Lafarge Africa Hits 52-Week High on 400% Dividend Surge

Lafarge Africa Hits 52-Week High on 400% Dividend Surge

Lafarge Africa Plc reached its highest valuation in 52 weeks on the Nigerian Exchange, driven by a remarkable 400% year-on-year increase in dividends, which has fueled buying momentum.

The cement company’s board of directors raised the payout ratio after a new significant shareholder, Huaxin Building Materials Group Co., emerged as the largest shareholder following Holcim’s exit last year.

The new single-largest shareholder favours a significant payout ratio, and the payout has fuelled increased buying. For the financial year 2025, Lafarge Africa’s board proposed a gross dividend of ₦6.00 for 2025, a substantial increase from ₦1.20 paid in 2024 for every ordinary share in circulation.

In total, Lafarge Africa plans to distribute ₦96,646,774,326 to shareholders, compared with ₦19,329,354,315.78 paid when Holcim was the company’s largest single shareholder.

Lafarge Africa grew its profit by 172.72% to ₦273.12 billion, driven by volume increases and price adjustments amid rising government capital expenditure to boost local infrastructure.

After dealing with Holcim, Huaxin Building Materials Group Co., Limited holds a controlling interest in Lafarge, with a total shareholding of 83.81%, while the remaining 16.19% is owned by other individuals and institutions.

At the close of Friday’s trading session, Lafarge Africa Plc’s 16.107 billion outstanding shares were valued at ₦3.445 trillion, marking its highest valuation in the past 52 weeks.

The company recorded revenue of ₦1.07 trillion in 2025, marking a significant milestone as it surpassed the ₦1 trillion mark for the first time, representing a 53.04% increase in revenue from ₦696.76 billion in FY 2024.

Cement sales remained the primary revenue driver, supported by robust construction activity and effective price optimisation, analysts said in a separate equity report on Lafarge Africa.

Despite a 28.25% increase in cost of sales to ₦448.94 billion—due to higher fuel, power, raw material, and logistics costs—gross profit rose 78.06% to ₦617.37 billion, reflecting the company’s strong pricing power and operational efficiency.

Lafarge Africa’s profit before tax grew significantly by 103.15%, increasing from ₦193.01 billion in 2024 to ₦392.10 billion, supported by improved pricing strategies, cost discipline, and economies of scale. Net income was N273 billion, representing about 173% year-on-year growth.

In an equity report, CardinalStone Securities Limited advised investors that Lafarge Africa Plc (NGX: WAPCO) presents a compelling investment case, driven by capacity expansion, improved utilisation, innovative product launches, and cost optimisation.

Analysts noted that the recently announced expansion plan under new ownership—its first in a decade—marks a new growth phase for the company, positioning it to leverage both public- and private-sector initiatives to address infrastructure and housing gaps in Nigeria.

This development also strengthens WAPCO’s competitive position in key markets and lays the groundwork for consistent earnings growth.

Analysts at CardinalStone Securities Limited said they have adjusted Lafarge Africa’s estimates to reflect these expansion plans, resulting in a new 12-month target price of ₦280.48, an upgrade from the previously set ₦202.87, indicating a 37.5% upside from the reference price.

Lafarge Africa’s 53% revenue growth, which pushed its annual sales above ₦1 trillion, outperformed its rivals in the cement sector, including Dangote and BUA Cement. Dangote’s revenue increased by 20.3% year on year, while BUA Cement reported a 34.6% increase in 2025.

CardinalStone Securities highlighted that this revenue growth outperformance is attributable to improved capacity utilisation, the launch of new low-carbon products, and higher pricing across the sector.

The cement company’s production rose to 6.3 million tonnes during the period, representing a 12.5% year-on-year increase, with capacity utilisation improving from 58.9% in FY 2024 to 66.3%.

Market analysts anticipate that cement demand will remain strong due to ongoing infrastructure spending and a potential rise in private sector discretionary income.

They project an 8.0% year-on-year growth in volumes to 6.8 million tonnes for 2026, while noting that pricing momentum across the sector has moderated after significant increases over the past two years, with prices per tonne remaining relatively stable in recent quarters. UACN Falls by 11.5% as Investors’ Sentiment Deteriorates