Lafarge Africa reported its highest profit since at least 2011, with top-line growth of up to 27.1%, and Africa’s largest economy’s real estate industry returned to bloom after a second recession in five years hampered consumer spending.
According to Lafarge Africa’s audited financials released on Tuesday and seen by PREMIUM TIMES, revenue increased to N293.1 billion last year from N230.6 billion the previous year.
However, this still falls short of the figure reported four years ago in 2017, when the company generated N299.2 billion in sales as a result of a cement market boom following a recession.
Profit before minimum tax increased by 65.7 percent to N62.3 billion. The increase was owed to some cost-cutting measures, most notably reducing finance costs (the cash spent by the company in servicing long-term credit facilities) from N9.7 billion to N5.3 billion while maintaining a measured growth in other components of operational expenditure.
After-tax profit increased to N51 billion, a 65.4 percent increase over the previous year.
“Our 2021 performance showed significant improvement, with net sales up 27.1%, recurring EBIT up 42.6%, and net income up 65.4% compared to FY 2020 results,” said Khaled El Dokani, CEO of Lafarge Africa.
“We are equally pleased with our progress on sustainability; our use of affordable clean energy and agro-ecology footprint are in line with our net zero pledge journey.”
KPMG Professional Services, which audited the company’s books, identified an impairment loss of N4.7 billion resulting from the situation created by Lafarge Africa’s Sagamu plant running below installed capacity as a key audit matter.
It cited the facility’s sub-optimal plant efficiency as the reason, noting that “a write down of the associated specific spares carried as inventories of 724 million has been recognised in the consolidated and separate financial statements.”
Holcim Limited, the world’s largest cement manufacturer based in Zug, Switzerland, owns 83.8 percent of Lafarge Africa through its subsidiaries AIC UK and CariCement BV.