PZ Cussons' (PZC) chief financial officer, Brandon Leigh, says the consumer goods company isn't selling its African business, despite ongoing issues across the region. Tough trading in Nigeria – which accounts for 90 per cent of its African sales – was the main reason for the 18.2 per cent fall in adjusted operating profit to £85.7m over the past year. It seems a lack of liquidity at both consumer and trade level meant Nigerians didn't spend money on health and hygiene products. But Mr Leigh maintains that Nigeria is the best African market to be in; it comes with a large, young population, which is expected to grow. PZ Cussons’ 50 per cent share of the market is also considered "incredibly strong".
That said, the company still wants to overhaul its business model to become “as lean and efficient as possible”, and Mr Leigh said removing divisional "layers" in the business could get new products to market more quickly. It’s also hoped that product innovation could reignite sales growth across Europe. Sales there fell 2.1 per cent last year to £275m.
Analysts at Investec expect pre-tax profit of £85m in the year to May 2019, giving EPS of 14.7p, compared with £80.1m and 13.4p in FY2018.
| PZ CUSSONS (PZC) | ||||
| ORD PRICE: | 213.6p | MARKET VALUE: | £916m | |
| TOUCH: | 213.2-213.8p | 12-MONTH HIGH: | 368p | LOW: 200p |
| DIVIDEND YIELD: | 3.9% | PE RATIO: | 19 | |
| NET ASSET VALUE: | 108p* | NET DEBT: | 34% | |
| Year to 31 May | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 861 | 124 | 21.5 | 7.76 |
| 2015 | 819 | 84.0 | 12.5 | 8.00 |
| 2016 | 821 | 83.7 | 16.2 | 8.11 |
| 2017** | 809 | 86.5 | 14.9 | 8.28 |
| 2018 | 763 | 66.6 | 11.4 | 8.28 |
| % change | -6 | -23 | -23 | - |
| Ex-div: | 9 Aug | |||
| Payment: | 4 Oct | |||
| *Includes intangible assets of £406m, or 95p a share **Restated | ||||
