PZ Cussons Nigeria PLC: “we may leave amid “extremely challenging” Conditions”
A few days ago, the management of PZ Cussons Nigeria hinted that the company is considering limiting the depth of its exposure to the Nigerian market in the midts of what they describe as “extremely challenging” trading conditions.
PZ Cusson’s shares were down 11% in early trade in London on Tuesday at a price of 187.58 pence each. PZ Cussons is a the consumer products firm with a wide range of products that have become household names in Nigeria feor decades.
This is, in addition, to the fact that they had registered a 23% fall in revenue to GBP111.3 million in Africa for the six months leading to November. At constant currency, revenue slipped 13% and the like-for-like decline was also 13%.
PZ Cusson’s Group revenue fell by 10%, or 4.6% constant currency, to GBP335.1 million. Like-for-like revenue also slid 4.6%. Adjusted operating profit fell 3.8%, or 1.1% constant currency, to GBP35.4 million, while statutory pretax profit sank 20% to GBP26.7 million. PZ Cussons declared an interim dividend of 2.67 pence per share, flat year-on-year
While awaiting further details on thier recent disclosure, in an interview reported by Leadership Newspapers Nigeria, the company’s managementz addded the follopwing:
“The group continues to make pleasing progress in Europe and Asia, with new product development and increased support across our key brands delivering positive momentum,” said Chair Caroline Silver.
“Disappointingly, however, the macroeconomic conditions in Nigeria remain extremely challenging and continue to have a significant negative impact on overall group performance. Reflecting this, we now expect group adjusted profit before tax for the year to be towards GBP70 million.”
PZ Cussons posted adjusted pretax profit of GBP80.1 million in its year ended May 2018.
“We anticipate consumer demand in all our key markets will remain subdued,” Silver continued.
“Whilst these conditions prevail, we will maintain our strong market shares in key product categories in Nigeria until growth returns to the market.”
To help streamline its activities and focus on Personal Care and Beauty operations in Europe and Asia, the company has begun some strategic initiatives, it said, which include “limiting exposure to Nigerian volatility”.