Dangote set to earn N13 billion in dividend from his sugar business

Africa’s richest man is set to earn a mega dividend of N13 billion from Dangote Sugar Plc.

By Omokolade Ajayi

Aliko Dangote, the founder of Africa’s most diversified manufacturing conglomerate, Dangote Industries Limited, is

expected to earn a mouth-watering dividend of N13 billion for the financial year 2020 from his stake in Dangote Sugar Refinery Plc.

Dangote who is Africa’s richest man with a total wealth valued at $16.5 billion (according to Bloomberg billionaire index) is set to earn N1.50 per share on his direct and indirect stakes in Dangote Sugar.

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The billionaire is the single majority shareholder of his integrated sugar business, with a direct stake of 653,095,014 units, and an indirect stake of 8,122,446,281 ordinary shares, which he holds through Dangote Industries Limited -a manufacturing conglomerate that also owns closely held businesses operating in food manufacturing, fertilizer, oil and other industries.

Recall that the Board of Directors of Dangote Sugar Refinery in its audited statement, proposed a final dividend of N1.5 per share to its shareholders, with Dangote’s total holdings of 8,775,541,295 issued shares of the company, he is expected to earn a mega dividend of nearly N13.2 billion.

READ: Dangote to commence 100,000 barrels of oil production

In case you missed it

• Dangote Sugar Refinery delivered an impressive financial performance in 2020, as the company declared a 33.0% growth in earnings to N29.8 billion for the financial year of 2020.
• The strong performance came from the increase in demand for the company’s products driven by the August 2019 Border closure, as it recorded strong volume growth in its 50 kg sugar offering in 2020.
• However, the company’s profit was pressured by a surge in operational cost partly due to persistent FX scarcity, and also the increase in finance cost, which can be largely attributed to the foreign exchange loss in its ordinary business operations.

READ: Food, Agro & Allied Industries set to export agri-products to New Zealand

What you should know

• A recent report revealed that Aliko Dangote lost a total $1.20 billion in the month of February, with the wealth of the richest black man on the planet declining from $17.8 billion on January 31 2021, to $16.6 billion on the 28th of February.
• The fall in his net worth was driven by the decline in the share price of his flagship company, Dangote Cement Plc (DCP), as well as the share price of his integrated sugar business, Dangote Sugar Refinery Plc (DSR).
• However, despite declaring a better-than-expected dividend of N1.50 per share in 2020 (N1.10 per share:2019), shares in Dangote Sugar are worth N18.0 per share, which is 17% lower than the peak price of N21.70 recorded this year.
• At this price, the market capitalization of Dangote Sugar Refinery is valued at N218.6 billion.