THE WHAT? PZ Cussons issued a profit warning, attributing it to the Nigerian currency’s devaluation, leading to a significant drop in shares to a 15-year low.
THE DETAILS The company anticipates an adjusted operating profit of 55 million to 60 million pounds for the year ending May 31, a decrease from last year’s 73.3 million pounds. This forecast falls below the analyst expectations from last September, which estimated profits between 61.5 million and 68.2 million pounds. The CEO, Jonathan Myers, highlighted the devaluation of the Nigerian naira, which has weakened by about 70% compared to the previous year, as the primary challenge. PZ Cussons is in talks to privatize its Nigerian subsidiary by the financial year-end.
THE WHY? The company also noted weaker beauty product sales and a softer Indonesian market, though UK personal care product sales remained robust. Consequently, PZ Cussons reduced its interim dividend to 1.5 pence per share from 2.67 pence a year earlier.