Africa, Lolu Alade-Akinyemi, said, “I am excited to report our record-breaking revenue of N697 billion and PAT of N100 billion for the full year 2024, a testament to our strong market positioning, operational efficiency, cost management and dedication to value creation.”

He stressed that, “despite a challenging business environment, we have remained resilient, leveraging innovation and green growth in line with our sustainability ambitions, while also delivering value to our stakeholders.”

Alade-Akinyemi noted that, “The Nigerian Infrastructure and Construction Sector is expected to continue to grow despite inflationary pressure on purchasing power. As a result, we maintain our positive outlook for 2025, with market recovery expected to continue at similar growth in 2024.

“We will continue to maximise volume opportunities across our markets and actively manage our costs. We remain committed to our sustainability ambitions and strategy of ‘Accelerating Green Growth’ through innovative building solutions and delivery of stakeholder value.”