Quarter 2 - financial statement for 2025

Statement of Significant Accounting Policies 2

Statement of Profit or Loss and Other Comprehensive Income 10

Statement of Financial Position 11

Statement of Changes in Equity 12

Statement of Cash Flows 13

Notes to the Unaudited Financial Statements 15

1. Material accounting policies

   The following are the significant accounting policies adopted by the Company in the preparation of its Financial Statements.

   1. Basis of preparation

      These Financial Statements have been prepared in compliance with IAS 34 Interim Financial Reporting and relevant International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board (the IASB).

      These Financial Statements were prepared under the historical cost convention. The principal accounting policies applied in the presentation of the Financial Statements are set out below. These policies have been applied to all the periods presented except for the adoption of new accounting policies.

   2. Revenue

      Revenue is measured at fair value of the consideration received or receivable net of value added tax, excise duty returns, customer discounts, and other sales related discounts.

      Revenue from the sale of products is recognised in profit or loss when the contract has been approved by both parties, rights have been clearly identified, payment terms have been defined, the contract has commercial substance and collectability has been ascertained as probable. Collectability of customer payment is ascertained from the customers' historical records, guarantees provided and advance payments made, if any.

      The four steps recognition process for revenue is listed below:

      • Identify the contract with a customer

      • Identify the performance obligation in the contract

      • Determine the transaction price

      • Allocate the price to the performance obligation

      • Recognise revenue.

   3. Cost of goods sold

      These are the costs of internally produced goods sold. The cost of internally produced goods includes directly attributable costs such as the costs of direct materials, direct labor and energy costs, as well as production overheads, including depreciation of production facilities. The costs of goods sold includes write-downs of inventories, where necessary.

   4. Selling and distribution expenses

      Comprises the cost of marketing, cost of organising the sales process and distribution.

   5. Foreign currency

      Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which they operate ('the functional currency'). The functional currency and presentation currency of the Company is the Nigerian Naira.

      Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from settlement of foreign currency transactions and from the translation of exchange rates of monetary assets, and denominated in currencies other than the Company's functional currency are recognised as the foreign exchange gain or loss in profit or loss.

   6. Financial instruments

Financial instruments represent the Company's financial assets and liabilities. Financial assets and financial liabilities are recognised in the Company's statement of financial position when the Company becomes a party to the contractual provisions of the instrument. These instruments are typically held for liquidity, investment, trading or hedging purposes. All financial instruments are initially recognised at fair value plus directly attributable transaction cost, except those carried at fair value through profit or loss where transaction cost is recognised immediately in profit or loss.

Financial instruments are recognised (derecognised) on the date the Company commits to purchase (sell) the instruments (trade date accounting).

(RC 1193879)

Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

1. Financial instruments (continued) Financial assets

   Financial assets include trade and other receivables, cash and bank balances and certain other assets. Financial liabilities include term loans, bank overdraft, trade and certain other liabilities. The Company classifies its financial assets into one of the categories discussed below, depending on the purpose for which the asset was acquired. The Company has not classified any of its financial assets as held to maturity.

   Subsequent measurement

   Subsequent to initial measurement, financial instruments are measured either at fair value or amortised cost, depending on their classifications below. The Company's accounting policy for each category is as follows:

   1. Trade and other receivables

      These assets are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise principally through the provision of goods and services to customers, but also incorporate other types of contractual monetary assets. They are initially recognised at fair value plus transaction costs that are directly attributable to their acquisition or issue and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment.

      Impairment provisions are recognised when there is objective evidence (such as significant financial difficulties on the part of the counterparty of default or significant delay in payment) that the Company will be unable to collect all of the amounts due under the receivable terms. The amount of such a provision being the difference between the net carrying amount and the present value of the future expected cash flows associated with the impaired receivable.

      For trade receivables which are reported net, such provisions are recorded in a separate allowance account with the loss being recognised within administrative expenses in the statement of comprehensive income. On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the associated provision.

   2. Cash and cash equivalents

      Cash and cash equivalents include cash in hand, deposits held at call with banks, other short term highly liquid investments with original maturities of three months or less that are readily convertible to a known amount of cash.

      Impairment of financial assets carried at amortised cost

      The Company assesses at each reporting date whether there is objective evidence that trade and other receivables are impaired. Trade and other receivable are impaired if objective evidence indicates that a loss event has occurred after initial recognition and that loss event has a negative effect on the estimated future cash flows of the receivables that can be estimated reliably. Criteria that are used by the Company in determining whether there is objective evidence of impairment include:

      • Known cash flow difficulties experienced by the customer

      • A breach of contract, such as default or delinquency in repayment for goods and service

      • Breach of credit terms or conditions and

      • It is becoming probable that the customer will enter bankruptcy or other financial reorganisation.

