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Dangote Sugar Reports ₦172 Billion Forex Losses, Ending 2023 with ₦108.9 Billion Loss

Medinat
By Medinat - Editor
Dangote Sugar Reports ₦172 Billion Forex Losses, Ending 2023 with ₦108.9 Billion Loss

Dangote Sugar Refinery Plc has disclosed a significant loss before tax of ₦108.92 billion for the year 2023, in stark contrast to the pre-tax profit of ₦82.3 billion recorded in the previous year. This drastic downturn is attributed primarily to the substantial devaluation of the naira, which has severely impacted the operating profits of many manufacturing companies across Nigeria.

In its recently released 2023 annual report and financial statements, Dangote Sugar revealed that it incurred foreign exchange losses totaling ₦172.198 billion, effectively erasing its operating profit of ₦76.68 billion. Consequently, shareholders’ funds witnessed a significant depletion of 53%, declining from ₦171.2 billion to ₦79.2 billion.

Key financial highlights for the year include:

  • Revenue: Increased to ₦441.453 billion from ₦403.246 billion in 2022, reflecting a 9.47% year-on-year growth.
  • Gross profit: Declined to ₦86.304 billion from ₦91.963 billion in 2022, marking a 6.15% decrease year-on-year.
  • Operating profit: Decreased to ₦76.68 billion from ₦82.41 billion in 2022, representing an 11.8% year-on-year decline.
  • Loss after tax: Recorded a loss of ₦73.760 billion compared to a profit of ₦54.742 billion in 2022, indicating a 234.74% year-on-year decrease.
  • Earnings per share (EPS): Turned negative to -₦6.07k from ₦4.51k in 2022, marking a 234.59% year-on-year decrease.

To mitigate the adverse effects of forex volatility and cost inflation, the company has implemented robust margin and cost management initiatives. Additionally, Dangote Sugar highlighted positive returns from its Numan operations, along with plans to expedite backward integration efforts and review other strategic actions aimed at enhancing operational efficiency and profitability.

These measures are crucial for restoring investor confidence, as evidenced by the marginal 5.2% year-to-date share price performance. Despite the challenging financial landscape, the company saw a remarkable 255% increase in share price during the course of 2023.

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