Nigeria: Ashaka Cement posts 20% rise in profit

11 August 2014

Ashaka Cement, a unit of French Cement maker Lafarge, has posted a record H1 profit after tax of N3.51 billion ($25.14 million) in the first half of 2014, 201.41% higher than N1.15 billion ($7 million) in the corresponding period of 2013.

The manufacturing company enjoyed a pre-tax profit surge of 166.16%, from N1.65 billion ($10.1 million) in the first of half of 2013 to N4.39 billion ($26.9 million) in 2014. Earnings per share (EPS) tripled to N1.57k from 52k in HY 2013 as net margin, the measure of profitability and efficiency, spiked to 28.33% in 2014, from 9% in 2013.

The growth is due in part to the company’s switch to coal from the Maiganga Coal Mine in Gombe State for generating electricity. This led reduced production costs as cost-of-sales margin dipped to 58.13% in 2014, from 80% in 2013, while cost of sales also fell by 22.44% to N6.71 billion ($41.1 million).

This is as Ashakacem, based in northern Nigeria, plans an aggressive expansion across the country, having secured a N50-billion credit facility. N100 billion is also earmarked for projects like capacity expansion and a coal-fired captive power plant, which should be completed within two years.
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