These include the following items:

1. Bank borrowings

   Bank borrowings are initially recognised at fair value, net of any transaction costs incurred. Borrowings are subsequently carried at amortised costs. Any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the profit or loss over the period of the borrowings using the effective interest method.

   (RC 1193879)

   Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

   Statement of Significant Accounting Policies
   1. Financial instruments (continued)

      General and specific borrowing costs directly attributable to acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period to get ready for their intended use or sale are added to the cost of those assets, until such time when the assets is substantially ready for intended use or sale. All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

2. Trade payables and other short-term monetary liabilities

These are initially recognised at fair value and subsequently carried at amortised cost using the effective interest method.

Fair value is the amount for which an asset could be exchanged or a liability settled between knowledgeable and willing parties in an arm's length transaction. The best evidence of the fair value of a financial instrument on initial recognition is the transaction price, i.e., the fair value of the consideration paid or received, unless the fair value is evidenced either by comparison with other observable current market transactions in the same instrument, without modification or repackaging or based on valuation techniques, such as discounted cash flow models and option pricing models whose variables include only data from observable markets.

When such valuation models with only observable market data as inputs or the comparison with other observable current market transactions in the same instrument indicate that the fair value differs from the transaction price, the initial difference will be recognised in the profit or loss immediately. The Company does not have any financial instrument (derivatives, etc.) that warrant such.

Financial assets are derecognised when the contractual rights to receive cash flows from the financial assets have expired or where the Company has transferred its contractual rights to receive cash flows on the financial assets such that it has transferred substantially all the risks and rewards of ownership of the financial asset. Any interest in transferred financial assets that is created or retained by the Company is recognised as a separate asset.

Financial liabilities are derecognised when they are extinguished, i.e., when the obligation is discharged, cancelled or expires. Where an existing financial liability is replaced by another from the same party on substantially different terms, or the terms of an existing financial liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, with the difference in the respective carrying amounts being recognised in profit or loss.

Financial assets and liabilities are offset and the net amount is reported in the statement of financial position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. The legally enforceable right is not contingent on future events and is enforceable in the normal course of business and in event of default, insolvency or bankruptcy of the Company or counterparty.

1. Retirement benefits

   The Company operates two defined benefit schemes for its employees: defined contribution scheme and defined benefit scheme. The defined pension contribution plan is based on a percentage of pensionable earnings funded through contributions from the Company (10%) and employees (8%). The Fund is administered by pension fund administrators. Contributions to this plan are recognised as an expense in the profit or loss, in the periods during which services are rendered by employees.

   Defined benefit schemes, also referred to as employee end of service gratuities are regarded as post-employment benefits.

   (RC 1193879)

   Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

   Statement of Significant Accounting Policies
2. Intangible assets

   Licences

   Licences are shown at historical cost. They have a finite useful life and are subsequently carried at cost less accumulated amortisation and impairment losses.

   Software

   Cost associated with acquiring software programmes are capitalised at historical cost. They have a finite useful life and are subsequently carried at cost less accumulated amortisation and impairment losses.

   Exploration assets

   Exploration assets are carried at cost less accumulated amortisation and impairment losses. The accumulated capitalised costs from exploration assets are amortised using straight line method.

   The Company also amortises other intangible assets with a limited useful life using the straight-line method over the following periods:

   Item	Depreciation method	Average useful life
   Exploration asset	Straight line	7-40 years
   Licences	Straight line	2-5 years
   Computer software	Straight line	3 years

3. Current taxation

   The tax for the period comprises current, education and deferred taxes. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is recognised in other comprehensive income or directly in equity, respectively.

4. Deferred taxation

   Deferred tax is recognized where the carrying amount of an asset or liability in the statement of financial position differs from its tax base. Recognition of deferred tax is restricted to those instances where it is probable that taxable profit will be available against which the difference can be utilised. The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the reporting date and are expected to apply when the deferred tax liabilities / (assets) are settled / (recovered).

5. Dividends

   Dividends are recognised when they become legally payable. Dividend distribution to the Company's shareholders is recognised as a liability in the Company's financial statements in the period in which the dividend is approved by the Company's shareholders at the AGM or when paid.

