Dangote Sugar Refinery has announced a profit before tax of N34.6 billion for the financial year ended December 31, 2018.
A breakdown of the result released on the floor of the Nigerian Stock Exchange (NSE) indicated that while gross profit stood at N39.7 billion, the refinery earned revenue of N150.4 billion.
In terms of volume, seasonal sugar production at Savannah Sugar was 12,375 tonnes; full year refinery production at Apapa 564,785 tonnes, while Group sugar sales volume was 581,504 tonnes.
Ravindra Singhvi, the Chief Operating Officer, Dangote Sugar Refinery, speaking on the results said: “Though we maintained our market leadership position in the sugar sector, year 2018 was very challenging due to the impact of unlicensed sugar, smuggled and sold in our key markets nationwide, and the logistics challenges brought about by the continued Apapa traffic gridlock.
“The gridlock constrained availability of trucks required daily to evacuate the production volumes, while the influx of smuggled sugar exerted a downward pressure on selling prices.
“Despite efforts being deployed by the regulators to stem the tide, the influx of smuggled sugar into the markets spread further across our key markets in the North East and North West. We are currently focusing on process optimisation and the realisation of our Sugar Backward Integration Projects targeted at the production of 1.08 million metric tonnes of sugar in 6 years; from our various projects across the country.”
Dangote Sugar is Nigeria’s largest producer of household and commercial sugar with 1.44M MT refining capacity at the same location. The refinery located at Apapa Wharf Ports Complex, refines raw sugar imported from Brazil to white, Vitamin A fortified refined granulated white sugar suitable for household and industrial uses.
Its subsidiary, Savannah Sugar Company Limited, factory located at Numan, in Adamawa State, is an integrated sugar production facility, with an installed factory capacity of 50,000 tonnes. Covering 32,000 hectares, the Savannah estate has considerable opportunity for expansion which is underway as part of the Dangote Sugar for Nigeria Project, campaign.
“Our Backward Integration goal is to become a global force in sugar production, by producing 1.5M MT/PA of refined sugar from locally grown sugar cane for the domestic and export markets” in 10 years, he added.
During the year, the following companies which form part of the Backward Integration Project (BIP) were incorporated and consolidated in the Financial Statements of the group, which is indicative of the progress being made in BIP.
They are Nasarawa Sugar Company Limited, Dangote Taraba Sugar Limited, Dangote Adamawa Sugar Limited and Dangote Niger Sugar Limited. These companies have a combined land mass for agriculture of about 110,000 hectares. The Greenfield sites like Savannah sugar will be integrated sugar production facilities with new plantation and modern facilities that are located closer to the consumers.
The Board has recommended a dividend payout of N1.10 kobo per ordinary share of 50k to be paid to shareholders for the year ended December 31, 2018. This is subject to shareholders’ approval at the 13th Annual General Meeting of the Company.