RC 501757

Contents

Notice of 4th Annual General Meeting 2

Directors, Advisers and Other Corporate Information 3

Financial Highlights 4

Chairman’s Statement 5

Board of Directors 7

Report of the Directors 8

Corporate Governance Report 12

Report of the Audit Committee 14

Report of the Independent Auditors 15

Statement of Significant Accounting Policies 16

Consolidated Profit and Loss Account 18

Consolidated Balance Sheet 19

Consolidated Statement of Cash Flows 20

Notes to the Consolidated Financial Statements 21

Consolidated Value Added Statement 32

Consolidated Four-Year Financial Summary 33

Share Capital History 34

Proxy Form

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 Notice of 4th Annual General Meeting

NOTICE IS HEREBY GIVEN that the 4th ANNUAL GENERAL MEETING OF DANGOTE FLOUR MILLS PLC will hold at Tahir
Hotel, Kano on Wednesday, 6th October, 2010 at 12.00 noon prompt to transact the following business:

ORDINARY BUSINESS
1. To receive the Audited Financial Statements for the year ended 31st December 2009 along with the reports of the
Directors and Audit Committee thereon for the year 2009.
2. To declare a Dividend.
3. To re-elect Directors.
4. To re-appoint the Auditors.
5. To authorize the Directors to fix the remuneration of the Auditors.
6. To appoint members of the Audit Committee.

SPECIAL BUSINESS
To fix the remuneration of the Directors.

PROXY
A member of the Company entitled to attend and vote at the above meeting is entitled to appoint a proxy to attend and
vote instead of him. A proxy need not be a member of the Company. A proxy for an organization may vote on a show of
hands and on a poll. For the appointment to be valid, a completed proxy form must be deposited at the registered office
of the Company or with the Registrar not later than 48 hours before the time fixed for the meeting.

DIVIDEND
The Board recommends for the approval of shareholders a payment of final dividend of 50 kobo per ordinary share of 50
kobo each, out of the profits declared in the financial year ended 31st December, 2009 and which will be subject to
withholding tax at the appropriate rate having paid an interim dividend of 30 kobo per share for the period ended 30th
September, 2009 the total dividend payable for the year ended 31st December, 2009 will be 80 kobo per share.

DIVIDEND WARRANTS
If approved, the dividend warrants will be posted on Monday, 25th October, 2010 to shareholders, whose names appear
in the Company Register of Members at the close of business on Friday, 17th September, 2010.

NOTES
1. CLOSURE OF REGISTER AND TRANSFER BOOKS
NOTICE IS HEREBY GIVEN that the Register of Members and Transfer Books of the Company will be closed from
Monday, 20th September, 2010 to Monday, 27th September, 2010 both days inclusive.

2. AUDIT COMMITTEE
In accordance with Section 359(5) of the Companies and Allied Matters Act 1990, a nomination (in writing) by any
member or shareholder for appointment to the Audit Committee should reach the Company Secretary at least 21
days before the Annual General Meeting. The Audit Committee comprises three shareholders and three Directors.

BY ORDER OF THE BOARD

A. L. ISA (MRS)
Company Secretary

Dated this 6th day of September, 2010

DANGOTE FLOUR MILLS PLC

8, Rycroft Street,
Off Liverpool Road,
Apapa, Lagos,
Nigeria.

A. L. ISA (MRS)
Company Secretary

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Directors, Advisers and Other Corporate Information

DIRECTORS
Alhaji Aliko Dangote — Chairman
Alhaji Sani Dangote — Director
Mr. Olakunle Alake — Director
Mr. Uzoma Nwankwo — Director
Alhaji Abdu Dantata — Director
Alhaji Abdullahi Mahmoud — Director
Mr. Asue Ighodalo — Director
Brigadier-General S. L. Teidi (Rtd) — Director
Mr. Rohit Chaudhry — Managing Director
Alhaji Shuaibu Idris — Deputy Managing Director

COMPANY SECRETARY/LEGAL ADVISER

A. L. Isa (Mrs)

REGISTERED OFFICE
1, Alfred Rewane Road,
Falomo,
Ikoyi, Lagos.

REGISTRAR AND TRANSFER OFFICE

Oceanic Registrars Ltd.
154, Ikorodu Road, Onipanu,
Shomolu, Lagos.

AUDITORS
Akintola Williams Deloitte (Chartered Accountants)
235, Ikorodu Road, Ilupeju, Lagos.

BANKERS
Zenith Bank Plc
Afribank Plc
Equitorial Trust Bank Plc
First Bank of Nigeria Plc
Guaranty Trust Bank Plc
Oceanic Bank Plc
Diamond Bank Plc
Access Bank Plc
Intercontinental Bank Plc
First City Monument Bank Plc
United Bank for Africa Plc

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 Financial Highlights

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000

PROFIT AND LOSS

Turnover 61,388,064 47,927,300 41,839,919 30,109,610

Profit before taxation 5,374,056 3,167,625 5,156,801 1,758,137

Taxation 187,024 (178,066) 203,060 (54,045)

Profit after taxation 5,561,080 2,989,559 5,359,861 1,704,092

BALANCE SHEET

Share capital 2,500,000 2,500,000 2,500,000 2,500,000

Shareholders’ funds 28,469,073 24,707,190 26,749,581 23,157,859

Per 50 kobo share data (kobo)

Earnings per share (kobo) 111 60 107 34

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Chairman’s Statement
Distinguished shareholders,
Members of the Board of Directors,
Gentlemen of the Press,
Ladies and Gentlemen,
It is my pleasure to welcome you on behalf of the Board
of Directors to the 4th Annual General Meeting of our
great Company, Dangote Flour Mills Plc. This meeting
gives me the opportunity to present our Company
financial statements and scorecard to shareholders and
various stakeholders for the year ended 31st December
2009, the challenges we faced, how these challenges
were managed to make the Company stay afloat.
Before I go into the details of the accounts, permit me
to briefly state major economic events which impacted
our operations during the year under review.
PREVAILING ECONOMY
The year 2009 was a challenging one for business both
locally and globally. The global financial crisis, which
started in 2007, reached its climax in 2009 with the
crash of the global stock markets and failure of several
DAN GOTE F LO U R M I LLS P LC
banks, which led to government interventions to
recapitalise the financial system. The Nigerian Stock
Exchange also experienced huge stock price fall in 2009
with the All Share Index dropping drastically. This
triggered loss of investors’ confidence and subsequent
liquidity crisis in the Nigerian economy; thereby
affecting our customer’s ability to fund their businesses
appropriately.
There was no significant improvement in the poor state
of infrastructure including power and road network
during the year. Despite government’s efforts, only an
average of 3,500 megawatts was reportedly achieved
as opposed to the target of 6,000 megawatts. The crisis
in the Nigerian energy sector has constituted a
hindrance to socio-economic transformation and,
consequently, capacity utilization in the industry where
we operate. The state of our road network also was a
major challenge in 2009 financial year. These
developments impacted adversely on our business
and has not helped the operating environment.
Inspite of this tough period however, your
Company was able to significantly increase its
market share, revenue and profit.
COMPANY PERFORMANCE
With a relative stability in price for all our products for
the year under review, I am delighted to report that
our Company has delivered record revenue and profit
for the financial year ended 31 December 2009.
Dangote Flour Mills Plc achieved a profit before tax of
N
= 5.374 billion in 2009, representing a growth rate of
69.7% from N = 3.167 billion reported in the previous
year. The turnover also increased from N = 47.927 billion
in 2008 to N= 61.388 billion in 2009 with profit after tax
moving from N = 2.989 billion in 2008 to N = 5.561 billion
in 2009. This represents 28.1% and 86% increase in
turnover and profit after tax respectively. The
subsidiaries have contributed an impressive N = 19.5
billion to the Group turnover which is highly
commendable despite all the challenges of surviving
in a highly competitive industry. Continuous effort in
growing economies of scales, and cost reduction
through operational efficiency as well as the effect of
focusing on human capital development had
contributed to the Group’s better performance
The flour milling business remains strong and
constitutes a key component of the Group’s profitability.
5
 Chairman’s Statement cont’d
Although overall average selling price had remained
stable compared to the prior year, flour sales were more
favourable. This increase resulted in a profit before tax
recorded of N= 5.37 billion for the year.
OUR PEOPLE
Our achievements this year would not have been
possible without the dedication and commitment of
our most important asset — our people. I would like to
seize this opportunity to acknowledge the good
contributions of our management and staff for their
relentless and painstaking efforts towards the
achievement of the Dangote Flour Mills Plc dream. On
our part, we would remain committed to providing
adequate and necessary development programmes and
enabling environment in order to maximise their
effectiveness and efficiency on the job at all times.
FUTURE PROSPECT
With an improved economic environment and barring
any unforeseen circumstances, Dangote Flour Mills Plc
is expected to perform favourably in 2010. The Group
has embarked on an expansion project to enlarge our
manufacturing and packaging facilities within the
country. The current ongoing projects in our various
mills are aimed at achieving 7,300 metric tons per day.
These projects are scheduled to be completed in the
last quarter of 2010. With the planned introduction of
our wheat meal brand, Alkama and retail packs for flour
and Danvita, the future looks bright and our Company
is positioned to take over the market lead. The plan to
commence direct and indirect export into Chad,
Cameroon, Niger and Sudan is at final stage. Your
futurist management is also exploring the need to site
a mill in Senegal. There is also a plan to increase the
capacity of our subsidiary (Agrosacks Limited) by 5
million bags per day. It is expected that this expansion
will contribute positively to the Group and assist in
achieving greater economies of scale.
DIVIDENDS
With the favourable profit for the year ended 31
December 2009, the Board of Directors is pleased to
recommend a final dividend of 50 kobo per 50 kobo
share for your approval at this Annual General Meeting.
This is in addition to the interim dividend of 30 kobo
per ordinary share earlier paid; thus bringing total
dividend payout to 80 kobo per 50 kobo share.
6 DAN GOTE F LO U R M I LLS P LC
GLOBAL ENVIRONMENT
Recent global events and their impact on our business
is another important factor which must be mentioned
here. The international price of our major raw material,
wheat is already soaring due to bad harvest and fire
incidence in Russia, one of the major producers of
wheat. This is in addition to the current global financial
crisis whose negative effects on sourcing offshore funds
to finance imports of raw materials and spares have
remained unabated.
Despite the above, I wish to re-assure shareholders that
our Company in its proactive manner has put strategies
in place to cope with any challenges arising from this
crisis.
CORPORATE SOCIAL RESPONSIBILITY
We would also continue to play our part in the society
as a responsible corporate body by not only complying
with required standards in products quality but also by
engaging with the larger society to continue to
contribute positively to the improved social welfare of
our operating environment.
CUSTOMERS
Our customers are considered indispensable partners
in our business. Within the year under review, we had
series of interactive sessions with them which enabled
them air their views and make significant contributions
on how to grow our partnership together. We shall
continue to hold this wonderful group of people in
high esteem. On behalf of the Board, Management and
Staff of the Company, I hereby wish to say a big thank
you to all our numerous customers.
APPRECIATION
On behalf of the Board of Directors, I would like to
express our heartfelt appreciation to the management
and employees of the Group for their continued
dedication, support and commitment during the year.
I would also like to thank you, my fellow shareholders,
as well as our customers, suppliers, bankers,
government agencies and regulatory authorities, for the
unrelenting support and confidence in Dangote Flour
Mills Plc.
Thank you and God bless.
Alhaji (Dr.) Aliko Dangote, CON
Chairman
(rtd.)
 Report of the Directors
for the Year Ended 31 December, 2009

