Dangote Cement Plc · NSENG:DANGCEM
Dangote Cement — Q1 2018 Earnings Presentation
21 slides from Dangote Cement's earnings presentation, 2018
Slide 1: Q1 2018 Results
SHR DANGOTE CEMENT Q1 2018 Results Building Prosperity in Africa Investor Presentation
Slide 2: Q1 2018 Highlights
Q1 2018 Highlights FINANCIAL * Group revenue up 16.3% * Group EBITDA up 22.2% at margin of 52.0% * Earnings per share up 23.9% to 84.20 OPERATIONAL * Group volumes up 2.8% — Nigeria volumes up 5.3% after strong March MANAGEMENT AND BOARD * Joe Makoju appointed Group Chief Executive Officer * Cherie
Slide 3: Group Financial Overview
Group Financial Overview Three months to 2018 2017 31st March Nm Nm | % change Revenue 242,116 208,166 16.3% Cost of sales (97,352) (87,802) 13.8% Gross profit 144,764 120,364 20.3% Gross margin 59.8% 57.8% 2.0pp EBITDA 125,917 103,003 22.2% EBITDA margin 52.0% 49.5% 2.5pp EBIT 103,787 83,248 24.7%
Slide 4: EBITDA Development
EBITDA Development pase — CEMENT Profitability MB + Impact of loss-making operations breaking even would increase Pan-African margin to 25.3% (excl. central costs) * Levers of EBITDA improvement in 2018: — Higher volumes — Tanzania fuel switch to gas — Sierra Leone, Congo progressing to profitabilit
Slide 5: Movement in Net Debt
SR Lt a a Group Financial Overview «..:. DANGOTE - CEMENT Movement in Net Debt Cash Debt Net debt mM AM xm As at 1st January 2018 168,387 (372,094) (203,707) Cash generated from operations before changes in working capital 132,727 132,727 Changes in working capital 4,167 4,167 Income tax paid (30) (
Slide 6: Balance Sheet
Group Financial Overview «..::: Balance Sheet As at 31/3/18 As at 1/1/18 mM sm Property, plant and equipment 1,195,138 1,192,140 Other non-current assets 59,353 57,089 Intangible Assets 7A12 6,355 Current Assets 241,822 241,912 Cash and Cash Equivalents 215,252 168,387 Total Assets 1,718,977 1,665,8
Slide 7: Strong Nigeria Performance
Strong Nigeria Performance pAere CEMENT * urvhghes quer see 2018 — Fourth-highest quarter since 2014 Ciurian) Salles (O00) “oumes) 5,000. = — Strong March creates good momentum for 2018 2014 2015 @2016 @2017 2018 * Revenues up 14.1% — Estimated 66% market share * EBITDA up 17.0% “000 * LPFO and impo
Slide 8: Revenue, EBITDA and volume per tonne
₦ 50,000 5,000 ₦ 45,000 ₦ 40,000 ₦ 45,070 ₦ 43,816 4,500 ₦ 44,960 ₦ 44,023 ₦ 35,000 ₦ 40,412 66.3% ₦ 30,000 ₦ 37,817 65.7% 66.3% 4,000 64.8% 64.4% ₦ 25,000 65.7% ₦ 28,192 ₦ 28,972 ₦ 20,000 ₦ 23,743 ₦ 29,630 ₦ 29,059 3,500 ₦ 29,176 ₦ 25,738 ₦ 15,000 ₦ 19,780 61.8% 53.3% ₦ 26,175 61.0% 44.0% ₦ 10,000
Slide 9: Nigeria Price Development
Nigeria Price Development pAere CEMENT Ex-factory price after discounts and other rebates 2,200 $200 § 2,000 YO / U7 $180 —_ $160 ¥ 1,800 fe es f—-\ $140 1,600 ~~ ; $120 * 1,400 $100 § 1,200 V ~~ $80 ® 1,000 $60 SO AS AY RDN A A DN DOD SOO. NO OOO OO XN XN KV CEES SEL FOE SAFE KEEFE ESF EEES ——=WN/b
Slide 10: Use of LPFO and Imported Coal Eliminated
