NASCON posts N4.4bn profits

 The management of NASCON Allied Industries (formerly National Salt Company), a member of the Dangote Group Sunday released its financials for the year ended December 31, 2018 with N25.8 billion revenue and a profit after tax of N4.4 billion.

The shareholders will however be paid a dividend payout of 100 kobo per share for every 50 kobo share held.

Analysts have attributed the decline in revenue and profitability to the company’s idling vegetable oil and tomato plants for straight two years.

It has however been projected that the shareholders will gain a bumper harvest in the preceding year as latest reports say the company’s Kano-based tomato paste plant has resumed operations.

The tomato paste has been idle for over two years owing to a supply disruption partly caused by a price dispute with farmers.

The 1,200 metric tonnes per day factory, meant to meet domestic demand, reportedly restarted production last week processing about 100 tonnes a day.

Managing Director of Dangote Farms Ltd, Abdulkareem Kaita, said the major challenge was the scarcity of tomato, because “the local tomato growers could not meet our production demand, we also could not agree with the farmers on the price of tomato per basket.”

Under a new deal with the farmers, the factory will buy tomatoes at prices pegged to what local markets are selling.

Dangote is also developing its own farms with a special tomato strain that could yield 60 tons per hectare, compared with the yield of 10 tons per hectare being recorded by the local farmers, Kaita said. The company plans to distribute the seedlings to growers to boost their output.

A further breakdown showed that sale of salt remained its biggest business, contributing N20.761bn, down from N22.247bn in 2017, out of which N12.565bn was incurred in cost of sales, as against N11.62bn in prior year, leaving segment profit of N8.195bn from N10.627bn. It was followed by freight income of N4.084bn, compared to the previous N3.858bn, incurring N4.442bn costs in the process, resulting in a loss of N500.245m, down from N583.36m a year earlier.

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