Lafarge Wapco proposes N1.20 dividend for 2012


Lafarge Wapco Plc has proposed a dividend of N1.20 per share to its shareholders for the year ended December 31, 2012.

According to analysts from FBN Capital, ‘This implies a dividend yield of 1.7 percent and a payout ratio of 24.5 percent. Both the Dividend per share, DPS and payout ratios were below our estimates of N2.1, 40 percent, but broadly in line with consensus expectations. With earnings and DPS in line with market expectations, the market’s muted response to the results is not surprising.”

The analysts also stated that Lafarge Wapco quarter four, 2012 sales of N18.1 billion came in flattish year-on-year, y/y, and was below the average run rate of N23.3billion delivered by the company for the first three quarters of 2012.

According to FBN, “Profit Before Tax (PBT) of N4.9billion was up 177 percent y/y, largely on the back of a gross margin expansion of 718bps and a 35 percent y/y decline in Operating expenses, ( Opex). PAT increased 140 percent y/y, while weaker comparables for Q4 2011 also helped the strong y/y growth in WAPCO’s earnings reflect strong operating leverage as the company ramped up 2.5 million metric tonnes of recently added capacity.

“On a sequential basis, although sales were down 23 percent quarter-to-quarters, q/q, a gross margin expansion of 1,359bps q/q drove an 18 percent q/q growth in PBT. WAPCO’s earnings were more or less in line with consensus expectations.”

Continuing, the FBN analysts, said, “Our estimates were on the aggressive side. On a full year basis, WAPCO’s 2012 sales grew 40.7 percent y/y to N88 billion, while PBT and PAT were up by 105 percent and 70 percent respectively.

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