Dangote Now Most Valuable Brand In Nigeria

Nigeria's Dangote has emerged the most valuable brand among the top 50 brands in Nigeria for 2018 which were unveiled at the weekend in Lagos.

This is coming barely three months after the brand was adjudged the most admired brand of African origin by Consumers in a brand rating coordinated by South Africa based Brand Leadership in conjunction with Johannesburg Stock Exchange (JSE). 

Brand Nigeria, the agency that coordinated the survey in Nigeria, in its report lauded the efforts of the handlers of the Dangote Brand because this is the first time a Nigerian brand would be achieving the feat since 2013. 

Unveiling the list of the top 50 brands at an event attended by top executives of leading corporate organizations in the country as well as stakeholders in Marketing and Advertising Industry, Mr. Taiwo Oluboyede, the Head of Brand Nigeria explained that 46 percent of the top brands amounting to 23 are Nigerian brands. 

Giving the highlights of the brands rating, he stated that Promasidor Nigeria Limited emerged the highest gainer jumping 15 points from last year, the followed by the trio of BUA, Nine Mobile and Olam all of which moved 12 points from last year position, while seven brands, Conoil, Channels TV, Union Bank, Access Bank, Chi, Toyota, and GTBank maintained their positions. 

He stated further that Fidelity bank came as a first entrant this year and Stallion Group making a fresh return to the top 50 brands this having exited before. 

The top 50 brands in Nigeria, Soboyede maintained are the brands that have succeeded in delivering their promises to the consumers. "They are fast growing in value and they are the drivers of our economy,"

"The top brands this year are those that have been able to analyse needs, see opportunities by creating solutions to them and communicating same to the consumers.

"They have also become so good at it that the consumers often refer to them with the name of the need they meet that is their products or services. These brands have found how to deliver something special often times." 

Giving insights into how the evaluation of the top 50 brands was carried out, Soboyede said: "we used the Brand Strength Model (BSM index),"

"It is model that measures a brand's ability to deliver on its promise to the consumers from the consumer's point of view. The model uses basic qualitative elements and there are seven variables that goes into the BSM model". 

According to the variables starts with a test of people's knowledge and affinity with the brands operational in Nigeria. We had a top on the mind survey where people tell us brads that easily come to their mind or brand they can recall. 

"Other variables in the model are innovation-this is a test how innovative a brand service delivery is; Quality-this checks some factors that enhance consumer's confidence in product delivery; Category Leadership-this is a classification of brands within their industry; Online engagements-this checks how active the brand's online platforms are and how engaging it has been from last evaluation; National Spread-this checks operational presence of a brand across the country."         

Chief Corporate Communication Officer of the Dangote Group, Anthony Chiejina said the management was not surprised at the ranking because the company has continuously deepened and delivered on its core values is to be a world-class enterprise that is passionate about the quality of life of the people and giving high returns to stakeholders. 

"And this philosophy is driven by values, which include customer service, entrepreneurship, excellence and leadership. In any of our subsidiaries, the focus is to provide local, value-added products and services that meet the 'basic needs' of the populace.

"Through the construction and operation of large scale manufacturing facilities in Nigeria and across Africa, the Group is focused on building local manufacturing capacity to generate employment, prevent capital flight and provide locally produced goods for the people.

"The expansion of our business especially the Cement which has operations in 14 African countries including Nigeria, Benin, Ghana, Senegal, South Africa and Zambia, among others has added to popularity of our company and the products, Mr. Chiejina stated.

It would be recalled that back in July, the Dangote brand came atop in the ranking of 100 best brands in Africa themed "Brand Africa:100", the sixth edition announced in Johannesburg, South Africa. 

The Brand leadership in the ranking list said of Dangote brand "Nigerian industrial brand Dangote is the number one African brand recalled when consumers are prompted about the continent (Africa) of origin while the South African tele-communications brand MTN is the number one African brand spontaneously recalled irrespective of continent of origin. 

The United States sports and fitness brand, Nike, is the overall brand in Africa spontaneously recalled by consumers. 

The Brand Africa 100 ranking is based on a survey among consumers 18 years and older, conducted in 23 countries across Africa. The countries, representing all African economic regions, collectively account for 75% of the population and the 74% of the GDP of Africa. 

