Nigeria: Lafarge Africa Completes Repayment of N34 Billion Bond

22 June 2021

Lafarge Africa Plc has repaid its N33.6 billion bond and has no outstanding under its N100 billion Bond Issuance Programme.

In a notification to the Nigerian Exchange (NGX) Limited, the company said it had registered a N100 billion bond issuance programme in June 2016, out of which the sum of N60 billion was issued in Series 1 and 2.

According to the company, the matured Series 1 bond was issued on June 10, 2016, with a 3-year tenor and at a fixed coupon of 14.25 per cent, which has been repaid, while the matured Series 2 bond issued on June 15, 2016 with a 5-year tenor at a fixed tenor of 14.75 per cent had now been repaid.

"The company leveraging on its performance and its recently concluded management strategic plans to systematically deleverage the company, has redeemed the Series 2 Bond from internally generated cash flow. In view of this, the company has no outstanding issued Bond under the N100 Billion Bond issuance programme," it said.

Market operators said the full repayment of the bond would impact positively on its operations and bottom-line as the cement firm would now channel its cash towards the enhancement of its performance.

Lafarge Africa Plc had reported a growth of 13.3 per cent in profit after tax (PAT) to N9.14 billion for the first quarter (Q1) ended March 31, 2021. Analysts at Cordros Securities had said profit before tax (PBT) grew by 36.1 per cent to N12.77 billion, while PAT grew slower by 13.3 per cent following the significant increase in tax expense (+176.4 per cent) which pushed the effective tax rate higher to 28.5 per cent in Q1-2021 as against 14 per cent in Q1-2020.

"We like that the company kicked off 2021 with double-digit growth in the bottom line, a trend that we had observed since Q3-2019 when the loss-making South African subsidiary was sold. We are also impressed that the company was operationally efficient during the quarter, given the improvement in operations expenses/sales ratio (-211bps to 6.2 per cent) despite the elevated inflationary pressures in the broad economy," they had said.

Meanwhile, the stock market opened the week on a negative note yesterday as the NGX All-Share Index fell 0.27 per cent to close at 38,545.30, while market capitalisation shed N54 billion to be at N20.1 trillion.

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