BUA Cement Reports Robust 2024 Growth
…Chairman Predicts Price Declines as Naira Stabilizes
By Patience Ikpeme
BUA Cement Plc has delivered a strong financial performance for 2024, marked by substantial growth in sales, increased earnings, and an improved balance sheet. Abdul Samad Rabiu, Chairman of BUA Cement Plc, also projected that prices of not only cement but other commodities are set to decrease as the Naira continues to stabilize.
Rabiu shared these insights with journalists following the company’s 9th Annual General Meeting and the presentation of its 2024 annual report in Abuja on Monday.
Rabiu expressed optimism regarding the exchange rate, stating, “Now, we are reaching $1,500. And I’m optimistic that going forward, we’ll see the exchange rate maybe get to N1,200 to the dollar or even below. And once that happens, we’re going to see prices coming down not only cement prize but other commodities as well.”
Addressing questions on the current cement price, which stands around N10,000 per bag, Rabiu attributed this range primarily to the cost of production. He explained, “It is the cost of production that has kept the price of cement at around N10,000. But as a company that invested billions of dollars, because we have invested billions of dollars in BUA cement over a period of 20 or 30 years, we need to see such a return. N69 billion profit after tax.”
He continued, “N69 billion is $40 million, for example, on an investment of billions of dollars. So really, if you look at the stock market, we need to make a little bit of money. We have staffs we have shareholders, and we invested a lot.” Rabiu added that “Our energy cost is the biggest cost we have. That’s why we decided to set up our mini LNG, so that we can, because we’ll be able to reduce our energy usage on the plants because there’s a lot of money on gas.”
BUA Cement’s 2024 financial results showed considerable progress. Revenue surged by 90.5% to N876.5 billion, up from N460 billion in 2023. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) grew by 43.8% to N268.6 billion, compared to N186.8 billion in the previous year. Net profit before tax increased by 48.2% to N99.63 billion, rising from N67.2 billion in 2023, even amidst further currency depreciation during the period, which led to increased foreign exchange losses of N93.9 billion (from N69.9 billion in 2023).
The company’s return on average capital employed (ROACE) in 2024 increased to 15% from 10% in 2023. Earnings per share saw a 6.3% rise, reaching N2.18 in 2024 from N2.05 in 2023. This performance was driven by a combination of increased dispatch volumes and careful pricing strategies, even as the Company absorbed rising input costs. Cash generation saw significant growth, facilitating increased capital expenditure financing and supporting strategic efforts to reduce exposure to foreign currency obligations.
This was achieved by settling import finance facilities and aligning accrued interest payments with available cashflows. With a proposed dividend of N2.05 per share, representing a 94% payout ratio, the company continues to show its commitment to shareholder returns, consistently distributing over 90% of its profits.
Speaking to the operational achievements, Alhaji Abdul Samad Rabiu noted the company’s commitment to ensuring the availability of high-quality cement and contributing to closing the housing and infrastructure gap in Nigeria and neighboring countries. He reported the successful commissioning of additional production lines in Edo and Sokoto States.
This expansion boosted BUA Cement’s installed capacity from 11 million to 17 million metric tonnes per annum, strengthening its position as a dynamic participant in Nigeria’s cement industry and contributing to its expanding market share. Additionally, the company held the ground-breaking ceremony for a greenfield 3 million metric ton per annum plant in Ososo, Edo State. Upon completion, this will bring BUA Cement’s total installed capacity to 20 million metric tons per annum by the first quarter of 2027.
The company also improved its logistics infrastructure with the acquisition of additional trucks and introduced a self-service solution integrating payment and order fulfillment, which has significantly reduced turnaround time and improved the customer experience.
A notable reform during the year involved the formal separation of the Internal Audit and Internal Control functions. This move addressed a key governance gap, allowing for a sharper focus on risk management, financial accuracy, and operational integrity. With distinct team leads for both functions, the Company is better positioned to implement robust control mechanisms and establish effective checks and balances across its operations.
Building on this commitment to strengthening governance and organizational resilience, the Board approved the engagement of a consultant to conduct a comprehensive review of the Company’s Succession Planning Policy and its implementation. This initiative aims to align the succession framework with emerging trends and global best practices.
The objectives of the engagement include evaluating the current succession pipeline, identifying potential gaps, and recommending enhancements to strengthen leadership continuity, mitigate key-person risks, and reinforce the Company’s long-term strategic goals.
This proactive measure further demonstrates the Board’s dedication to maintaining a resilient leadership structure and ensuring seamless business continuity across all critical roles. Risk governance also evolved in 2024, transitioning from a narrow operational view to a broader enterprise-wide risk reporting system, allowing for proactive identification and mitigation of emerging risks.
The Risk Management Committee, chaired by a Non-Executive Director, oversees all risk-related matters, with regular updates provided to the Board along with action plans and designated responsibilities.
Looking ahead, BUA Cement’s governance roadmap remains dynamic, with a firm commitment to maintaining transparency in all engagements with regulators, stakeholders, and shareholders. Disclosures on the NGX portal, investor calls, and AGM proceedings reflect the company’s belief in open communication and inclusive dialogue.
Yusuf Binji, Managing Director/Chief Executive Officer, provided further insight into the driving forces behind BUA Cement’s performance. “BUA Cement’s strong leadership and diverse workforce provide the varied perspectives needed to anticipate and meet customer demands effectively. This is the cornerstone of our success,” he stated.
He added that “The strategic guidance of our Board and the collective expertise across our team have enabled us to navigate challenges and seize opportunities. Our research-driven approach to every facet of our operations has positioned BUA Cement as a trailblazer in the Nigerian cement industry.”
The Board’s attention to ethics and governance, he revealed, “permeates every operational layer. In 2024, we achieved 100% compliance with ISO 9001 (Quality Management) and ISO 14001 (Environmental Management) recertifications, underscoring our commitment to sustainable practices.” This commitment to excellence, he conveyed, “differentiates our activities and establishes new benchmarks for quality and customer trust in our sector.”
Reflecting on the achievements in 2024, Binji said BUA Cement “stands at the threshold of unprecedented opportunity, strategically positioned to address Nigeria’s persistent infrastructure deficit.”
He further disclosed that “Our journey forward is anchored on four interconnected priorities that will define our success: optimise our production capacity, Continue prudent debt management, expand our market presence in underserved regions, and embrace digital transformation across our operations, while delivering exceptional value to our shareholders.”