African brands rose slightly to account for 17% of the Top 100 brands in Africa, non-African brands retained their firm position in Africa with 83% share of the Top 100 most admired brands in Africa. Brands from Europe leads the table with 40%, North America at 24% and Asia 19%.  West Africa 6% with only Nigerian brands and Southern Africa 6%. 

The Top 100 is dominated by technology and electronic brands (29%), consumer (non-cyclical) (19%), apparel (15%), automobile (8%), food (7%) and sports & fitness (5%) categories are the top categories.

Gécamines, Katanga Group Enter Settlement Agreement

Gécamines, together with its subsidiary Société Immobilière Du Congo ("SIMCO"), entered into a settlement agreement with Katanga Mining Limited and some of its affiliated companies making up the Katanga Group as well as their joint company Kamoto Copper Company (KCC).

Under the terms of the Agreement, the following goals and results are targeted, among others:

  • KCC's net equity will be restored in accordance with applicable laws ;
  • KCC's indebtedness towards the GLENCORE group will be reduced from 9 billion USD down to 3.45 billion USD as at 1 January 2018;
  • Interest rates applicable on intra-group loans are revised and shall no longer exceed 6% per year;
  • On the basis of KCC's current business plan, as early as the 2019 fiscal year, GÉCAMINES will start, for the first time, receiving dividends, which assessed cumulated amount should exceed 2 billion USD over the next ten years;
  • The profits will allow for the payment of corporate taxes being likely to significantly contribute to the replenishment the Congolese State's treasury;
  • A better valuation, in the future, of GÉCAMINES' contribution of the copper and cobalt deposits to the partnership through a significant increase of the amount per ton of the pas de porte, from 35 USD to 110 USD, and which can reach 170 USD in certain scenarios;
  • A significant increase of the valuation of GÉCAMINES' ownership in KCC, which value was until then nil due to the high level of indebtedness of the company;
  • The waiver by KCC to the benefit of the JORC certified reserves amounting to 3,992,185 tCu and 205,629 tCo (the "Reserves"), releasing GÉCAMINES from its obligation to deliver the Reserves or, failing that, to pay a counter-value of a maximum amount of 285 million USD;
  • The payment by the KATANGA GROUP of a settlement indemnity (150 million USD) in favor GÉCAMINES; and
  • The withdrawal by GÉCAMINES and SIMCO, at closing, from the judicial proceeding initiated before the Commercial Court of Kolwezi on 20 April 2018.

Gécamines welcomes the outcome of the discussions with the Katanga Group and its majority shareholder Glencore Plc, and the new foundations now set for the partnership, with a view to an effective sharing of wealth, with immediate financial benefits for all the stakeholders, and in particular the Democratic Republic of the Congo and the affected communities. GÉCAMINES hopes that upcoming negotiations with other partners and companies will be conducted in a similar open and respectful climate, and will reach the same satisfactory outcome.

Siemens, Anglo American Platinum Collaborate On Skills Development In Africa

Currently, one of the most debated topics influencing innovation is digitalization and its impact on the future of employment. It is met with equal parts excitement and trepidation. No matter how you look at it, digital transformation and a truly connected global economy is already upon us.

Siemens (www.Siemens.com) has provided automation equipment and industrial networks to assist Anglo's Engineering Skills Training Centre (ESTC). One of the pillars of Digitalization is industrial networks and security and it is crucial that these engineers understand the role of this technology in the future of mining.

As a leader in automation we are continuously expanding our leadership role in Industrial Digitalization. There is an opportunity, especially in Africa to embrace new and exponential technologies combined with human talent to accelerate industrialization and drive economic growth.

"We are proud to be supporting Anglo American Platinum to advance skills and opportunities in Africa," explains Sabine Dall'Omo, CEO for Siemens Southern and Eastern Africa.

Gary Humphries, Anglo American Platinum's Executive Head for Processing was appreciative of Siemens completion of yet another skills project at the ESTC. In his address, Gary said Siemens and Anglo American Platinum have been in partnership since 2010 and have seen approximately 298 artisans successfully trained and qualified at this centre.

“This vital contribution by Siemens to ESTC will significantly contribute towards the development of the human resource capabilities of our artisans and will help broaden the thinking of the students to explore new career capabilities. We celebrate the handover of the Siemens Simatic Wall and look forward to the role it will play in training the current and next generation of skilled artisans."

