Dividend Hunters to Get N30/Share Purchase Before April 16
- Some 60% of the Nigerian cement market is controlled by Dangote Cement
- After the buyback of shares, the volatility of the share price decreased.
- Its Cement is in Higher Demand
- Dangote’s Gross Margin is more than 60%
Dangote Cement Plc, Nigeria’s dividend aristocrat, will pay a final dividend of N30 on May 31, 2024, to all shareholders who registered their shares before April 16. The cement company’s board of directors revealed a decision following its earnings beat in 2023. The Nigerian Exchange has been informed that qualifying shareholders must have purchased the shares prior to April 16, 2024.
The company is paying out more than 100% of its profits but is generating plenty of cash to support the dividend. The share price of the cement company has remained unchanged at N686.7 since Femi Otedola ramped up shares in the first quarter of the year.
No major shareholders have had traders on it since then. Dangote Industries Limited has accumulated substantial shareholdings, so low volatility is anticipated. MarketForces Africa reported that Dangote Cement Plc has been repurchasing its shares to reduce volatility. The words across Broadstreet have it the company has a plan to list the cement company on the London Stock Exchange.
In 2023, the cement company’s earnings per share (EPS) rose to N26.47 from N22.27 in 2022. Its solid EPS growth was spurred by its strong earnings performance in the period. Dangote Cement controls some 60% of the entire cement market in Nigeria.
Due to shifting market dynamics and industry price increases, the company’s revenue in 2023 increased by 36.4% annually to N2.208 trillion. This was supported by 7.7% sales growth in the Nigerian market.
The company also got the added advantage of boosting its bottom line with moderation in tax expenses. Tax expenses during the period decreased by 31.2% annually. Selloffs Provoke Spike in Nigerian Treasury Bills Yield
Tax expenses reduced with more than 209% year-on-year growth in net finance costs. The board has proposed a final dividend per share of N30.00, implying a dividend yield of 4.4% based on the last closing price of N686.70.
Dangote Cement experienced strong sales across African markets, even with exposure to currency fluctuations. Pan-African sales saw a 123.2% increase. This was driven by increased demand for Dangote Cement in Senegal, Congo, Zambia, and Ethiopia.
These countries contributed 41.2% to the group’s sales volume. In 2023, sales volume advanced by +1.8% to 27.28 MMT. Nonetheless, the business faced increased production costs during a time when major markets saw a sharp increase in inflation.
As a result, the gross market shrank to 60% from 64.6% in 2022, a decrease of 4.67%. Cost increases for raw materials, fuel, and electricity were the main causes of the company’s sales pressure expenses.
Exposure to foreign currency fluctuation drove FX losses up 304.2% year on year to N164.08 billion. During that time, the heavily leveraged company’s interest expenses increased as well.
Its audited results showed that pre-tax profit grew by 5.6% to N553.10 billion. A lower tax charge saved the day. Dangote Cement’s net profit rose by 19.2% to N455.58 billion.