1. ACCOUNTS
The Directors are pleased to submit their report together with the audited accounts of the Company for the year
ended 31st December 2009.

2. RESULT
The Group The Company
N
=’000 N
=’000
Turnover 61,388,064 41,839,919
Profit after taxation and minority interest 5,530,732 5,359,861

3. PRINCIPAL ACTIVITIES
The principal activities of the Company during the year are as follows:
(a) Manufacturing and selling of bread and biscuit flour
(b) Manufacturing and selling of Wheat Offal (Bran)
(c) Manufacturing of Semolina.
The principal activities of its subsidiaries are:
Pasta
Manufacture of Spaghetti, Macaroni etc.
Agrosacks
Manufacture of packaging materials.

4. LEGAL FORM
The Company started operating as a division of Dangote Industries Limited in 1999. It was incorporated as public
limited liability company on 1 January 2006 and commenced operations on the same date. It however became
quoted on the Nigerian Stock Exchange on 4 February 2008. Its principal activity is the milling, processing and
marketing of branded flour.

5. DIRECTORS AND DIRECTORS’ INTEREST

The names of Directors who are currently in office are as follows:
(a) Alhaji Aliko Dangote
(b) Alhaji Sani Dangote
(c) Mr. Olakunle Alake
(d) Mr. Uzoma Nwankwo
(e) Alhaji Abdu Dantata
(f) Alhaji Abdullahi Mahmoud
(g) Mr. Asue Ighodalo
(h) Brigadier-Gen. S. L. Teidi (rtd)
(i) Mr. Rohit Chaudhry
(j) Alhaji Shuaibu Idris

(i) In accordance with the provisions of Section 259 of the Companies and Allied Matters Act 1990, one-third of
the Directors of the Company shall retire from office. The Directors to retire every year shall be those who have
been longest in office since their last election. In accordance with the provisions of this section, Mr. Olakunle
Alake, Mr. Uzoma Nwankwo and Alhaji Abdullahi S. Mahmoud retire by rotation and being eligible, offer
themselves for re-election.

(ii) No Director has a service contract not determinable within five years.

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Report of the Directors cont’d
for the Year Ended 31 December, 2009

(iii) The Directors’ interest in the issued share capital of the Company as recorded in the register of members
and/or as notified by them for the purpose of Section 275 of the Companies and Allied Matters Act, C20 Laws
of the Federation of Nigeria 2004 are as follows:
Number of 50k Shares held
as at 31 December 2009
(a) Alhaji Aliko Dangote 38,148,029
(b) Alhaji Sani Dangote 2,200,000
(c) Mr. Olakunle Alake 2,377,500
(d) Mr. Uzoma Nwankwo 271,500
(e) Alhaji Abdu Dantata —
(f) Alhaji Abdullahi Mahmoud 43,750
(g) Mr. Asue Ighodalo —
(h) Brigadier-Gen. S. L. Teidi (rtd) —
(i) Mr. Rohit Chaudhry —
(j) Alhaji Shuaibu Idris 118,680

6. DIRECTORS’ RESPONSIBILITIES
The Directors are responsible for the preparation of financial statements which give true and fair view of the state of
affairs of the Company at the end of each financial year and of the profit or loss for that period and comply with the
Companies and Allied Matters Act, C20 Laws of the Federation of Nigeria 2004. In doing so they ensure that:
(a) Proper accounting records are maintained which disclose with reasonable accuracy the financial position of
the Company and which ensure that the financial statements comply with the requirements of the Companies
and Allied Matters Act of Nigeria;
(b) Applicable accounting standards are followed;
(c) Suitable accounting policies are adopted and consistently applied;
(d) Judgments and estimates made are reasonable and prudent;
(e) It is appropriate for the financial statements to be prepared on a going concern basis;
(f) Internal control procedures are instituted which as far as is reasonably possible, safeguard the assets and
prevent and detect fraud and other irregularities.

7. CORPORATE GOVERNANCE
Dangote Flour Mills Plc is committed to manage the Company with best practice and policies which align management
of the Company with the interests of all stakeholders. This, in the long run results in beneficial relationship and
long-term growth.

Dangote Flour Mills imbibes good Corporate Governance as a key factor in achieving its business success while
remaining within the ambit of the law as a good corporate entity.

The Board in line with its responsibilities to Shareholder works to achieve the best practice of good Corporate
Governance. The business of the Company is conducted in a fair, honest and transparent manner which conforms
to high ethical standards.

8. SUBSTANTIAL INTEREST IN SHARES

The Registrar has advised that according to the register of members on 31st December 2009, only Dangote Industries
Limited with 3,667,716,667 ordinary shares of 50k each held more than 5% of the issued share capital of the
Company.

9. FIXED ASSETS
Movements in fixed assets during the year are shown in Note 6 to the Accounts. In the opinion of the Directors, the
market value of the Company’s properties is not less than the value shown in the accounts.

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 Report of the Directors cont’d
for the Year Ended 31 December, 2009

10. DONATIONS AND CHARITABLE GIFTS

The holding Company Dangote Industries Limited currently makes donation on behalf of the Group Companies.

11. POST BALANCE SHEET EVENTS

There were no significant developments since the balance sheet date which could have had a material effect on the
state of affairs of the Company as 31st December, 2009 and the profit for the year ended on that date which have
been adequately recognized.

12. COMPANY DISTRIBUTORS

The Company’s products are distributed through many distributors spread across the whole country.

13. SUPPLIERS
The Company procures its materials at arm’s length basis from overseas and local suppliers. Amongst its main
overseas and local suppliers are Cargill International SA, Ameropa SA, Vitachem Nigeria Limited and Biochemical
Nigeria Limited.

