Dangote Sugar Refinery (DSR) Plc has grown its profit after tax for the nine months ended September 30, 2020, by 81 percent, thereby giving shareholders a reason to salivate ahead of the end of the financial year.
Details of the results showed that DSR posted revenue of N160.514billion, indicating an increase of 36.6 percent from N117.425 billion in the corresponding period of 2019.
Selling and distribution expenses declined from N606 million to N496 million, while administrative expenses rose from N5.631 billion toN6.235 billion in 2020. Financing expenses also soared to N1.948 billion, compared with N85 million in 2019.
Profit before tax grew by 26.9 percent to N29.1 billion in2020, up from N22.968 billion. A lower tax payment enhanced the profit after tax to grew faster at 81.1 percent to N26.629 billion as against
N14.703billion recorded in 2019.
DSR last July formally took over Savannah Sugar Company Limited(SSCL) in a bid to boost production capacity and further increase its market share.
The merger of the two firms to become sub-Saharan Africa’s largest sugar refining supported the company’s backward integration plan to revolutionize the sugar sub-sector of the nation’s economy.
Chairman of DSR, Alhaji Aliko Dangote, had said the company would be leveraging SSCL’s sugarcane plantation to enhance its production capacity.
According to him, SSCL has 32,000 hectares of land available for cultivation of sugar cane as well as milling capacity of 50,000 tonnes of sugar per annum and that upon the merger, further investments would be made to increase SSCL land under cultivation.
Dangote had explained that the DSR board considered the merger as fair and reasonable and believed that it would provide strategic opportunities and benefits for the company, employees and other stakeholders as the new company would be operating from the position of increased access to capital and then higher profitability.
Dangote had listed some of the benefits of the merger as being to consolidate the assets, intellectual property rights, operations, and business dealings of the SSCL into the DSR; eliminate cost inefficiencies arising from duplication of resources and processes and improve the efficiency through more focused management of resources and position it as the biggest integrated sugar producer in Nigeria.
Meanwhile, the market opened the new week and month on bearish note as the Nigerian Stock Exchange(NSE) All-Share Index (ASI) fell 0.17 percent to close at 30,479.39 on profit-taking.
Source: THISDAY
