VENTURES AFRICA – Nigeria largest cement manufacturer, Dangote Cement intends to double its production capacity across Africa in 2014 to 40 million metric tons (44.092 million tons), company chief executive Devakumar Edwin, said on Monday.
Devakumar told Reuters in Lagos that 9 million tons would be added by the firm to its operations in Nigeria, which would make up a capacity of 29 million tons. The company would also commission plants across the continent that have been in the making for several years. This, according to the him will add a further 11 million tons.
“The key driver is the increase in volumes," said Devakumar, who added that although the company has focused on cost control, it has also ensured to focus on volume growth, which has increased profits.
Dangote cement has put expansion plans into works over the past years with plants across Africa, most of which have been under construction. The plants in Cameroon, Senegal, Zambia, Sierra Leone, Ethiopia and South Africa will be ready this year, according to Devakumar, who added that between the plants, they will contribute a little less than a million tons to the current overall production capacity of Dangote Cement.
With additional capacity in Nigeria, Ivory Coast, Liberia, Ghana, Congo and Tanzania, a 60 million ton capacity would have been achieved by mid-2016, the chief executive added, priding the company as making almost all its expansion using internal cash flows.
While he noted that competitors are cash strapped and have to borrow heavily for mergers, being buoyant enough to expand without incurring massive debts is "one of the key reasons we have been able to grow aggressively in the African market."
Owned by Africa's richest man Aliko Dangote, whose personal fortune is estimated to be $25 billion, the company has been doing well over the years, with massive expansion plans beyond Africa in the works.
Dangote Cement's profit in 2013 increased by 40 percent from $827 million recorded in 2012 to $1.16 billion.
The company's stock closed at N234.99 ($1.43) on April 7, 2014 at the NSE.
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