Cussons chief executive announces retirement after 13 years in hot-seat

Alex Kanellis

The chief executive of Manchester-based international consumer products group, PZ Cussons, is to stand down next month.

The firm announced today that Alex Kanellis will retire from the company on January 31, 2020. The announcement was alongside a trading update for the six months to November 30.

A search for his replacement has already started and is expected to be completed in the first half of 2020. In the meantime, Caroline Silver will become executive chair with effect from February 1, 2020. Alan Bergin will continue as interim chief financial officer.

Mr Kanellis has been with the company since 1993 and has been chief executive since 2006.

During that time he has overseen significant development of the group, including the operational restructuring of the business, the creation of the beauty division, the development of the joint venture businesses in Africa and, most recently, the resetting of the group’s strategy to begin the process of returning it to profitable growth.

Group chair, Caroline Silver said: “The board would like to thank Alex for his lifetime of service to PZ Cussons.

“His commitment to the CANDO and Good 4 Business values and culture which make PZ Cussons so special and his tireless efforts to develop and grow the business in each of its key markets are truly appreciated, particularly during recent difficult years.

“During his 13-year tenure as chief executive officer, Alex has led numerous initiatives which have shaped the business, including the acquisition of the brands which now underpin the group’s growth and future potential.

“The group is now ready to move onto the next chapter under new leadership and we are confident that the opportunities to return to profitable growth are significant.

“On behalf of the board and Alex’s many friends within the business, we wish him and his family all the very best for the future.”

Mr Kanellis said: “It has been a privilege to serve the company and the board as chief executive officer and I am proud to have worked with so many fantastic people across the business over many years.

“The company has a stable of great brands and enjoys strong long-term relationships with partners across all regions but, above all, it is our unique CANDO culture and our people which makes PZ Cussons special and which, as I retire from the company, gives me the confidence that the business has a bright future ahead.”

Today’s half-year trading update showed a fall in revenues and operating profits as difficult conditions continued.

During the six month period the group’s market share grew in the UK, USA and Indonesia, with revenue for its Focus Brands stable versus last year.

Marketing investment was in line with the prior year and is planned to accelerate in the second half.

Overhead saving initiatives are under way and further details will be provided later in the year.

The sale of the Greek and Polish businesses were agreed and the group’s portfolio restructuring continues.

Good improvement in net debt reflects the disposal proceeds and continued focus on cash management.

In Europe and the Americas, while the Imperial Leather and Original Source brands continued to demonstrate market share growth, continuing consumer uncertainty and well-documented challenges in the UK high street adversely impacted overall revenue and profit. Results remained solid in beauty with continued growth in retail sales of St Tropez in the USA.

In Asia Pacific there was continued good revenue and profit growth in Indonesia, driven by Cussons Baby, offset by lower revenue and higher promotional costs in Australia. The region was also adversely impacted by higher manufacturing costs related to raw materials and the strengthening of the Indonesian rupiah.

Africa revenue declined due to weakness in the group’s mass market home and personal care brands offsetting strong growth in electricals. Profitability was impacted by continued consumer pricing pressure, continuation of charges associated with the port in Lagos and the closure of the borders limiting exports.

Looking ahead, the group says a stronger second half is expected, subject to no further worsening of the economic and trading environments across its key geographies. Full year revenue and adjusted profit before tax is expected to be modestly below the prior year on a like-for-like basis.

Interim results for the half year to November 30, 2019 will be announced on Tuesday, January 28, 2020.

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