PZ Cussons, a multinational consumer goods company, is selling its African subsidiaries due to Nigeria’s economic challenges. The parent company of PZ Cussons Nigeria announced plans for a partial or full sale to mitigate exposure to the devalued naira, which dropped 70%.
In its preliminary results for the year ended May 31, 2024, the company stated, “Over the last 12 months, we have made continued operational progress and delivered against the strategic priorities set out at the start of the year, against the backdrop of macro-economic challenges.”
The company’s UK Personal Care business saw significant improvement, with profitable, double-digit revenue growth. However, Nigeria’s 70% naira devaluation impacted 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 company added.
Regarding the sale, PZ Cussons received “a number of expressions of interest for our African business,” recognizing the potential of its brands. This could lead to a partial or full sale.
“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,” the company stated.
CEO Jonathan Myers previously mentioned reviewing brands and geographies due to Nigeria’s macroeconomic challenges.
In September 2023, PZ Cussons attempted to buy remaining minority shares in its Nigerian subsidiary at N21 per unit but was rejected by the Securities and Exchange Commission.
PZ Cussons Nigeria Plc struggled, posting a N94.78bn loss in Q3 2023/24, compared to a N11.213bn gain in the corresponding period in 2022. The company suffered a N74.14bn loss in Q2.
Liabilities surpassed assets by N46.420bn due to naira depreciation, keeping PZ Cussons in a negative net asset position.
The Securities and Exchange Commission rejected the company’s request to buy out minority shareholders at N23 and delist from the Nigerian exchange.
PZ Cussons notified the Nigerian exchange of its closed period, effective September 1, 2024, until 24 hours after releasing its Q1 unaudited financial statements for 2024.