We are ramping up our commitment to the region to meet our customer's needs, expanding our portfolio for digital enterprises, supporting our customers in the manufacturing and process industries with digitalization, customization and efficiency improvements and investing in equipping our future generation with the right skills," ends Sabine.

Distinguished Extractives Lecture To Discuss Social Development, Investment

By Malise Otoo

The West African Institute of Mining, Metallurgy & Petroleum (WAIMM) will on April 5 at the Ghana Academy of Arts and Sciences present this year’s Distinguished Mining lecture.

This distinguished lecture presents participants with the understanding and information for the promotion of mineral development and redirection of government’s focus to achieve sustainable economic growth through minerals-led investments.

Similarly, these series of lectures are aimed at encouraging professionals to combine knowledge in related areas and blend with Ghana’s prospectively, strength of leadership, political stability and attractive social and cultural environment to attract investments to develop Ghana’s mining sector while giving an overview of the enabling factors for resource based industrialization to drive the economic growth of Ghana.

Again, it is to highlight strategies and provide industry inputs to attract investment to the minerals sector to re-examine the adequacy of Ghana’s institutional capability to carry out promotional activities in the wake of intense competition for investment capital.

In recent times, Government has intensified its fight against illegal Mining or Galamsey in what it describes as "Operation Vanguard".

Four Hundred security men since last year were drawn from the Ghana Police Service and the Ghana Armed Forces and deployed to counter the activities of illegal miners in the Ashanti, Western and Eastern Regions of the country.

However, Government is determined to establish an alumina refinery and expand the VALCO smelter, the President, Nana Addo Danquah Akufo-Addo has assured and which WAIMM is in full support of.

He made this known during the 61st Independence Day anniversary, that work on the law establishing an Integrated Bauxite and Aluminium Development Authority is far advanced, and will be submitted to Parliament shortly.

Henry Antwi, Commercial and Technical Advisor - Minerals Development, Oman will be the speaker for this year's lecture and will lecture on the theme, "Developing Resource–based Industrialization to Drive Economic Growth in Ghana’.

UK Eying Africa’s Mining Infrastructure Development

The UK government and companies are to offer a holistic approach to infrastructure development in Africa after the introduction of the Africa Infrastructure Board.

The UK Department for International Trade (DIT), UK government and private sector presented the Africa Infrastructure Board on the sidelines of the Mining Indaba in Cape Town, South Africa.

The Africa Infrastructure Board is an initiative that brings together and puts the case forward for choosing the UK as an ideal partner not only to develop projects in the mining sector but to create a holistic solution that will benefit the wider community by developing the associated infrastructure around the project.

The High Commissioner of UK to South Africa, Nigel Casey, mentioned that the UK would be increasing their efforts to work closer with African governments and private sector.

Mining projects are much more than just mining, he said, and they don't work without the associated infrastructure. Without naming names, he mentioned that the UK was conscious that there is plenty of competition out there when it comes to offering comprehensive solutions to African partners.

"We felt the need to up our collective game," he said, "and create a new government industry partnership called the Africa Infrastructure Board, which brings together all the players in the UK whether that is government through DFID, or UK Export Finance, one of our best kept secrets, or the deep pockets of the Commonwealth Development Corporation (CDC), and private sector operators, all operating in one single place to offer an end to end solution."

Oliver Andrews, Chief Investment Officer at the Africa Finance Corporation (AFC) who was one of the panellists during the roundtable, noted how DFID, the UK's government development arm, was instrumental in developing the model currently being used in infrastructure project financing.

He also reiterated the importance of the City of London, especially as most contracts are generally governed by UK law. The support network in structuring these deals, that is the legal, capital raising and technical side in London plays a vital role.

Craig Sillars from the Department for Trade showcased a number of projects where opportunities in the mining sector are being structured in a way that truly develops the infrastructure and act as a catalyst to develop other sectors.

The UK DIT, for example, is working with a UK investor in Angola on resurrecting an iron ore mine. But as well as the mine they are developing a smelter, which will ensure in-country beneficiation of natural resources, and that will involve the extension of an existing railways, and the expansion of a port.

"There will be 600MW of power attached to that," he went on to add, "and 25,000 of agriculture land provided grow biomass to help provide charcoal for the smelter."

