Many Nigerians panicked last Thursday when a national newspaper reported that PZ Cussons was considering leaving Nigeria as a result of its tough financial situation in the country.
Social media picked the story and ran to town with it, generating a plethora of reactions from Nigerians at home and in the Diaspora.
One Demola Olarewaju, with the Twitter handle @DemolaRewaju, said PZ leaving Nigeria was like half of his childhood going with them.
“You practically didn’t grow up in the 80s/90s if you didn’t use at least one of their products,” he said.
Another Twitter user, who goes by the name Novah’s Stitches, said: “ PZ! Makers of Cussons? Oh no. This one is like my lifestyle leaving me behind. Please someone should tell the company to carry me along. Seriously, tears dropped from my eyes for Nigeria.”
However, the Fast-Moving Consumer Goods (FMCG) firm, which produces and distributes detergents, toiletries, soaps and home appliances, has dismissed the report as false.
“The headline is totally false and misleading and creates the impression that PZ has decided to leave Nigeria,” Christos Giannopoulos, chief executive officer, PZ Cussons Nigeria Plc, said weekend.
Giannopoulos said the trading statement issued to the London Stock Exchange, which was quoted by the newspaper, was clear on the company’s continued operations in Nigeria.
Quoting the trading statement issued in London, he said: “Whilst these conditions prevail, we will maintain our strong market shares in key product categories in Nigeria until growth returns to the market.”
He said PZ was celebrating 120 years of its existence this year, making life better and adding value to Nigerians.
“In our 120 years of doing business in Nigeria, we have faced different conditions and come out stronger at the end,” the managing director said.
“We confirm to our consumers, customers, employees, business partners and stakeholders that Nigeria still remains a market of interest for us and have made no plans to leave Nigeria,” Giannopoulos stated.
“Our factories in Ikorodu, Aba and all our distribution centres around the country are operational and will continue to be,” he added.
The exit rumours are not totally strange. Before Procter &Gamble (P&G) shut down its Agbara plant in July 2018, rumour mill had gone to town with the story that the diaper maker was leaving the country. P&G did not entirely exit Nigeria, but it shut down its Agbara factory, which was a big hit for its host state, Ogun.
There is a general consensus that firms are facing tough macroeconomic conditions in the country.
PZ’s financial statement for the full year ended May 2018 showed that the consumer goods company’s revenue increased from N78.2 billion in 2017 to N80.5 billion in 2018, representing a 2.94 percent increase year on year. But profit before tax fell from N4.8 billion to N2.3 billion in 2018. Profit after tax also dropped from N3.6 billion to N1.9 billion.
In the third quarter of 2018, PZ Cussons, like other firms, struggled from weak consumer discretionary spending in Nigeria and macroeconomic issues.
“It is a wake-up call for the government to put policies in place that will spur the economy,” said Ike Ibeabuchi, a manufacturer and CEO of MD Services Limited.
Manufacturers were unable to sell goods worth N149.23 billion in the first half of 2018 after producing goods worth N4.6 trillion.
They are selling to a population whose disposable income and spending are shrinking. Real household consumption and government consumption expenditures declined in 2017 (at –0.99 percent) while national disposable income fell by 1.52 percent, according to the National Bureau of Statistics (NBS).
Pz Cussons has billions of naira worth of investments in Africa’s biggest consumer nation and has made commitments to do more. The company has a number of ongoing investments and may not exit the Nigerian economy within the shortest possible time, given the country’s demographic potential and market size, which has
It has a joint venture partnership with Wilmar International aimed at developing the country’s depleted palm oil industry.
Santosh Pillai, managing director of PZ Wilmar, told BusinessDay last year that PZ Wilmar was committed to the development of palm oil industry in Nigeria, stating it had invested approximately $150 million in palm oil plantations in Cross River State alone.
ODINAKA ANUDU
