Lafarge Africa Plc, prominent cement and building solutions provider, has exhibited a robust positive outlook for the year 2015 by raising its stakes in UNICEM and AshakaCEM, the company’s profitability profile also took a leap in 2014, with the company approving a N3.60 dividend for its shareholders representing nine per cent improvement over prior year’s.
Lafarge Africa, posted an operational Profit after Tax of N37 billion, which is eight per cent higher than prior year, after adjusting for one-offs. Operations of United Cement Company Ltd (UNICEM) were included on an equity basis in Q4. Cash of N49 billion was generated from the operations. The Board of Directors of Lafarge Africa at its meeting of March 11th 2015, approved a dividend of N3.60 subject to shareholders approval.
Lafarge Africa Plc, formerly known as Lafarge Cement Wapco Nigeria Plc, is a combination of all Lafarge’s Nigerian operations – (AshakaCem Plc, UNICEM, Atlas Cement Company Limited) and Lafarge South African Holdings Limited assets in order to create a stronger platform for growth in Sub-Saharan Africa, with value creating opportunities. The transaction was concluded in September 2014.
On 7 November 2014, Nigerian Cement Holdings B.V. (NCH), a 50 per cent affiliate of Lafarge Africa Plc, entered into an agreement with Flour Mills of Nigeria, defining a roadmap to purchase Flour Mills of Nigeria’s 30 per cent investment in UNICEM (the 3rd largest cement manufacturer in Nigeria). Recently the company announced the completion of the first phase of 15 per cent acquisition.
Being required in accordance with Section 131(1) (a) of the Investments and Securities Act, 2007, to make a Tender Offer to all other shareholders of AshakaCem Plc. Consequently, the Board of Lafarge Africa granted approval for a Tender Offer to be made to all Qualifying Shareholders of AshakaCem Plc. The Mandatory Tender Offer was successful and is in the final stages of regulatory approval.
- Lafarge Africa Plc (“Lafarge Africa”) received, and accepted, 534,144,592 ordinary shares of AshakaCem Plc (“the Company”) tendered by 3,641 Shareholders. This represents 23.85 per cent of the Company;
Lafarge Africa has allotted 150,725,822 ordinary shares of its shares as consideration to the Shareholders that accepted the Offer;
- An additional cash consideration of N1,068,289,184 has also been paid to the Shareholders that accepted the Offer;
- Following the conclusion of the Offer, Lafarge Africa now owns 82.46 per cent of AshakaCem Plc.
Lafarge Africa Plc has announced the completion of the Mandatory Tender-Offer to all other shareholders of AshakaCem Plc, following receipt of the requisite regulatory approvals.
Under the terms of the tender offer, qualifying shareholders who accepted the offer were allotted 57 ordinary shares in Lafarge Africa for every 202 ordinary shares in AshakaCem Plc tendered. An additional cash payment of N2.00 (Two Naira) per every ordinary share of AshakaCem Plc purchased by Lafarge Africa during the acceptance period was also made to accepting shareholders.
The acceptance period for the tender offer opened on December 10, 2014 and closed on January 23, 2015 following an extension of five (5) working days to the offer period.
Commenting on the completion of the transaction, the Chairman of Lafarge Africa Plc, Chief Olusegun Osunkeye, CON, OFR said “This is a significant step in the conclusion of the consolidation process of Lafarge Africa Plc. I would like to express my appreciation to the AshakaCem shareholders whose participation in the transaction (through the tender of their shares) has made this a very successful process.’’
In addition to this, Mr. Guillaume Roux, the Group Managing Director/CEO of Lafarge Africa Plc said: “We are delighted to have received a great response from AshakaCem Plc shareholders and will continue to work towards maximizing shareholder value.”
In his statement, Osunkeye, said “it is with pleasure that we publish the first audited results of our newly transformed Company. The good performance even in a volatile market affirms the strength of our new Company and our commitment to achieving excellence.”
Commenting on the results, Roux mentioned that ‘’our Company has shown impressive performance; our business combination plans have been well executed within set timelines. We are committed to improving operational performance by leveraging on opportunities this presents to us to deliver sustainable returns to our shareholders.”
Key Highlights for the period
- Consolidated Revenues were flat at N206 billion when compared to 2013. The Nigerian operations showed a growth of eight per cent cushioning the short term market challenges in South Africa.
- EBITDA was relatively stable at N55.3 billion in 2014 compared to N55.7 billion in 2013, with Nigeria growing by 16 per cent.
- Profit After Tax grew by eight per cent when adjusting for one-offs in 2013 and the UNICEM scope change. Profit After Tax was N35 billion in 2014.
Lafarge Africa Plc has shown remarkable performance in the year and states that it remains highly committed to driving business excellence. The company expects cement demand to increase both in Nigeria and South Africa in 2015.
“In Nigeria, the demand growth should be supported by increasing needs for housing and infrastructures, but could be lower than normal growth levels given the exchange rate development. This should be partly cushioned through the South African cash flow. We remain very optimistic and highly committed to delivering innovative building materials while leveraging on the operational strength and pedigree of the Lafarge Group,” the company said in a statement.