British consumer goods giant, PZ Cussons Plc, is reportedly contemplating a partial or complete withdrawal from its African operations, particularly in Nigeria and Kenya.
This development comes as the company faces economic hurdles in the region. According to a report by Premium Times, PZ Cussons, known for popular brands such as Canoe, Premier Cool, and Devon Kings, has been approached with several offers for its African business.
The company stated, "We have received a number of expressions of interest for our African business, recognizing the potential of our brands and people, which could lead to a partial or full sale."
Africa accounts for 28.7% of PZ Cussons' revenue, with Nigeria being its largest and most diverse single market. However, the company's financial performance has been severely impacted by macroeconomic conditions in Nigeria.
The 2024 financial statement revealed a 39.7% drop in net profit, largely due to a 57% depreciation of the naira against the Pound sterling.
The Nigerian division reported its first annual loss in years, amounting to N76 billion, primarily due to a surge of 3,000% in foreign exchange losses. "Our FY24 reported results fell short of our initial expectations, primarily due to the macroeconomic developments in Nigeria which, as we indicated last year, would significantly affect our results," the group disclosed in its earnings report.
"The 70% currency devaluation over the course of the financial year has, therefore, caused a significant impact not only on our local business but also on the profitability and financial position of the Group." PZ Cussons holds a 73.3% stake in its Nigerian unit and has assured that it will go public once a formal notification about any sale from its parent company is in place.
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