Nigeria’s largest sugar refinery, Dangote Sugar Refinery Plc, recorded strong improvements in performance indices for the nine months ended September 30, 2022.
The sugar refiner’s unaudited results posted on the Nigerian Exchange portal revealed profit before tax (PBT) of N36.27 billion for the period under review, rose by N13.17 billion compared to N23.10 billion posted in the corresponding period in 2021.
Profit after tax (PAT) rose from N15.51 billion to N24.83 billion while revenue went up from N195.50 billion to N288.32 billion. The earnings growth primarily reflected a 61.9 per cent rise in sales to N102.9 billion.
Topline performance mirrored growths in the 50kg, retail and molasses segments, which constituted 96.9 per cent, 1.9 per cent, and 0.6 per cent of revenue, respectively. Further down, the combined effect of operational efficiency (evinced by a lower OPEX-to-sales ratio) and the trickle-down of the buoyant sales growth resulted in an operating profit margin expansion of 7.23 points to 15.32 per cent.
The company’s annualised return on equity (ROE) and return on assets (ROA) are currently at 24.5 per cent and 7.9 per cent, respectively as against 17.4 per cent and 6.9 per cent in full year 2021.
Group managing director, Dangote Sugar Refinery Plc, Ravindra Singhvi, in his remarks, attributed the positive results in the nine months to key trade interventions introduced during the year and positive market responses.
He said: “our impressive performance in the period demonstrates our resilience in the face of prevalent challenges, which rightly reflected in strong topline growth shown in the financial results.”
It should be recalled that Dangote Sugar Refinery recorded a profit before tax (PBT) of N29.73 billion for the half year ended June 30, 2022 while profit after tax (PAT) hit N20.24 billion in that period.
Meanwhile, Dangote Sugar Refinery has continued to implement its sugar backward integration projects plans and the enhancement of its Outgrowers Scheme to support the economic growth of the immediate communities. The aim is to develop a robust outgrower scheme with about 5,000 outgrowers when the projects have fully taken off, in addition to the achievement of other targets of its Sugar for Nigeria Project plan.
The key focus is of the sugar refiner is achievement of the Dangote Sugar Backward Integration Projects targets and put Nigeria on the path of sugar self-sufficiency and the world sugar map.
Employee Health & Safety as well as that of its partners remains a top priority at the company’s operations at the Apapa Refinery, its Sugar Backward Integration Operations in Numan, Adamawa State and Tunga, Nasarawa State. All processes are in compliance with stipulated health and safety protocols.
Chairman of the company, Aliko Dangote recently said, the goal of Dangote Sugar Backward Integration Projects Master plan remains the achievement of 1.5 million MT annually from locally grown sugarcane in support of the quest for sugar sufficiency in the country by the federal government of Nigeria.
He stated that this will be achieved in addition to the extended value chain benefits that will be derived from the projects including thousands of jobs that will be generated in the sector from these projects.
According to Dangote, efforts were made by all stakeholders to provide support that would help in cushioning these challenges during the period under review. Several teams from the supervising agencies and federal ministries took tours of our sugar backward integration sites, which helped them access and appreciate the volume of investments that have been made so far, the level of work done, progresses made and the challenges we are faced with in the project’s development.
He assured of the company’s commitment to the achievement of Sugar Backward integration projects, which is the future of the industry in Nigeria, saying this will keep us on our sustained growth path and we will continue to deliver and improve our quality service while delivering value to all stakeholders.
Singhvi also said that the company remained ahead of the pack in implementation of the National Sugar backward Integration Development Master Plan, saying achievement of the Dangote Sugar Master Plan remained paramount in the Company’s operations.
He explained that “steady progress is now being made as we continue the rehabilitation and expansion project at Dangote Sugar, Numan; and development activities at the Nasarawa Sugar Company Limited, Tunga.
“The board and management remain resolute and commitment to ensuring a sustainable future for our business with the Dangote Sugar Master Plan.”
Singhvi added that the implementation of the sugar projects initiatives continue at a high tempo despite the challenges the company face, ranging from the inability to access the land acquired for the sugar projects, community unrests and the aftermath of the COVID-19 pandemic negative impact on the economic activities.
He said: “we remain confident that the backward integration programme will deliver huge benefits and positive impacts on the country’s economic land scape.”
Dangote Sugar Refinery is Nigeria’s largest producer of household and commercial sugar with 1.44M MT refining capacity at the same location, refines raw sugar imported from Brazil to white, Vitamin A fortified refined granulated white sugar suitable for household and industrial uses.
Its Backward Integration goal is to become a global force in sugar production, by producing 1.5M MT/PA of refined sugar from locally grown sugar cane for the domestic and export markets.
To achieve this, Dangote Sugar Refinery acquired DSR Numan Operations (Savannah Sugar Company Limited), located in Numan, Adamawa State in December 2012, and embarked on the ongoing rehabilitation of its facilities and expansion of its 32,000 hectares’ sugarcane estate.
In September 2020, the scheme of merger between DSR and Savannah Sugar Company Limited was completed which gave birth to a bigger and stronger business with considerable opportunity for growth and delivery of superior benefits to all stakeholders. The expansion of the Numan sugar estate is still ongoing as well as the development of the greenfield site acquired at Tunga, Nasarawa State for the achievement of DSR’s sugar for Nigeria development master plan.
