Lafarge Grows Profit by 837% in Q1, Declares Interim Dividend
Lafarge Africa Plc grew profit by more than 836% to N48.64 billion in the first quarter of 2025, the cement company said in a regulatory filing. As a result of the cement company’s monster earnings growth in the first three months, the board has proposed an interim dividend of N4.00 per share.
The amount translates to a 5.1% dividend yield based on the closing price of N79.20 as of 24 April. Details showed that Lafarge Africa’s revenue surged by 80.3% in Q1, underpinned by strong growth across all business segments—cement, aggregates & concrete, and mortar and power.
The revenue growth recorded was driven by an improved production capacity and strong market reception of new product offerings. Lafarge sold 1.62 million metric tons of cement in Q1 2025, an 18.3% increase compared to 1.37 million metric tons in Q1 2024.
The average cement price soared by 80.3%, reaching ₦153,019 per ton, up from ₦84,887 per ton in the same period last year. “In our view, this performance also reflects sustained demand from both public and private sector construction activity, further complemented by modest price adjustments”, analysts at Cordros Capital Limited said.
Despite robust revenue growth, gross margin rose only six basis points to 52.6%, as ex-depreciation cost of sales grew by 80.0% year on year, according to analysts. The increase in the cost of sales was primarily driven by significant pressure from variable production costs, which consist of fuel, power, raw materials, and consumables costs.
Analysts at Cordros Capital Limited said the growth in these cost elements highlights the persistent impact of elevated energy prices and input cost pressures across the business.
Operating expenses rose year on year, driven by a 40.3% increase in distribution costs, reflecting diesel and energy expenses. Nonetheless, the OPEX-to-sales ratio improved by 483 bps to 20.8% from 25.6% in Q1-2024, indicating improved operational efficiency.
Lafarge Africa recorded a net finance income of N1.45 billion in Q1 2025, a notable turnaround from the net finance cost of N21.53 billion recorded in Q1 2024. This was because its finance income rose modestly to N1.84 billion from N1.56 billion in the comparable period in 2024, while finance costs dropped significantly to N388 million from N23.09 billion a year earlier.
The sharp decline in finance costs reflects the absence of FX losses during the quarter, following the company’s proactive steps to clear all outstanding FX obligations. The finance costs incurred were solely related to interest on borrowings and other related matters.
Consequently, pre-tax profit rose sharply by 739.5% year on year to N73.11 billion in Q1 2025, up from N8.71 billion in Q1 2024. The company’s tax expense also increased to N24.45 billion from N3.52 billion in Q1-2024.
Lafarge Africa’s profit before tax rose sharply by 739.5% year-on-year to N73.11 billion, while profit after tax (PAT) increased by 836.7% year-on-year to N48.64 billion, after accounting for a tax expense of N24.47 billion. #Lafarge Grows Profit by 837% in Q1, Declares Interim Dividend US Dollar Slides as Trade Tensions Cloud Sentiment
