Analysis by Daily Trust has shown that the three major cement producers in the country, namely Dangote, BUA and Lafarge, posted a combined loss of N254bn in the year 2023.
The development is a direct reaction to the decision of the Central Bank of Nigeria to unify all segments of the foreign exchange market which led to the weakening of the naira to the dollar, nearing N2,000/$1, until the recent intervention by the CBN to resume sales of forex to Bureau De Change operators.
This has seen the local currency stabilize, and now hovers between N1,500 and N1,600 in the parallel market.
The devastating effects of the forex unification was felt by the manufacturing sector as forex shortages and devaluation led to high costs of operations.
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Dangote tops chart with N164bn loss
Further analysis shows that Dangote Cement leads in operational loss with N164 billion, closely followed by BUA cement with N69 billion, and Lafarge with N29 billion.
Checks show that Dangote Cement, which is Nigeria’s biggest cement producer, recorded a whopping N2.208 trillion in revenue in 2023, a 36.44 per cent increase from N1.618 trillion in 2022.
However, a further look at the statement showed that the company posted N164.07 billion as its total FX loss in 2023, as a result of its operations in other countries.
Similarly, the financial statement of BUA Cement shows that it recorded a growth in its profit-after-tax from N360.98bn in December 2022 to N460 billion in the same month last year, according to the firm’s full-year financial statement.
The company, however, reported an FX loss of N69.96 billion, up from N5.5 billion recorded in 2022. The lows showed over 1,000 per cent increase in forex loss.
In the same vein, Lafarge Nigeria Plc presented its financial report for the year 2023 with a profit after tax of N51.1 billion down from N53.6 billion recorded in 2022.
The company also reported FX losses of N21 billion during the year under review.
Organised private sector canvasses productive Fx management
Only recently, the Nigerian Employers Consultative Association called on the federal government to entrench and sustain productive foreign exchange management through adequate intervention in the forex market as part of efforts to address inflation and save the manufacturing sector from collapse.
The Director General of NECA, Adewale Adewale-Smatt Oyerinde said, “The reason for the persisting high inflation rate in the economy is not far-fetched. This can be explained by the triadic relationship among exchange rate, interest rate, and then inflation rate, and the implication on investment.
To address the high and rising inflation in the economy, the NECA director-general noted that “The Central Bank of Nigeria (CBN) must entrench and sustain productive FX management through adequate intervention in the forex market.
