Dangote Cement Plc · NSENG:DANGCEM
Dangote Cement — 9M 2016 Earnings Presentation
15 slides from Dangote Cement's earnings presentation, Sep 30, 2016
Slide 1: Unaudited results for the nine months to 30th September 2016
Unaudited results for the nine months to 30th September 2016
Slide 2: Highlights for 9m 2016
Highlights for 9m 2016 Financial results Regional revenues (₦B) • Revenue up 20.9% to ₦442.1B Nine months to 2016 2015 Change 30th September • Nigeria EBITDA of ₦164.1B at 53.3% margin on lower selling price, higher fuel costs Nigeria 307.8 295.5 4.2% • Pan African EBITDA of ₦22.9B at 16.7% margin,
Slide 3: Financial Overview
Financial Overview Income Statement Nine months to 30th September 2016 2015 ₦B ₦B % change Comments Maiden 9M contributions from non-Nigerian factories and improved revenue from Revenue 442.1 365.5% 20.9% Nigeria Higher fuel costs in Nigeria owing to gas disruption, cost increased due to Cost of sal
Slide 4: Financial Overview (cont'd)
Financial Overview (cont’d) % of average cash costs per tonne (Nigeria, 2016 ytd) Plant general 6% SG&A 12% Direct wages 6% Kiln fuel (cement plant) 36% O&M contract 4% Maintenance 5% Other variable Packaging 3% 9% Power Plant Refractories 12% 1% Gypsum Limestone 4% Mine costs 0% 2% Proportion of ca
Slide 5: Financial Overview (cont'd)
Financial Overview (cont’d) Movement in net debt Cash Debt Net debt ₦B ₦B ₦B As at 1st January 2016 40.8 (245.0) (204.2) Cash generated from operations before 182.9 182.9 changes in working capital Changes in working capital (26.7) (26.7) Income tax paid (0.7) (0.7) Capital expenditure (102.8) (102.
Slide 6: Financial Overview (cont'd)
Financial Overview (cont’d) Balance sheet As at As at 30/09/16 31/12/15 ₦B ₦B Property, plant and equipment 1,141.5 917.2 Other non-current assets 24.3 25.1 Intangible assets 4.3 2.6 Current assets 244.2 125.2 Cash and cash equivalents 86.9 40.8 Total Assets 1,501.2 1,110.9 Non-current liabilities 9
Slide 7: Analysis of Debt
Analysis of Debt ₦bn Short-term Long-term Total % Naira 64.3 207.0 271.0 73% US$ 23.1 8.2 31.4 8% Rand 2.8 46.6 49.4 13% Other 10.2 11.1 21.3 6% Total 100.5 272.7 373.2 100% • DCP has low US$ debt exposure • BUT: DCP Nigeria lends funds to country operations in US$ • Results in gain on translation a
Slide 8: Nigeria Performance
Nigeria Performance • Record 9M sales up 28.1% to nearly 12Mt Nigeria performance Nine months to • Good growth in July/August but September 30th September 2016 2015 Change was c7% lower vs September 2015 – Breaks 11-month streak of growth from 10/15 to 8/16 Volumes sold (kt) 11,913 9,296 28.1% – Imp
Slide 9: Fuel Costs in Nigeria
Fuel Costs in Nigeria • Kiln fuel is the major cost of cement production Relative cost of alternative fuels vs gas per tonne of clinker • Group margins are affected by mix of fuel in Nigerian kilns • Preference has previously been to run on gas, but: Obajana Ibese • Disruption and maintenance have l
Slide 10: Good Progress with Coal Upgrades
Good Progress with Coal Upgrades • Decided 2-3 years ago to diversify and de-risk fuel supplies Update on coal mills • Coal mills operational on all lines at Ibese and Obajana Obajana Capacity Operational date • Immediate and positive impact on margins Line 1 2.5Mta June 2016 • Already using local
Slide 11: Pan Africa
Pan Africa • Strong performance across the region despite Rest of Africa performance heavy seasonal rains, religious festivals in Q3 Nine months to 2016 2015 Change 30th September • Sales volumes up 72.9% to 6.4Mt Volumes sold (kt) 6,450 3,731 72.9% • Revenues rise 94.9% to ₦136.6B • EBITDA up 27.9%
Slide 12: Country Updates
Country Updates Cameroon Ethiopia • GDP growing at c5% but slowing on lower oil price • Local political disruption reduced output in • Infrastructure investment continues but at more September/October modest levels • Price increased to $95 as a result of disruption • Cement pricing generally stable,
Slide 13: Country Updates
Country Updates South Africa Zambia • Economy weak on China slowdown, Brexit worries • Low copper prices impact export earnings, • But infrastructure investment set to rise Kwacha depreciation vs US$ • Strong sales despite economy • Increased unemployment, 20% inflation, power shortages • Pricing pr
Slide 14: Update on Trading and Outlook for 2016
Update on Trading and Outlook for 2016 • Q4 margin improvements expected from: • Impact of Nigeria price adjustment in September • Elimination of LPFO from fuel mix • All Nigeria lines now running gas/and or coal, eliminating use of LPFO +46% +47% with immediate benefits to Q4 margins • Own-mined co
Slide 15: Investor Relations
Investor Relations For further information contact: Carl Franklin Head of Investor Relations Dangote Cement Plc +44 207 399 3070 +44-7713 634 834 carl.franklin@dangote.com www.dangotecement.com @DangoteCement 15