14. ANALYSIS OF SHAREHOLDINGS

Analysis of shareholdings as at 31st December, 2009

Range No. of Holders Per cent Units Per cent

1 — 50,000 381,999 99.58 782,865,597 15.66
50,001 — 100,000 817 0.21 63,053,575 1.26
100,001 — 1,000,000,000 809 0.20 486,364,869 9.73
1,000,000,001 and above 1 0.01 3,667,715,959 73.35
383,626 100.00 5,000,000,000 100.00

15. HUMAN RESOURCES

1. Employment, Training and Employees
The Company recruits without discrimination in considering application for employment through selection
process to get the best and most suitable for various positions after interview. The Company employs
management professional and technical expertise and continues to invest in developing such skills and maintain
to set standards. The Company also has in-house training facilities in additional to external training for employees.
This gives every employee equal opportunity for career development.
2. Employees Welfare and Safety at Work
The Company continuously strives to improve its operations to ensure a safe working environment. The
Company maintains a high standard of hygiene in all its premises through sanitation practices and the regular
fumigation exercises have been further strengthened by the installation of pest and rodent control gadgets.
Safety and environment workshops have been organized for all senior employees with a broad focus on good
house-keeping to ensure good and safe working environment. Nutritionally balanced meals are provided in
staff canteens at fully subsidized prices. The use of safety shoes, goggles, apron e.t.c. is enforced. The Company
carries out safety and fire awareness drills for all staff on regular basis. As a guide in the performance of all
functions, a written Safety Policy for ensuring safe working practices is in place. Safety Officers and Security
Supervisors are on hand to ensure the use of the systems and implementation of procedures for safety by all
staff. Also, there is a clinic within each factory to provide adequate medical care in the event of accidents or
any emergency in the work place.
3. Employee Development
Local and overseas training and development programmes have been organized to meet the need of the
Company’s modernization, automation strategy implementation. The Company continues to place premium
on its human capital development arising from the fact that this would ensure improved efficiency of the
business while maintaining strategic advantage over competition. On the other hand, the employee is fully
equipped to provide quality service which at the end will be beneficial to the organization and thus contribute
to its growth.

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Report of the Directors cont’d
for the Year Ended 31 December, 2009

16 AUDIT COMMITTEE
In compliance with the provisions of Section 359(3) of the Companies and Allied Matters Act, Cap C20 Laws of the
Federation of Nigeria 2004, the Company has an Audit Committee comprising 3 Shareholders and 3 Directors as
follows:
1. Mr. Alex Adio
2. Alhaji Kasumu Ibrahim
3. Chief M. O. Mbonu
4. Alhaji Abdullahi Mahmoud
5. Mr. Asue Ighodalo
6. Mr. Olakunle Alake

The functions of the Audit Committee are as laid down in Section 357(2) of the Companies and Allied Matters Act,
Cap C20 Laws of the Federation of Nigeria 2004.

17. AUDITORS
Messrs Akintola Williams Deloitte (Chartered Accountants) have indicated their willingness to continue in office as
the Company’s Auditors in accordance with Section 357(2) of the Companies and Allied Matters Act, Cap C20 Laws
of the Federation of Nigeria, 2004. A resolution will be proposed authorizing the Directors to fix their remuneration.

BY ORDER OF THE BOARD

A. L. ISA (MRS)
Company Secretary

Dated this 6th day of September, 2010

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 Corporate Governance Report

DANGOTE FLOUR MILLS PLC is committed to the best practice and procedures in corporate governance. Overseen by
the Board of Directors, corporate governance practice are constantly under review, in line with the dynamics of the
business environment.

The Corporate Governance policies adopted by the Board of Directors are designed to ensure that the Company’s business
is conducted in a fair, honest and transparent manner which conforms to high ethical standards.

THE BOARD
Appointment to the Board is made by Shareholders at the Annual General Meeting, upon the recommendation of the
Board of Directors.

The Board consists of ten (10) members comprising the Chairman, Managing Director, assisted by one (1) Deputy
Managing Director and seven (7) non-Executive Directors.

The Board governs and supervises the overall activities of the Company through the Managing Director.

Members of the Board of Directors hold quarterly meetings to decide on policy matters and direct the affairs of the
Company, review its performance, its operations, finances and formulate growth strategy. Attendance at Directors’ meetings
was impressive. In line with provisions of Section 258(2) of the Companies and Allied Matters Act, C20 Laws of the
Federation of Nigeria 2004, the records of Directors’ attendance at Board meetings is available for inspection at the
Annual General Meeting.

The remuneration of Executive Directors is fixed and reviewed by a Committee of non-Executive Directors.

Composition of Committees within the Board of Directors

Members of Nomination and Remuneration Committee
Mr. Asue Ighodalo
Alhaji Abdu Dantata
Mr. Uzoma Nwankwo

Members of Finance and Investment Committee

Alhaji Abdullahi S. Mahmoud
Brigadier-Gen. S. L. Teidi (rtd)
Mr. Olakunle Alake

The Board delegates the day-to-day running of the Company’s affairs to the Managing Director/Chief Executive. The
Managing Director/Chief Executive is supported in this task by an Executive Management Committee. The Board consists
of 10 members, made up of the Chairman, Managing Director, 1 Deputy Managing Director and 7 non-Executive Directors.

FREQUENCY OF MEETINGS
The Board of Directors holds at least four (4) meetings a year, to consider important corporate events and actions such as
approval of Corporate Strategy, Annual Corporate Plan, review of internal risk management and control systems, review
performance and direct the affairs of the Company, its operations, finances and formulate growth strategies. It may
however, convene a meeting if the need arises. During the year under review, the Board had a total of four (4) meetings.

Attendance at Directors’ meetings is impressive. In line with provisions of Section 258(2) of the Companies and Allied
Matters Act, Cap C20 Laws of the Federation of Nigeria 2004, the record of Directors’ attendance at Board meetings is
available for inspection at the Annual General Meeting.

RESPONSIBILITIES OF THE BOARD OF DIRECTORS

It is the responsibility of the Board of Dangote Flour Mills Plc to:
• Ensure that the Company’s operations are conducted in a fair and transparent manner that conforms to high ethical
standards;
• Ensure integrity of the Company’s financial and internal control policies;
• Ensure the accuracy, adequacy and timely rendition of the statutory returns and financial reporting to the regulatory
authorities (NSE, CAC, SEC) and Shareholders;

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Corporate Governance Report cont’d

• Ensure value creation for the Shareholders, employees and other stakeholders;
• Review and approve corporate policies, strategy, annual budget and business plan;
• Monitor implementation of policies and the strategic direction of the Company;
• Set performance objectives, monitor implementation and corporate performance;
• Review and approve all major and capital expenditure of the Company;
• Ensure that the statutory rights of all Shareholders are protected at all times;
• Provide the Company with entrepreneurial leadership within a framework of prudent and effective controls which
enables risk to be assessed and managed;
• Deploy the Company’s resources to profitable use;
• Outline the Company’s strategic and corporate aims;
• Ensure that the necessary financial and human resources are in place for the Company to meet its objectives;
• Review management performance on a continuous basis;
• Set the Company’s values and standards;
• Take decisions objectively in the interests of the Company;
• Ensure that its obligations to its Shareholders and other stakeholders are understood and met;
• Constructively challenge and help develop proposals on strategy developed by Management.
The Board carries out some of the above responsibilities through the Board Committees whose terms of reference set out
clearly their roles, responsibilities, scope of authority and procedure for reporting to the Board.
Each Committee is presided over by a non-Executive Director to ensure strict compliance with the principles of good
Corporate Governance practice; while the Audit Committee has a representative of the Shareholders as its Chairman.
In compliance with the practices of good Corporate Governance, the Chairman of the Board is not a member of any of the
Committees, namely:
THE FINANCE AND INVESTMENT COMMITTEE
1. Alhaji Mahmoud S. Abdullahi — Chairman
2. Brigadier-Gen. S. L. Teidi (rtd) — Member
3. Mr. Olakunle Alake — Member
THE NOMINATION AND REMUNERATION COMMITTEE
1. Mr. Asue Ighodalo — Chairman
2. Mr. Uzoma Nwankwo — Member
3. Alhaji Abdu Dantata — Member
THE AUDIT COMMITTEE
The Audit Committee is made up of six (6) members, consisting of three representatives of the Shareholders and three
members of the Board of Directors. Members of the Audit Committee are elected at the General Meetings. The Committee,
in compliance with the requirements of Corporate Governance practice is chaired by a Shareholder. The Committee met
two (2) times during the year under review. Members of the Committee are:
1. Mr. Alex Adio — Shareholder/Chairman
2. Chief M. O. Mbonu — Shareholder
3. Alhaji Kasumu Ibrahim — Shareholder
4. Mr. Asue Ighodalo — Director
5. Mr. Olakunle Alake — Director
6. Alhaji Mahmoud Abdullahi — Director
In addition to its responsibility to review the scope, independence and objectivity of the audit, the Audit Committee
carries out all such matters as are reserved to the Audit Committee by the Companies and Allied Matters Act, Cap C20
Laws of the Federation of Nigeria, 2004.
• Review adequacy and effectiveness of Dangote Flour Mills Plc internal control policies prior to endorsement by the
Board.
• Direct and supervise investigations on matters within the scope, such as evaluations of the effectiveness of Dangote
Flour Mills Plc internal controls, cases of employee, business partner and client misconduct or conflict of interest.

