Financial analysts Cordros Securities have blamed falling earnings at Lafarge Africa on the merger of its Nigerian businesses with Lafarge South Africa.
In a research report the analysts found that the merger increased operating costs and reduced shareholder value, according to the Vanguard newspaper.
Lafarge WAPCO’s earnings per share, earnings before interest, taxation, depreciation and amortization (EBITDA) and profit before tax have all fallen since 2013.
It also found that operating costs had increased ‘significantly’ following the merger, debt had risen and that earnings had also been hit by efficiency issues.
Lafarge announced plans to merge its businesses in Nigeria and South Africa in 2014. The move saw the consolidation of Lafarge South Africa, United Cement Company of Nigeria, Ashakacem and Atlas Cement to Lafarge WAPCO. It was subsequently renamed Lafarge Africa.