Dangote Cement Buys Back N9.8bn Worth of Shares

By Goddy Egene

Dangote Cement Plc has bought back 40.2 million shares for N9.77 billion during the first tranche of its share buyback programme. The company said in a statement that the first tranche of the share buyback programme commenced on December 30, 2020 and ended on December 31, 2020, on the open market of the Nigerian Stock Exchange.

According to the company, it purchased 40,200,000 ordinary shares of the company at an average price of N243.02, representing 0.24 per cent of the issued and fully paid ordinary shares.

When the company last December announced the commencement of the programme, it had targeted to buy 85.203 million shares under the tranche 1. However, only 40.2 million was purchased.

“Following the conclusion of Tranche I, the total number of residual issued and fully paid outstanding shares of DCP amounts to 17,000,307,404. However, the completion of the share buyback programme of the company does not portend any material impact on the company’s financial position, and the operation of the company as a going concern,” it said.

Dangote Cement had explained that the share buyback programme was intended to increase long-term shareholder value, improve its balance sheet efficiency and enhance earnings and yields to its various shareholders.

Market analyst said with a reduced shares of 17,000,307,404 and expected improved earnings, shareholders would receive higher dividend per share going forward.

The Chief Financial Officer of Dangote Cement, Mr. Guillaume Moyen, had last year said the company had grown the wealth of its shareholders by paying over N1 trillion as dividends in the past seven years.

According to him, the company paid N51.1 billion in 2013; N119.3 billion in 2014, N102.2 billion in 2015, N136.3 billion in 2016, N144.8 billion in 2017, N178.9 billion in 2018 and N272.6 billion in 2019.

He said: “We have paid over N1 trillion in dividends to shareholders in the last seven years. As Africa’s largest cement manufacturer, we will continue to prioritise giving value to investors and other stakeholders.”

The Group Chief Executive Officer, Dangote Cement, Michel Puchercos, had explained that with the world facing economic recession and downturn, Dangote Cement was fortunate enough to have had a decent start to 2020 year as reflected in its financial results
“We are fortunate to have resilient first half (H1) 2020 results amidst impact of COVID-19. Cement is an essential building material with no viable substitutes and the global cement industry continues to grow, driven by urbanisation, population growth, housing growth, industrialisation, and infrastructure development, especially in emerging economies such as Africa, where we operate,” he said.

He noted that the company has been presented with an opportunity and is strategically positioned to take advantage of it with its operational efficiency, product quality, modern facilities, and technology to leverage our unique economies of scale and know-how.”

Apparently to buttress the claims of the GCEO, Dangote Cement Plc reported an impressive nine months result ended September 30, 2020, with a revenue of N761.4 billion, showing an increase of 12 per cent compared with N679.8 billion in the corresponding period of 2019.

Profit before tax rose 37.6 per cent to N271.96 billion in 2020, from N197.68 billion, just as profit after tax grew by 35.2 per cent from N154.35 billion to N208.69 billion.