DAN GOTE F LO U R M I LLS P LC 13

 Report of the Audit Committee

TO THE MEMBERS OF DANGOTE FLOUR MILLS PLC

In accordance with the provisions of Section 359(6) of the Companies and Allied Matters Act, 1990, we have examined
the Auditors’ report for the year ended 31st December, 2009. We have obtained all the information and explanation we
required.

In our opinion, the Auditors’ report is consistent with our review of the scope and planning of the audit. We are also
satisfied that the accounting policies of the Company are in accordance with the legal requirements and agreed ethical
practice. Having reviewed the Auditors’ findings and recommendations on Management matters, we are satisfied with
Management’s response therein.

Mr. Alex Adio

Chairman, Audit Committee

Dated this 6th day of September, 2010

Members of the Committee

Alhaji Kasumu Ibrahim
Chief M. O. Mbonu
Mr. Asue Ighodalo
Alhaji Abdullahi S. Mahmoud
Mr. Olakunle Alake

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Report of the Independent Auditors

Akintola Williams Deloitte

235 Ikorodu Road, Ilupeju
P.O. Box 965, Marina
Lagos,
Nigeria
Tel: +234 1 2717800
Fax: +234 1 2717801
www.deloitte.com/ng

TO THE MEMBERS OF DANGOTE FLOUR MILLS PLC

We have audited the accompanying consolidated financial statements of Dangote Flour Mills Plc and its subsidiaries,
set out on pages 16 to 33 which comprise the balance sheet as at 31 December 2009, the income statement, statement
of cash flows and statement of value added for the year then ended, and a summary of the significant accounting policies
and other explanatory information.

Directors’ Responsibility for the Financial Statements

The Directors are responsible for the preparation and fair presentation of these consolidated financial statements in
accordance with the Companies and Allied Matters Act, CAP C20, LFN 2004 and for such internal control as the Directors
determine are necessary to enable the preparation of consolidated financial statements that are free from material
misstatement, whether due to fraud or error.

Auditors’ Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted
our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial
statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material
misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments,
the auditors consider internal control relevant to the entity’s preparation and fair presentation of the consolidated financial
statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as
well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of
Dangote Flour Mills Plc and its subsidiaries as at 31 December 2009, and of its financial performance and its cash flows
for the year then ended; the Company and its subsidiaries have kept proper books of account, which are in agreement
with the balance sheet and income statements in the manner required by the Companies and Allied Matters Act, CAP
C20, LFN 2004 and in accordance with the Statements of Accounting Standards issued by the Nigerian Accounting
Standards Board.

Chartered Accountants
Lagos, Nigeria

19 August, 2010

DAN GOTE F LO U R M I LLS P LC 15

 Statement of Significant Accounting Policies
for the Year Ended 31 December, 2009

The following are the significant accounting policies which have been adopted.

1. Basis of accounting
The consolidated financial statements are prepared on the historical cost basis. Adjustment has not been made to
reflect the impact of specific price changes or changes in the general level of prices on the financial statements.

2. Consolidation
The consolidated financial statements comprise the financial statements of the Company and its subsidiaries which
are Dangote Pasta Limited and Dangote Agrosacks Limited whose financial statements are equally made up to
31 December. All inter-company transactions and balances are eliminated.

3. Turnover
Turnover represents the net value of goods and services sold to third parties during the year less discounts.

4. Fixed assets
Fixed assets are stated at cost less accumulated depreciation.

5. Depreciation
Depreciation is calculated to write off the cost of fixed assets on a straight line basis over their expected useful lives.
The principal annual rates used for this purpose are:
%
Leasehold land and buildings — 2
2
Plant and machinery — 6 –3
Motor vehicles — 25
Tools and equipment — 20
Furniture and fittings — 20
1
Computer equipment and softwares — 33 –3

6. Stocks and work-in-progress

Stocks and work-in-progress are stated at the lower of cost based on FIFO and net realisable value while goods in
transit are stated at the invoice price. Cost of stocks includes purchase cost, conversion cost (materials, labour and
overhead) and other costs incurred to bring inventory to its present location and condition.

7. Foreign currencies
Transactions in foreign currencies are recorded in Naira at the rates of exchange ruling at the time they arise. Assets
and liabilities existing in foreign currencies are converted to Naira at the rates of exchange ruling at the balance
sheet date. Gains or losses arising therefrom are included in the profit and loss account.

8. Debtors
Debtors are stated after deduction of specific provisions for debts considered doubtful of recovery.

9. Taxation
(i) Companies income tax
Income tax and education tax are provided by applying the current statutory rate on the taxable profit and
adjusted profit respectively.
(ii) Deferred taxation
Deferred taxation is provided using the liability method at the current rate of income tax on all timing differences
between the treatment of certain items for accounting purposes and their treatment for taxation in accordance
with SAS 19.

16 DAN GOTE F LO U R M I LLS P LC

Statement of Significant Accounting Policies cont’d
for the Year Ended 31 December, 2008

10. Employees retirement benefit scheme

The Company and its subsidiaries make provision for retirement benefits in accordance with the Pension Reform Act
of 2004. The contribution of the employer is 7.5% while that of the employee is 7.5% of relevant emoluments.

The Company and its subsidiaries also operate a gratuity scheme for its permanent Nigerian staff, the benefits under
which are related to employees’ length of service and remuneration. The provision for liability in respect thereof
based on actuarial valuation is provided in full in the financial statements.

11. Investments
Investments are stated at cost after specific provision for diminution in value.

12. Provisions
Provisions are recognized when the Company and its subsidiaries have present obligation whether legal or constructive,
as a result of a past event for which it is probable that an outflow of resources embodying economic benefits will be
required to settle the obligation and a reliable estimate can be made of the amount of the obligation in accordance
with the Statement of Accounting Standards (SAS) 23.

13. Segment reporting

The Company’s business segments are presented by products that are subject to similar risks and returns.

DAN GOTE F LO U R M I LLS P LC 17

 Consolidated Profit and Loss Account
for the Year Ended 31 December, 2009

The Group The Company

2009 2008 2009 2008
Note N
= ’000 N
= ’000 N
= ’000 N
= ’000

Turnover 3 61,388,064 47,927,300 41,839,919 30,109,610

Cost of sales (48,560,958) (38,288,106) (31,842,774) (24,078,077)
Gross profit 12,827,106 9,639,194 9,997,145 6,031,533
Distribution and administrative expenses (4,944,119) (5,182,564) (2,787,500) (3,271,788)
Operating profit 7,882,987 4,456,630 7,209,645 2,759,745
Other income 4 411,530 1,012,493 185,877 940,375
Profit before interest payable 8,294,517 5,469,123 7,395,522 3,700,120
Interest income 95,821 97,121 65,385 15,370
Interest payable and similar charges (3,016,282) (2,398,619) (2,304,106) (1,957,353)
Profit before taxation 5 5,374,056 3,167,625 5,156,801 1,758,137
Taxation 6 187,024 (178,066) 203,060 (54,045)
Profit after taxation 5,561,080 2,989,559 5,359,861 1,704,092
Attributable to:
Equity holders — parent 20 5,530,732 2,947,448 5,359,861 1,704,092
Non-controlling interest 21 30,348 42,111 — —

5,561,080 2,989,559 5,359,861 1,704,092

Earnings per share — Basic (kobo) 111 60 107 34

The accounting policies on pages 16 and 17 and other explanatory notes on pages 21 to 31 form part of these consolidated
financial statements.

