British consumer goods company PZ Cussons Plc is reportedly exploring the possibility of fully or partially exiting its operations in Africa. This comes as the company faces significant financial difficulties, particularly in Nigeria, which is its largest market on the continent.
PZ Cussons, known for popular brands like Canoe, Premier Cool, and Devon Kings, has revealed that it has received multiple expressions of interest for its African business. In a statement, the company noted that these inquiries recognize the potential of its brands and workforce, potentially leading to a sale.
As of now, Africa accounts for 28.7% of the company’s overall revenue, with Nigeria and Kenya being the primary contributors. However, the recent financial report indicated a steep decline in net profit, which fell by 39.7%. This downturn is attributed to a significant depreciation of the Nigerian naira against the British pound, which slid by 57% during the review period.
PZ Cussons Nigeria, which holds a 73.3% stake in its Nigerian subsidiary, reported its first annual loss of N76 billion in August. The company cited a staggering 3,000% increase in foreign exchange losses as a key factor in this loss.
The group acknowledged that macroeconomic conditions in Nigeria had a substantial negative impact on its financial results. “Our FY24 reported results fell short of our initial expectations,” the company stated, highlighting the serious challenges posed by currency devaluation on both local business operations and overall profitability.
PZ Cussons Nigeria has stated it will provide updates once a formal notification regarding any potential sale is announced from its parent company.
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