Interestingly, he said that the UK was looking at partnering with China on the Simandou Mine in Guinea once they take over the mine to help them develop a holistic solution to develop the local infrastructure and sharing with them the designs they have put together to ensure a sustainable project that benefits the local community as well as getting the high quality iron ore to market.

"The approach we are taking," he told the participants, "is to produce masterplans that will benefit the communities not only for the next four to five years but the next 60, which is what we are doing in Angola, and that when the mining project is finished the infrastructure will continue to benefit the whole region."

Francis Gatare, CEO of the Rwanda Mining Petroleum and Gas Board, had said that most of the Rwandan involvement with the UK had been through government, but that private sector interest was growing.

It was agreed that London would continue to be an important hub for investors in mining and in infrastructure, not only as a financial centre, but also for the legal and technical expertise it offered, and that the resurging interest from the UK to Africa can only be a positive development for both the UK and the African continent.

 

BUA Group Alleged To Be Using Militia To Mine In Dangote Site

The management of BUA Group has been using armed militia, soldiers and policemen to mine marble and limestone in mining sites allocated to the Dangote Group, the Ministry of Mines and Steel Development has alleged.

In a statement signed by the ministry's Permanent Secretary, Mohammed Abass, and made available, the ministry said the company had been using a combination of armed militia, soldiers and policemen to obstruct the ministry's team from executing the stop work order issued to the company in October.

The ministry's statement was in response to an open letter to President Muhammadu Buhari by the company alleging that a minister was involved in sabotaging its operations.

Abass said that in the records of the Ministry of Mines and Steel Development and the Nigerian Mining Cadastre Office, the BUA Group did not have a mining lease over the contentious site (No. 2541ML) and was therefore engaged in illegal mining.

He stated, "The ministry stands by the stop work order issued to the BUA Group and signed by the Permanent Secretary dated 17th of October 2017."

"The letter was issued after thorough investigation confirmed that the BUA Group was indeed engaging in illegal mining of marble/limestone at a mine pit located on geographical coordinates N070 21' 47.4' E0060 26' 51.8', while the run-of-mine is stockpiled at an area with geographical coordinates N070 21' 48.4'; E0060 26'37.2'."

"Clarification provided by the Mining Cadastre Office shows that the coordinates of the mine pit and RoM stockpile area fall wholly within the area of mining Lease No 2541ML belonging to Messrs Dangote Industries Limited."

Abass added, "The ministry had earlier in 2015 issued a stop work order on this same disputed site but the BUA Group disregarded the order and went ahead with its illegal mining activities, under heavy cover of armed soldiers, policemen and men of the Nigeria Security and Civil Defence Corps."

"The management of BUA also resisted the enforcement of the latest stop work order issued on October 17, 2017 using a combination of armed militia, soldiers and policemen to obstruct the team from the ministry in effecting the stop work order."

He added that the ministry would not compromise due process in its commitment to promote local and global investments in the Nigerian mining sector.

 

Dangote Partners With Jumia To Sell Cement Online

In a new move designed to reduce price and ease logistics inherent in the purchase of its products, the management of Dangote Cement Plc has signed a pact with the foremost e-commerce platform Jumia Nigeria to offer for sale its cement to customers online.

At the unveiling of the deal in Lagos, Dangote Cement, Key Account Director, Chux Mogbolu said Dangote Cement was happy to partner with online shopping giant, in a bid to make Dangote cement available with ease to customers.

According to the deal, Nigerians and corporate bodies wishing to purchase a minimum of 300 bags of 50kg of Dangote Cement and above can now order on Jumia from the comfort of their rooms at a reasonable price of N2,500 per bag as opposed to how much is sold in the open market and see them delivered to any place of their choice without any extra cost for transportation.

Mogbolu, however disclosed that the purchase would only be within Lagos, Port- Harcourt and Abuja for now.

He said: "Dangote Cement decided to work with Jumia Nigeria based on its credibility and excellent performance over the years in online shopping management", adding that the new initiative would help arrest the scams perpetrated by online fraudsters who deceived the people by asking them to come and purchase Dangote Cement for N1000 per bag.

"For now, the pilot scheme is live in Lagos, Abuja and Port Harcourt, but we can extend to other cities depending on the level of demand and performance of the new deal".

