June 19, 2026/CSL Report
Dangote Sugar Refinery Plc (Dangsugar) reported a weaker topline performance in Q1 2026, with Revenue declining by 12.2% year-on-year (y/y) to ₦187.8 billion from ₦213.9 billion in Q1 2025. The decline was primarily driven by softer performance in the 50kg sugar segment, the company’s largest revenue contributor, as wholesale sugar sales fell to ₦182.1 billion from ₦207.5 billion in the corresponding period of 2025.
Despite the weaker Revenue performance, Dangsugar recorded a significant improvement in profitability during the quarter. Operating Profit surged to ₦45.8 billion, compared with ₦2.8 billion in Q1 2025, supported largely by lower Cost of Sales following the continued decline in global raw sugar prices through early 2026, as well as foreign exchange gains recorded during the period. Consequently, the company returned to profitability, posting a Profit After Tax (PAT) of ₦19.2 billion, compared with a Loss After Tax of ₦23.6 billion in Q1 2025.
Looking ahead, we forecast FY 2026 Revenue of ₦767.2 billion, representing a 7.5% y/y decline from ₦829.2 billion recorded in FY 2025. The weaker Revenue outlook reflects our expectation of continued softness in the 50kg sugar segment, which remains the primary driver of the company’s sales performance. While lower raw sugar prices supported margins in Q1 2026, we expect some cost pressures to re-emerge over the remainder of the year as global raw sugar prices begin to recover from the downward trend experienced since early 2025. Nevertheless, we project Gross Profit to increase to ₦149.8 billion in FY 2026 from ₦122.6 billion in FY 2025 while Profit Before Tax (PBT) is expected to improve to ₦38.3 billion from a loss of ₦72.3 billion recorded in the previous year.
At its current valuation, Dangsugar trades at an EV/EBITDA multiple of 8.23x, representing a modest discount to the Middle East and Africa (MEA) peer median of 9.43x. We maintain our HOLD recommendation and revise our target price upward to ₦84.56 per share from ₦73.24 per share previously, reflecting the company’s improved earnings outlook despite the weaker revenue trajectory.
To read full report, click on the link below
DANGSUGAR Q1 2026 Company Update.pdf