Use of LPFO and Imported Coal Eliminated pase CEMENT Fuel mix Three months to 31st March Obajana Ibese 2018 2017 2018 2017 Gas 57% 48% 62% 54% Coal 43% 46% 38% 43% LPFO - 6% - 3% Relative cost of fuels vs gas per tonne of clinker As at 315t March 2018 Obajana Ibese Own-mined coal 0.67x 0.76x Importe
Slide 11: Nigeria Cash Cost Analysis
Nigeria Cash Cost Analysis xed Kiln Fuel a Power Plant Production Wages & Salaries SR DANGOTE CEMENT Maintenance Manpower Mine Costs Cash cost was approximately $33/tonne in Q1 2018 65% of cash costs are US Dollar based, though less than 20% paid in Dollars Investor Presentation
Slide 12: Pan-Africa Revenues Up
Pan-Africa Revenues Up * Sales volumes down 4.4% to 2.2Mt * Revenues up 16.8% to N68.6B EBITDA up 77.3% — Higher per-tonne pricing on FX translation . . Good Q1 performances — Zambia volumes up 29.9% — Cameroon volumes up 9.6% — Senegal volumes up 7.7% Three months to 31t March 2018 2017 Change Volu
Slide 13: Country Updates: Cameroon, Congo, Ethiopia
Country Updates Cameroon Estimates 760Kt total Q1 market Housing and infrastructure driving sales Volumes up 9.6% to 332Kt Stronger brand recognition achieved Pricing around $119/tonne 44% market share Commenced operations September 2017 Slow start, 39Kt sold in Q1 DRC borders now open for cement im
Slide 14: Country Updates: Ghana, Senegal, Sierra Leone
Country Updates GDP accelerating with attractive outlook for cement demand Market drivers include Tema- Accra highway, school building and infrastructure for oil and gas Volumes down to 193Kt owing to reallocation of vehicles to serve Nigerian demand and lead time of increasing seaborne imports Ex-f
Slide 15: South Africa, Tanzania, Zambia
South Africa Tanzania Zambia
Slide 16: Appendix
SIR DANGOTE CEMENT APPENDIX Building Prosperity in Africa Investor Presentation
Slide 17: Change in Pioneer Tax Treatment
Change in Pioneer Tax Treatment pAere CEMENT * Company remains confident that Pioneer Previous treatment applications will soon be approved by NIPC fobajana_| 2009 | 2010 | 2011 2012 | 2013 2014 | 2015 | 2016 | 2017 | 2018 | 2019 + Pioneer tax relief taken for the two-year extension on Lines 1&2 Ibe
Slide 18: Sustainability
Sustainability pase CEMENT + First Sustainability Report published in 2017 Annual Report * Reporting guided by: — Nigerian Stock Exchange requirements on sustainability reporting — Cement Sustainability Initiative — Global Reporting Initiative G4 Sustainability Reporting Guidelines * Focus upon: — C
Slide 19: Manufactured vs Imported Cement
25 Manufactured Imported 20 15 10 5 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Slide 20: Regional Cement Consumption Trends
Regional Cement Consumption Trends SR DANGOTE CEMENT 2010 2011 2012 2013 2014 2015 2016A 2017E 2018F — CAGR 2010-18F Mt Mt Mt Mt Mt Mt Mt Mt Mt % Australasia 13.1 13.2 119 10.5 11.2 113 114 11.8 12.0 -1.19% Central America 50.3 517 53.4 52.9 55.0 58.1 59.1 60.6 613 2.5% Central Europe 43.1 46.5 42.5
Slide 21: Investor Relations Contacts
INVESTOR RELATIONS CONTACTS For further information contact: Carl Franklin Head of Investor Relations. Dangote Cement Plc +44 207 399 3070 BOARD. 3a SRR } DANGOTE | CEMENT