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Dangote Keys Into FG Agenda, To Run All Cement Trucks On CNG By 2025
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Amidst applause by shareholders for the impressive results in the 2023 financial year despite the harsh business operating environment, the Chairman of Dangote Cement Plc, Aliko Dangote has announced an increase of 50 per cent on dividend payout to the shareholders, from N20.00 per share paid in the 2022 financial year to N30.00 for the last financial year 2023.
In the same vein, Dangote also revealed that arrangements are in top gear for thousands of the Company’s delivery trucks to henceforth run on Compressed Natural Gas (CNG) in line with the Federal Government agenda on adoption of alternative fuel for official vehicles.
This decision, Dangote told excited shareholders at the 15th Annual General Meeting (AGM) of Dangote Cement Plc, held in Lagos was to add to the Federal Government’s quest towards reducing dependence on fossil fuel, thereby enhancing the nation’s energy independence and contributing to a more secure energy future.
According to him: “We are now going to start using CNG vehicles, especially with the new policy of the Federal Government, launched by the Renewed Hope Agenda by His Excellency, President Bola Tinubu.
By the end of next year, all our trucks that are operating in the company will be running on CNG, and that is a whole lot of money that we are going to invest. But we are equal to the task, and we will continue to push and make sure that we continue to make our shareholders happy.”
The Chairman disclosed to the shareholders the Company’s ongoing efforts at ramping up production with the ongoing construction of a new plant of 6 million metric tonnes per annum at Itori, in Ewekoro local government area of Ogun State, noting that despite the hiccups at the Apapa Port in Lagos, the plant would be completed to time.
Dangote said the company’s impressive performance was in fulfillment of the promise he made of an enhanced Return on Investments (RoI) to the shareholders and other stakeholders in Dangote Cement, assuring them that the following year would even be better.
He expressed satisfaction that Dangote Cement achieved double-digit growth in revenue of ₦2,208.1 billion, while Group EBITDA (Earnings before Interest, Taxes, Depreciation and Amortisation) reached a record high of ₦886.1 billion, increasing by 25.1%.
“This outstanding EBITDA performance was underpinned by our robust cost control measures and our diverse pan-Africa operations. The latter acted as a cushion, providing resilience to country-specific risks, while the former enhanced our overall profitability. Our pan-Africa operations now contribute 41.2% to the Group’s overall volumes,” he added.
Dangote pointed out,” We made significant strides in our expansion initiatives, with the successful launch of operations at our 0.45Mta grinding plant in Ghana, increasing our total installed capacity to 52.0Mta. Furthermore, our 1.5Mta grinding plant in Côte d’Ivoire is making substantial progress and is nearing completion. Lastly, we have commenced construction on our 6Mta Itori plant in Ogun State, a crucial step in supporting our ambitious export goals.”
The 2023 results showed that Africa’s largest cement manufacturer recorded improvement in all performance measurement indicators with group revenue rising by 36.4 per cent to ₦2,208.1 billion while Profit after tax (PAT) was up by 19.2 per cent to ₦455.6 billion.
Earnings per share went up by 18.8 per cent at ₦26.47. Dangote Cement is garnering more market share across the continent with pan-Africa volumes going up by 12.7 per cent to 11.3Mt.
In his interview with the media during the AGM, the Group Managing Director of Dangote Cement Plc, Arvind Pathak said 2023 was yet another testament to the effectiveness of the management’s diversification strategy, despite the challenging macroeconomic conditions.
He said; “Our diverse operations acted as a cushion, providing resilience to country-specific risks. Pan-African volumes were up 12.7 per cent and now account for 41.2 per cent of Group volume. Consequently, pan-African revenue increased by a record 123.2 per cent to ₦925.9 billion, while EBITDA surged by over four-fold to ₦263.7 billion.”
Alluding to what Dangote said on use of CNG as an alternative fuel for its cement trucks, Pathak noted that in response to the heightened inflationary environment, “we implemented new and innovative business strategies that helped to drive up revenues, contain costs, and protect margins. These initiatives included fuel mix optimisation, propelling the use of alternative fuels to replace more expensive fossil fuels. We also began the phased transition from diesel power trucks to full Compressed Natural Gas (CNG) trucks.”
