• Wednesday, April 17, 2024
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Lafarge Africa FY’23 profit impacted by significant FX loss

Lafarge Africa FY’23 profit impacted by significant FX loss

Lafarge Africa Plc has announced its full year 2023 results, saying its profits were impacted by significant foreign exchange (FX) loss.

Full year 2023 profit before tax (PBT) went up 15.7 percent YoY in spite of N21billionn Foreign exchange losses in 2023.

FY 2023 net sales went up 8.6 percent year-on-year (YoY), it also shows strong balance sheet position with FY 2023 free cash flow of N109.7billion, and strong net cash of N142billion.

Lafarge Africa noted that higher effective tax rate in 2023 (after expiry of Pioneer Status Incentive in 2022) coupled with pressures from FX losses led to a PAT decline of 4.7 percent YoY.

Read also: Lafarge Africa lifts students, farmers with projects across communities

The cement maker also noted its continued focus on product solutions, innovation, operational excellence, health and safety and decarbonisation

Lolu Alade-Akinyemi, CEO of Lafarge Africa, said, “The fundamentals of our business remain strong. In spite of extremely challenging macroeconomic head winds, we grew the top line by 8.6 percent and improved Operating Margin from 22.6 percent to 25.3 percent in FY 2023.

“In the face of very material FX devaluation losses and higher effective tax rate, Profit After Tax declined YoY by 4.7 percent. Our performance was largely impacted by spiralling inflation and unprecedented Naira devaluation, with the attendant pressure on energy and supply chain costs.

“Despite these challenges, we continue to maintain a strong free cash flow position and a strong balance sheet, positioning us for sustainable growth over the medium to long term. We are committed to delivering sustainable value to all stakeholders in the coming years, as we have done historically.
I would like to thank all employees and stakeholders of Lafarge Africa for their commitment over the years,” Alade-Akinyemi said.

Lafarge Africa unveiled its first green depot in Abeokuta, designed to accelerate green mobility.

“As part of our commitment to promoting sustainable growth, the Green Depot runs entirely on a solar power system, which guarantees 100 percent energy conservation in lighting, air-conditioning, and electric forklift charging.

“This complements our electric and CNG trucks; the additional injection of CNG trucks further facilitates eco-friendly transportation of cement from our Ewekoro plant to the depot, further underscoring our dedication to green mobility.

“Earlier in the year, Lafarge had announced the launch of Eco Label cement brand; Lafarge UniCem; which contributes about 23 percent of the company’s entire volume and is eco-friendly with a 30 percent lower carbon footprint compared to the local industry standard (Global Concrete & Cement Association). It represents a broad range of green cement produced for high performance, sustainability and circular construction,” it said.

Read also: Here are 5 strategies to protect your business from volatile FX market

Lafarge Africa commissioned its cement bag manufacturing plant in Ewekoro Plant in May 2023 with a monthly production capacity of 8.8 million bags and an annual capacity of 105 million bags.

The new bag plant allows Lafarge to reinforce availability and handle large scale production of bags while also improving livelihood through direct employment of 254 individuals, with 60 percent being residents of Ewekoro Community.

“The Nigerian Infrastructure and Construction Sector is expected to continue growing despite inflationary pressure and currency depreciation affecting the economy. As a result, we maintain our positive outlook, expecting increased demand in 2024 as the economy picks up. We will continue to maximize volume opportunities across our markets and actively manage our costs. The Company remains committed to its sustainability ambitions and strategy of ‘Accelerating Green Growth’ through innovative building solutions and delivering stakeholder value,” Lafarge Africa said.