18 DAN GOTE F LO U R M I LLS P LC

Consolidated Balance Sheet
as at 31 December, 2009

The Group The Company

2009 2008 2009 2008
Note N
= ’000 N
= ’000 N
= ’000 N
= ’000
FIXED ASSETS 7 35,238,199 32,449,283 18,961,804 15,732,634
INVESTMENTS 8 — — 7,463,637 7,463,637
GOODWILL 278,925 278,925 — —

DEFERRED TAXATION 16 328,067 — 328,067 —

CURRENT ASSETS
Stocks 9 8,246,918 9,910,531 3,248,788 5,397,449
Trade debtors 10 9,402,933 7,410,110 7,838,096 6,118,790
Other debtors and prepayments 11 1,681,842 1,333,748 952,239 626,649
Due from subsidiaries 27.1 — — 9,218,193 12,806,780
Due from related companies 27.2 6,997,161 8,865,888 5,716,330 2,972,121
Bank and cash balances 1,929,598 1,648,773 1,226,829 371,632
28,258,452 29,169,050 28,200,476 28,293,421
CREDITORS: Amounts falling due
within one year
Bank loans and overdrafts 12 13,868,256 20,595,334 10,652,531 15,214,170
Trade creditors 6,408,279 4,387,431 5,214,589 3,173,700
Other creditors and accruals 13 8,375,659 7,039,548 5,237,955 4,849,947
Due to subsidiaries 27.1 — — 974,969 690,711
Dividend payable 14 822,460 — 822,460 —
Taxation 6 351,068 423,248 212,389 139,361
Due to related companies 27.3 5,016,326 3,960,932 4,624,887 3,887,582
34,842,048 36,406,493 27,739,780 27,955,471
NET CURRENT LIABILITIES (6,583,596) (7,237,443) 460,696 337,950
TOTAL ASSETS LESS CURRENT LIABILITIES 29,261,595 25,490,765 27,214,204 23,534,221
PROVISION FOR LIABILITIES AND
CHARGES
Gratuity 17 (559,926) (582,037) (464,623) (376,362)
NET ASSETS 28,701,669 24,908,728 26,749,581 23,157,859
CAPITAL AND RESERVES
Share capital 18 2,500,000 2,500,000 2,500,000 2,500,000
Share premium 19 11,806,537 11,806,537 11,806,537 11,806,537
Revenue reserve 20 14,162,536 10,400,653 12,443,044 8,851,322
Shareholders’ fund 28,469,073 24,707,190 26,749,581 23,157,859
Non-controlling interest 21 232,596 201,538 — —
28,701,669 24,908,728 26,749,581 23,157,859

The consolidated financial statements on pages 16 to 33 were approved by the Board of Directors on 19 August, 2010
and signed on its behalf by:

Alhaji Aliko Dangote

Rohit Chaudhry
} Directors

The accounting policies on pages 16 and 17 and other explanatory notes on pages 21 to 31 form part of these consolidated
financial statements.

DAN GOTE F LO U R M I LLS P LC 19

 Consolidated Statement of Cash Flows
for the Year Ended 31 December, 2009

The Group The Company

2009 2008 2009 2008
Note N
= ’000 N
= ’000 N
= ’000 N
= ’000
Cash flows from operating activities
Cash receipts from customers 60,197,219 45,993,302 40,220,976 28,917,530
Cash payments to suppliers and employees (42,978,388) (36,719,304) (26,513,175) (21,300,004)
Value added tax paid — — — —
Income tax paid (213,223) — (51,979) —
Net cash provided by operating activities 22 17,005,608 9,273,998 13,655,822 7,617,526

Cash flows from investing activities

Proceeds from disposal of fixed assets — 138 — 138
Purchase of fixed assets 7 (5,399,703) (7,181,130) (4,322,725) (3,289,943)
Net cash provided by investing activities (5,399,703) (7,180,992) (4,322,725) (3,289,805)

Cash flows from financing activities

Dividend paid (1,677,540) — (1,677,540) —
Interest income 95,821 97,121 65,385 15,370
Term loan:
— Obtained — 244,000 — —
— Repaid (483,863) (1,094,490) — —
Interest paid (3,016,283) (2,398,619) (2,304,106) (1,957,353)
Net cash provided by financing activities (5,081,865) (3,151,988) (3,916,261) (1,941,983)

Net increase/(decrease) in cash and

cash equivalents 6,524,040 (1,058,982) 5,416,835 2,385,738
Cash and cash equivalents at 1 January (18,462,698) (17,403,716) (14,842,538) (17,228,276)
Cash and cash equivalents at 31 December 23 (11,938,658) (18,462,698) (9,425,702) (14,842,538)

20 DAN GOTE F LO U R M I LLS P LC

Notes to the Consolidated Financial Statements
for the Year Ended 31 December, 2009

1. THE COMPANY
1.1 Legal form
The Company started operating as a division of Dangote Industries Limited in 1999. It was incorporated as
public limited liability company on 1 January 2006, commenced operations on the same date and was quoted
on the Nigerian Stock Exchange on 4 February 2008.

In 2007, the Company acquired controlling interests in Dangote Pasta Limited and Dangote Agrosacks Limited.
Particulars of these subsidiaries are:
Subsidiaries Percentage held Principal Activities
Dangote Pasta Limited 99 Manufacture of Spaghetti, Macaroni and other Pasta
products.
Dangote Agrosacks Limited 99 Manufacture of packaging materials. It holds 75%
equity in Obajana Agrosacks Limited.

1.2 Principal activities

The principal activities of the Company are the milling, processing and marketing of branded flour.

2. STRATEGIC CONSIDERATIONS
Dangote Industries Limited has confirmed its capacity and commitment to continue to support Dangote Flour Mills
Group and has committed to takeover all external borrowings and provide medium-term loan facilities.

3. ANALYSIS OF TURNOVER AND COST OF SALES

The Group 2009 2008

Analysis by: Turnover Cost of sales Gross profit Turnover Cost of sales Gross profit
Activity N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000
Flour 38,808,447 30,330,161 8,478,286 26,269,299 21,746,622 4,522,677
Bran 2,399,162 723,589 1,675,573 1,996,365 419,821 1,576,544
Danvita and Semolina 632,310 378,455 253,855 2,401,532 1,911,634 489,898
Sacks 10,007,648 8,923,678 1,083,970 8,442,720 6,774,998 1,667,722
Spaghetti 8,401,722 7,216,594 1,185,128 8,456,424 7,435,031 1,021,393
Macaroni 1,138,775 988,481 150,294 360,960 — 360,960
61,388,064 48,560,958 12,827,106 47,927,300 38,288,106 9,639,194

The Company
Flour 38,808,447 30,740,730 8,067,717 26,269,299 21,746,622 4,522,677
Bran 2,399,162 723,589 1,675,573 1,438,779 419,821 1,018,958
Danvita and Semolina 632,310 378,455 253,855 2,401,532 1,911,634 489,898
41,839,919 31,842,774 9,997,145 30,109,610 24,078,077 6,031,533

DAN GOTE F LO U R M I LLS P LC 21

 Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
4. OTHER INCOME
Sale of scraps — 100,689 — 100,689
Provision no longer required 316,844 839,686 156,689 839,686
Sundry income 94,686 72,118 29,188 —
411,530 1,012,493 185,877 940,375

5. PROFIT BEFORE TAXATION

This is arrived at after charging/(crediting):
Directors’ emoluments:
— Fees 2,550 2,100 2,550 2,100
— Salaries and allowances 66,020 58,756 51,820 20,450
Audit fee 50,190 45,500 28,800 27,500
Depreciation 2,603,849 1,801,832 1,093,555 932,014
Management fee (Note 28) 431,224 176,348 — —

6. TAXATION
Profit and loss account
Tax based on the profit for the year
Income tax — 67,407 — —
Education tax 141,043 110,659 125,007 54,045
141,043 178,066 125,007 54,045
Deferred taxation (Note 16) (328,067) — (328,067) —
(187,024) 178,066 (203,060) 54,045

Balance sheet
As per profit and loss account 141,043 178,066 125,007 54,045
At 1 January 423,248 245,182 139,361 85,316
Payments during the year (213,223) — (51,979) —
At 31 December 351,068 423,248 212,389 139,361

The charges for taxation in these financial statements were based on the provisions of the Companies Income
Taxation Act, CAP C21, LFN 2004 as amended and the Education Tax Act, CAP E4, LFN 2004.

