Lafarge Africa optimistic of good performance
The Chief Executive Officer (CEO), Lafarge Africa Plc, Michel Puchercos, has said that in spite of the macro-economic challenges and market uncertainties, his company will continue to deliver good performance.
Puchercos said that the organisation is much stronger and better positioned to deliver operational excellence and improve value to our shareholders.
He said this while commenting on the company’s half-year result, which showed that Lafarge Africa Plc, a cement and building solutions provider, recorded sales of N107 billion in the first half of 2016.
The result revealed that industrial operations were significantly impacted by gas supply shortages in the South West and East Nigeria operations with occasional plant repair works, as a result, earnings before interest, taxes, depreciation and amortization stood at N12 billion, as against N48 billion in H1 2015.
During the first half of 2016, Lafarge Africa successfully acquired the balance of 50 per cent ownership stake in UNICEM and this takes shareholding to 100 per cent. A N60 billion bond was raised successfully from the debt market, to refinance the UNICEM’s Naira denominated debt at a lower interest rate. Given the current exchange rate environment, actions are being implemented to restructure and refinance the USD denominated debt. These loans were largely used to fund the expansion projects, which will add an additional 2.5MTpa cement capacity to the current production capacity of UniCem as well as that of the group.
“We are at the final stages of concluding the voluntary tender offer issued to increase our shares in Ashakacem from 82.46 per cent presently. The shares acquisition is expected to conclude before the end of the year.
“The second half of the year is anticipated to be more rewarding. We expect the cement market to be strong mainly driven by the Individual Home Segment with a marginal contribution from the public sector. We expect to benefit from the synergies of our integrated operations, in spite of the gas shortages. Our objective is to deliver innovative and good quality building solutions to meet the specific needs of our customers, while also achieving good value creation for our shareholders.
“The South African market will remain challenging, but with the reinforced sales team and route to market strategies, financial performance is expected to improve. In aggregates and concrete, the company will continue to benefit from its strong network to drive business growth.