Dangote Cement to Issue $833m Bonds for Expansion

By March 23, 2018 Investment News

Dangote Cement Plc. has unveiled plans to raise N300 billion ($833m) in bonds to fund expansion of its operations across the continent. Brian Egan, its chief financial officer (CFO), disclosed this during an investor conference call, according to Bloomberg reports .

The debt instrument would be issued in tranches of N50 billion at a time whenever interest rates are favourable over next three years, says Edgan who equally disclosed that the company is considering sale of Eurobonds to improve funding.

The funds raised will be used for capital projects including the construction of export facilities at Nigeria’s ports. This will enable the firm export much needed raw materials to its other subsidiaries.

The company had in July last year, disclosed plans to expand its production capacity from 45 million tonnes to 80 million tonnes per annum. The company claims has it has received approval from Nigerian regulators to issue the N300 billion local currency bonds.

Dangote Cement currently has operations in Senegal, Sierra Leone, Ghana, Cameroon, South Africa, Zambia, Tanzania, Congo and Ethiopia. The company was incorporated in Nigeria as a public limited liability company on 4th November, 1992 and commenced operations in January 2017 as Obajana Cement Plc.

The name was changed on 14th July 2010 to Dangote Cement Plc. The company’s FY 2017 results show revenue increased from ₦615 billion in 2016 to ₦805 billion in 2017. Profit before tax went up from ₦189 billion in 2016 to ₦289 billion in 2017.

Profit after tax also surged from ₦142 billion in 2016 to ₦204 billion in 2017. The company declared a dividend of ₦8.50 per share. Dangote Cement currently trades at ₦260 as of Wednesday on the Nigerian Stock Exchange (NSE). Year to date, the stock is up 15.22 percent.

Source: Dailytimes