22 DAN GOTE F LO U R M I LLS P LC

Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

7. FIXED ASSETS
(a) The Group
Freehold/ Computer Assets
Leasehold equipment Furniture under
land and Plant and Tools and and and Motor construc-
buildings machinery equipment softwares fittings vehicles Trucks tion Total
N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000
Cost
At 1 January 2,730,581 26,934,690 619,777 71,841 148,626 323,472 — 7,690,387 38,519,374
Additions 26,153 422,079 99,203 19,640 22,938 650,957 1,740,587 2,418,146 5,399,703
Disposals — — — (452) — — — — (452)
Transfers 317,000 3,516,947 (8,854) — 127 — — (3,825,220) —
Amortised to direct cost — — — — — — — (6,939) (6,939)
At 31 December 3,073,734 30,873,716 710,126 91,029 171,691 974,429 1,740,587 6,276,374 43,911,686

Depreciation
At 1 January 178,302 5,262,432 344,365 46,786 75,674 162,531 — — 6,070,090
Charge for the year 56,092 1,988,876 142,758 25,865 30,062 184,697 175,499 — 2,603,849
Disposals — — — (452) — — — — (452)
At 31 December 234,394 7,251,308 487,123 72,199 105,736 347,228 175,499 — 8,673,487

Net book value

At 31 December 2009 2,839,340 23,622,408 223,003 18,830 65,955 627,201 1,565,088 6,276,374 35,238,199

At 31 December 2008 2,552,279 21,672,258 275,412 25,055 72,952 160,940 — 7,690,387 32,449,283

(b) The Company

Computer Assets
Leasehold equipment Furniture under
land and Plant and Tools and and and Motor construc-
buildings machinery equipment softwares fittings vehicles Trucks tion Total
N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000
Cost
At 1 January 1,844,899 10,541,472 415,525 47,266 77,983 113,383 — 5,433,864 18,474,392
Additions 2,164 20,260 33,695 13,746 16,274 95,476 1,740,587 2,400,524 4,322,725
Disposals — — — (452) — — — — (452)
Transfers 317,001 1,267,363 (8,854) — 127 — — (1,575,637) —
At 31 December 2,164,064 11,829,095 440,366 60,560 94,384 208,859 1,740,587 6,258,751 22,796,665

Depreciation
At 1 January 109,323 2,284,816 209,207 29,363 39,084 69,965 — — 2,741,758
Charge for the year 38,149 718,235 89,044 16,648 17,040 38,940 175,499 — 1,093,555
Disposals — — — (452) — — — — (452)
At 31 December 147,472 3,003,051 298,251 45,559 56,124 108,905 175,499 — 3,834,861

Net book value

At 31 December 2009 2,016,592 8,826,044 142,115 15,001 38,260 99,954 1,565,088 6,258,751 18,961,804

At 31 December 2008 1,735,576 8,256,656 206,318 17,903 38,899 43,418 — 5,433,864 15,732,634

Assets under construction comprise of capacity expansion projects in flour production mills Apapa, Ilorin and Calabar.

DAN GOTE F LO U R M I LLS P LC 23

 Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
8. INVESTMENTS (UNQUOTED)
Dangote Pasta Limited
49,500,000 ordinary shares of =
N1 each in
Dangote Pasta Limited — — 2,507,637 2,507,637
Dangote Agrosacks Limited
84,150,000 ordinary shares of N
=1 each in
Dangote Agrosacks Limited — — 4,956,000 4,956,000
— — 7,463,637 7,463,637

9. STOCKS
Raw materials and work-in-progress 4,806,929 5,747,680 2,871,634 3,766,420
Finished goods 2,315,765 2,321,381 138,431 501,985
Engineering spares and other stocks 1,061,387 821,709 159,359 109,283
Goods-in-transit 79,364 1,019,761 79,364 1,019,761
8,263,445 9,910,531 3,248,788 5,397,449
Provision for slow moving items (16,527) — — —
8,246,918 9,910,531 3,248,788 5,397,449

10. TRADE DEBTORS

Trade debtors 12,214,178 9,616,719 10,343,829 8,223,263
Provision for bad and doubtful debts (2,811,245) (2,206,609) (2,505,733) (2,104,473)
9,402,933 7,410,110 7,838,096 6,118,790

11. OTHER DEBTORS AND PREPAYMENTS

Other debtors 1,130,483 349,908 442,633 424,147
Advances to suppliers 954,956 244,106 954,956 244,106
Deposit for stocks — 600,334 — —
Staff debtors 67,367 — 67,367 —
VAT receivable — 73,711 — 73,711
Prepayments 168,977 65,689 108,677 53,968
2,321,783 1,333,748 1,573,633 795,932
Provision for other debtors (639,941) — (621,394) (169,283)
1,681,842 1,333,748 952,239 626,649

12. BANK LOANS AND OVERDRAFTS

Bank overdrafts 5,482,578 9,536,663 4,478,622 7,801,362
Short-term loans 8,385,678 10,574,808 6,173,909 7,412,808
Term loan (Note 15) — 483,863 — —
13,868,256 20,595,334 10,652,531 15,214,170

The loans and overdraft are secured by Corporate Guarantee of a related party, Dangote Industries Limited.

24 DAN GOTE F LO U R M I LLS P LC

Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
13. OTHER CREDITORS AND ACCRUALS
Customers’ deposits 1,459,624 1,069,176 595,198 680,712
Accruals 3,034,335 1,552,827 2,064,324 1,119,969
Pension contribution 66,702 — — —
VAT payable 651,012 101,943 651,012 —
Other creditors 3,163,986 4,315,602 1,927,421 3,049,266
8,375,659 7,039,548 5,237,955 4,849,947

14. DIVIDEND PAYABLE

At 1 January — — — —
Dividend declared (Note 20) 2,500,000 — 2,500,000 —
Payment during the year (1,677,540) — (1,677,540) —
At 31 December 822,460 — 822,460 —

15. TERM LOAN

At 1 January 483,863 1,334,353 — —
Repayment during the year (483,863) (1,094,490) — —
Loan obtained during the year — 244,000 — —
At 31 December — 483,863 — —
Due within one year (Note 12) — (483,863) — —
Due after more than one year — — — —

16. DEFERRED TAXATION

At 1 January — — — —
Provision for the year (Note 6) (328,067) — (328,067) —
At 31 December (328,067) — (328,067) —

The deferred tax asset of N

= 328 million arises from an excess of depreciation charged in the financial statements over
capital allowances claimed on the related assets.

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
17. GRATUITY
At 1 January 582,037 389,402 376,362 312,829
Provision for the year 183,792 267,415 143,158 114,419
Adjustments (129,470) — — —
636,359 656,817 519,520 427,248
Payments during the year (76,433) (74,780) (54,897) (50,886)
At 31 December 559,926 582,037 464,623 376,362

DAN GOTE F LO U R M I LLS P LC 25

 Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
18. SHARE CAPITAL
Authorised
6,000,000,000 ordinary shares of 50k each 3,000,000 3,000,000 3,000,000 3,000,000
Issued and fully paid
5,000,000,000 ordinary shares of 50k each 2,500,000 2,500,000 2,500,000 2,500,000

19. SHARE PREMIUM

At 31 December 11,806,537 11,806,537 11,806,537 11,806,537

Exchange
equali- 2009 2008
Revenue sation Capital Total Total
N
=’000 N
=’000 N=’000 N
=’000 N
=’000
20. RESERVES
The Group
At 1 January 3,689,251 122,765 6,588,637 10,400,653 7,958,095
Transfer from non-controlling interest (710) — — (710) —
Prior year adjustment 731,861 — — 731,861 (504,890)
Dividend declared — Final 2008 (1,000,000) — — (1,000,000) —
Dividend declared — Interim 2009 (1,500,000) — — (1,500,000) —
Transferred from profit and loss account 5,530,732 — — 5,530,732 2,947,448
At 31 December 7,451,134 122,765 6,588,637 14,162,536 10,400,653

The Company
At 1 January 8,851,322 7,600,955
Prior year adjustment 731,861 (453,725)
Dividend declared — Final 2008 (1,000,000) —
Dividend declared — Interim 2009 (1,500,000) —
Transferred from profit and loss account 5,359,861 1,704,092
12,443,044 8,851,322

Prior year adjustment relates adjustment for prior year reconciling items in intercompany balance with Dangote
Industries Limited cleared during the year.

On 9 December 2009, a dividend of 20 kobo per ordinary share of 50 kobo totalling N

= 1 billion in respect of 2008
was approved by shareholders and subsequently paid.

On 29 October 2009, the Board of Directors approved interim dividend of 30 kobo per ordinary share of 50 kobo
each amounting to N
= 1.5 billion and subsequently paid.

At the Board of Directors meeting held on 19 August 2010, the Directors proposed final dividend of 50 kobo per
ordinary share of 50 kobo each amounting to N = 2.5 billion. The dividend is subject to approval by shareholders at the
Annual General Meeting net of withholding tax at the appropriate rate. Consequently, it has not been included as a
liability in these financial statements as they do not constitute present obligation to the Company in accordance
with (SAS) 23 on Provisions, Contingent Liabilities and Contingent Assets.