"With the deal, Nigerians in need of seamless supply of cement from Dangote can now place order and pay online and wait for the delivery in record time from any of Dangote's nearest cement plant to Lagos, Port Harcourt or Abuja.

"We are starting with Minimum Order Quantity (MOQ) of 300, 600 and 900. We may increase depending on demand surge as time goes on," Mogbolu explained.

Speaking on the deal too, Chief Executive Officer of Jumia Nigeria, Juliet Anammah said the deal with Dangote Cement is part of efforts to deepen service delivery on Jumia Nigeria online platform.

She said she was of the belief that the deal will be beneficial to all parties involved and deepen further online shopping in Nigeria as obtained all over the world.

The Jumia Nigeria boss reflected on the 2017 Black Friday Festival ran by her organization and said the Festival has attracted more than 14 million visits since the commencement of the campaign on November 13th.

According to her, "the annual sales event, which was initiated in Nigeria in 2013 by Jumia remains the busiest and largest shopping day of the year on both online and offline stores. This year's explosive Black Friday numbers demonstrates the increasing capacity and flexibility of the online retail space in Nigeria."

"We deliver to the 36 states across Nigeria, and are able to reach neighborhoods and shoppers who traditionally have not had access to a wide variety of products and deals. This year we also see the increasing interest in groceries and other FMCG products which reflect the increasing relevance of Black Friday to the average Nigerian."

Some key highlights of the 2017 figures presented by Jumia Nigeria in Lagos on Thursday showed among other things more than 1.9 million visits on Black Friday Big Bang. 14.4 million visits since the start of the sales event; Overall, 85% of all visits were made on a mobile device, compared to 72% in 2016; and 86,000 smartphones and counting have been sold in the past two weeks.

Quantum Global Quits Kenya’s Savannah Cement

QGIAM, the private equity arm of Africa focused investment firm Quantum Global last week announced that on behalf of their investors, the sale of its interest in Savannah Cement, a leading Kenyan cement producer, has been completed following the receipt of regulatory approvals.

Quantum Global's investment was designed to support the cement producer on a number of value creation initiatives, including the development and launch of new products and the optimization of existing facilities.

Jean-Claude Bastos de Morais, Quantum Global's Founder and Group CEO expressed delight to have partnered with Savannah Cement in one of the critical industry sectors in East Africa.

He said they advanced together and aimed to close the existing infrastructure gap in Africa. “The exit from this investment is testament to the success of our approach of deploying capital in transformative sectors of key importance in Africa at the right time."

Martin Bachmann, Group Head of Active Management of Quantum Global, stated that the partnership with Savannah Cement and its management team created significant value and the two were involved in such a critical growth phase for the company. “Through its development of state-of-the-art products and technologies and its focus on the best use of green technology and on revolutionising environmental management in the cement industry, the company is well positioned to compete in an expanding marketplace, and we wish them continued success."

Quantum Global Group held the asset since 2015 through its USD 1.1 billion Infrastructure Fund, which is one of the most significant private equity funds in Africa solely focused on infrastructure developments.

Having started operations in 2012, Savannah Cement operates in a buoyant market driven by rising demand for cement products in a growing region. Savannah Cement is a state of the art, eco-friendly cement grinding plant with a capacity of 1.5 million tons a year, located in Athi-River, ca. 30 km from Nairobi. Successful in capturing several regional infrastructure deals to grow its market share, Savannah Cement quickly became a major regional player.

As part of the Infrastructure Fund, the Group so far has committed a significant portion of the capital for the construction of a deep-sea port in the Angolan province of Cabinda and for the development of an agri-processing plant for juice, water and wine processing and packaging geared towards the SADC region.

 

Turf Year For South African Miners But Stakeholders Are Optimistic

The year 2017 was another challenging year for South Africa's mining industry in light of a decrease in dividends and market capitalisation, various retrenchments across the industry, and marginal increases in taxes paid.

However, spot price increases for bulk commodities supported the industry and resulted in a return to profitability after the first substantial increase in revenues in five years. These are some of the highlights from PwC's ninth edition of SA Mine, a series of publications that highlights trends in the South African mining industry released by PwC last week. 

Michal Kotzé, PwC Africa Energy Utilities & Resources Leader, says: "The 2017 year can be described as a year of policy uncertainty and real questions over the long-term sustainability of the industry." 

