BUA Cement’s revenue jumps 27.4% to N460bn

Business a.m

BUA Cement emerged victorious in the face of economic challenges posed by the naira redesign policy, posting an impressive 27.4 per cent increase in revenue to N460 billion against N361 billion recorded in 2022.  This achievement was attributed to the company’s increasing market share, a testament to its resilience and continued growth.

Though the company’s revenue growth is certainly a cause for celebration, the full year financial statements and accounts also revealed some challenges. In particular, the devaluation of the naira and continued inflation led to increased production costs, rising 39.5 per cent to N276 billion in 2023,compared to N197.9 billion in 2022. 

In addition to the impact of the devaluation of the naira on production costs, BUA Cement also recorded a net foreign exchange loss of N70 billion in 2023. This was a significant increase from the previous year’s loss of N5.5 billion. Of this loss, N52.5 billion was attributed to finance costs associated with the construction of additional 3mmtpa lines at the Obu and Sokoto plants, as well as other ancillary activities. A further N17.5 billion of the loss was attributed to foreign trade payables.

Despite the challenges presented by the devaluation of the naira and rising production costs, BUA Cement managed to generate a net profit after tax of N69.5 billion in 2023.

Yusuf Binji, the Managing Director/ CEO,noted that the operating environment in 2023

was challenging, given the different headwinds confronted with at the start of the year and especially with the devaluation of the naira. 

Commenting on activities conducted by the company during the year in review, he said, “During the year, we launched the maiden edition of the BUA Cement Scratch and Win promo., among other initiatives, which saw BUA Cement further increase its share of the market and resulted in a 27.4% rise in revenues to N460 billion from N361 billion in the prior year.

In addition, we commissioned the new 3mmtpa lines at the Sokoto and Obu Plants, activated a new 70MW gas power plant in Sokoto and eagerly await the activation of the 70MW gas power plant at Obu during the first quarter of 2024.” 

Among other developments, Binji noted that the company took delivery of over 500 trucks to support its distribution activities, which further deepened its market presence.

“We believe these investments further ‘Reinforces our Purpose,’ which is to be ‘A highly competitive

leader in Nigeria’, as we address not only the housing and infrastructure needs in a sustainable manner,but also seek out innovative ways to making cement affordable,”he added.

Also discussing the company’s financial performance, Jacques Piekarski, BUA Cement’s chief financial officer, stated that the company’s resilience was impressive given the difficult economic environment, particularly the naira’s devaluation. 

Piekarsk also disclosed that in spite of the foreign exchange loss, BUA Cement’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased by 9.6 per cent to N169.3 billion in 2023.  He also expressed confidence about the business, together with the evolving strategy to thrive.

BUA Cement Plc is currently the second largest cement company in Nigeria and the largest producer in the country’s North-West, South-South, and South-East regions,making it a key player in the industry. With an installed capacity of 11 million metric tonnes per annum (mmtpa), the company said it is well-positioned to meet the growing demand for cement in Nigeria.