Dangote Cement Plc · NSENG:DANGCEM
Dangote Cement — FY2014 Earnings Presentation
19 slides from Dangote Cement's earnings presentation, Mar 26, 2015
Slide 1: An emerging cement major building shareholder value and prosperity in Africa
An emerging cement major building shareholder value and prosperity in Africa Audited results for the year ended 31 December 2014 26 March 2015
Slide 2: Disclaimer
Disclaimer This document is not an offer of securities for sale in the United States. Any securities discussed herein have not been and will not be registered under the US Securities Act of 1933, as amended (the “US Securities Act”) and may not be offered or sold in the United States absent registra
Slide 3: FY 2014 highlights
FY 2014 highlights Financial • Revenue up 1.4% to ₦391.6bn • Gross profit eases 2.8% to ₦248.6bn, 63.5% margin • EBITDA down 2.7% to ₦223.4bn at 57.0% margin • EBIT down 4.5% ₦187.1bn at 47.8% margin • Earnings per share down 20.5% to ₦9.42 as operations enter tax • Net debt well below industry aver
Slide 4: Nigerian market
Nigerian market • Long-term growth remains robust at >10% Total Nigerian market sales (mt) Manufactured Imported • Slight fall in market sales to 21mt 25 • First half affected by production issues 20 10.3% CAGR • Unreliable gas supply at Obajana (c35% of entire market) 15 • Lack of back-up LPFO cons
Slide 5: Nigerian operations
Nigerian operations • Nigeria volumes down 3.2% to 12.9mt Ibese kiln fuel utilisation, 2014 Gas LPFO Coal • Revenues flat at ₦371.5bn 100% • Obajana 80% • Line 4 commissioned late 2014, now 13.25mt total 60% • Gas supply normalised in Q4, positive for margins 40% • Gas expected to be stable in 2015
Slide 6: West & Central Africa
West & Central Africa • Generated ₦6.2bn revenue • ₦3.9bn operating loss on start-up costs • Senegal operational late December 2014 • No contribution to FY14 revenue • Potential to export to Mali and other ECOWAS countries • Ghana sales down to 309kt • Unfavourable forex made trading difficult • Cam
Slide 7: South & East Africa
South & East Africa • Region generated ₦13.9bn revenue • Breakeven at EBIT level • South Africa makes good start • Contributes all regional revenue • Aganang/Delmas already at high utilisation • Good reception in key Inland market • Ethiopia expected operational April 2015 • Plant producing clinker
Slide 8: Healthy margins
Healthy margins Year ended Year ended 31/12/14 31/12/13 ₦bn ₦bn Comments Revenue 391.6 386.2 Increase mostly due to South African operations Cost of sales (143.1) (130. 5) Increased cost of fuels in Nigeria Gross profit 248.6 255.7 Gross margin 63.5% 66.2% Administration expenses (27.7) (26.0) Selli
Slide 9: Regional performance
Regional performance Year ended Nigeria West & Central South & East Eliminations Total 31/12/14 Africa Africa ₦bn ₦bn ₦bn ₦bn ₦bn Revenue 371.5 6.2 13.9 391.6 Depreciation & amortisation 34.2 0.8 1.2 36.3 Operating profit/(loss) 190.9 (3.9) 0.6 187.1 Other Income 3.5 0.0 0.0 3.6 Finance income 42.5
Slide 10: Key manufacturing costs
Key manufacturing costs Year ended Year ended 31/12/2014 31/12/2013 ₦bn ₦bn Comments Material consumed 33.2 31.1 Sephaku clinker and other consumables compensated by lower Ghana cement imports Fuel & power consumed 62.0 48.6 Increased use of LPFO, higher gas price Royalty 0.5 0.4 Salaries and relate
Slide 11: Strong balance sheet
Strong balance sheet Year ended Year ended 31/12/14 31/12/13 ₦bn ₦bn Comments Property, plant and equipment 747.8 581.5 Other non-current assets 96.1 111.4 Intangible assets 3.7 2.3 Current assets 116.5 78.8 Cash and cash equivalents 20.6 70.5 Total assets 984.7 844.4 Non-current liabilities 27.9 4.
Slide 12: Analysis of debt
Analysis of debt Year ended 31/12/14 Short term Long term Total Loans by currency ₦bn ₦bn ₦bn US$ 16.0 4.4 20.4 Euro 5.1 0 5.1 Naira 80.7 91.1 171.8 Rand 0 36.5 36.5 GHC 4.2 0 4.2 Total 106.0 131.9 237.9 Including loans from parent company 80.0 75.0 155.0 12
Slide 13: Cash flow/movement in net debt
Cash flow/movement in net debt Cash Debt Net debt ₦bn ₦bn ₦bn At 1 January 2014 70.5 (181.1) (110.6) Cash generated from operations 241.9 - 241.9 before working capital changes (26.0) - (26.0) Change in working capital (0.2) - (0.2) Income tax paid (217.2) - (217.2) Capital expenditure (0.1) - (0.1)
Slide 14: Investing for growth
Investing for growth Year ended 31/12/14 Nigeria South & West & Forecast East Africa Central 2015 Africa Capital expenditure ₦bn ₦bn ₦bn ₦bn Nigeria 121.8 40 Senegal 5.4 3 Cameroon 9.7 7 Congo 5.3 23 Ghana 1.3 16 Cote d’Ivoire 0.6 12 Sierra Leone 0.9 1 Other 0.0 South Africa 11.6 Ethiopia 18.4 23 Ta
Slide 15: International standards of governance
International standards of governance • Two Independent Non-Executive Directors appointed in 2014 • Ernest Ebi • Emmanuel Ikazoboh • Group-wide risk management initiative • Appointed Chief Risk Officer • Developed risk management framework • Improved Annual Report providing stakeholders with more in
Slide 16: EHSS commitments
EHSS commitments • Major Environment, Health & Safety and Social initiative • Standard approaches to be rolled out across all territories • Occupational Health & Safety Management System • Improves on plant-by-plant approach adopted so far • Teams being recruited to Dangote Cement EHSS program in 20
Slide 17: New Chief Executive
New Chief Executive • Onne van der Weijde • Joined February 2015 • Three-month handover period from outgoing CEO • Previously Area Manager Holcim India • 2008-2014 • CEO/MD Ambuja Cement, India • Senior Vice President, Holcim South Asia • CFO ACC Ltd, India • CFO Holcim Indonesia • Director & Busine
Slide 18: Key events in 2015
Key events in 2015 • All lines at Obajana and Ibese fully operational, combined 25mt capacity • Coal upgrade being completed across all plants by mid-year • Obajana Lines 1,2,4 • Ibese Lines 3&4 • Gboko being equipped to run 100% on coal in kilns and power • New plants opening in Cameroon, Zambia, E
Slide 19: Investor relations
Investor relations For further information contact: Carl Franklin Uvie Ibru Ayeesha Aliyu Chief Investor Relations Officer Investor Relations Investor Relations Dangote Industries London Lagos +44 207 399 3070 +44 207 399 3070 +234 1 448 0815 +44-7713 634 834 +44 7747 027 895 carl.franklin@dangote.c