"After the price lows of December 2015 and January 2016, the current year saw USD prices recover for most commodities with the exception of platinum. Although some USD price gains were offset by a stronger rand, the improved prices did bring the industry as a whole back into profitability." 

Despite an improvement in the financial performance of the industry, regulatory announcements in June 2017 resulted in market capitalisation dropping to June 2015 levels.

A subsequent recovery at the end of August was aided by improved USD prices and hope by investors that the suspended new Mining Charter would be revised before final implementation. In this edition, we have also included a brief look at the regulatory changes in Nigeria, the DRC and Tanzania.

Market capitalisation 

The 2017 financial year saw a decrease in the market capitalisation of the companies analysed to almost the low levels of 2015. The market capitalisation of the 29 companies analysed in this report decreased to R420 billion, a 25% decline from R560 billion as at 30 June 2016. Market capitalisation recovered somewhat to R506 billion as at 31 August 2017 on the hope that there would be an amicable solution between the industry and the regulator. 

Contribution by commodity 

Coal maintained its strong position as the leading South African mining commodity revenue generator. Despite its percentage of revenue generated remaining unchanged at 27%, it increased total revenue to R119 billion from the prior year's R105 billion.

Platinum group metals' (PGMs) share of total revenue decreased to 22% from 24% as total PGM revenue decreased by R2 billion to R94 billion. Gold's share of mining revenue decreased to 16% from the 18% in 2016. In contrast, iron ore's share increased to 11% from 9% due to a R10 billion increase in revenue. 

Financial performance 

Revenue increased by 13% (R43 billion) from the prior year. "It is notable that this is the first substantial increase in more than five years," says Andries Rossouw, PwC Assurance Partner. 

The gold companies' revenue increased by 17% (R23 billion) due to improvements in USD gold prices and a weaker rand for most of the reporting period. The platinum companies have seen revenue increases by 4% from the prior year on the back of improved platinum prices for parts of the year. 

Operating expenses increased by R13 billion, which is a 5% increase from the prior year. Continued low commodity prices have resulted in another year with significant impairments in the industry, with a total of R22 billion in impairment provisions. More than R100 billion was impaired over the last three years, more than wiping out the last two years of capital expenditure in the industry. 

After last year's net loss the companies in this year's analysis are back into a net profit position due to lower impairments. The EBITDA margin of 26% is 6% higher than the previous year.

"It is encouraging that all commodities improved their EBITDA margins. However, the low platinum EBITDA margin (12%) is still a significant concern and threatens the sustainability of a number of operations," Rossouw adds. 

Labour still accounts for the majority of mining companies' costs, accounting for approximately 44%. Labour costs increased by 4.5% which was marginally below inflation. 

Integrating risk into business strategy 

In the last number of years we have not seen a significant change in the risks identified by mining companies. These include: volatile commodity prices and foreign exchange fluctuations; the regulatory, political and legal environment; socio economic environment around mines; sustainable business plans or budgets; labour relations; operating costs; reliance on third-party infrastructure; employee safety and health; liquidity and capital management; and compliance with environmental standards.

In 2017, the risks have remained relatively consistent with three companies also including cybersecurity and its consequences as a risk. 

Safety in mines 

According to safety statistics, the level of safety has improved substantially in the industry, with fewer fatalities reported over the past 10 years. This is indicative of investments made by mining companies in safety initiatives. 

Value to investors in the mining sector 

The mining industry continues to add value to all its stakeholders. As reported in company value added statements, employees still take the lion's share of value added at 40%, followed by the Government through direct taxes, payroll and royalties with 19%. It is disappointing to note that shareholders got only 2% in the form of distributions. 

Adoption of emerging technologies in the mining industry 

Technological advancements have spurred innovation and new ideas in the mining industry. A number of mining companies have adopted emerging technologies. The use of remotely-piloted as well as autonomous drones to survey opencast mines is a common example of the adoption of emerging technology. Mines are also using autonomous drilling, proximity devices, collision awareness systems for mine vehicles and trucks, cloud and mobility solutions. 

Illegal mining activities 

The value of illegal mining and dealing of metals and diamonds in South Africa is estimated to be more than R7 billion per year. The South African gold sector has been the most adversely impacted by illegal mining within the industry, according to the companies included in our study.

