Productivity Improvement and Profitability: A Comparative Analysis between Dangote and Lafarge Cement

Abstract

This article examined the comparative analysis between productivity improvement and profitability of Dangote Cement and Lafarge Cement from 2008 to 2017 in Nigeria. Regression analysis was used to carry out the connection between productivity improvement and profitability where profit after tax was used to proxy profitability (dependent variable), while turnover, number of employees, fixed asset and production capacity were used as the productivity improvement (independent variable). The findings revealed that the two company's turnover exhibited positive and significant impact on profit after tax, while Fixed asset (FA) revealed negative and insignificant to influence profit after tax (PAT). Meanwhile, production capacity (PC) was positive but not significant to profit after tax (PAT) in the case of Dangote while Lafarge Cement production capacity exhibited negative and insignificant to influence profit after tax (PAT). The study concluded thatturnover and production capacity have been majorly focused to influence profit after tax of the two companies while number of employees and fixed asset have not been significantly employed as a driving force for profitability during the study period.