Lafarge Africa Shareholders to Receive 100k Dividend as Firm Returns to Profitability

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Goddy Egene

Shareholders of Lafarge Africa Plc are to receive a dividend of 100 kobo per share for the 2019 financial year, after some years without dividend pay-out.

The payment of dividend followed the return of the cement company to profitability. Details of the audited results of the Lafarge Africa Plc made available yesterday, showed a revenue of N213 billion for the year ended December 31, 2019, as against N218 billion in 2018.

Operating expenses were reduced from N29.89 billion to N23.42 billion. The company ended the year with a profit after tax of N15.5 billion compared with a loss of N8.1 billion in 2018. Based on the positive performance, the board has recommended a dividend of 100 kobo per share.

Commenting on the results, the Managing Director/Chief Executive Officer of Lafarge Africa Plc, Mr. Khaled El Dokani, said: “Our turnaround and cost-reduction strategy in 2019 and the divestment of the South African business, have delivered strong results. The decrease in net debt has significantly strengthened our balance sheet and has placed us in a vantage position to face the future.”

Looking ahead, Dokani, said the coronavirus (COVID-19) pandemic now impacts Nigeria, Lafarge Africa had taken the necessary measures to protect the health of its employees, customers, suppliers and other stakeholders.

“The construction sector and construction sites are generally more resilient than other sectors and Lafarge Africa has a strengthened balance sheet and is well equipped to weather the storm. However, we are closely monitoring the evolving situation and the impact of the COVID-19 pandemic on the Nigerian market,” he noted.

In the assessment of analysts at Cordros Securities Limited, said the result showed that the company’s 2019FY earnings per share (EPS) settled N7.15 per cent, up from a loss position in the previous year.

According to Cordos Securities, the positive out turn was driven by the one-off gain from the sale of Lafarge South Africa Holdco (LSAH) in the third quarter (Q3) of 2019.

“We understand that the comparative year now excludes the profit and loss statement of LSAH. Adjusting for the gains from the discontinued operation, Lafarge’s core EPS grew marginally by 2.8 per cent, supported by the blend of lower finance charges, higher other operating income, and lower operating expenses. On the 2019FY reported EPS, the board has proposed a final dividend of NGN1.00/share, which implies a dividend yield of 10.2 per cent on today’s closing price (N9.80 per share),” the analysts added.