Sugar Backward Integration’ll Save Nigeria $700m Annually – Dangote
Dangote Sugar Refinery Plc has said Nigeria will save up to $700m of foreign exchange yearly from sugar production self-sufficiency if the government faithfully follows through the backward integration policy in the sugar industry.
The Chairman of Dangote Sugar Refinery, Aliko Dangote, at the company’s 15th Annual General Meeting in Lagos, said that allowing for distortions in the sugar master plan framework would adversely affect the target of self-sufficiency in sugar production.
He described the backward integration policy as commendable, saying it would reduce imports of raw sugar and save the country enormous forex used for importation.
Dangote expressed delight that the BIP was going on well, saying, “If the National Sugar Master Plan is followed strictly and the players all follow the rules, the country will be better for it as Nigeria will save between $600m and $700m annually as forex.”
According to him, the backward integration policy of Dangote Sugar Refinery is recording appreciable progress, and the company is irrevocably committed to the policy.
He told shareholders that despite the disruptions in the economy occasioned by the COVID-19 pandemic, the company’s production volume rose by 13.7 per cent to 743,858 tonnes in the financial year ended December 31, 2020, compared to 654,071 tonnes in 2019.
He said the company posted a group turnover of N214.3bn, a 33 per cent increase over the N161.1bn in 2019, while its sales volume rose by 6.9 per cent from 684,487 tonnes in 2019 to 731,701 tonnes in 2020.
The board of the company declared a dividend payment of N18.22bn, amounting to N1.50 kobo per ordinary share of 50k each.
According to Dangote, the improvements were attributable to operations optimisation strategy despite disruption caused by civil unrest in last quarter of the year.
“Our growth continued to benefit from the sustained efforts to drive customer base expansion and several trade initiatives and investments,” he said.
He said the company had revised its sugar production target to 550,000 metric tonnes achievable by 2024 in line with the revised plan on the BIP by the Federal Government.
The Group Managing Director/Chief Executive Officer, Mr Ravindra Singhvi, said the sugar group continued the growth path with commitments to improve performance and generate value for all stakeholders.
He said, “Our backward integration goal is to become a global force in sugar production, by producing 1.5M MT/PA of refined sugar from locally grown sugar cane for the domestic and export markets.”
“Our focus on the implementation of our key strategies in the face of the several challenges posed by the COVID-19 pandemic, the peculiarities of the Apapa traffic situation, among others, we achieved a topline growth in revenue of N214.30bn, a 33 per cent increase over 2019; a 53 per cent year-on-year increase in PBT, and 33.2 per cent increase in PAT.