Dangote Cement to spend $1bn to boost capacity by 2030

Dangote Cement Plc, Africa’s biggest producer of the building material, will spend $1 billion to boost capacity over the next four years as infrastructure construction spurs demand.

The company, controlled by billionaire Aliko Dangote, plans to raise capacity by 45% to 80 million tons, according to Chief Financial Officer Gbenga Fapohunda. The money will be invested in “Nigeria, Ethiopia and some other countries,” Fapohunda said during an investor conference call in Lagos on Wednesday.

Sub-Saharan African governments need to spend $170 billion on infrastructure projects every year, according to the African Development Bank. From South Africa to Ghana, nations are now prioritising construction of roads, ports and power plants — boosting demand for cement and other building materials.

The company’s shares were unchanged at 809 naira at close of trading in Lagos. They have advanced 33% this year, compared with a 26% gain for the benchmark NGX All Share Index.

Dangote had earlier announced plans to increase exports of cement and clinker to 10 million tons by 2030 compared with 1.4 million tons in 2025, as part of a strategy to reduce dependence at home in Nigeria.

Dangote Cement will use operating cash flow, supplier credit, commercial papers, bonds and bank loans to fund the capacity expansion, Fapohunda said.

The company’s net income more than doubled to 1 trillion naira ($730 million) for the year through Dec. 31, despite a 0.9% decline in volumes to 27.5 million tonnes, it said in filing to the Nigerian stock exchange this week.

Dangote’s assets are valued at $32.6 billion, according to the Bloomberg Billionaires Index, making him Africa’s richest person.