Shareholders one after another were full of praise for the board and management of the Company for the impressive outing in 2023, which accounted for the dividend payout of N30 per share; an increase of 50 per cent over the 2022 dividend despite the economic headwind that characterised 2023.
Mrs. Bisi Bakare, Chairperson of the Pragmatic Shareholders Association lauded the management of Dangote Cement for what she described as a huge dividend payout even when many other companies could not pay their shareholders a dime because they declared losses.
She stated that the shareholders were happy, and expressed optimism that with the way the management has steered the Company in the face of the current economic downturn and recorded good results, the 2024 dividend will be higher.
In his comment, the President, of the Association for the Advancement of Rights of Nigerian Shareholders (AARNS), Dr. Faruk Umar said the shareholders could not but thank the board and management of Dangote Cement for a job well done.
He noted that no company, in recent time, has been able to be as profitable as Dangote Cement, just because of the sound judgment of the management in navigating the murky economic weather which has had negative impact on results of some other companies.
He commended Dangote for his patriotism and dedication to the cause of Nigeria and her people with his decision to reduce prices of his petroleum products. He expressed hope that the price of Premium Motor Spirit popularly called petrol would come down once the Dangote Refinery rolls out the product soon.
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The presidential candidate of the African Democratic Congress ADC, former Vice President Atiku Abubakar has facilitated with Kwara ADC guber candidate Hon Zakari Mohammed as he clocks 56.
In a congratulatory message he e:signed Atiku said: “On behalf of my family, I extend my warmest congratulations to my younger brother and compatriot, Rt. Hon. Zakari Mohammed, the ADC Governorship Candidate for Kwara State, as he marks his 56th birthday.
“Today, we celebrate a distinguished patriot whose life has been defined by service, courage, competence, and an unwavering commitment to the progress of Kwara State and Nigeria.
“Your record as a two-term member of the House of Representatives, where you also served with distinction as the Spokesman of the 7th Assembly, reflects your deep understanding of democratic governance and legislative excellence.
“Your impactful service as Commissioner for Sports and Youth Development, Commissioner for Energy, Special Assistant on Sports, and Sole Administrator of Kwara United Football Club further demonstrates your capacity to deliver results wherever duty calls.
“Beyond politics, you have built an admirable career as a broadcaster, journalist, criminologist, and defence and security expert. Your attainment of a PhD in Defence and Strategic Studies from the Nigerian Defence Academy is a testament to your dedication to knowledge, leadership, and national development.
“As you continue your journey of service, I pray that Almighty Allah grants you sound health, greater wisdom, renewed strength, and many more years of impactful leadership.
” May He guide your steps and bless your aspiration to lead Kwara State into a new era of justice, prosperity, security, and inclusive development.
I have no doubt that your experience, integrity, and passion for the welfare of the people will continue to inspire hope and confidence among Kwarans and Nigerians. -AA
Dangote Refinery, depot owners, and petroleum products marketers have agreed to further slash premium motor spirit prices across the value chain after meeting with the Nigerian government.
Recall that the federal government had insisted on further fuel price cuts by Dangote Refinery, depot owners, and marketers, respectively, on the basis of falling crude oil prices.
The Nigerian government stood on this ground in a meeting with the oil downstream sector’s regulator, the Nigerian Midstream and Downstream Petroleum Regulatory Authority, with the attendance of stakeholders within the value chain, including Dangote Refinery, depot owners and petrol marketers.
Nigerian Government had warned refiners and marketers on adherence to cost-reflection prices commensurate with the $72 per barrel Brent crude price amid war escalation in the Middle East.
NMDPRA’s position is that fuel price, indeed, other petroleum products should drop further.
The chief executive of NMDPRA, Rabiu Umar, stated this during Monday’s stakeholders meeting on cost-reflective pricing of petrol in Abuja.
Providing further details on the meeting, both the president of the Petrol Petroleum Products Retail Outlets Owners Association of Nigeria, Billy Gillis-Harry, and the president of the Independent Petroleum Marketers Association of Nigeria, Abubakar Maigandi, in separate interviews with DAILY POST, confirmed that fuel prices would further drop nationwide.
According to them, petrol may decline further to around N1000 or less if crude oil price continues to fall.
