Dangote Sugar Refinery Plc has opened its N50 billion debut series 1 commercial paper offering to investors in the local debt capital market in an effort to increase operating cash.
According to Futureview Financial Services Limited, the sum made available to investors in its most recent launch is a part of its ₦150 billion Commercial Paper Issuance Programme. The closing date of the short-term capital raising is set for Tuesday, February 27, 2024.
Holding a nearly 55% market share in the retail sector, Dangote Sugar is the biggest refinery of its kind in Sub-Saharan Africa, with an annual total installed refining capacity of 1.44 million metric tons.
The issuer, a Dangote Group company, is in the business of selling, distributing, and refining granulated sugar to top wholesalers and retailers players in the skin care, food and beverage, and pharmaceutical industries.
DSR is on track to becoming a leading global integrated sugar producer with its backward integration plan – target 0.7MMT refined sugar production, expansion of out-growers scheme and strategic seeking to expand existing warehouses and fleet.
The company has over 800 haulage trucks to cover target markets in Nigeria and West Africa. Currently, it has 47,364 hectares of sugar plantation and aims to produce 1.5 million metric tonnes of refined sugar annually from its sugarcane in the medium term.
Historically, the company has reported a solid financial performance with both top-line and bottom growth despite challenging macro headwinds, Futureview Financial Services Limited said in an update sent to investors.
Its strong revenue growth is evidenced by a 28.0% cumulative average growth rate between 2018 and 2022 on account of improving operational efficiency, improving customer service delivery, and maintaining the high quality of its products.
Its profit has seen a 3.4% and 26.0% cumulative average growth rate in gross profit and operating profit respectively, between 2018 and 2022, according to Futureview.
As of 9 months of financial year 2023, DSR reported a 7.42% growth in revenue year on year.
