Dangote Sugar Refinery released its Q1’23 Earnings results, delivering topline growth of 8% y/y to ₦102.2 billion. In the Q1 period, the National Sugar Development Committee (NSDC) reported that wholesale sugar prices per tonne rose 36% higher y/y which supported sugar revenue for the industry. By geography, higher growth stemmed from Lagos operations, growing 15% y/y and contributing 40% to revenue. On the Opex front, while selling expenses declined by 33%, admin expenses increased b...
Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
According to data from the National Sugar Development Council (NSDC), sugar prices averaged ₦19,108 per 50kg bag, representing a 32% y/y surge. This was evident in Dangote Sugar Refinery’s Q1’21 Financial Statements, where it showed a 41% y/y jump in Revenue to ₦67.4 billion (Vetiva: ₦52.7 billion). Suppressed importation boosts sugar volumes Whilst the increase in sugar prices was partly responsible, we believe that topline growth was also driven by a boost to sales volume. Thus, af...
Growth continues strong Dangote Sugar Refinery’s Q420 revenue of N53.78 billion was a decline from Q320’s N57.28 billion (-6%QoQ) but still represented a strong growth of 23% when compared to Q419 (N43.66 billion). DSR’s cost of sales declined, for the first time since Q119, by 0.6%YoY which is impressive in the midst of a double-digit inflation and a currency depreciation. Gross profit more than doubled to N19.6 billion on the back of higher revenue and declining costs while operating profi...
Sector valuation is now closer to fair value. Our coverage of Nigerian consumers stocks is down 21% ytd on aggregate, and currently trades at a median FY 20f PE and EV/EBITDA of 22.8x and 10.3x, respectively (average 30% discount to the 2-year historical median). In our view, the sector historically traded at unjustifiably rich multiples, and is now closer to our fair value estimates (FY 19f PE and EV/EBITDA of 23.9x and 7.9x), hence our broadly neutral stance, despite cuts to our target prices....
Nigeria H2'19 Outlook - Feeble feet on thorny grounds Narrow opportunity window amid easing global monetary conditions: A sense of urgency is required for Nigeria to derive optimal benefits from the sudden increase in global liquidity conditions occasioned by the switch to accommodative monetary policy by central banks in developed markets. IMF projections indicate, that global GDP growth could ease to 3.3% for FY’19 due to weaker growth in the...
We are bullish on the Africa Consumer sector and identify Nigerian Breweries (NB NL), Nestle Nigeria (NESTLE NL), and East African Breweries (EABL KN) as our top picks. In this report we introduce a proprietary valuation metric, Productive Exposure to the Poor (PEP), that rates companies based on the extent to which their business model targets Africa’s poorer segments. We also focus on Nigeria and provide individual company analysis of the eight Nigerian Consumer names in our coverage.
Mixed bag of performances for FMCGs In line with the year-long trend observed in the sector, we expect revenue growth for consumer goods companies in Q4’18 to remain majorly driven by volume performance. Specifically, we forecast stronger topline figures in the seasonally stronger fourth quarter amid higher consumption levels in the festive period, and also mildly buoyed by stronger commercial activity during the electioneering se...
External factors weigh on Q3’18 performance DANGSUGAR released its 9M’18 results showing a 28% y/y revenue decline to ₦117 billion, 5% below our estimate. While we had expected revenue in Q3 to come in lower q/q, given that it is a seasonally slower quarter, topline still came in at ₦33 billion (Q2: ₦42 billion), below our ₦38 billion estimate. This variance was driven by further reduction in sugar prices...
Despite the difficult operating environment, Dangote Sugar reported an 11% y/y rise in Q1’18 Profit after tax in spite of a 31% y/y moderation in Revenue to ₦41.1 billion (Vetiva: ₦43.7 billion). Gross Margin came in much stronger y/y at 25% compared to the 13% recorded in the cost-bombarded Q1’17 period (Vetiva: 25%, Q4’17: 23%), supported by lower foreign exchange related costs. According to Management, average cost of raw sugar decreased 23% y/y. As such, Gross Profit came in 31% higher y...
Resilient earnings despite increasing competition Dangote Sugar’s FY’17 financial results showed a 20% y/y rise in Revenue for the period as a 43% y/y increase in average selling prices offset a 16% y/y decline in sugar volumes sold. Particularly, the top line figure came in at a record high of ₦204 billion – marginally below our expectation. The deviation was largely driven by lower than expected volume rollout in Q4’17 (3% q/q rise vs 11...
​Dangote Sugar PLC released its Q1’17 results showing an 83% y/y rise in revenue to ₦59.5 billion, above Vetiva estimate of ₦42.9 billion. Like prior quarters, the topline performance was solely supported by higher average selling prices which rose 121% y/y to ₦340,200/MT. Whilst volumes have been adversely impacted (down 17% y/y), the price increases have been sufficient to produce this robust topline growth. Reflecting the impact of a weaker exchange rate on the import-reliant sugar ...
Dangote Sugar Refinery PLC recently released its FY’16 financial results which showed a 68% y/y rise in revenue to ₦170 billion (Vetiva: ₦158 billion). This was following an outperformance in Q4’16 revenue which came in at ₦54 billion – 27% higher than we had expected. Given the relatively flat sales volume of 778,518 MT (FY’15: 778,000 MT) for sugar in FY’16, the topline performance was solely driven by price increases implemented in the year. Following a further surge in costs ...
Ford Equity International Research Reports cover 60 countries with over 30,000 stocks traded on international exchanges. A proprietary quantitative system compares each company to its peers on proven measures of business value, growth characteristics, and investor behavior. Ford's three recommendation ratings buy, hold and sell, represent each stock’s return potential relative to its own country market.. The rating reports which are generated each week, include the fundamental details behind...
DANGSUGAR maintained the impressive revenue growth run-rate recorded from H1’16 in its Q3’16 results, posting an 18% q/q growth in the period. Though flattered by a low base from the preceding year (volumes impacted by distribution challenges and higher smuggled sugar volumes), 9M’16 revenue was up 58% y/y to ₦115 billion (Vetiva estimate: ₦102 billion). This notable growth can be attributed majorly to multiple price increases implemented through the year, up 45% y/y to ₦187,590/ton ...
​DANGSUGAR reported a 7% y/y revenue growth for FY’15 driven by a 0.1% volume growth and an 8% average price increase. More interesting was the surprisingly material volume rebound in Q4 (54% q/q), supported by a significant 28% price cut in September (implemented to counter lower priced smuggled sugar). Gross profit came in 11% higher for the year with a 90bps y/y gross margin improvement to 20.5% (Vetiva estimate: 24.7%). However, growth in profit before tax came in slower at 8% y/y as int...
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