Gillis-Harry revealed that fuel price is to be reduced below its current rates of N1150 and N1299 per liter in Abuja and its environs.
According to him, major stakeholders in the country’s petroleum downstream sector were in the same boat on the fuel price drop.
However, he insisted that marketers cannot be compelled to sell fuel below cost.
He provided details of the meeting outcome, stating that it is focused on finding practical solutions that would make fuel more affordable for Nigerians.
“You can quote us that PETROAN is willing to work with the NMDPRA, the Federal FCCPC, the minister of petroleum, and all stakeholders to ensure that price reduction is implemented for the benefit of Nigerians.
“However, nobody is going to be running a business at a loss, and then, you know, basically what that means is that’s the close of business,” he said.
He explained that fuel pricing remains largely dependent on international market forces, noting that fluctuations in crude oil prices and other global factors make it difficult to fix a specific pump price.
“The true cost-reflective price is still determined internationally. That’s the reality,” Gillis-Harry said.
He added that the dynamics affecting pricing change constantly, making it impossible to announce a fixed cost-reflective price.
“It’s not easy to work things out because the dynamics of the input vary. There’s no time that is static,” he stated.
Why fuel pump price hasn’t dropped like crude oil price- Gillis-Harry
Addressing public expectations that petrol prices should immediately fall whenever crude oil prices decline, the PETROAN president said such assumptions do not reflect the realities of the downstream petroleum market.
“The expectations that are put by Nigerians, ‘Oh, the crude oil has come down to $72, therefore, it must affect us.’ But that is not the reality,” he said.
According to him, international oil prices remain volatile, noting that even during the meeting, crude prices rose sharply.
“Even today, as we are sitting there, we were checking the price volatility. Price increased by $7,” he said.
Gillis-Harry stressed that no stakeholder in the petroleum value chain could independently determine fuel prices, adding that efforts are ongoing to reduce costs across the industry.
“We cannot, in reality, make any pronouncements today. Because what we’re trying to do is everybody must take a cut,” he said.
“Every one of us must take a cut. We had earlier issued a press release on this matter, and it hasn’t changed.
“That press release was based on empirical evidence, empirical data, all of which today was very transparently presented.”
Marketers, retailers will not shut down due to fuel price reductions
He also maintained that the government cannot simply direct marketers to sell petrol at a predetermined price without considering market realities.
“If you tell us to go and sell at this price, then business is closed. How do Nigerians get fuel overnight?” He asked.
He added that allowing experienced operators to continue running the business remains the best approach to ensuring uninterrupted fuel supply.
“So as it is today, prices will come down, we know. But how much it will come down, we cannot say.
“And I don’t think it will be fair for me, for anybody, to make that kind of assumption because it will be just, at best. And assumptions are not facts,” Gillis-Harry said.
He noted that refiners, importers, and retailers have already begun adjusting prices downward where possible.
“You can see Dangote has been reducing. Our retail outlets have been reducing. That’s how we continue to go until the price comes down,” he said.
While expressing confidence that petrol prices would continue to decline over time, Gillis-Harry said the pace of reduction would depend on prevailing market conditions.
“It will come down. But how fast and how well is something that we have to keep working on until we get the dynamics of how to make sure that there’s an answer,” he added.
On his part, Maigandi reiterated that Dangote Refinery marketers will continue to reduce the price upon lower crude oil prices.
According to him, the federal government cannot impose fuel prices on stakeholders in the petroleum downstream.
“Fuel prices will go down further; that was our major agreement. Both Dangote Refinery and depot owners assured Nigerians.
“But you can say exactly that the fuel price may come down to below N1,000 per liter,” he stated.
Recall that Dangote Refinery, depot owners, and filling stations have dropped fuel prices by at least N100 per liter in the last three weeks.
This has led to fuel pump drops to between N1150 and N1299 per liter in Abuja and its environs.
At the weekend, Nigerian National Petroleum Company Limited slashed its fuel price to N1,150 per liter.
MRS filling station, AA Rano, Ranoil, NIPCO, and other filling stations dispense between N1,191 per liter and N1,240.
Recall that Brent and West Texas Intermediate crude blends stood at $71 and $68 per barrel at the time of filing this report.
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