BUA Cement Falls by 10% as Investors Sell Shares over Weak Earnings

BUA Cement Plc plunged by 10%, or N373.507 billion, on the Nigerian Exchange (NGX) at the beginning of the week as investors dumped the company shares after a weak third quarter of 2024 earnings performance.

The company’s profit after tax expenses fell by 35.62% year on year to N48.970 billion at the end of nine months of financial year 2024, from N76.065 billion in the comparable period in 2023.

The highly capital intensive cement industry’s players have been operating under tight market conditions in Nigeria with multiple pressures, including high interest and hot red inflation rates.

The market is less optimistic about the cement oligarchy earnings prospect as the country’s devaluation exposed players earning to the naira fluctuations. The largest cement company, Dangote Cement, only saw marginal increase in profitability as FX losses and high costs damaged its earnings.

BUA has been facing similar issues in the past few quarters, and these have been putting pressures on the company’s earnings. Investors have been picking profit on BUA Cement, reversing its earlier in the year momentum.

In the equities market, BUA Cement fell by 10% on Monday to N99 per share from N110. The price depreciation brought down the cement company’s market value to N3.352 trillion, down by about N374 billion in one day.

At the current price, BUA Cement is now trading at more than 46% discount to its 52 week high, During the good time, the cement share price had climbed to N185, its 52 week high on the Nigerian Exchange.  #BUA Cement Falls by 10% as Investors Sell Shares after Weak Earnings