Nigeria’s largest sugar refiner, Dangote Sugar Refinery (DSR), is projected by financial analysts to resume dividend payments to shareholders by at least 2027. This optimistic outlook follows a challenging period of consecutive losses that forced the company to halt payouts since 2023. A significant turnaround in macroeconomic conditions and DSR’s recent return to profitability are key factors underpinning this forecast.

The positive shift became evident in the third quarter of 2025, when Dangote Sugar reported a net profit of N13.7 billion. This marked its first positive quarterly financial outcome since the fourth quarter of 2024, and its strongest performance since the first quarter of 2023, signaling a crucial rebound. Analysts at CardinalStone highlight this return to profitability as a foundational step towards restoring shareholder distributions.

The resumption of dividends, however, remains contingent on the company’s retained earnings transitioning from their current negative state into positive territory, thereby bolstering shareholders’ equity. As of the nine-month period ending September, Dangote Sugar’s retained earnings stood at a significant negative N136.3 billion, underscoring the scale of recovery still required before payouts can recommence.

Dangote Sugar experienced substantial losses in both 2023 and 2024, primarily due to the sharp devaluation of the Nigerian naira, which lost nearly 70 percent of its value against major currencies. Given that approximately 90 percent of the company’s raw material inputs are imported, this currency depreciation led to a dramatic increase in the cost of sales and significant foreign exchange losses. These combined factors resulted in piling financial deficits for the refinery.

The financial impact was severe, with Dangote Sugar reporting a net loss of N73.8 billion for the full year 2023. This deficit further exacerbated, more than doubling by the end of the last financial year. The sustained period of losses directly prompted the suspension of dividend payments, as the company grappled with its mounting financial obligations and the adverse currency environment.

Despite these historical challenges, CardinalStone analysts now project an overall return to profitability for Dangote Sugar in the full year 2025, forecasting a profit after tax of N5.2 billion. This revised estimate, though lower than an earlier prediction of N27.4 billion, still represents a significant improvement from the previous losses. Analysts anticipate easing operational costs will translate into better financial margins for the company.

Specifically, for the full year 2025, CardinalStone forecasts gross, EBIT (Earnings Before Interest and Taxes), and net margins of 16.0%, 14.4%, and 0.6% respectively. These figures represent a notable upgrade from previous estimates of 12.5% for gross margin, 9.6% for EBIT margin, and a negative 3.0% for net margin, illustrating the expected positive trajectory of the company’s financial health.

Looking further ahead to the full year 2026, analysts see considerable scope for sustained improvement in Dangote Sugar’s performance, driven by more optimistic macroeconomic expectations. They anticipate revenue to grow by 26.0% year-on-year, pushing past the N1.0 trillion mark to reach an estimated N1.1 trillion. This growth is primarily attributed to a continued recovery in sales volumes, supported by an improving consumer purchasing power.

Several factors are expected to bolster profitability in 2026. These include an anticipated easing of the cost of sales, a decline in finance costs, and the absence of the significant foreign exchange losses that plagued previous years. Furthermore, benefits from the company’s strategic debt refinancing initiatives are expected to contribute positively, enhancing the bottom line.

As a result of these favorable conditions, CardinalStone projects even stronger margins for Dangote Sugar in full year 2026. Forecasts indicate gross, EBIT, and net margins of 18.0%, 15.4%, and 4.0% respectively. This sustained improvement in profitability is critical for rebuilding the company’s financial reserves and establishing a stable foundation for future shareholder returns.

Therefore, while the path to full financial recovery is underway, analysts remain firm that dividend resumption is unlikely before the full year 2027. This timeline allows for sustained profitability to accumulate sufficient distributable reserves, ensuring the company can responsibly resume shareholder payouts without compromising its financial stability. The focus remains on strengthening the balance sheet.

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Keywords: Dangote Sugar Refinery, Dividend payment, Profit rebound, Nigerian economy, Naira devaluation impact, Financial performance forecast, Retained earnings recovery, CardinalStone analysis