PZ Cussons bullish after ‘steady’ set of results

MANCHESTER-based consumer products company PZ Cussons has experience a 0.3% increase in revenue to £821.2m (2015: 819.1m), but pre-tax profits are down 5.3% to £103m (2015: 108.8m).

For the year ended May 31, profits after exceptional items fell from £84m to £83.7m. Earnings per share fell 4% from 17.94p to 17.22p.

The listed company said a strong performance in Europe offset a difficult trading environment in Africa.

There was tight liquidity and restricted foreign exchange availability in Nigeria, which has begun to improve post year end with a new flexible exchange rate resulting in an approximate 40% devaluation of the Naira.

The company enjoyed a robust performance in Nigeria home and personal Care despite extremely competitive environment.

Revenue and profits in Nigeria Electricals was lower as a result of squeeze on disposable income, but there was a strong performance in both Nutricima and PZ Wilmar food businesses despite lower raw material availability.

Cussons saw Continued growth in Indonesia in both baby care and non-baby care and there was a good performance in Australia across personal care, beauty and food and nutrition, offsetting more difficult trading conditions in home care.

In Europe, the UK washing and bathing division performing well with new product launches across Imperial Leather, Carex and Original Source.

A strong performance in the beauty division driven in particular by St Tropez’s new in shower gradual tan lotion and a new range of Sanctuary products was also a highlight.

Chairman Richard Harvey said: “These are a steady set of results, with a strong performance in Europe offsetting a very difficult trading environment in Nigeria and the impact of weaker currencies in both Asia and Africa.

“Despite these challenging trading conditions, to end the year on a constant currency basis with revenue growth of 5.9% and operating profit broadly flat is a creditable performance.

“The liquidity squeeze and restrictions in foreign exchange availability in Nigeria, caused by the fall in the oil price, have created some of the most difficult trading conditions we have seen for some time and I am proud to see our 130 year experience in Nigeria carry us through this challenging period with our brands holding or growing share.”

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