BUA Cement Limited Sees Substantial Increase in Q1 2026 Profits
BUA Cement Limited has reported a remarkable profit after tax of N176.38 billion for the three months ending March 31, 2026, a significant rise from N81.12 billion during the same timeframe last year. This strong performance underscores the company’s ongoing growth trajectory in Nigeria’s cement market.
Sales Growth Driven by Strong Cement Demand
According to the unaudited financial report, the company’s sales surged from N290.82 billion to N354.98 billion, bolstered by N340.58 billion in bagged cement sales and an additional N14.4 billion from bulk cement sales. This increase reflects a robust demand as BUA cement prices in Nigeria range between N10,000 and N11,000 per 50kg bag, translating to an approximate 30 percent industry-wide price hike in 2026.
Stable Cost of Sales Amid Rising Revenue
The cost of sales for the quarter slightly increased to N153.08 billion from N152.07 billion. Key components contributing to this cost included energy consumption at N67.34 billion, materials at N27.31 billion, and operation and maintenance service fees totaling N31.41 billion. These figures demonstrate BUA’s commitment to managing production costs effectively while expanding its revenue base.
Significant Growth in Gross and Operating Profits
BUA Cement’s gross profit rose from N138.75 billion to N201.9 billion, marking a substantial growth attributable to the difference between revenue and production costs. Operating profit also climbed, increasing from N119.04 billion to N179.51 billion. This figure includes sales and logistics expenses, which rose to N15.44 billion due to distribution costs and administrative expenses totaling N7.27 billion associated with personnel and security expenses.
Improved Financial Income and Foreign Exchange Gains
The financial income for the quarter saw an impressive increase, rising from N1.53 billion to N11.28 billion, largely driven by interest income. Meanwhile, finance costs decreased notably from N19.32 billion to N11.12 billion, with interest on borrowings at N10.01 billion and bonds at N1.12 billion. Additionally, the company recorded net foreign exchange gains of N13.01 billion, contributing to a profit before tax of N192.68 billion, a dramatic turnaround from a loss of N836.81 billion in 2025.
Increase in Total Assets and Strategic Financial Management
On the balance sheet, total assets grew to N1.99 trillion, up from N1.58 trillion last year, supported by property, plant, and equipment valued at N1.21 trillion and cash and short-term deposits amounting to N404.05 billion. Inventory stands at N165.9 billion, with raw materials at N53.45 billion and engineering spares at N61.22 billion. The company also increased its capital from N469 billion to N849.28 billion, fueled by retained earnings of N638.69 billion.
Strong Cash Flow and Continued Investments
Net cash from operating activities more than doubled to N180 billion, with profit before tax adjusted for depreciation and changes to working capital reaching N192.68 billion. The company’s investment in activities totaled N31.59 billion, primarily due to capital expenditures of N42.06 billion on property and equipment. In financing, there was a net cash outflow of N23.54 billion, attributed to the repayment of borrowings totaling N22.91 billion. Despite these outflows, cash and cash equivalents rose to N404.05 billion from N138 billion over the past year.
Management Highlights Strategic Initiatives and Future Outlook
Yusuf Binji, the managing director of BUA Cement, emphasized that the company’s strong performance and organizational transformation efforts are closely aligned. He noted that the business transformation program, which includes restructuring the transportation division for better efficiency, has already begun yielding results, contributing to a stable operational environment. In the upcoming quarters, BUA Cement plans to focus on enhancing operational cost management and penetrating new market segments, particularly amid current geopolitical challenges.
