Earlier this morning, Lafarge Africa Plc (WAPCO) released its FY-2020 scorecard, according to the report, WAPCO grew its revenue by 8.25% to N230.57bn in FY-2020 compared to the N212.99bn generated in FY-2019.
For the record, the COVID-19 induced lockdown impact was greatly felt in the construction industry during the first half of the year. WAPCO revenue growth was buoyed by the significant recovery in H2-2020 after the contraction witnessed in Q1 and Q2.
Specifically, the company recorded a 9.14% increase in the sales of cement to N226.18bn despite a significant 25.47% decline in revenue from aggregates and concretes segment of the business.
Cost Management Effectiveness Buoyed Operating Profit
Following a 3.92% decline in cost margin, gross profit increased by 20.17% from N55.95bn to N67.24bn in the reporting period. This was also supported by a marginal 0.58% decline in operating expenses which led to a 30.83% growth in operating profit. Notably, WAPCO generated N67.24bn gross profit in contrast to the N55.95bn realized in FY-2019. Similarly, operating profit increased from N34.91bn in FY-2019 to N45.68bn in FY-2020.
Share of Profit in Joint Ventures (JV) Turns Positive
During the period under review, WAPCO realized a total of N433.15mn in the JV with Continental Blue Investment (CBI) Ghana contrary to the previous years of losses. Specifically, the Group has a 35% interest in CBI, a company involved in development, financing and operation of a cement grinding plant in Ghana. As at 31 December 2020, the carrying amount of the Company’s investment in Continental Blue Investment (CBI) was N379.4 billion, adjusted by the share of profit in 2020 after recognizing prior years accumulated losses.
Profit After Tax Surged by 98.75% to N30.842bn
As a result of the impressive topline performance, profit before tax advanced by 109.99% to N37.57bn with the profit after tax also improving by 98.75% to N30.84bn. Consequently, EPS from continuing operations advanced by 98.96% to N191.00. In summary, the company declared a N1.00 dividend to be paid on May 25, 2021.