L-R: Vice President, Oil & Gas, Dangote Industries Limited, Devakumar Edwin; President/CE, Dangote Industries Limited, Aliko Dangote, holding a...
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· strong earnings prospects from the new refineryGCR Ratings (GCR) has affirmed the national scale long-term and short-term issuer ratings of AA+(NG) and A1+(NG) respectively accorded to Dangote Industries Limited (DIL). GCR in its recent report also affirmed the national scale long-term issue rating of AA+(NG) accorded to each of Dangote Industries Funding Plc’s Series 1 NGN10.5Bn Tranche A and NGN177.1Bn Tranche B Bonds and Series 2 NGN112.4Bn Senior Unsecured Bond. The outlook on the ratings has been revised to Evolving from Stable previously.According to GCR, “the ratings were affirmed on the prospects of significant growth in earnings following the commencement of operations at the new petrochemical refinery and robust earnings expectation from the other businesses.”In the report, the rating agency decried the impact of naira devaluation on DIL performance stating that, “the ratings are constrained by the adverse impact of the currency devaluation on the profitability and financial position of the group, given its significant foreign debt exposure.”GCR in recognition of the potential of the Dangote Group added, “the group’s business profile is bolstered by the commencement of refining operations in February 2024 (with the production of diesel, Naphtha, heavy fuel oil, and aviation fuel), which now complements the already well-diversified group businesses. Accordingly, we expect the group’s business fundamentals to become increasingly tilted towards oil refining, given its size as the largest refinery in Africa and Europe. We also expect strong export sales potential given the recent debut exports of refined oil to Europe. The non-oil businesses continue to demonstrate strong earnings generating capacity and market leaderships in their respective sectors, underpinned by the above-peer production capacities and favourable demographics.”“We have maintained a positive peer comparison consideration for DIL underpinned by the importance of the refinery to the Nigerian economy. However, we have lowered the extent of support applicable under this rating component because we expect the support factors to translate to substantive enhancements to the group’s business and financial profiles over the outlook period. In 2022, DIL raised a cumulative NGN300Bn in Series 1 (Tranches A and B) and Series 2 Senior Unsecured Bonds issued by its sponsored special purpose vehicle, Dangote Industries Funding Plc. Being senior unsecured debt sponsored by DIL, the Series 1 Tranches A and B Bonds and the Series 2 Bond rank pari passu with all other senior unsecured creditors of the group.Therefore, the Bonds bear the same national scale long-term rating as that accorded to DIL and any change in DIL’s long-term corporate rating would impact the Bonds ratings. We have reviewed the draft trustees’ bond performance report dated 24 May 2024 and note that the coupons have been paid as and when due and there were no breaches to any covenants and pledges in the trust deeds. However, the group remains highly exposed to volatile energy cost dynamics and is reliant on importation of gypsum for cement, raw sugar input, and crude oil for the refinery” GCR stated.
L-R: Vice President, Oil & Gas, Dangote Industries Limited, Devakumar Edwin; President/CE, Dangote Industries Limited, Aliko Dangote, holding a...
L-R: Vice President, Oil & Gas, Dangote Industries Limited, Devakumar Edwin; President/CE, Dangote Industries Limited, Aliko Dangote, holding a...
Bloomberg, on Thursday, confirmed that the Dangote Petroleum Refinery will determine the price of petrol from October. The Chairman of Dangote...
Bloomberg, on Thursday, confirmed that the Dangote Petroleum Refinery will determine the price of petrol from October. The Chairman of Dangote...
WorldStage Newsonline– GCR Ratings has downgraded Union Bank of Nigeria’s (UBN) national scale long-term and short-term issuer ratings to...
The Crude Oil Refinery Owners Association of Nigeria (CORAN) has commended the efforts of the chairman of Dangote Group, Mr. Aliko Dangote and his...
Nigeria’s Dangote Oil Refinery has begun processing gasoline, marking a significant development after delays caused by crude shortages. The $20...
Nigeria’s Dangote Oil Refinery has begun processing gasoline, marking a significant development after delays caused by crude shortages. The $20...
Aliko Dangote, the CEO of Dangote Refinery, announced a game-changing strategy that could reduce Nigeria’s foreign exchange demand by at least 40...
By Farooq A. Kperogi Many Nigerians invested hopes in the Dangote Refinery and thought it would bring stability to Nigeria’s chaotic petroleum...