26 DAN GOTE F LO U R M I LLS P LC

Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

The Group
2009 2008
N
=’000 N
=’000
21. NON-CONTROLLING INTEREST
At 1 January 201,538 159,427
Transfer to revenue reserve 710 —
On acquisition of Obajana Agrosacks — 29,552
Dangote Agrosacks Limited 29,444 4,759
Dangote Pasta Limited 904 7,800
At 31 December 232,596 201,538

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
22. RECONCILIATION OF NET INCOME TO NET
CASH PROVIDED BY OPERATING ACTIVITIES
Profit after taxation and exceptional item 5,561,080 2,989,559 5,359,861 1,704,092

Adjustments to reconcile net income to

net cash provided by operating activities
Depreciation 2,603,849 1,801,832 1,093,555 932,014
Interest income (95,821) (97,121) (65,385) (15,370)
Interest expenses 3,016,282 2,398,619 2,304,106 1,957,353
Prior year adjustment 731,861 (504,890) 731,861 —
Fixed assets adjustment/transfer 6,939 555 — 555
Loss on disposal of fixed assets — 55 — 55

Changes in assets and liabilities

Decrease in stocks 1,663,613 1,516,812 2,148,661 2,988,557
Increase in trade debtors (1,992,823) (2,277,300) (1,719,306) (1,989,308)
Increase in other debtors and prepayments (348,094) (5,489,632) (325,591) (5,573,120)
Decrease/(Increase) in due from subsidiaries — — 3,588,587 (1,148,270)
Decrease/(increase) in due from related companies 1,868,728 966,583 (2,744,209) 1,734,176
Increase in trade creditors 2,020,848 1,633,160 2,040,889 1,633,904
Decrease in other creditors and accruals 1,336,110 6,330,657 388,008 5,714,252
Increase/(decrease) in due to related companies 1,055,394 (365,592) 737,305 (438,942)
Increase in due to subsidiaries — — 284,258 —
(Decrease)/increase in taxation payable (72,180) 178,066 73,028 54,045
(Decrease)/increase in gratuity provision (22,111) 192,635 88,261 63,533
Increase in deferred taxation (328,067) — (328,067) —
Total adjustments 11,444,528 6,284,439 8,295,961 5,913,434

Net cash provided by operating activities 17,005,608 9,273,998 13,655,822 7,617,526

23. CASH AND CASH EQUIVALENTS

Cash and bank balances 1,929,598 1,648,773 1,226,829 371,632
Short-term loans (8,385,678) (10,574,808) (6,173,909) (7,412,808)
Bank overdrafts (5,482,578) (9,536,663) (4,478,622) (7,801,362)
(11,938,658) (18,462,698) (9,425,702) (14,842,538)

DAN GOTE F LO U R M I LLS P LC 27

 Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
24. INFORMATION REGARDING DIRECTORS
AND EMPLOYEES
.1 Directors
(i) Directors’ emolument comprises:
— Fees 2,550 2,100 2,550 2,100
— Salaries and allowances 66,020 58,756 51,820 20,450
68,570 60,856 54,370 22,550

(ii) Highest paid Director 24,270 18,600 24,270 18,600

(iii) The number of Directors excluding the
Chairman with gross emoluments within
the bands stated below were:
N
= ’000 N
= ’000 Number Number Number Number
Nil — 4,000 — 1 — —
10,000 — 15,000 0 1 — —
15,000 and above 3 1 2 1

.2 Employees
Average number of persons employed
during the year:
Management 170 157 121 106
Senior staff 581 500 369 364
Junior staff 2,989 2,755 356 375
3,740 3,412 846 845

N
=’000 N
=’000 N
=’000 N
=’000
Aggregate payroll costs:
Wages, salaries, allowances and
other benefits 3,889,782 1,565,636 1,242,490 604,458
Provision for gratuities 152,054 235,354 111,420 82,358
Pension cost 26,847 49,045 26,847 12,438
4,068,683 1,850,035 1,380,757 699,254
The number of employees with gross
emoluments within the bands stated
below are:
N
=’000 N
=’000 Number Number Number Number
0 — 200 4 — — —
200 — 400 2,432 2,444 37 324
401 — 600 571 369 309 220
601 — 800 199 178 93 50
801 — 1,000 162 137 121 100
1,001 — 2,000 257 190 185 102
2,001 and above 115 94 101 53
3,740 3,412 846 849

28 DAN GOTE F LO U R M I LLS P LC

Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

25. CONTINGENT LIABILITIES

.1 There were no material contingent liabilities in respect of pending litigation against the Company and its
subsidiaries at 31 December 2009 (2008: Nil).

.2 The Directors are of the opinion that all known commitments and liabilities which are relevant in assessing the
state of affairs of the Group have been taken into consideration in the preparation of these financial statements.

26. CAPITAL COMMITMENTS

The Group The Company
2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
Capital commitments 190,000 423,155 190,000 423,155

The capital commitments were made for capacity expansion projects in three of the four production mills (Apapa,
Ilorin and Calabar).

27. RELATED PARTY TRANSACTIONS

During the year the Company had dealings with subsidiaries and related companies. The balances emanating from
the transactions which have been disclosed in the balance sheet as due from subsidiaries and related companies as
well as due to related companies are as analysed below:

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
27.1 Due from/(to) subsidiaries
Dangote Pasta Limited — — 9,218,193 12,806,780
Dangote Agrosacks Nigeria Limited — — (974,969) (690,711)
— — 8,243,224 12,116,069

27.2 Due from related companies

Dangote Noodles Limited 1,079,704 601,900 1,050,769 601,900
Dangote Industries Limited 4,740,399 8,259,269 4,504,942 2,039,645
National Salt Company of Nigeria Plc 51,378 — — 329,076
Dangote Fisheries Nigeria Limited 1,500 1,500 1,500 1,500
Danote Port operation 200 — 140 —
Obajana Cement Plc 1,134,258 — 107,907 —
Dangote Pasta Limited — — 72 —
Dangote Textile Nigeria Limited 55,593 — 51,000 —
Dangote Bail Nigeria Limited 12,263 — — —
Benue Cement Company Plc 453 — — —
Dangote Foundation 122,562 — — —
Savannah Sugar Limited 43 — — —
Others 171,508 3,219 — —
7,369,861 8,865,888 5,716,330 2,972,121
Less provision (372,700) — — —
6,997,161 8,865,888 5,716,330 2,972,121

DAN GOTE F LO U R M I LLS P LC 29

 Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

The Group The Company

2009 2008 2009 2008
N
=’000 N
=’000 N
=’000 N
=’000
27.3 Due to related companies
Dangote Nigeria Limited 61,937 73,350 53,182 —
Dangote Transport Nigeria Limited 2,591,008 2,492,769 2,506,152 2,492,769
Dangote Sugar Refinery Plc 128,601 1,389,885 57,155 1,389,885
Bluestar Shipping Company 3,500 3,500 3,500 3,500
Green View Development Nigeria Limited 10,882 1,428 14,347 1,428
National Salt Company of Nigeria Plc — — 924 —
Dangote Pasta Limited 93,430 — — —
Bulk Pack (Nig) Ltd 27,013 — — —
MRS Plc 107,204 — — —
Dangote Agrosacks Limited 3,124 — — —
Dangote Industries Ltd. — Commercial paper 1,989,627 — 1,989,627 —
5,016,326 3,960,932 4,624,887 3,887,582

27.4 Dangote Pasta Limited

Dangote Pasta is a subsidiary company to Dangote Flour Mills Plc. During the year, the supply of wheat and
pasta flour to Dangote Pasta amounted to N
= 9.2 billion.

27.5 Dangote Agrosacks Nigeria Limited

Dangote Agrosacks Nigeria Limited is a subsidiary of Dangote Flour Mills. During the year, the Company had
significant transactions amounting to N
= 550 million for the supply of bags for packaging of Flour, Bran, Danvita,
etc.

27.6 Dangote Industries Limited

Dangote Industries Limited (DIL) is the parent company. DIL undertake payments for expansion projects,
recommend external consultants, negotiate bank facilities and purchases of raw materials on behalf of the
Group. The balance at 31 December 2009 amounted to N = 4.5 billion (2008: N
= 2.03 billion).

27.7 Dangote Transport Nigeria Limited

Dangote Transport Nigeria Limited is a related company to Dangote Flour Mills Plc. The Group had had transactions
with respect to haulage of finished products to customers as well as wheat to other plants. The balance at
31 December 2009 stood at N = 2.51 billion (2008: N= 2.49 billion).

27.8 Dangote Sugar Plc

Dangote Sugar Plc is a related company to Dangote Flour Mills Plc. Dangote Sugar supplies power to Dangote
Flour Mills Plc. There is no trading relationship between the two companies.

27.9 Dangote Salt Nigeria Limited

Dangote Salt is a related company to Dangote Flour Mills Plc. There were no material transactions between the
two companies during the year.

27.10 Dangote Noodles Limited

The amount due from Dangote Noodles Limited relates to funds committed to the infrastructural development
of this entity which is yet to commence operations.

