PZ Cussons hails resilience in year of change
INTERNATIONAL consumer products group PZ Cussons defied a number of challenges to report “solid” annual results and to increase its dividend for a 42nd year in a row.
The Manchester-based group, best known in this country for its Imperial Leather, Carex, Original Source and St Tropez brands, has major operations in Australia, Indonesia and Greece, while its single biggest market is Nigeria.
On a like-for-like basis before the impact of currency and exceptional items. revenue was up 2.3% to £819.1m while pre-tax profit was down 1% at £108.8m.
The company said currency issues had cost it £48.3m in revenue and hit operating profits by £4m in the year to the end of May.
After including £24.8m worth of exceptional items in the year – related to three efficiency projects, an acquisition in Australia and a provision against Nigerian government receivables, the group’s stutory profits were down 32.1% to £89.6m.
Chairman Richard Harvey said: “Despite tough trading conditions, particularly in our largest market Nigeria, underlying revenue and operating profit grew 2.3% and 2.7% respectively, and our market share positions were either held or grown in our core categories.
“As part of our long-term strategy to focus the Group’s portfolio on higher growth, value add businesses, a number of strategic initiatives were successfully completed in the year.
“To develop our Food & Nutrition category further and to create a broader portfolio for expansion into South East Asia we acquired the Australian food brand five:am early in the financial year, following the acquisition last year of the Rafferty’s Garden brand. In addition, we now own 100% of our Nigerian beverage business after completing the buy-out of Nutricima from our joint venture partner.”
Harvey said the group’s balance sheet was strong with net debt of 1.2x EBITDA at the year-end.
“The strength of our balance sheet gives us the flexibility to further evolve the group’s portfolio into new areas of growth and to take advantage of new investment opportunities as they arise,” he added.
Despite the outlook remaining “challenging”, performance since the year-end has been in line with expectations, the chairman stated.
In the UK washing and bathing division, PZ Cussons said all brands had performed well with revenue and profit ahead of the prior year driven by a major renovation and innovation programme which saw more than over 70% of products relaunched or refreshed in the year.
