Recently at the Nigerian Stock Exchange (NSE), PZ Cussons Nigeria plc, the largest subsidiary of the PZ Cussons global group released its consolidated statement of profit or loss and other comprehensive income for the year ended May 31, 2015. The company opened this week’s trading with a share price of N26.93.
Q4 2015 results
The company, which has enjoyed tremendous business successes in Nigeria for over a century and has understandably, established unrivaled consumer loyalty to its wide range of products over time reported full year revenue increase of 0.30percent to N73.126billion from N72.905billion in the prior year. The cost of sales (which is the direct costs attributable to the production of the goods sold by a company) rose by 1.93 percent to N52.672billion from N53.710billion.
The company’s profit before tax (PBT) declined by 5.66 percent to N6.556billion from N6.949billion in the prior year. Profit After Tax also dipped by 10.07% to N4.570billion from N5.082billion.
The Basic Earnings per Share (EPS) –which is a rough measurement of the amount of PZ Cussons Nigeria plc profit that can be allocated to one share of its stock declined by 11.72 percent to 1.02kobo from a high of 1.16kobo.
PZ Cussons believes that in the last century it has developed a deep understanding of the Nigerian markets, its consumers and general landscape which enables the company to develop market leading brands that touch the life of its consumers, day after day. Its brands range from personal care to home care products; and nutrition to household equipment.
PZ Cussons Nigeria plc proposed final dividend of 61 kobo payable to shareholders of the company. The closure date of the company’s register for qualified shareholders is from September 14 -18, 2015, while date of payment of the proposed final dividend is September 30, 2015.
Analyst view on PZ Cussons Nigeria results
“Compared with our estimates, sales were in line while both PBT and PBT beat by over 40%. Consensus was slightly above our forecasts. PZ (parent) had signaled that the operating environment remained challenging in its last trading update. However, we await management’s comments as to what drove the expansion in its gross margin”, said research analyst at Lagos-based FBN Capital Limited.
“We had expected that PZ’s gross margin would be weighed down by naira devaluation. It appears the impact was not as severe as we had thought, or that there were other offset factors that proved significant,” they analysts added.
“PZ declared a final dividend of 61kobo which implies a total dividend of 81 kobo for 2015 and yield of 3%. The shares have outperformed the NSE ASI year-to-date (ytd) with a gain of 25.3% (All Share Index (ASI): -13.8%). We would expect a slightly positive reaction by the market to these results. We rate the stock Underperform; our estimates are under review”, FBN Capital analysts added.
CSR as value enhancing for PZ shareholders and other stakeholders
Like other multinationals, the financial performance of PZ Cussons Nigeria plc has a positive impact in all territories in which it operates. The board’s commitment to the principles of Corporate Social Responsibility (CSR) reflects its view that it is incumbent on leading companies to make a positive contribution to society through their activities.
PZ Cussons Nigeria plc board believes, however, that socially responsible conduct is value enhancing for its shareholders and other stakeholders. In particular, the board recognises the potential benefits which may be derived where its CSR activities are aligned to the concerns and demands of its customers and the Group listens to and takes account of those concerns in shaping its business strategies and practices. The board also recognises that companies are subject to increasing regulation, particularly in respect of environmental issues, and that the pursuit of a proactive CSR policy reduces the risk of adverse regulatory action.
About PZ Cussons
In 1899, Paterson Zochonis (PZ) opened a branch office in Nigeria. In 1948, PZ acquires its first soap factory of PB Nicholis & Company Limited. In 1953, the company changed name to Alagbon Industries (Associated Industries in 1960). In 1973, PZ entered the detergent and refrigerator markets simultaneously in Nigeria. In 1975, PZ acquires Cussons Group Limited. In 1976, the company witnessed global name change to Paterson Zochonis Industries plc.
Furthermore, year 2002 witnessed the global renaming of Paterson Zochonis Plc to PZ Cussons plc. In 2003, PZ Cussons plc entered into a joint venture (Nutricima) with Glanbia plc to supply evaporated milk and milk powder in Nigeria. In 2005, Nutricima JV commenced manufacture in Nigeria. Also, year 2007 witnessed the name change to PZ Cussons Nigeria plc; also in 2007, PZ Cussons Foundation was constituted; while in 2009 Nutricima Ready-To-Drink factory was commissioned by PZ Cussons Nigeria plc.
Currently, PZ Cussons Nigeria plc has a vision to profitably grow its business, strengthen its product portfolio, enhance the lives of its employees, consumers and all other stakeholders, by living and breathing its shared values, everyday.
Iheanyi Nwachukwu