30 DAN GOTE F LO U R M I LLS P LC

Notes to the Consolidated Financial Statements cont’d
for the Year Ended 31 December, 2009

28. MANAGEMENT FEE

Dangote Pasta Limited and Dangote Agrosacks Limited entered into management and technical service agreement
dated 2 January 2006 with Dangote Industries Limited (DIL). The agreement is for an initial period of five years with
an option to renew for a further period of five years subject to termination by either party in accordance with the
terms of the agreement. As consideration for the services provided, a sum equivalent to 2% of the net revenue from
the Dangote Pasta Limited and Dangote Agrosacks Limited sales for each month is payable to Dangote Industries
Limited. Management fees for the financial year ended 31 December 2009 amounted to N = 431.2 million
(2008: N
= 176.3 million).

29. COMPARATIVE FIGURES

Certain balances in prior year have been reclassified where necessary for more meaningful comparison.

30. POST BALANCE SHEET EVENTS

There were no post balance sheet events that could have had a material effect on the consolidated financial statements
of the Group which had not been adequately provided for or disclosed in these consolidated financial statements.

DAN GOTE F LO U R M I LLS P LC 31

 Consolidated Value Added Statement
for the Year Ended 31 December, 2009

The Group The Company

2009 2008 2009 2008
N
=’000 % N
=’000 % N
=’000 % N
=’000 %

Turnover 61,388,064 47,927,300 41,839,919 30,109,610

Other income 411,530 1,012,493 531,387 955,745
61,799,594 48,939,793 42,371,306 31,065,355
Less: Bought-in-materials
and services
— Imported (29,332,573) (26,556,495) (26,008,149) (23,623,137)
— Local (17,404,151) (13,165,187) (6,427,938) (2,095,460)
Value added 15,062,870 100 9,218,111 100 9,935,219 100 5,346,758 100

Applied as follows:
To pay employees
Salaries, wages and
other benefits 4,068,683 27 1,850,035 20 1,380,757 14 699,254 13

To pay providers of capital

Interest on loans and bank
overdrafts 3,016,282 20 2,398,619 26 2,304,106 23 1,957,353 37

To pay government
Taxation (187,024) — 178,066 2 (203,060) 1 54,045 1

To provide for enhancement

of assets and growth
Depreciation 2,603,849 17 1,801,832 20 1,093,555 12 932,014 17
Profit and loss account 5,561,080 36 2,989,559 32 5,359,861 50 1,704,092 32
15,062,870 100 9,218,111 100 9,935,219 100 5,346,758 100

“Value added” represents the additional wealth the Company has been able to create by its own and employees’ efforts.
This statement shows the allocation of that wealth between employees, capital providers, government and that retained
for future creation of more wealth.

32 DAN GOTE F LO U R M I LLS P LC

Consolidated Four-Year Financial Summary
for the Year Ended 31 December, 2009

The Group The Company

31 DECEMBER 2009 2008 2007 2006 2009 2008 2007 2006
N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000 N
=’000
BALANCE SHEET
Assets
Fixed assets 35,238,199 32,449,283 27,357,655 — 18,961,804 15,732,634 13,375,453 13,365,235
Investments — 601,900 — — 7,463,637 7,463,637 7,750,559 —
Goodwill 278,925 278,925 278,925 — — — — —
Net current (liabilities)/assets (6,583,596) (7,839,343) (4,636,107) — 460,696 337,950 1,094,309 1,043,095
28,933,528 25,490,765 23,000,473 — 26,886,137 23,534,221 22,220,321 14,408,330
Deferred taxation 328,067 — — — 328,067 — — —
Long-term liabilities — — (187,012) — — — — —
Provision for liabilities
and charges (559,926) (582,037) (389,402) — (464,623) (376,362) (312,829) (254,810)
28,701,669 24,908,728 22,424,059 — 26,749,581 23,157,859 21,907,492 14,153,520

CAPITAL AND RESERVES

Share capital 2,500,000 2,500,000 2,500,000 — 2,500,000 2,500,000 2,500,000 1,500,000
Share premium 11,806,537 11,806,537 11,806,537 — 11,806,537 11,806,537 11,806,537 11,931,537
Revenue reserve 14,162,536 10,400,653 7,958,095 — 12,443,044 8,851,322 7,600,955 721,983
Minority interest 232,596 201,538 159,427 — — — — —
28,701,669 24,908,728 22,424,059 — 26,749,581 23,157,859 21,907,492 14,153,520

PROFIT AND LOSS ACCOUNT

Turnover 61,388,064 47,927,300 42,153,272 — 41,839,919 30,109,610 31,303,845 35,672,696

Profit before taxation 5,374,056 3,167,625 675,703 — 5,156,801 1,758,137 375,651 721,983
Taxation 187,024 (178,066) (114,144) — 203,060 (54,045) (85,316) —
Minority interest (30,348) (42,111) (36,849) — — — — —
Retained profit transferred
to general reserve 5,561,080 2,947,448 524,710 — 5,359,861 1,704,092 290,335 721,983

Per share data —

50k ordinary share
Earnings:
— Basic (kobo) 111 60 11 — 107 34 6 24
— Diluted (kobo) 111 60 11 — 107 34 6 14
Net assets (Naira) 6 5 4 — 5 5 4 5

Note:
1. Earnings per share are based on profit after taxation and the number of issued and fully paid ordinary shares at the
end of each financial year.

2. Net assets per share are based on net assets and the issued and fully paid ordinary shares as at the end of each
financial year.

DAN GOTE F LO U R M I LLS P LC 33

 Share Capital History

Dangote Flour Mills Plc was quoted on the Nigerian Stock Exchange on 4th February, 2008.

The share capital history of the Company is as indicated below:

Date Authorised Share Capital Issued and Fully Paid Consideration

Value Shares Value Shares

04/02/2008 3,000,000,000 6,000,000,000 2,500,000,000 5,000,000,000 Cash

34 DAN GOTE F LO U R M I LLS P LC

DAN GOTE F LO U R M I LLS P LC 35
 FLOUR
Dangote Flour Mills Plc
RC 501757

Proxy Form
DANGOTE FLOUR MILLS PLC
RESOLUTIONS FOR AGAINST
4TH ANNUAL GENERAL MEETING TO BE HELD AT
12.00 NOON ON WEDNESDAY, 6TH OCTOBER, 2010 AT 1. To receive the Audited
TAHIR HOTEL, KANO. Financial Statements for the
year ended 31st December
I/We* ........................................................................................................ 2009 and the Directors’,
Auditors’ and Audit Committee’s
of ............................................................................................................... Reports thereon
hereby appoint ......................................................................................
2. To declare a dividend
...................................................................................................................
of ............................................................................................................... 3. To re-elect Directors
or failing him, the Chairman of the meeting, as my/our proxy
to act and vote for me/us and on my/our behalf at the Fourth 4. To re-appoint the Auditors
Annual General Meeting of the Company to be held at 12.00
noon on Wednesday, 6th October, 2010 and at any 5. To authorise the Directors
adjournment thereof. to fix the remuneration
of the Auditors
Dated this ................ day of .......................................... 2010.
6. To appoint members of
Signature .................................................................................................
the Audit Committee
NOTES
1. Please sign this proxy card and post it to reach the SPECIAL BUSINESS
registered office of the Company not less than 48 hours
7. To fix the remuneration of
before the time for holding the meeting.
the Directors
2. If executed by a corporation, the proxy card should be
sealed with the common seal.
3. This proxy card will be used both by show of hands and Please indicate with an “X” in the appropriate space how
in the event of a poll being directed or demanded. you wish your votes to be cast on resolutions set out
4. In the case of joint holders the signature of any one of above. Unless otherwise instructed, the proxy will vote
them will suffice, but the names of all joint holders should or abstain from voting at his/her own discretion.
be shown.
✂ Before posting the above form, please sign/tear off this part and retain it for admission to the meeting.

Admission Card
DANGOTE FLOUR MILLS PLC
PLEASE ADMIT THE SHAREHOLDER ON THIS FORM OR HIS/HER APPOINTED PROXY TO THE
4TH ANNUAL GENERAL MEETING TO BE HELD AT 12.00 NOON
ON WEDNESDAY, 6TH OCTOBER, 2010 AT TAHIR HOTEL, KANO.
Name of Shareholder * ........................................................................................................................................................................................
IF YOU ARE UNABLE TO ATTEND THE MEETING
A member (shareholder) who is unable to attend Annual General Meeting is allowed by law to vote by proxy. A proxy
need not be a member of the Company. The above proxy card has been prepared to enable you exercise your right to
vote if you cannot personally attend.
No. of Shares held Signature of person attending

IMPORTANT
Please insert your name in BLOCK CAPITALS on both proxy and admission card where marked *.
A. L. ISA (MRS)
Company Secretary/Legal Adviser
RC 501757