Dangote Sugar Refinery, Dangote Cement, BUA Foods, BUA Cement, Lafarge Africa, Cadbury Nigeria, and Nestle Nigeria Plc all reported N3.6 trillion in revenue in their full-year financial statements submitted to the Nigerian Exchange.
Dangote Industries Limited reported a staggering N785bn in its two largest investments, Dangote Sugar and Refinery and Dangote Cement Plc.
The N403 billion recorded in 2022 for its sugar refinery represented a growth of 46.07 percent over the N276.05 billion recorded in 2021.
In his remarks at the group’s 2022 full-year audited results webcast event for investors and analysts, Dangote Sugar Refinery Plc. Group Managing Director/Chief Executive Officer Ravindra Singhvi noted notable shocks in the operating environment, including changes in global market dynamics fueled by the increase in international prices of raw sugar, forex unavailability, currency adjustment, and a high inflation environment that caused an increase in the cost of production.
Similar to Dangote, BUA Foods reported in its unaudited financial statement for 2022 that revenue increased by more than a quarter to N417.8 billion. Sales of sugar were a contributor to 65.5% of that.
Despite the sharp increase in profit, the company claimed that the business was negatively impacted by a challenging operating environment that was largely centered around flooding (which had an impact on logistics efficiencies), energy costs, rising input costs, as well as rising concerns about foreign exchange and the Central Bank of Nigeria’s tightening stance, which further increased interest rates.
Contrarily, BUA Cement saw a 40.3% increase in revenue, from N257.3 billion in 2021 to N360.9 billion in 2022.
In a similar vein, Dangote Cement generated N382 billion, up 4.9% from the N364.44 billion reported the year before.
Lafarge Africa plc, another competitor, overcame economic challenges to generate impressive revenue, increasing it by 27.3% from N293.1 billion in 2021 to N373.2 billion in 2022.
In 2022, the top three cement producers—Dangote, BUA, and Lafarge—collectively generated N2.35 trillion in revenue. From the N1.93 trillion recorded in 2021, this represented a decrease of 21.6%.
It’s crucial to remember that the businesses under consideration experienced a decline in sales volume despite an improvement in revenue. However, a rise in product prices led to an increase in revenue as a result.
For instance, Dangote Cement sold 27.77 million tonnes of cement in 2022, compared to 29.27 million tonnes sold in 2021, a 5.1% decrease. Nevertheless, sales revenue rose by 17% despite this decline.
Similarly, Cadbury Nigeria Plc, a food, sweets, and drink company, reported strong revenue growth, increasing by 30% from N42.37bn in 2021 to N55.21bn in 2022. The business claimed that despite rising inflation and the naira’s ongoing depreciation, this was accomplished.
An increase in domestic sales was said to be the cause of the revenue growth.
The company’s main rival, Nestlé Nigeria Plc, reported a 27 percent increase in revenue in its 2022 financial results, from N351.8 billion to N446.8 billion.
The Deputy-President of the Lagos Chamber of Commerce and Industry, Dr. Gabriel Idahosa, explained the companies’ strong financial statements in an interview as a result of their capacity to survive the challenging operating environment encountered by typical businesses.
He asserted that the businesses could have performed much better if the various issues plaguing the business environment had been resolved.
These large organizations have the resources to deal with the risks and disruptions that characterize the Nigerian economy, according to Idahosa.
Starting with the most fundamental concerns, like power supply, the majority of those businesses don’t exist in the same power supply universe as us ordinary folks or the vast majority of small and medium-sized businesses. In addition, they have logistics to overcome any significant problems we may have.
They struggle to pass through the Nigerian ports as a small or medium-sized exporter, but Dangote won’t. They will find a way around anything and everything that could prevent them from entering the ports.”
