Lafarge Cement Plc recorded a drop in profit after tax to the tune of 4.7 percent in the financial year ended December 31, 2023.
A higher effective tax rate in 2023 (after the expiry of the Pioneer Status Incentive in 2022) coupled with pressures from FX losses led to a PAT decline of 4.7 percent year–on–year.
Meanwhile, net sales increased by 8.6 percent YoY in the review period with an improved balance sheet.
Major components of the balance sheet showed a free cash flow of N109.7 billion and strong net cash of N142 billion
Profit before tax was up 15.7 percent YoY despite N21 billion foreign exchange losses in 2023.
Lolu Alade-Akinyemi, CEO of Lafarge Africa, commenting on the result, said, “The fundamentals of our business remain strong. In spite of extremely challenging macroeconomic headwinds, we grew the top line by 8.6% and improved our Operating Margin from 22.6% to 25.3% in FY 2023. In the face of very material FX devaluation losses and a higher effective tax rate, Profit After Tax declined YoY by 4.7%. Our performance was largely impacted by spiralling inflation and unprecedented Naira devaluation, with the attendant pressure on energy and supply chain costs.”
“Despite these challenges, we continue to maintain a strong free cash flow position and a strong balance sheet, positioning us for sustainable growth over the medium to long term. We are committed to delivering sustainable value to all stakeholders in the coming years, as we have done historically. I would like to thank all employees and stakeholders of Lafarge Africa for their commitment over the years,” he added.
Lafarge Africa unveiled its first green depot in Abeokuta, designed to accelerate green mobility. As part of its commitment to promoting sustainable growth, the Green Depot runs entirely on a solar power system, which guarantees 100 percent energy conservation in lighting, air-conditioning, and electric forklift charging.
This complements its electric and CNG trucks; the additional injection of CNG trucks further facilitates the eco-friendly transportation of cement from Ewekoro plant to the depot, further underscoring our dedication to green mobility.
Earlier in the year, Lafarge had announced the launch of Eco Label cement brand; Lafarge UniCem; which contributes about 23 percent of the company’s entire volume and is eco-friendly with a 30 percent lower carbon footprint compared to the local industry standard (Global Concrete & Cement Association). It represents a broad range of green cement produced for high performance, sustainability and circular construction.
Lafarge Africa commissioned its cement bag manufacturing plant in Ewekoro Plant in May 2023 with a monthly production capacity of 8.8 million bags and an annual capacity of 105 million bags. The new bag plant allows Lafarge to reinforce availability and handle large-scale production of bags while also improving livelihood through the direct employment of 254 individuals, with 60% being residents of Ewekoro Community.
