Stating the case for investing in Nigeria

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• Stating the case for investing in Nigeria
• Tony Hadley, CEO, Dangote Cement

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Contents

• The Dangote Group in Nigeria
• Profile
• Business sectors
• Major Assets
• The Nigerian operating environment
• Economy
• Opportunities
• Challenges

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The Dangote Group in Nigeria
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Group Profile

• Mission Statement Touching the lives of people
  by providing their basic needs
• Diversified business conglomerate focused on
  provision of essential goods (food and shelter)
• Began life as a trading business (1985) and made
  a strategic decision in 1999 to transition to
  local production/manufacturing.
• Recognition of the opportunity to develop value
  added local production capacity
• Rapid growth into one of the largest
  conglomerates in Nigeria

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Group business sectors

• Cement - Manufacturing / Importing, Packing and
  Distribution
• Sugar - Farming Refining, Packing and
  Distribution
• Salt - Refining, Packaging and Distribution
• Flour Semolina - Milling, Packing and
  Distribution
• Spaghetti, Macaroni Noodles - Manufacturing and
  Distribution
• Polysacks - Manufacturing
• Logistics - Port Management
• Logistics - Transportation of Raw material and
  Finished Goods
• Property Development
• Oil Gas exploration
• Telecoms 3G licence
• Associated infrastructure

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Major Assets (1)

• Obajana Cement Plant Largest cement plant in
  Sub-Saharan
• Africa (5 Million tonnes of production capacity)

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Major Assets (2)

• Dangote Sugar Refinery Plc (Apapa, Lagos) 1.44
  Million tonnes
• of annual refining capacity making it the largest
  in SSA.

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Major Assets (3)

• Savannah Sugar in Numan has 32, 000 hectares of
  cultivated land
• and currently produces 150,000 tonnes of raw
  sugar per annum.
• An upgrade is currently taking place to increase
  production to
• 600,000 tonnes per annum.

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Major Assets (4)

• Dangote Flour Mills plc has five flour mills in
  Nigeria producing
• 4,500 Metric tonnes of flour every day

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The Nigerian operating environment
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Economy

• GDP (PPP) of US293 Billion
• Real GDP growth (2008) of 6.4
• Population (2008) 143 Million
• Oil and agriculture made up 69 of GDP in 2009
  (37.3 and 31.7 respectively)
• Non-oil sector growth outstripping real GDP
  growth (agriculture grew by 8 in 2007)
• Predicted growth of over 3.5 in 2009, despite
  global financial crisis (IMF)

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Opportunities

• Cited by Goldman Sachs as one of next 11
  countries expected to follow the BRICs into the
  top 20 world economies
• Significant consumer market and growing middle
  class (143 Million population and growing)
• Large natural resource reserves
• Reform agenda
• High Return on Investment (ROI)

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Challenges

• Infrastructure deficiency (energy, services and
  transportation)
• Financial Sector high cost of capital and
  short-term mindset
• Lack of sufficient skilled local labour
• Costly operating environment
• A challenging environment, but one that rewards
  those committed to success

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Conclusions

• Strong ROI for companys committed to investment
• Reform agenda creating a platform for enhanced
  operating environment
• Growth despite global financial crisis
• Opportunities across a range of non-oil sectors
• Importance of local content and knowledge
• The Dangote model demonstrates that success is
  achievable across a range of sectors