March 3, 2025/CSL Research

Financial Highlights:

• Revenue +62.2% y/y to N3.58TN
• Cost of Sales (ex-depreciation) +64.8% y/y to N1.46TN
• OPEX (ex-depreciation) +72.74% y/y to N799.75BN
• EBITDA +56.0% y/y to N1.38TN
• Operating Profit +56.9% y/y to N1.15TN
• Profit before Tax +32.4% y/y to N732.54BN

Stock Rating: BUY Target Price: N505.33/s

Dangote Cement’s recently released FY 2024 results show a significant 62.2% y/y increase in Revenue, rising to N3.58tn from N2.21tn in FY 2023. However, on a quarter-on-quarter basis, Revenue increased by 27.4%, reaching N1.02tn in Q4 2024, up from N800.52tn in Q3 2024. The impressive y/y Revenue growth was driven by a combination of price hikes and increased sales volumes, particularly from its Nigerian operations. Specifically, the company’s group total prices surged by 59.65%, averaging N129,224 per ton in FY 2024, compared to N80,942 per ton in FY 2023. 

Meanwhile total sales volume rose by 1.6%, reaching 27.71 million metric tons in FY 2024, up from 27.28 million metric tons in the previous year.

The Nigerian operations’ sales volume increased by 7.9%, reaching 17.7 million metric tons, up from 16.4 million metric tons in FY 2023. The company attributed this growth to stronger promotional activities and enhanced market access, which boosted product visibility and helped offset the impact of heavy rainfall and flooding. 

Prices in Nigeria also reflected broader macroeconomic conditions, rising by 56.64% to an average of N144,000 per ton in FY 2024, up from N79,163 per ton in FY 2023. As a result, Revenue from Nigerian operations grew by 69.0%, reaching N2.19tn in FY 2024, compared to N1.30tn in FY 2023.

While Revenue growth remained strong across Dangote Cement’s Pan-African operations, total sales volume declined slightly by 1.1%, from 11.3 million metric tons in FY 2023 to 11.1 million metric tons in FY 2024. Management attributed this decline to adverse weather conditions faced in Tanzania, and election-related uncertainties in Senegal and South Africa. Despite lower sales volumes, price increases were the main driver of Revenue growth in the Pan-African segment. Average prices rose by 61.73%, reaching N133,087 per ton in FY 2024, up from N82,291 per ton in FY 2023.

Consequently, Revenue from Pan-African operations grew by 60.0%, reaching N1.48tn, compared to N925.93bn in FY 2023.

In FY 2024, the group’s Cost of Sales (adjusted for depreciation) rose by 64.8% y/y, increasing to N1.46tn from N883.77bn in FY 2023. This increase was primarily driven by a significant rise in plant maintenance costs (+88.79% y/y), increases in production expenses (+80.80% y/y), fuel and power consumed (+70.32% y/y), and materials consumed (+47.55% y/y). Despite these rising costs, Gross Profit grew by 60.4% y/y, reaching N2.12tn in FY 2024, up from N1.32tn in FY 2023.

However, the Gross Margin declined by 0.6 percentage points, falling to 59.3% in 9M 2024 from 60.0% in FY 2023.

Given the current inflationary environment and the persistent depreciation of the Naira, which have negatively impacted operating costs, the company’s Operating Expenses (adjusted for depreciation) rose by 72.74% y/y, increasing to N799.75bn in FY 2024 from N462.99bn in FY 2023. This increase was largely due to a 71.0% y/y growth in Selling and Distribution Expenses (adjusted for depreciation) and a 78.2% y/y rise in Administrative Expenses (adjusted for depreciation).

In FY 2024, Other Income—which includes insurance claims, government grants, and miscellaneous sources—surged by 128.7%, reaching N57.07bn. Meanwhile, EBITDA rose by 56% y/y to N1.38tn, up from N885.43bn in FY 2023. However, the EBITDA margin declined by 1.5 percentage points, falling to 38.6% from 40.1% in FY 2023, reflecting higher operating costs.

Despite a 51.5% increase in Depreciation and Amortization, which rose to N228.96bn, Operating Profit grew by 56.98% y/y, reaching N1.15tn, up from N734.27bn in FY 2023.

Net Finance Cost surged by 87.5% y/y to N531.73bn, up from N283.56bn in FY 2023. This increase was driven by a significant rise in Finance Costs, which grew to N700.30bn from N310.96 billion. The rise in Finance Costs was largely attributed to foreign exchange (FX) losses, which increased 51.95% y/y to N249.32bn, up from N164.08bn in FY 2023, due to the further devaluation of the Naira and higher interest expenses, contributing to the overall rise in borrowing costs. Conversely, Finance Income also rose to N168.57bn from N27.41bn.

In FY 2024, Pre-Tax Profit increased by 32.4% y/y, rising to N732.54bn, up from N553.10bn in FY 2023. However, Tax Expenses surged by 135.1%, reaching N229.29bn, which moderated overall profit growth. As a result, Net Income rose by 10.5% y/y to N503.25bn, compared to N455.58bn in FY 2023. Earnings per Share (EPS) improved to N29.74, up from N26.47 in the previous year.

We have a target price of N505.33/s for Dangote Cement with a Buy recommendation. Current Price; N480.00/s.

Source: Company Data. CSL Research

To read the full report, click on the link below​​

​Dangote Cement Quick Take FY 2024.pdf​​​​​​​​​​​​​​​

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