By Bamidele Famoofo
WorldStage– Though revenue dropped by 12.22 percent, Nigeria’s largest sugar processing company, Dangote Sugar Refinery Plc ( DSR), a member of the Dangote Group, returned to profit making in first quarter in 2026.
Dangote Sugar Plc staged a dramatic turnaround in the first quarter ended March 31, 2026, swinging from a loss-making position a year ago to a solidly profitable one.
Revenue declined 12.22 percent to ₦187.8 billion from ₦213.9 billion in Q1 2025. Cost of sales fell by 29.31% to ₦144.7 billion. COGS margin compressed sharply from 95.7 percent to 77.0 percent, and gross margin expanded from a razor-thin 4.3 percent to a far more respectable 23.0 percent. Gross profit surged 365.58 percent to ₦43.1 billion from just ₦9.3 billion.
Operating expenses were held almost completely flat, with administrative costs up just 1.14 percent to ₦6.5 billion. Other income of ₦9.5 billion, up from a negligible ₦143 million, added a further substantial boost. The combined effect pushed profit from operating activities to ₦45.8 billion from just ₦2.8 billion. Operating margin expanded to 24.4 percent from 1.3.percent.
Finance costs remained elevated at ₦28.5 billion, dropping from ₦29.9 billion in Q1 2025, and continue to be the most significant drag on the bottom line. Net finance costs of ₦26.8 billion, while marginally improved, are still heavy relative to the size of the business. Profit before tax nonetheless recovered strongly to ₦20.7 billion from a loss of ₦22.6 billion. After a modest tax charge of ₦1.5 billion, profit after tax came in at ₦19.2 billion from the ₦23.6 billion loss recorded in Q1 2025. Earnings per share turned positive at ₦1.58 from a loss of ₦1.95 per share.
The balance sheet tells a story of active repair. Financial liabilities were fully extinguished, falling from ₦37.3 billion to zero, with a debt-to-equity ratio now at 0.0% compared to 28.9 percent a year ago. Total liabilities declined 7.03 percent to ₦778.1 billion, while shareholders’ equity grew 14.85 percent to ₦148.1 billion, driven by the return to profitability. Return on equity stood at 12.9 percent and return on assets at 2.1 percent.
The market has responded accordingly since the results dropped, the stock has surged from ₦69.70 to ₦90.05, a gain of roughly 29.2.percent in a matter of days.
Investors have clearly looked past the revenue decline and latched onto the profitability turnaround, the complete elimination of borrowings, and the dramatic margin recovery as the more compelling narrative.