6. Property, plant and equipment

All property, plant and equipment are stated at historical cost less depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the assets carrying amount or recognised as a separate asset as appropriate, only when it is probable that future economic benefits associated with the item to the Company and the cost can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance cost, are charged to the profit or loss during the financial period in which they are incurred.

(RC 1193879)

Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

1. Property, plant and equipment (continued)

   Capital work in progress is not depreciated. Depreciation of assets commences when assets are available for use. Depreciation on other assets is calculated using straight line method over their expected useful economic life as follows:

   Item	Depreciation method	Average useful life
   Land	Straight line	Not depreciable
   Buildings	Straight line	30 - 50 years
   Plant and machinery	Straight line	3 - 40 years
   Furniture and fixtures	Straight line	5 years
   Motor vehicles	Straight line	4 years
   Quarry equipment	Straight line	5 years
   Tools, computers, laboratory and office equipment	Straight line	5 years
   Trucks	Straight line	4 years
   Construction work in progress	Straight line	Not depreciable

   The residual values and useful lives of these assets are reviewed and adjusted if appropriate at the end of the reporting year.

   Property, plant and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of the estimated selling price in the ordinary course of business less cost to sell and value in use. Impairment losses and reversal of previously recognised impairment losses are recognised within administrative expenses in profit or loss.

   An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefit is expected from its use or disposal. Gains or losses on disposal are determined by comparing the proceeds with the carrying amount and are recognised within other income or other expenses (net in profit or loss).

   Quarry exploration and evaluation expenditures are accounted for using the successful efforts method of accounting. Costs are accumulated on a quarry-by-quarry basis. Geological and geophysical costs are expensed as incurred. Costs directly associated with quarry and exploration are capitalised until the determination of minable reserves are evaluated. If it is determined that commercial discovery has been achieved, these costs are charged as expenses.

   Capitalisation is made with property, plants and equipment or intangible assets according to the nature of the expenditure. Once commercial reserves are found, exploration and evaluation assets are tested for impairment and transferred to development tangible or intangible assets. No depreciation or amortisation is charged during the exploration and evaluation period..

2. Inventories

   Inventories are stated at the lower of cost and net realisable value after providing for any obsolescence and damages determined by the Management. Costs are those expenses incurred in bringing each product to its present location and condition and are computed as follows

   • Raw materials, spare parts, and consumables: Actual costs include transportation, handling charges and other related costs

   • Work in progress and finished goods: Cost of direct materials, direct labor and other direct cost-plus attributable overheads based on standard costing

   • Finished Goods: Direct cost plus all production overheads.

     Inventories are initially recognised at cost, and subsequently at the lower of cost and net realizable value. Cost comprises all costs of purchase, costs of conversion and other costs incurred in bringing inventories to their present location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated cost to sell.

     Allowance is made for excessive, obsolete and slow-moving items. Write-downs to net realisable value and inventory losses are expensed in the period in which the write-downs or losses occur.

     (RC 1193879)

     Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

     Statement of Significant Accounting Policies
3. Related party disclosures

   Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial and operating decisions.

   Related parties include:

   • Entities over which the Company exercises significant influence

   • Shareholders and key management personnel of the Company

   • Close family members of key management personnel

   • Post-employment benefit plan which is for the benefit of employees of the Company or of any entity that is a related party of the Company.

     Key management personnel comprise the Board of Directors and key members of the Management Team having authority and responsibility for planning, directing, and controlling the activities of the Company.

     The Company enters into transactions with related parties on an arm's length basis. Prices of transactions with related parties are determined using the current market price or admissible valuation method.

4. Basic earnings per share

   Basic earnings per share is calculated by dividing the net profit for the year attributable to equity holders of the Company by the weighted average number of ordinary shares outstanding at the statement of financial position date.

5. Provisions

   Provisions are recognised when the Company has a present legal or constructive obligation as a result of a past event, and it is probable that the Company will be required to settle that obligation and the amount has been reliably estimated.

   Provisions for restructuring costs are recognised when the Company has a detailed formal plan for the restructuring that has been communicated to affected parties. Provisions are not recognised for future operating losses.

6. Borrowing costs capitalised

   Borrowing costs that relate to qualifying assets, i.e., assets that necessarily take a substantial period to get ready for their intended use or sale and which are not measured at fair value are capitalised. All other borrowing costs are recognised in profit or loss.

   (RC 1193879)

   Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

   Statement of Significant Accounting Policies
7. Right- of-use-asset

   Rights-of-use assets are initially measured at cost comprising of the following:

   • The amount of the initial measurement of lease liability

   • Any lease payments made at or before the commencement date, less any lease incentives received

   • Any initial direct costs, and

   • Restoration costs.

