March 2, 2026/Cordros Report

Dangote Cement Plc (DANGCEM) released its 2025FY audited results on 28 February, reporting a 101.3% y/y increase in EPS to NGN59.86 (2024FY: NGN29.74). The earnings expansion was driven by a 20.3% y/y growth in revenue, alongside a 741bps y/y expansion in EBITDA margin to 46.0%. The Board proposed a final dividend of NGN45.00/share, implying a 5.8% dividend yield at the closing price of NGN779.00 (27 February).

Group revenue rose by 20.3% y/y in 2025FY (Q4-25: +12.9% y/y), supported primarily by higher realised prices (c. NGN156,784/tonne; +21.3% y/y), which offset a 0.9% y/y decline in volumes to 27.45 million tonnes (Mt).

On geographical performance, Nigeria’s revenue grew by 34.8% y/y (66.2% of total revenue), while Pan-Africa operations revenue declined by 1.7% y/y (33.8% of total revenue). The growth in Nigeria’s Opco revenue was driven by a 34.8% y/y increase in prices to NGN167,186/tonne (c. USD110/tonne), while volumes were broadly flat at 17.68Mt. Additionally, exports of cement and clinker rose by 6.9% y/y to 1.40Mt, including 34 clinker shipments to Ghana and Cameroon. In Pan Africa, the drop in revenue, reflects a 1.6% drop in volumes to 10.95Mt and a marginal 0.1% decline in average pricing to c. NGN132,917/tonne (USD87.65/tonne). The volume weakness in Pan Africa was driven by softer demand in Cameroon (-14.1% y/y) and Senegal (-19.8% y/y), amid election related uncertainties and budget delays.

Meanwhile, gross margin expanded by 609bps y/y to 65.4% (Q4-25: +423bps y/y to 69.8%), as cost of sales (ex-depreciation) rose by a modest 2.3% y/y, well below revenue growth. Cost pressures were limited, with slight increases in energy (+0.3% y/y), plant maintenance (+5.5% y/y), and staff costs (+9.2% y/y), while raw material costs (-6.3% y/y) declined. The contained cost growth underscores ongoing efficiency gains from alternative fuel usage, energy optimisation, and relative FX stability.

At the same time, EBITDA and EBIT margins expanded to 46.0% (+741bps y/y) and 41.0% (+881bps y/y), respectively, despite a 9.4% y/y increase in operating expenses (ex-depreciation). OPEX growth was driven by higher staff costs (+13.8% y/y), administrative expenses (+37.1% y/y), and advertising (+197.7% y/y). Haulage costs (61.7% of OPEX) declined by 0.8% y/y, supported by stabilising diesel prices and increased deployment of CNG trucks.

Below the operating line, net finance costs declined by 54.6% y/y to NGN241.56 billion, supported by lower interest expenses (-22.7% y/y) and the FX reversal to a net gain of NGN27.80 billion (2024FY: net FX loss of NGN249.32 billion). The decline in interest expenses reflects a 55.9% y/y decline in total debt to NGN1.16 trillion, while the effective interest rate reduced by 386bps to 21.94% (202FY: 25.80%). In Q4-25, net finance costs declined by 70.3% y/y to NGN32.61 billion.

Ultimately, profit before tax (PBT) increased by 109.2% y/y to NGN1.53 trillion, while profit after tax (PAT) advanced by 101.7% y/y to NGN1.01 trillion. In Q4-25, PBT increased by 50.8% y/y to NGN491.68 billion, while PAT increased by 21.2% y/y to NGN271.66 billion.

Comment: DANGCEM delivered a strong 2025 performance, with revenue up 20.3% y/y (Cordros Estimate: +21.6% y/y), driven largely by higher pricing, particularly in Nigeria, which more than offset softer volumes. Profitability also outperformed expectations, with EBITDA margin expanding to 46.0% (Cordros Estimate: 44.6%), reflecting sustained cost optimisation, while EPS rose by 101.3% y/y to NGN59.86 (Cordros Estimate: +98.6% y/y to NGN59.05), further supported by the reversal to a net FX gain of NGN27.80 billion. However, the dividend declared came in below expectations, with DPS of NGN45.00 versus our NGN50.00 estimate, implying a 75.2% payout ratio, the lowest since 2018 (70.1%). In 2026, we expect revenue growth to be increasingly volume-led across core markets, given more limited headroom for further price increases. Nonetheless, we see scope for continued margin resilience and earnings growth, underpinned by higher alternative fuel penetration, distribution efficiencies including CNG deployment, and a relatively stable FX backdrop. Our estimates are under review.