By Goddy Egene
Dangote Sugar Refinery (DSR) Plc has grown its profit after tax for
the nine months ended September 30, 2020, by 81 per cent, thereby
giving shareholders reason to salivate ahead of the end of the
financial year.
Details of the results showed that DSR posted a revenue of N160.514
billion, indicating a an increase of 36.6 per cent from N117.425
billion in the corresponding period of 2019.
Selling and distribution expenses declined from N606 million to N496
million, while administrative expenses rose from N5.631 billion
toN6.235 billion in 2020. Financing expenses also soared to N1.948
billion, compared with N85 million in 2019.
Profit before tax grew by 26.9 per cent to N29.1 billion in2020, up
from N22.968 billion. A lower tax payment enhanced the profit after
tax to grew faster at 81.1 per cent to N26.629 billion as against
N14.703billion recorded in 2019.
DSR last July formally took over Savannah Sugar Company
Limited(SSCL) in a bid to boost production capacity and further
increase its market share.
The merger of the two firms to become sub-Saharan Africa’s largest
sugar refining supported the company’s backward integration plan to
revolutionise the sugar sub-sector of the nation’s economy.
Chairman of DSR, Alhaji Aliko Dangote, had said the company would
be leveraging SSCL’s sugarcane plantation to enhance its production
capacity.
According to him, SSCL has 32,000 hectares of land available for
cultivation of sugar cane as well as milling capacity of 50,000 tonnes
of sugar per annum and that upon the merger, further investments would
be made to increase SSCL land under cultivation.
Dangote had explained that the DSR board considered the merger as
fair and reasonable and believed that it would provide strategic
opportunities and benefits for the company, employees and other
stakeholders as the new company would be operating from the position
of increased access to capital and then higher profitability.
Dangote had listed some of the benefits of the merger as being to
consolidate the assets, intellectual property rights, operations, and
business dealings of the SSCL into the DSR; eliminate cost
inefficiencies arising from duplication of resources and processes and
improve the efficiency through more focused management of resources
and position it as the biggest integrated sugar producer in Nigeria.
Meanwhile, the market opened the new week and month on bearish note
as the Nigerian Stock Exchange(NSE) All-Share Index (ASI) fell 0.17
per cent to close at 30,479.39 on profit taking.
