April 30, 2026/Cordros Report

Lafarge Africa Plc (WAPCO) released its unaudited Q1-26 financial results yesterday (29 April), reporting EPS growth of 101.4% y/y to NGN6.08 (Q1-25: NGN3.02). The strong earnings performance was driven by revenue growth (+34.8% y/y), EBITDA margin expansion (+13.26ppts y/y to 45.2%), and a significant increase in net finance income (+440.3% y/y to NGN7.85 billion).

WAPCO’s revenue grew by 34.8% y/y, supported by strong performance across all segments – cement (+35.0% y/y | 97.8% of revenue), aggregates & concrete (+28.6% y/y | 2.1% of revenue), and mortar & power (+6.8% y/y | 0.1% of revenue). Growth was driven by a combination of higher volumes, reflecting stronger demand conditions during the period, and higher pricing. On a quarter-on-quarter basis, revenue increased by 17.2%.

Gross margin expanded strongly by 11.84ppts y/y to 61.4%, as cost of sales grew at a slower pace (+3.2% y/y) relative to revenue. This reflects continued benefits from cost efficiency initiatives, including increased use of alternative fuels and raw materials. Notably, the modest growth in COGS was driven by higher production variable costs (+2.6% y/y | 68.4% of COGS) and maintenance costs (+21.6% y/y | 9.5% of COGS), which outweighed the 11.1% y/y decline in production fixed costs (14.8% of COGS). 

Similarly, EBITDA and EBIT margins expanded materially by 13.26ppts y/y and 13.33ppts y/y to 45.2% and 42.2%, respectively, despite a 23.3% y/y increase in operating expenses. The rise in OPEX was driven by higher advertising (+190.4% y/y), staff costs (+50.7% y/y), and general expenses (+89.0% y/y). Nonetheless, the OPEX-to-sales ratio improved to 19.1% (Q1-25: 20.9%).

Below the operating line, WAPCO reported a net finance income growth of 440.3% y/y to NGN7.85 billion in Q1-26 (Q1-25: NGN1.45 billion). This was supported by a 559.4% y/y increase in finance income and an 81.2% y/y decline in finance costs.

Finally, profit before tax (PBT) increased by 104.0% y/y to NGN149.12 billion, while profit after tax (PAT) increased by 101.4% y/y to NGN97.95 billion, after accounting for a tax expense of NGN51.17 billion.

Comment: WAPCO delivered a strong Q1-26 performance, supported by improved demand, higher pricing, and continued cost efficiency gains from alternative fuel usage and logistics optimisation. We expect earnings momentum to remain firm in 2026E, underpinned by sustained construction activity, higher pricing and ongoing efficiency initiatives. However, inflationary pressures, particularly from elevated oil prices, remain a key risk, with potential to drive higher energy and logistics costs which might weigh on margins. Our estimates are under review.