**Pays N40.4bn Tax to Government
By Dipo Olowookere
Nigeria’s treasury is expected to receive a boost with the expected payment of N40.4 billion in corporate tax by a leading cement firm in the country, Dangote Cement Plc.
The tax is from the operational result of the cement marker in the first quarter of 2021, according to details of its financial statements released to the Nigerian Exchange (NGX) Limited on Friday, April 30, 2021.
The country is currently undergoing a decline in earnings and the payment of over N40 billion into the coffers of the government would go a long way to benefit the citizens.
Dangote Cement is one of the most responsible corporate citizens of the country as well as one of the biggest private-sector taxpayers. At the moment, it pays over N240 million daily as Value Added Tax (VAT) to the government.
As part of the company’s corporate social responsibility, in line with the government’s quest to boost infrastructural development in the country, Dangote Cement opted to provide funding for the constructions of major roads in Lagos and Kogi States.
The roads are the critical Lagos Apapa Port road leading to the old toll gate and the Lokoja-Obajana-Kabba road straddling Kogi and Kwara states.
A review of the Q1 results of the firm showed that the N40.4 billion tax it paid in the period under review was 47.3 per cent higher than the N27.42 billion paid in the corresponding period of the 2020 financial year.
In order to meet increased demand for its products, Dangote Cement has ramped up production capacity in the Obajana Line 5 and resumed production at the Gboko plant.
During the first three months of the year, the firm also increased the total volume of cement sold from its Nigerian operations to 4.9Mt compared to the 4.0Mt sold in the first quarter of 2020.
Pan-African operations sold 2.6Mt of cement in the period under review compared to 2.3Mt sold in the corresponding period in 2020.
The cement maker said it’s making efforts to start the Okpella Plant before the end of June in order to meet the increasing demand for cement in the country and help to moderate prices in the market.
Commenting on the results, Dangote Cement GMD/Chief Executive Officer, Mr Michel Puchercos, said that the company started the first quarter of 2021 on a positive note and recorded increases in revenue and profitability as the post-tax profit closed at N89.7 billion.
“We took the strategic decision to pause our clinker exports to ensure we meet the rapid volume growth in the Nigerian domestic market.
“We are improving the output of our existing and new assets and aim to recommence clinker exports in the second quarter.
“Our Pan-Africa operations have reached new heights, with an EBITDA margin of 25.5 per cent and volume growth of 12.8 per cent reported during the quarter.
“One of our priorities in 2021 is to strengthen our alternative fuel initiative. It focuses on leveraging the circular economy business model, optimising costs and reducing exposure of our cost base to foreign currency fluctuations.
“As ever, we are committed to keeping our staff and communities safe by being fully compliant with health and safety measures in all our territories of operation,” he said.
Dangote Cement Plc is sub-Saharan Africa’s largest cement producer with an installed capacity of 48.6Mta across 10 African countries and operates a fully integrated “quarry-to-customer” business with activities covering manufacturing, sales and distribution of cement.
The firm has a long-term credit rating of AAA+ by GCR and Aa2.ng by Moody’s due to its market-leading position, significant operational scale and strong financial profile evidenced by the company’s robust operating and net profit margins relative to regional and global peers, adequate working capital, satisfactory cash flow and low leverage.
Dangote Cement is a subsidiary of Dangote Industries Limited, a diversified and fully integrated conglomerate as well as a leading brand across Africa in businesses such as cement, sugar, salt, beverages, and real estate, with new multi-billion dollar projects underway in the oil and gas, petrochemical, fertiliser and agricultural sectors.
