PZ Cussons is 'on track' to meet full-year profit expectations for its 2025 financial year as positive trends in the first half continued in the second, the soap maker said in a trading update.
The Imperial Leather parent experienced solid overall trading in the UK, Indonesia, and Australia and New Zealand (ANZ) in the first half of its financial year to 30 November 2024.
Like-for-like revenue increased 7.1% year on year, driven by pricing in Africa and growth in the UK and Indonesia. Excluding Africa, Like-for-like revenue growth was 1.6% with volume growth of 2.0%.
Jonathan Myers, chief executive officer of PZ Cussons, added, “New product innovation, competitive brand activation, and increased retail distribution have combined to deliver the strongest performance in our UK business for three years, thanks in part to particularly successful Christmas sales for Sanctuary Spa gifting.
“Indonesia recorded a third consecutive quarter of growth and in ANZ our brands have continued to grow share, albeit against a backdrop of market softness.”
First-Half Highlights
PZ Cussons' reported revenue saw a decline of 10.0% due to the 55% year-on-year depreciation in the Nigerian Naira versus Sterling.
The company achieved a gross debt reduction of £22.7 million in its first half, reflecting an improvement compared to the same period in the previous financial year.
Adjusted operating profit margin in this period reduced by 20bps, to 10.8% in this period.
However, excluding the contribution from the PZ Wilmar joint venture in Nigeria, which is equity-accounted, the adjusted operating profit margin grew 70bps.
Myers explained, “Our H1 reported revenue and adjusted operating profit have continued to be impacted by the depreciation of the Naira. The more recent stabilisation of the exchange rate and our operational interventions on the ground have, however, enabled us to sustain our trading momentum in the Nigerian market whilst reducing our exposure to further currency depreciation.
“We are progressing with our plans to transform our portfolio to unlock value and reduce complexity, through the processes involving our Africa business and the St.Tropez brand.”
Profit before tax (PBT) declined by 24.1%, reflecting the 11.8% reduction in operating profit and increased net finance expense, the company noted.
Earnings per share declined 10.0% as the decline in PBT was partly offset by a reduced effective tax rate and a smaller impact of non-controlling interests, largely associated with Nigeria.
