{"id":35056,"date":"2024-06-17T17:01:43","date_gmt":"2024-06-17T17:01:43","guid":{"rendered":"https:\/\/abujacityjournal.com\/livenews\/?p=35056"},"modified":"2024-06-17T17:01:43","modified_gmt":"2024-06-17T17:01:43","slug":"dangote-subsidiary-offers-n42-79-billion-commercial-papers-at-23-and-25","status":"publish","type":"post","link":"https:\/\/abujacityjournal.com\/livenews\/2024\/06\/17\/dangote-subsidiary-offers-n42-79-billion-commercial-papers-at-23-and-25\/","title":{"rendered":"Dangote Subsidiary offers N42.79 billion commercial papers at 23% and 25%"},"content":{"rendered":"

Dangote Sugar Refinery plc\u00a0one of Dangote Subsidiary announced the successful issuance of its N42.79 billion Series 4 and 5 commercial papers, issued at 23% and 25% respectively.<\/span><\/p>\n

The papers were issued as part of the company\u2019s N150 billion commercial paper issuance program.<\/span><\/p>\n

The Series 4 and 5 issuances comprised N12.93 billion for the 181-day Series 4 and N29.86 billion for the 265-day Series 5.<\/span><\/p>\n

According to the notice issued by the company, the CP issuance witnessed participation from pension and non-pension asset managers, as well as institutional and individual investors.<\/span><\/p>\n

As part of its N150 billion commercial paper programme, Dangote Sugar Refinery has issued N39.39 billion in 266-day Series 1 notes at a discount rate of 17.08%. Additionally, the company has issued N6.15 billion in 184-day Series 2 notes at a discount rate of 19.84%.<\/span><\/p>\n

The company issued N53.47 billion in 254-day Series 3 notes at a discount rate of 21.30%. Hence, with its Series 1 to 5 CPs, Dangote Sugar has raised N141.8 billion.<\/span><\/p>\n

According to the group\u2019s notice, the company\u2019s strategy of issuing commercial papers aims to diversify its funding sources. The funds raised will be used to support short-term working capital and meet funding requirements.<\/span><\/p>\n

Dangote Sugar\u2019s Q1 2024 financials reveal that the company incurred interest expenses of N543.2 million on commercial papers, compared to N21.48 million in interest expenses on bank loans.<\/span><\/p>\n

This indicates that the company\u2019s financing strategy is tilting more towards commercial papers than bank loans.<\/span><\/p>\n

The high discount rates at which these commercial papers are issued reflect the current high-interest monetary environment in Nigeria. In 2024, the CBN hiked Nigeria\u2019s benchmark interest rate by 750 basis points, to 26.25%, and this action has affected the affordability of working capital for manufacturers.<\/span><\/p>\n

As of Q1 2024, Dangote Sugar posted a N106.9 billion pre-tax loss, as the company incurred an N103 billion loss due to exchange rate changes during the quarter.<\/span><\/p>\n

During the quarter, Dangote Sugar posted an operating profit of N5.3 billion, representing a 77% year-on-year decline from the N22.9 billion operating profit posted in Q1 2023. The group\u2019s operating margin during the quarter was 4.3%, in contrast with 22.4% as of Q1 2024.<\/span><\/p>\n

Although a single quarter is not enough to fully assess the company\u2019s operational efficiency, Dangote Sugar\u2019s Q1 2024 results indicate a need for improvement in this area.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Dangote Sugar Refinery plc\u00a0one of Dangote Subsidiary announced the successful issuance of its N42.79 billion Series 4 and 5 commercial papers, issued at 23% and 25% respectively. The papers were issued as part of the company\u2019s N150 billion commercial paper issuance program. The Series 4 and 5 issuances comprised N12.93 billion for the 181-day Series […]<\/p>\n","protected":false},"author":27,"featured_media":35057,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[173],"tags":[],"class_list":["post-35056","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"aioseo_notices":[],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/posts\/35056","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/users\/27"}],"replies":[{"embeddable":true,"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/comments?post=35056"}],"version-history":[{"count":2,"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/posts\/35056\/revisions"}],"predecessor-version":[{"id":35076,"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/posts\/35056\/revisions\/35076"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/media\/35057"}],"wp:attachment":[{"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/media?parent=35056"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/categories?post=35056"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/abujacityjournal.com\/livenews\/wp-json\/wp\/v2\/tags?post=35056"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}