Soap maker and household item manufacturer, PZ Cussons has hinted at plans to sell its African business stating that it has received a number of expressions of interest.
The company disclosed this in its result presentation for the year ending May 31, 2024, where revenues declined by 19.6% to £527.9 million.
The Chief Executive Officer (CEO), Jonathan Myers, stated that despite efforts to mitigate the effects of Nigeria’s foreign exchange depreciation, the 70% decline in the naira’s value had a significant impact on the company’s financials during the year under review.
Furthermore, it noted it is progressing in its plan to sell St. Tropez and might fully or partially sell its African business.
It stated, “The period was marked by a 70% devaluation of the Nigerian Naira, which has had significant implications on our reported financials. We have worked hard to mitigate the impact of this on the Group while continuing to serve Nigerian consumers who are facing unprecedented inflation and economic difficulties.”
“The favourable trends of the second half of FY24 have continued into the new financial year. We are progressing with our plans to sell St. Tropez and have received a number of expressions of interest for our African business, recognising the potential of our brands and people, which could lead to a partial or full sale.”
“Against this backdrop, we remain confident in the long-term potential for PZ Cussons as a business with stronger brands in a more focused portfolio, delivering sustainable, profitable growth.”
In reaction to the company’s disclosure, the Board of PZ Cussons Nigeria has stated that it has not received any information from the parent company on the proposed sale of its African business.
Backstory
Earlier in April, the company stated that it is reviewing its African business to reduce risk and maximise shareholder value. PZ Cussons has faced significant challenges over the past year due to the impact of Nigeria’s macroeconomic issues on its global operations.
- Additionally, the company’s plan to delist from the Nigerian Stock Exchange encountered a setback after the Securities and Exchange Commission (SEC) rejected its proposal.
- In its FY 2024, which ended on May 31, PZ Cussons Nigeria reported a loss after tax of N76.02 billion, despite a 34% increase in revenue to N152.24 billion. This marked a sharp turnaround from the previous year, where the company posted a profit after tax of N14.35 billion, now shifting to a N76.03 billion loss for the same period in 2024.
