L-R: Company Secretary/Legal Adviser, Temitope Hassan; Chairman, Dangote Sugar Refinery Plc, Aliko Dangote; Non-Executive Director, Dangote Sugar Refinery Plc, Olakunle Alake; Group Managing Director/CEO, Dangote Sugar Refinery Plc, Ravindra Singhvi; during the 15th Annual General Meeting (AGM) of Dangote Sugar Refinery Plc, held in Lagos on Thursday, May 27, 2021.
Dangote Sugar Refinery Plc has urged government to faithfully follow through the Backward Integration Policy in the sugar industry as the nation stands to rake in foreign exchange up to $700millon yearly from Sugar production self-sufficiency.
Chairman of Dangote Sugar Refinery Aliko Dangote, yesterday, at its 15th Annual General Meeting (AGM) held in Lagos said that allowing for distortions in the sugar masterplan framework will adversely affect the target of the nation attaining self-sufficiency as projected.
He described the backward integration policy as commendable which will not only reduce imports of raw sugar but save the nations enormous foreign exchange used for importation.
Dangote expressed delight that the BIP in the Sugar industry is going on well and added “if the National Sugar Master Plan is followed strictly and the players all follow the rules, the country will be better for it as Nigeria will save between $600million and $700 million annually as forex”
He stated that the backward integration policy of Dangote Sugar Refinery is recording appreciable progress even as he declared the company’s irrevocable commitment to the policy.
Addressing the shareholders, Dangote opined that despite the disruptions in the economy occasioned by the Covid-19 pandemic, Dangote Sugar Refinery has announced an increase in production volume which rose by 13.7 percent to 743,858 tonnes in the financial year ended December 31, 2020, compared to 654,071 tonnes in 2019.
He stated that the Company posted a Group turnover of N214.3 billion a 33percent increase over the N161.1 billion in 2019, while in the same period the Sugar Group also posted a 6.9 percent increase in sales volume from 684,487 tonnes in 2019 to 731,701 tonnes in 2020.
Therefore, the Board of the company declared a dividend payment of N18.22billion to the shareholders, amounting to N1.50kobo per ordinary share of 50k each.
According to Dangote, the improvements were attributable to operations optimization strategy despite disruption caused by civil unrest in last quarter of the year. “Our growth continued to benefit from the sustained efforts to drive customer base expansion and several trade initiatives and investments.”
Gross profit increased by 40.4 percent to N53.75 billion, compared to N38.29 billion in 2019 while Group profit after taxation for the year increased by 33.2 percent to N26.70 billion as against N22.36 billion in 2019, reflecting management’s unrelenting goal to deliver consistent shareholder value.
Dangote said the Company has revised its sugar production target to 550,000 metric tonnes achievable by 2024 in line with the revised plan on the BIP by the federal government.
In his remarks, the Group Managing Director/Chief Executive Officer, Mr. Ravindra Singhvi, speaking on the results said the sugar group continued the growth path with commitments to improve performance and generate value for all stakeholders.
He explained that this was reflected in the sales volume delivery of 731,701 tonnes, and production of 743,858 tonnes being 6.9% and 13.7% increase in volumes over the comparative year 2019.
He said the Company would ensure all hands are on deck to meet the targeted 550,000tonnes projected to be achieved by 2024. “Our Backward Integration goal is to become a global force in sugar production, by producing 1.5M MT/PA of refined sugar from locally grown sugar cane for the domestic and export markets.”
According to him, “our focus on the implementation of our key strategies in the face of the several challenges posed by the COVID Pandemic, the peculiarities of the Apapa traffic situation amongst others we achieved a topline growth in revenue of N214.30 billion, a 33.0% increase over 2019; a 53% YOY increase in PBT, and 33.2% increase in PAT.
“2020 was indeed very eventful for our company ranging from the weak macroeconomic fundamentals caused by the underlying impact of COVID-19 pandemic which saw to the steady rise in forex rate, high inflation and the significant rise in our cost of production, to the worsening traffic gridlock on the Apapa Wharf Road which led to delays and at times disruption of the distribution and deliveries to customers.”
He noted that one of the key highlights of during the year was the successful completion of the Scheme of Arrangement – merger of Dangote Sugar Refinery Plc (DSR) and Savannah Sugar Company Limited (SSCL) with effect from September 1, 2020, to operate under one unified entity.
He added, “We are confident the merger will enable us to achieve operational, administrative and governance efficiencies resulting in increased shareholder value. We will continue to pursue our Backward Integration Projects, and other key initiatives to grow our sales volumes, market share, optimize cost and operational efficiencies.
Also speaking, Dr. Farouk Umar, President, Association for the Advancement of the Rights of Nigerian Shareholders commended the management of Dangote Sugar for the impressive performance of the company despite the hiccups in the year 2020.
He said the shareholders expect more robust results next year since the economy is already picking up and for them to have performed excellently under pandemic, then next year will be greater for us all. The leadership of the company has been very wonderful.”
Commenting in the same vein, Coordinator, Independent Shareholders Association, Sir Sunny Nwosu said the management of Dangote Sugar led by Dangote has never let the shareholders down for once “their management style is second to none and that is why the company has been growing steadily.
He said the way and manner the Company has been executing its BIP projects was also commendable as this will afford the Company opportunity to meet target within it projected timelines.
Dangote Sugar Refinery is Nigeria’s largest producer of household and commercial sugar with 1.44M MT refining capacity at the same location. Our 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.
To achieve this, Dangote Sugar Refinery Plc acquired Savannah Sugar Company Limited, located in Numan, Adamawa State in December 2012, and embarked on the ongoing rehabilitation of its facilities and expansion of its 32,000 hectares’ sugarcane estate. In September 2020, the scheme of merger between DSR and Savannah Sugar estate was completed which gave birth to a bigger and stronger business with considerable opportunity for growth and delivery of superior benefits to all stakeholders. The expansion and rehabilitation of the sugar estate is still ongoing as well as the development of the greenfield site acquired at Tunga, Nasarawa State for the achievement of DSR’s sugar for Nigeria development master plan.
The Nasarawa Sugar Company Limited, is the registered subsidiary of Dangote Sugar Refinery Plc. The 78,136 hectares Sugar Project Site is located at Tunga, Awe Local Government Area, of Nasarawa State. Massive developments in agriculture, irrigation infrastructure amongst others is ongoing at the site. Unfortunately, Lau/Tau project is still on hold following the lingering compensation issue between the communities and Taraba state government.
DSC7799: L-R: Chairman, Dangote Sugar Refinery Plc, Aliko Dangote; Group Managing Director/CEO, Dangote Sugar Refinery Plc, Ravindra Singhvi; and Non-Executive Director, Dangote Sugar Refinery Plc, Olakunle Alake during the 15th Annual General Meeting (AGM) of Dangote Sugar Refinery Plc, held in Lagos on Thursday, May 27, 2021