Dangote Sugar Refinery Plc (DSR) has reported a remarkable turnaround in its financial performance for the third quarter of 2025, swinging to a pre-tax profit of N13.38 billion, compared to a staggering N64.16 billion loss in the same period last year. This performance marks one of the company’s strongest quarterly recoveries in recent years, signaling a firm step toward returning to full-year profitability after a turbulent 2024.
The Q3 rebound substantially narrowed the refinery’s nine-month loss to N8.7 billion, a dramatic improvement from the N275.5 billion loss posted during the same period in 2024, according to the company’s unaudited financial results. Analysts attribute this positive swing to stronger operating efficiencies, improved cost control, and a steep reduction in finance expenses, even as revenue growth remained modest.
Revenue Growth and Margin Expansion
Dangote Sugar reported a 3.8% increase in revenue, rising to N196.02 billion in Q3 2025 from N188.80 billion in Q3 2024. Although the topline expansion was modest, the company’s profitability benefited from significant cost optimization efforts. The cost of sales dropped sharply by 15.8% to N157.64 billion, down from N187.12 billion in the previous year’s quarter.
This cost discipline propelled gross profit to N38.38 billion, compared to a marginal N1.68 billion a year earlier—representing a more than 20-fold increase. Consequently, gross margin improved dramatically to 19.6%, from just 0.9% in Q3 2024.
The performance underscores the company’s successful focus on operational efficiency and cost containment. Despite a relatively flat revenue environment, the ability to extract higher value from sales and streamline production costs has become a major driver of profitability.
Operating Profit Returns to Positive Territory
Following the gross margin improvement, Dangote Sugar posted an operating profit of N43.02 billion in Q3 2025, a major turnaround from an operating loss of N2.16 billion in the same quarter last year. The significant improvement was aided by higher other income, which surged to N12.49 billion, compared to N461 million in Q3 2024.
The spike in other income was largely attributed to foreign exchange gains, reflecting improved FX management strategies during the quarter.
However, the company also recorded higher administrative expenses, which rose to N7.57 billion from N4.08 billion in 2024, driven by inflationary pressures and increased personnel costs. Impairment charges also edged up to N134.4 million, compared to N47.6 million a year earlier.
Despite these cost increases, the overall operating environment improved substantially, aided by strong revenue-to-cost alignment and efficient capital utilization.
Finance Costs Halved, Supporting Profitability
A major factor behind the rebound in profitability was the 53.6% reduction in finance costs, which fell to N30.61 billion in Q3 2025 from N65.98 billion in Q3 2024. This decline reflects the company’s successful efforts to manage its debt exposure and optimize financing arrangements.
Meanwhile, finance income declined to N480.1 million from N2.69 billion, leading to a net finance cost of N30.13 billion, significantly below last year’s N63.30 billion.
Additionally, Dangote Sugar reported a fair value gain of N497.8 million, slightly below N1.29 billion in Q3 2024. These combined factors contributed to the company’s strong bottom-line rebound.
The result was a pre-tax profit of N13.38 billion, reversing a N64.16 billion loss in Q3 2024. After-tax figures also improved significantly, with the company reporting a profit after tax of N13.68 billion, compared to a N40.34 billion loss in the same quarter of the previous year.
Balance Sheet Growth and Financial Stability
Dangote Sugar’s balance sheet expanded across several key categories, reflecting improved asset utilization and revaluation gains. Total assets climbed by 52% year-on-year to N1.01 trillion, with property, plant, and equipment (PPE) accounting for the majority at N615.6 billion.
On the liabilities side, total obligations rose by 6% to N817.15 billion, primarily due to higher trade payables and lease liabilities. Importantly, the company’s shareholders’ equity recovered strongly, moving from a negative N105.11 billion in 2024 to a positive N198.46 billion in 2025—a reflection of the improved profitability and asset revaluation gains during the year.
Market Confidence and Outlook
Investor sentiment toward Dangote Sugar has strengthened significantly following the release of its Q3 results. As of October 31, 2025, the company’s stock traded at N60.50 per share, representing a year-to-date gain of 86%.
The rebound in profitability, coupled with improving balance sheet metrics, has bolstered investor confidence that the company is successfully stabilizing after a difficult 2024 marred by foreign exchange volatility, input cost inflation, and supply chain disruptions.
Looking forward, market analysts expect Dangote Sugar to maintain its recovery trajectory as cost efficiencies deepen and local sugar production capacity continues to expand under the Nigeria Sugar Master Plan (NSMP).
With its renewed focus on vertical integration, import substitution, and operational efficiency, Dangote Sugar appears poised to close 2025 on a stronger note, moving steadily toward restoring sustainable profitability and shareholder value.
