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The stock price of Lafarge Africa, a member of LafargeHolcim Group, fell by 5 percent on Monday to close at N60.45 following the profit warning for the second quarter of 2016 issued by the company on Friday.  

The Board of Directors of Lafarge Africa had announced at the Nigerian Stock Exchange (NSE) that it expected its Q2 2016 results to be affected by the impact of the naira devaluation against the U.S. dollar.

The company said it expects to record a foreign exchange loss of N28 billion for Q2 2016 arising from its dollar-based borrowings, which consists of $310 million in shareholder loans and $85 million in external loans, according to a statement released on the NSE.

Following the announcement, the company’s stock price declined by 5 percent from N67 from the previous trading day to close at N63.65 on Friday.

Lafarge Africa said the loans relate to its fully-owned subsidiary, the United Cement Company of Nigeria (Unicem), which was acquired from Flour Mills of Nigeria for N55 billion in October last year. The company also said the N28 billion “unrealized” exchange loss in Unicem will have no immediate impact on cash flow.

“Lafarge Africa is very positive about the future outlook for Unicem, which is strategically located in Calabar, Cross River State and is a major cement plant in the South-South and South-East regions of Nigeria,” the company said.

Formerly known as Lafarge Cement WAPCO Nigeria Plc, Lafarge Africa is the second largest cement company in Nigeria after Dangote Cement, the clear market leader. In the 2015 full year, the company said pre-tax profits fell 27.5 percent year-on-year to N29.27 billion while gross revenues rose 2.4 percent year-on-year to N267.23 billion.

Founded in 2014 to house the Nigerian and South African assets of LafargeHolcim, the world’s largest cement company, Lafarge Africa controls four cement companies in Nigeria: LafargeWapco, based in Ogun State; AshakaCem, based in Gombe state; Atlas Cement, based in Rivers State; and Unicem.