PZ Cussons Nigeria 9-month pre-tax profit down 23%

Nigeria’s PZ Cussons, the local unit of British soap and shampoo maker, said on Friday its nine-month pre-tax profit fell 23 percent to N3.99 billion ($205m) from a year earlier.

Turnover dropped slightly to N52.88 billion from N52.59 billion during the period to end-February compared with a year earlier, it said in a statement, adding it would pay an interim dividend of 0.20 naira per share.

The recent devaluation of the naira and continuing turmoil in the North East of the country will negatively impact PZ Cussons operations, according to a recent trading update released by the company.

“In Nigeria, disruption in the North of the country has continued at a high level, resulting in a decline in sales in that region. Good growth has continued in the South of the country, in particular in the electrical goods business and in the two foods and nutrition joint ventures. While Nigeria has been declared Ebola free, there has been a negative impact on cross-border trade,” said PZ in the update released December 10.

“Overall operating profits in Nigeria were lower than the comparative period both as a result of tough trading conditions, particularly in the North, and of the 8 percent devaluation of the naira towards the end of the period.”

The macro environment in Nigeria in the second half, which includes the March presidential elections and potential further currency volatility, will be a key contributing factor to the overall result for the full year, the update said.