Merger drives CCNN’s profit margin to 5-year  

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The cement industry is facing increasing competitions as leading players brace up capacity to bargain for better share of the growing cement sector.

The industry saw two giants leverage mergers and acquisitions between 2017 and 2018 to expand capacity and intensify competition.

Cement Company of Northern Nigeria (CCNN) saw an improved performance in 2018 on the back of its merger with Kalambaina Cement. The performance in 2018 was sustained in the first quarter of 2019 and possibly heralds a better full year outing for the cement maker.

Corporate information

Cement Company of Northern Nigeria Plc (CCNN) is one of the oldest players in the Nigeria’s cement industry and was founded by Alhaji Sir Ahmadu Bello, the Premier of the then Northern Region and Sardauna of Sokoto.

CCNN engages in the production and marketing of CEM II type of cement in accordance with the Nigerian Industrial Standards under the brand name “Sokoto Cement”.

Incorporated on August 15, 1962 as a Limited Liability Company, CCNN commenced production of Cement five years after, with an initial installed capacity of 100,000 tons per annum at the Kalambaina plant in Sokoto state, Northern Nigeria.

The capacity of CCNN was expanded in 1985 after current president – the then Head of State, Major General Muhammadu Buhari -commissioned a second line with an installed capacity of 500,000 tons per annum brining CCNN’s total capacity to 600,000 tons per annum.

However, CCNN was forced to shut down its first line in 1986 on account of production inefficiencies, thus reducing its total capacity to 500,000 tons per annum.

 Under the administration of Ibrahim Badamasi Babangida in 1992, the Federal Government disinvested about 20% of its holding in CCNN and sold it to the Nigerian Public in a bid to improve operational efficiencies and as part … Read More...

CCNN donates N6m drugs to 6 Sokoto healthcare centres

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The Cement Company of Northern Nigeria (CCNN) has donated drugs worth N6 million to six healthcare facilities within its host community.
The facilities are Sabon Gari Dole Clinic, Kalanbaina Clinic, Wajeje Dispensary, Barkin Kusu PHC, Arkilla PHC and Mobile Barracks Clinic in Wamakko Local Government Area of the state.
Speaking while presenting the drugs, Yusuf Binji, CCNN managing director, said the gesture was part of the social responsibility of the company to the host communities.
The company takes the interest of the host people at heart through the provision of some social amenities, not only in the local government but also the state entirely.
“The drugs we are presenting today are for six different health centres in the community. The communities include Sabon Gerri Dole clinic, Kalanbaina clinic, Wajeje Dispensary, Barkin Kusu Primary health care centre, Arkilla primary health care centre and Mobile Barracks clinic, all in Wamakko local government,” Binji said.
“This is just part of what we have been doing regularly for our people here. It will interest you to know that not less than fifty students benefits from our Scholarships scheme in different parts of higher institutions. We also contributed through the provision of portable water to some community as well as construction of inner roads network within the local government,” he explained.
Speaking earlier, the vice chairman of the council, Zubairu Muhammad Dundaye, thanked the management for the gesture, and advised the beneficiaries to make use of the drugs judiciously and not to divert them for their personal use.
In his remarks, the district head of Wajeje village, Muhammadu Melato Gunbi, who spoke on behalf other district heads, also expressed appreciation to the management of the company for the laudable programme done for the host communities.
He assured the company of the Read More...

CCNN Plc: Operating efficiency bolsters profit margin

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Historical Background

Cement Company of Northern Nigeria (CCNN or the company) started operations in the 1960s, with federal government as the major investors.

The company was listed on the Nigerian Stock Exchange in 1993 and the FG soon fully divested to a private investors in 2000. The company is the only cement company in the North West. 

The total installed capacity of the company was 500,000 Mt/a and the plant ran at almost full capacity of 92.30 percent between 2016 and 2017.

But in 2017, the company entered into a merger with Kalambaina Cement with a capacity of 1.5 Mt/a, owned by BUA, the majority shareholder in CCNN via stake in Damnaz Cement Company Limited (50.70 perent). This brings the total installed capacity of the company 2.0 Mt/a.

Analysts are optimistic that the merger will spur the cement company to growth while shareholders wealth will be maximized.

Operational Strategy and Outlook

Following the merger of CCCN and Kalambaina Cement that saw total capacity surge to 2.0 Mt/a, the company’s shares outstanding now stands at  13.10 million shares, from 1.30 million shares previously held. If the new shares are multiplied by N17 market price as at Friday, the new market value of the cement maker will be N223.14 billion, this compares with N22.10 billion pre merger.

The upside of the marriage cannot be overemphasized as it would underpin operating efficiency, as the company had migrated from the use of LPFO that was very expensive and susceptible to disruptions, to coal, a strategic plan that is responsible for lower costs and strong margins.

Financial performance for q1

For the first three months through March 2019, CCNN’s revenue surged by 213.17 percent to N16.88 billion from N5.39 billion as at march 2018, the highest revenue in the Read More...