     The Right-of-use and lease liability are presented separately from other non-lease assets and liability in the statement of financial position.

8. Leases

   The Company primarily leases building used as offices and warehouse. The lease terms are typically for fixed periods ranging from 1 to 2 years but may have extension options as described below. On renewal of lease, the terms may be renegotiated.

   Contracts may contain both lease and non-lease components. The Company has elected not to separate lease and non-lease components but instead accounts for them as a single lease component. Lease terms are negotiated on an individual basis and contain different terms and conditions, including extension and termination options. The lease agreement does not impose any covenants; however, leased assets may not be used as security for borrowing purposes.

9. Segment reporting

   Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker. The latter who is responsible for allocating resources and assessing performance of the operating segments has been identified as the BUA Cement Leadership Team, which comprises of the Board of Directors and other Executive Officers.

10. Government grants

    Grants from the government are recognised at their fair value, where there is a reasonable assurance that the grant will be received and the Company will comply with all attached conditions. Government grants relating to costs are deferred and recognised in profit or loss over the period necessary to match them with the cost that they are intended to compensate.

11. Comparative figures

    Where necessary, comparative figures with notes have been restated to conform to changes in presentation in the current year.

12. Securities trading policy

    In compliance with Rule 17.15 Disclosure of Dealings in Issuers' Shares, Rulebook of the Exchange 2015 (Issuers' Rules), BUA Cement Plc maintains a Security Trading Policy which guides Directors, Audit members, employees, and all individuals categorised as insiders as to their dealing in the Company's securities. The policy is periodically reviewed by the Board and updated. The Company has made specific inquiries from all its directors and other insiders and is not aware of any infringement of the policy during the period under review.

    (RC 1193879)

    Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

    Statement of Significant Accounting Policies
13. Shareholding structure and free float status

₦95.40 ₦143.20

BUA Cement Plc with a free float value of ₦74,810,608,007 as at 30 June 2025, is compliant with the Exchange's free float requirements for companies listed on the Main Board.

(RC 1193879)

Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

The unaudited financial statements and the notes on page, were approved by the board of directors on July 25, 2025 and were signed on its behalf by:

Chikezie Ajaero

Chief Finance Officer FRC/2014/ICAN/0000001040

Abdul Samad Rabiu CFR, CON

Chairman FRC/2014/IODN/00000010111

Engr. Binji Yusuf

Managing Director/CEO FRC/2013/NSE/00000001746

(RC 1193879)

Unaudited Financial Statements for the Six Months ended 30 June 2025

Re-

Reserve on Actuarial

(RC 1193879)

Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

₦ '000

Unaudited 3 Months ended

30 June 2025

Unaudited

YTD 30 June 2025

Unaudited 3 Months ended

30 June 2024

Unaudited

YTD 30 June 2024

Audited Year end

31 December

2024

1. Revenue

   Sale of Cement 289,482,962 580,303,927 202,811,578 363,943,026 876,469,849

2. Cost of sales

   Materials	18,402,790	38,533,439	16,136,185	31,073,576	68,294,212
   Consumables	1,673,319	2,881,798	1,012,868	2,387,855	4,790,794
   Energy cost	33,391,488	77,909,185	40,559,006	70,473,478	282,483,504
   Repair and maintenance	5,827,831	11,713,716	4,476,083	8,005,903	18,552,260
   Operations, maintenance and technical fees	5,143,104	17,498,324	11,080,090	19,764,099	46,855,276
   Stock movement	37,090,656	51,045,407	11,423,860	18,969,488	67,624,309
   Employee costs	3,177,752	6,520,898	2,885,748	5,754,133	12,217,533
   Depreciation and impairment	8,551,367	17,070,067	5,229,695	10,452,595	25,041,521
   Manufacturing expenses	29,542,358	72,610,033	45,772,214	87,774,530	52,902,116
   Subtotal (before decommissioning adjustment)	142,800,665	295,782,867	138,575,749	254,655,657	578,761,525
   Decommissioning liability adjustment	(621,441)	(1,234,288)	-	-	(2,548,608)
   Total (after decommissioning adjustment)	142,179,224	294,548,579	138,575,749	254,655,657	576,212,917

   *Decommissioning liability adjustment relates to a decrease in decommissioning liability of one quarry, Ikpobia that exceeds the carrying amount of the decommissioning asset in line with IFRIC 1.

