Dangote Sugar Refinery, a subsidiary of Dangote Group, has declared a profit before tax of US$112 million (N34.6 billion) for the financial year ended Dec. 31, 2018.
A breakdown of the result released on the floor of the Nigerian Stock Exchange (NSE) on Wednesday indicated that the refinery earned a revenue of US$492 million (N150.4 billion).
In terms of volume, seasonal sugar production at Savannah Sugar was 12,375 tonnes; full year refinery production at Apapa 564,785 tonnes, while Group sugar sales volume was 581,504 tonnes.
The Board of the company recommended a dividend payout of N1.10 kobo per ordinary share of 50k to be paid to shareholders for the year ended Dec. 31, 2018.
The dividend was subject to shareholders’ approval at the 13th Annual General Meeting of the company.
Commenting on the result, Ravindra Singhvi, Chief Operating Officer, Dangote Sugar Refinery, said, although the company maintained its market leadership position in the sugar sector, 2018 was very challenging.
He attributed the challenges to the impact of unlicensed sugar, smuggled and sold in key markets nationwide and the logistics challenges brought about by the continued Apapa traffic gridlock.
“The gridlock constrained availability of trucks required daily to evacuate the production volumes, while the influx of smuggled sugar exerted a downward pressure on selling prices.
“Despite efforts being deployed by the regulators to stem the tide, the influx of smuggled sugar into the markets spread further across our key markets in the North East and North West.
“We are currently focusing on process optimisation and the realisation of our Sugar Backward Integration Projects targeted at the production of 1.08 million metric tonnes of sugar in six years; from our various projects across the country,” he said.
Singhvi said that the company’s backward integration goal was to become a global force in sugar production, by producing 1.5 million tonnes per annum of refined sugar from locally-grown sugar cane for the domestic and export markets in the next 10 years.
He said that during the year, the following companies which formed part of the Backward Integration Project (BIP) were incorporated and consolidated in the Financial Statements of the group, which was indicative of the progress being made in BIP.
The companies are; Nasarawa Sugar Company Ltd, Dangote Taraba Sugar Ltd, Dangote Adamawa Sugar Ltd and Dangote Niger Sugar Ltd.
He said that the companies had a combined landmass of about 110,000 hectares for agriculture.
Dangote Sugar is Nigeria’s largest producer of household and commercial sugar with 1.44 million tonnes refining capacity.
The refinery located at Apapa Wharf Ports Complex, refines raw sugar imported from Brazil to white, Vitamin A fortified refined granulated white sugar suitable for household and industrial uses.
Its subsidiary, Savannah Sugar Company located at Numan, Adamawa State, is an integrated sugar production facility, with an installed capacity of 50,000 tonnes on 32,000 hectares of land.