December 15, 2020/Proshare

By Stanbic IBTC Stockbrokers

We are pleased to inform you that the book build for the BUA Cement PLC (“BUA Cement” or the “Company”) Series 1, up to NGN 100 billion 7-year Fixed Rate Senior Unsecured Bonds, under its NGN200 billion Debt Issuance Programme opens on Tuesday, 15 December 2020 and will close on Monday, 21 December 2020. 

BUA Cement was formed as a result of the merger between CCNN PLC and Obu Cement Company PLC and is the third most capitalized company on the Nigerian Stock Exchange. BUA Cement is a fully integrated cement manufacturer, with 3 modern factory lines across two States. BUA Cement has an installed capacity of 8 million metric tonnes and is the largest cement producer in the North-West, South-South and South-East regions of Nigeria. Despite the breakout of the COVID-19 pandemic, the Nigerian cement sector has recorded increased profitability given the infrastructure deficit in the country. Nigeria’s per capita cement consumption of 109kg is below global average of 521kg. BUA Cement reported a 21% and 24% year-on-year growth in revenue and profit after tax respectively as at September 2020 which is consistent with growth in prior years. The Company’s EBITDA margin of 46.4% for the same period is one of the highest amongst listed corporates on the NSE. BUA Cement is a lowly geared company with debt to equity ratio at 0.3x and debt service ratio of 4.3x.

The Company expects to sustain growth by unlocking added synergy benefits, increasing foothold on existing and into new markets whilst consolidating its’ current market share, and implementing lower cost energy mix across plants. BUA Cement is looking to launch a debut offering in the bond markets and plans to utilize proceeds of the bond issuance to refinance a shareholder loan, fund a debt service reserve account and for working capital purposes.

Please see terms of the offer below;