Rating Release
Agusto & Co. hereby assigns an “A-“ rating to African Non-Ferrous Industries Limited with a stable outlook
The rating expires on 30-06-23
Agusto & Co. hereby assigns an “A-“ rating to African Non-Ferrous Industries Limited (“African Non-Ferrous Industries”, “ANFIL” or “the Company”). The assigned rating reflects the Company’s financial condition characterised by its good profitability buoyed by the continued expansion in production capacity and sales volume as well as the rise in international Lead prices. The rating is further enhanced by the off-take agreement with offshore customers for its high-quality Lead which also commands a premium on international prices as well as the Company’s satisfactory cash flow and moderate leverage position. The rating also considers ANFIL’s stable, experienced and qualified management team as well as the strong technical and financial support the Company enjoys from African Industries Group (AIG) . Furthermore, the rating takes cognisance of the ongoing plant expansion which we believe would result in a higher earnings capacity over the near to medium term, in addition to the strong governmental support for export-oriented businesses in Nigeria. However, the rating is moderated by the Company’s concentrated ownership profile, inadequate working capital and the governance structure that needs further strengthening in line with best practices. The rating is also tempered by ANFIL’s exposure to volatilities in the global commodities market and the persistent inflationary pressures in Nigeria with resultant adverse impact on margins.
African Non-Ferrous Industries Limited is a leading producer and exporter of high-purity refined Lead in Nigeria. The Company is part of African Industries Group (AIG), a conglomerate with several business interests in Nigeria. ANFIL has a fully integrated Lead manufacturing plant with 30,000 metric tonnes per annum capacity located in Ogijo, Ogun State, which it plans to scale up to 40,000 metric tonnes per annum before the end of 2023.
The opinions expressed in this rating release do not represent investment or other advice and should therefore not be construed as such. Visit www.agusto.com for further information.