Lafarge Africa, one of the top cement makers in Nigeria, recorded its highest profit in the past 11 years in the period ended June 30, 2022, according to its unaudited financial statement.
Data sourced from the Nigerian Exchange (NGX) shows that the company recorded an increase in profit by 32.1 percent to N37.4 billion from N28.3 billion in the comparable period of 2021, the highest in 11 years.
Its share price is also up 3.8 percent year-to-date, to N23.45 as of Friday.
Likewise, the cement maker grew its revenue by 28.7 percent in the first half (H1) of 2022 to N186.6 billion from the N145 billion recorded in the same period last year, the highest in 11 years.
The revenue growth was on the back of 28.2 percent and 45.3 percent increases in the proceeds from cement, and aggregates & concrete sales, respectively.
According to CardinalStone research analysts, these proceeds were bloated by higher product prices.
A breakdown of revenue by product shows revenue from cement amounted to N181.1 billion in H1 2022 from N141.3 billion in H1 2021, aggregates and concrete amounted to N5.2 billion from N3.6 billion, and other products amounted to N276.7 million from N159.2 million in the comparable periods under review.
The firm’s cost of sales grew faster than revenue growth, up 33.2 percent to N78.7 billion in H1 2022 from N59.1 billion in H1 2021.
Operating expenses increased by 37.0 percent to N47.1 billion in H1 2022 from N34.4 billion in H1 2021. The double-digit growth was driven by pressure on both selling & distribution expenses which were up 45.4 percent to N37.7 billion from N25.9 billion and administrative expenses which were up 9.8 percent to N10.1 billion from N9.2 billion.
Finance costs nosedived by 30.1 percent to N1.9 billion in H1 2022 from N2.7 billion in the same period last year, while finance income was also down 47 percent to N191 million from N362.8 billion in the periods under review.
The cement company’s total assets grew by 11 percent to N568 billion in H1 2022 as against N511.7 billion reported in H1 2021.
Lafarge’s cash and cash equivalents, which show the value of a company’s assets that are cash or can be converted into cash immediately, amounted to N78.8 billion in the first six months of 2022, a 39 percent increase from N56.6 billion in the same period last year.
Its net cash generated from operating activities, however, declined by 14.7 percent to N46.8 billion in H1 2022 from N54.8 billion in H1 2021.
However, Lafarge Africa recorded negative net cash from its investing activities, which increased by 91.9 percent to a loss of N6.9 billion in the first half of 2022, compared to the loss of N3.6 billion recorded in the previous year’s first half.
Likewise, the company reported a negative net cash flow from financing activities, which declined by 79 percent to N9 billion in the first half of 2022 from N46.7 billion in 2021.