Lafarge Africa Plc, makers of Elephant Cement, released its 2023 full yeae audited financials statements, reporting an EPS of N3.17 against N3.33 in 2022.

The decline in the company’s EPS is attributable to the higher net foreign exchange losses FX losses and tax payments for the year, majorly due to its expired pioneer tax incentive.

Lafarge Africa board has proposed a final dividend of N1.90 per shares. Revenue grew by 8.6% in 2023 full year against 27.3% in 2022, reflective of the broad economic headwinds that slowed sales within the year and shutdown of the Mfamosing plant which accounts for c.50.0% of production volume for maintenance in third quarter of 2023.

Across its product segments, Lafarge Africa Plc saw improvement in sale of cement and readymix and other product.

Revenue was buoyed by upward adjustment of cement prices which as of nine months 2023 was hiked by 23.0%.

Gross margin weakened by 150bps to 57.4%, as the cost of sales ex-depreciation grew by 12.6%, owing to higher cost of fuel and power, production and maintenance.

The cost pressure was driven by the high inflationary environment and naira depreciation effect on the company’s foreign exchange linked gas contracts.

Notwithstanding, EBITDA margin strengthened by 259bps to 32.0% in 2023 full year against 29.4% in 2022, supported by a moderation in selling and distribution costs amid increased administrative expenses during the period.

Consequently, the OPEX/sales ratio declined by 400bps to 26.0% against 30.0% in 2022.

Following the devaluation of the naira in 2023, net finance cost spiked by 47.6% as the group recorded net foreign exchange
losses of N21.04 billion amid a 73.0% rise in interest expenses, majorly from bank charges and other interest costs.

Elsewhere, profit before tax increased by 15.7% to N80.69 billion in 2023 full year.

However, due to the expiration of the group’s pioneer status incentive in 2022 full year, tax expense for the review period surged by 83.6% to N29.55 billion.