3. Other income

   Sundry income	143,627	732,269	83,623	137,002	294,484
   Profit on disposal of assets	-	53	-	-	900
   Government grants	159,779	317,801	-	-	753,967
   Insurance claims	7,258	7,258	12,253	-	14,405
   	310,664	1,057,381	95,876	137,002	1,063,756

4. Selling and distribution costs

   Marketing expenses & other overheads	1,088,356	1,232,281	221,911	325,485	669,312
   Advertisement and promotion	1,229,260	1,234,923	14,481	26,128	32,523
   Cement handling charges	97,146	203,318	193,936	334,931	971,784
   Printing and stationery	5,809	18,844	1,581	5,249	55,595
   Distribution costs	9,315,186	19,815,690	7,331,321	12,264,894	30,347,520
   Depreciation	3,248,779	6,497,559	1,204,555	2,409,111	9,502,046
   Salaries, wages & benefits	362,604	729,503	313,676	878,143	1,279,860
   Other expenses	29,449	55,542	20,156	37,633	-
   	15,376,589	29,787,660	9,301,617	16,281,574	42,858,640

   (RC 1193879)

   Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

   Notes to the Unaudited Financial Statements

   ₦ '000

   Unaudited 3 Months ended

   30 June 2025

   Unaudited

   YTD 30 June 2025

   Unaudited 3 Months ended

   30 June 2024

   Unaudited

   YTD 30 June 2024

   Audited Year end

   31 December

   2024

5. Administrative expenses

   Amortisation	1,842	3,771	2,334	4,668	9,173
   Auditors remuneration - external auditors	45,222	107,343	47,085	115,803	200,000
   Bank charges	122,477	233,883	193,160	335,549	868,711
   Computer expenses	-	-	192	192	300
   Depreciation	457,206	947,421	333,147	648,696	1,491,475
   Donation and Public relation	373,559	778,092	597,031	1,073,770	1,270,990
   Employee costs	1,711,500	3,782,421	1,459,792	2,727,022	6,016,046
   Debt issue expenses	79,175	79,175	1,772,873	1,772,873	1,781,473
   Board of directors expenses	331,753	407,908	222,848	355,935	1,235,379
   Corporate social responsibility	20,481	144,973	54,664	120,963	873,070
   Legal and other professional fees	246,177	539,931	54,406	271,864	1,071,601
   Gifts	115,035	212,103	29,940	55,300	290,485
   Insurance	16,523	33,046	8,554	17,667	446,389
   Medical expenses	73,309	136,831	31,155	45,048	200,227
   Motor vehicle expenses	39,033	68,285	17,664	36,087	103,481
   Other expenses	1,455,153	2,711,847	1,077,542	2,299,094	3,326,418
   Printing and stationery	-	-	-	-	160
   Repairs and maintenance	183,369	262,143	155,906	311,591	805,858
   Security	594,026	1,154,423	479,311	969,121	2,003,495
   Staff welfare	16,311	32,687	12,991	25,451	67,164
   	5,882,151	11,636,283	6,550,595	11,186,694	22,061,895

6. Investment income Interest income

   Investments in financial assets:

   Interest Income 5,235,339 6,764,236 6,741,356 9,801,387 18,190,652

7. Finance costs

   Interest expenses	18,813,801	38,132,683	6,000,740	10,878,500	58,191,262
   8(a). Foreign exchange (gain)/loss
   Net foreign exchange loss on borrowings/cash	(690,350)	(953,060)	89,574,919	90,682,323	237,661,060
   Foreign exchange loss capitalised	-	-	(56,166,534)	(56,166,534)	(52,493,150)
   Net loss on other foreign exchange transactions	(929,282)	170,237	(3,485,305)	5,462,341	(93,062,591)
   	(1,619,632)	(782,823)	29,923,080	39,978,130	92,105,319

   (RC 1193879)

   Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

   Notes to the Unaudited Financial Statements

   ₦ '000

   Unaudited 3 Months ended

   30 June 2025

   Unaudited

   YTD 30 June 2025

   Unaudited 3 Months ended

   30 June 2024

   Unaudited

   YTD 30 June 2024

   Audited Year end

   31 December

   2024

8. Earnings per share

Basic earnings per share are calculated by dividing the profit attributable to equity holders by the weighted average number of ordinary shares outstanding at the end of reporting period.

(RC 1193879)

Unaudited Financial Statements for the Three Months and Six Months ended 30 June 2025

11. Property, plant and equipment Reconciliation of property, plant and equipment

19