The Chamber of Mines has emphasized the need for mining houses, the DMR and the South African Police Service to work together at every level of illegal mining activity from individuals working underground to the large syndicates that organise activity and sell the end product. 

Mining in Africa 

The DRC 

The growth in the DRC mining sector since 2002 has been facilitated by the commodities boom, attractive tax and customs incentives, greater stability and an improved regulatory environment. By the end of 2016, 482 companies held mining rights, compared to 35 in 2002. The production of copper amounted to 1.035 billion tons at the end of 2016 versus 27 259 tons in 2002. Cobalt production achieved 69 038 tons at the end of 2016, versus 11 865 tons in 2002. 

Nigeria 

Despite various challenges the Government has taken a number of steps to make the mining sector more attractive for investment by putting in place clear regulatory policies and operationalising existing ones. There are still a number of challenges in the sector ranging from insufficient infrastructure as well as regulatory conflicts. The Nigerian mining sector realises it needs to align itself with world trends and norms, especially around the future demand for various minerals. 

Tanzania 

In 2016, the Tanzanian Government introduced fundamental changes to the income tax regime for the extractive sector. June 2017 saw significant changes for the sector, even more fundamental than the 2016 changes. The broad objective of the new legislation is to seek to obtain a higher return to Tanzania from its natural resources.

Dangote Cement Records 12.6% Sales Volume Increase Across Africa

Dangote Cement, Africa’s largest cement producer, has announced its unaudited results for the six months ended 30th June 2017, posting a 12.6 percent increase in sales volume across Africa. 

In the financials released on the floor of the Nigerian Stock Exchange indicated that the increase in sales volume showed a growing capture of Pan-African market as Dangote Cement continues to gain grounds.

Revenues from operations in Nigeria increased by 34.5 percent  to ₦291.4 billion while Pan-Africa revenue increased by 63.7 percent to ₦124.4B from ₦76.0B mainly as a result of increased volumes and foreign exchange gains when converting the sales from country local currency into Naira.

Analysis of the half year result revealed that sales volumes of African operations increased by 12.6 percent to 4.7 million metric tons with Sierra Leone making a   53 kt maiden contribution.

Record of sales from its operations scattered around the African continent revealed that a total of 1.1million ‘metric tons of cement was sold in Ethiopia, almost 0.7 million metric tons sold in Senegal, 0.6 million metric tons sold in Cameroon, and 0.5 million tons in Ghana.

Also, 0.4 million metric tons of cement was sold in Tanzania and 0.3 million tons in Zambia. Sales volumes from Nigerian operations fell from 8.8Mt to 6.9Mt, occasioned by the onset of rains which stalled many construction projects.

Reflecting on the half year results, Dangote Cement’s Chief Executive Officer, Onne van der Weijde expressed satisfaction that the company’s revenues have continued to grow despite low sales from the Nigerian operations noting that the revenues grew on the strength of sales from other African operations.

Said he: “Our revenues have continued to grow despite the lower volumes seen in Nigeria, especially because of the recent heavy rains. Our margins have improved significantly, helped by improved efficiencies and a much better fuel mix in Nigeria.

“We are using much more gas and increasing our use of coal mined in Nigeria, thus reducing our need for foreign currency and supporting Nigerian jobs.

”Our Pan-African operations are growing well and increasing market share. We saw our the first sales from Sierra Leone in the first quarter and our new plant in the Republic of Congo will be in production at the end of July, further increasing our footprint across Africa and strengthening our position as its leading manufacturer of cement.”

The Company reports that it estimated that Nigeria’s total market for cement was 10.2 million tonnes (Mt), 23.2% lower than the estimated 13.3Mt sold in Nigeria in the first half of 2016. Of total market sales in the first half of 2017, just 0.1Mt was imported. 

“As a result of the slower market, our Nigeria operation sold nearly 6.9Mt of cement, down 21.8% on the 8.8Mt sold in the first half of 2016. We estimate our market share to have been about 64.5% during the first six months of 2017.   

Dangote Cement is a high-growth, low-debt, internationally diversified company that has just paid a dividend amounting to nearly 75% of 2016 net profits to shareholders.

“The recent publication of our credit ratings highlights the financial strength we have achieved through our unwavering focus on the profitable expansion of the business, underpinned by our belief that we must remain prudent in our financial management.”, Mr. Weijde stated.

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