Sector: Building Materials
Date of Incorporation: July 16, 1975
Date of Listing: April 8, 1991
Shares Outstanding: 3,132,421,875
Year End: December
Core Activities: Production and sale of Ordinary Portland Cement
Three years after the takeover over Benue Cement Company by renowned industrialist, Alhaji Aliko Dangote, the fortune of the company has evidently improved as current reports clearly show. Also, what is also interesting is that the future outlook for the company is very promising based on recent turnaround strategies that are already paying off.

Without going deep into the pre- Dangote acquisition of the company, what most people, especially company workers would recall back in 2005 was the poor state the company was in with huge outstanding salaries and debt. Infact, it would not be out of place to say that the company was moribund. Few years down the line, and BCC has become the most sought after stock in the building materials sector of the Nigerian Stock Exchange. So where and how did it all happen?

After the take over in 2005, Dangote injected fresh capital into the company which amongst other things saw workers being paid their outstanding salaries. This indeed was a good motivator for not just the staff but the company as well. Also, a new production line was installed and commissioned which saw production capacity increase to 3 million tonnes per annum.

So far, Dangote has injected about $500 million into the company which has impacted in its financials.After receiving boost in production capacity in 2007, the turnover of the company increased by over 200 percent between 2007 and 2008. Turnover increased from N5.47 billion in 2007 to N16.45 billion in 2008. Profit before tax and after tax also increased by 153.10 percent and 230 percent respectively. Net Assets increased from N9.60 billion in 2007 to N13.75 billion in 2008, indicating that the company is really poised to grow the business.

Challenges and Opportunities
The company faces a major challenge in terms of power which it has tackled as it has commissioned its own independent power station. Some other challenges include logistics, competition from other major players in the sector. As regards debt, the company has performed well it reducing its debt which will ease up its cash flow very soon.

On the other hand, the company stands to gain from the huge infrastructural and housing development in Nigeria which is still growing. With a growing population and acute shortage of houses, Nigerian cement manufacturing has still not been able to meet up with demand . This has resulted in the ongoing importation of cement.

In its 2007 result, the company declared a bonus of 1 for 8 , while in its just released 2008 result, it declared a bonus of 1 for 4. The share price as at the time of takeover by Dangote in 2005/2006 was about N5.00. With a closing price of N38.20 on June 16, 2009, the stock has appreciated by over 600 percent in a little over three years.

This entry was posted on Saturday, June 20th, 2009 at 12:50 pm and is filed under StockMarketNigeria. You can follow any responses to this entry through the RSS 2.0 feed. Tags: ApprovedO, Benue Cement Company
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