Nigeria’s leading cement manufacturers faced a significant surge in production costs in 2024, spending a total of N3.64 trillion—an increase of 72% from N2.12 trillion in 2023.

The spike in expenses was largely driven by inflation and the devaluation of the naira, making raw materials and foreign exchange transactions more costly.

The country’s top three cement producers—Dangote Cement Plc, Lafarge Africa Plc, and BUA Cement Plc—experienced sharp increases in operational costs, including production, administrative, and distribution expenses.

Financial reports for the year ending December 31, 2024, revealed that Dangote Cement’s total expenditures reached N2.48 trillion, marking a 65.9% jump from N1.5 trillion in the previous year.

Production costs alone climbed to N1.65 trillion in 2024 from N1.01 trillion in 2023. Meanwhile, operating expenses (OPEX) rose from N491.64 billion to N839.2 billion.

BUA Cement reported N641.13 billion in production and operational costs, doubling from N317.41 billion in 2023.

Similarly, Lafarge Africa’s total costs reached N510.62 billion, a 67.7% increase from N304.4 billion the previous year.

One of the major factors contributing to these rising costs was Nigeria’s inflation rate, which peaked at 34.8% in December 2024, the highest in nearly three decades.

On average, the inflation rate for the year stood at 33.2%, a sharp increase from 24.7% in 2023.

The depreciation of the naira further exacerbated the situation, with the official exchange rate closing at N1,535 per dollar—40.9% lower than N907.11 per dollar in 2023.

In the parallel market, the naira weakened by 26.8%, trading at N1,660 per dollar compared to N1,215 per dollar at the end of 2023.

Energy costs also surged due to shifts in the oil and gas sector. Dangote Cement, for instance, spent N679.94 billion on fuel and power in 2024, up from N399.21 billion in 2023.

Despite these financial hurdles, Nigeria’s cement industry saw a substantial increase in revenue.

Combined earnings from Dangote Cement, BUA Cement, and Lafarge Africa reached N5.15 trillion in 2024, up 68% from N3.07 trillion in 2023.

Dangote Cement led the industry, accounting for 69.4% of the total revenue.

The company’s revenue surged by 62.2% to N3.58 trillion, propelled by higher sales volume and inflation-driven price adjustments. Its EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) surpassed N1 trillion for the first time, reaching N1.38 trillion. Profit after tax (PAT) grew by 10.5%, totaling N503.2 billion.

BUA Cement nearly doubled its revenue, rising from N460 billion in 2023 to N876.5 billion in 2024.

Its profit before tax increased to N99.6 billion from N67.2 billion, while profit after tax reached N73.9 billion, up slightly from N69.5 billion the previous year.

Lafarge Africa also recorded strong financial performance, with its profit after tax jumping 96% to N100.1 billion in 2024 from N51.1 billion in 2023.

The company’s revenue climbed 72%, reaching N696.8 billion compared to N405.5 billion in 2023.

Amid rising cement costs, the Nigerian government has called on manufacturers to lower prices.

The Minister of Works, Dave Umahi, recently directed cement producers to bring the price of a bag down to N7,000, citing improved exchange rates and reduced fuel costs as reasons for lower production expenses.

Umahi warned that companies failing to comply within seven days would be reported to President Bola Tinubu.

As Nigeria’s cement industry continues to navigate economic instability, companies must balance soaring operational costs with maintaining competitive pricing for consumers.

ROAMAN NEWS

Vice Admiral Ibok-ete Ibas (retd.) has pledged to restore stability in Rivers State after being sworn in as the state’s Sole Administrator.

Speaking to journalists at the State House in Abuja on Wednesday, Ibas emphasized his primary duty.

“We know the circumstances that led to why we are here, and Mr President made it clear in his broadcast.

If the main issue is that of maintaining law and order in the state, I think for any meaningful activities to take place in Rivers State, that is the utmost task that I have,” he stated.

The retired naval officer assured the public of his commitment to collaborating with key stakeholders to reestablish order in the region.

“We will work together with other stakeholders to ensure that we bring peace, order, security, and stability to the people and government of Rivers State and Nigeria at large,” he said.

President Bola Tinubu, in a nationwide address on Tuesday, declared a state of emergency in Rivers, citing Section 305 of the 1999 Constitution.

He suspended Governor Siminalayi Fubara, Deputy Governor Ngozi Odu, and all members of the state House of Assembly for six months, stating that decisive intervention was necessary to prevent further escalation of political tensions.

Following this announcement, Tinubu appointed Ibas as the state’s Sole Administrator, entrusting him with the responsibility of restoring order in the oil-rich region.

ROAMAN NEWS