NIGERIA – Dangote Sugar Refinery (DSR) has reported a 33% rise in group revenue for the financial year of 2020 to N214.30bn (US$562.39m) from N161.09bn (US$422.75m) in 2019.
The sugar milling giant attributes the rise in earnings to an increase of 6.9% in sales volume from previous year’s 684,487 tonnes to 731,701 tonnes.
Despite the disruptions to the economy, owning majorly to coronavirus pandemic, it recorded an increase of 13.7 per cent in production volume to 743,858 tonnes from 654,071 tonnes in 2019.
Revenue drew strength from the performance of its flagship brand, the 50kg sugar, which accounted for N206.444 billion (US$514.7m) or at least 96 per cent of its share of the sugar market.
Nigeria’s commercial capital Lagos contributed 49 per cent of its total sales in Africa’s biggest economy.
However, earnings were limited by a spike in the cost of sales by 31 per cent from N122.801 billion (US$322.27m) to N160.552 billion (US$421.3m) the same way a 112 per cent leap in taxation, on the account of carrying forward deferred tax, also capped gains.
Overall, it posted a profit after tax of N29.78 billion (US$78m) in 2020, compared to N22.36 billion (US$58.6m) in 2019,
The sugar group said the improvements were attributable to operations optimisation strategy despite momentary disruption caused by civil unrest in last quarter of the year.
“Our focus on the implementation of our key strategies in the face of the several challenges posed by the COVID-19 pandemic, the peculiarities of the Apapa traffic situation, amongst others, we achieved a top line growth in revenue of N214.30 billion (US$562.39m) , a 33.0 per cent increase over 2019; a 53 per cent y-o-y increase in PBT, and 33.2 per cent increase in PAT,” The Group Managing Director/Chief Executive Officer of Dangote Sugar Refinery Plc, Mr Ravindra Singhvi, said.
He noted that one of the key highlights during the year was the successful completion of the Scheme of Arrangement – merger of Dangote Sugar Refinery Plc and Savannah Sugar Company Limited with effect from September 1, 2020 to operate under one unified entity.
“We are confident the merger will enable us to achieve operational, administrative and governance efficiencies resulting in increased shareholder value.
“We will continue to pursue our backward integration projects, and other key initiatives to grow our sales volumes, market share, optimize cost and operational efficiencies,” he said.
DSR with an installed capacity to produce 1.44 million metric tonnes per annum, will be leveraging on the Savannah Sugar’s sugarcane production capacity to enhance its output.
Savannah Sugar has 32,000 hectares of land available for cultivation of sugar cane as well as milling capacity of 50,000 tonnes of sugar per annum.
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