PZ Cussons Just Reported Another Depressing Results

PZ Nigeria Plc released its first quarter result for the period ended August 31 2015 showing pre-tax profits dropped 7% to N547 only. Here are highlights of the result.

• Revenue was relatively N14.9 billion (-0.47% YoY)
• Revenue also recorded a flat growth YoY last year
• Gross profit margin however fared better at 27.6% compared to 26.9% a year ago.
• However, the problem with PZ remains with its operating cost. The company reported a 7.5% rise in operating expenses to N3.4billion
• Operating expenses also rose 9% same period in 2014.
• The rise in opex and flat growth in revenue continues to be a major problem for the consumer goods company.
• Pre-tax profits dropped 37% even higher than the 31% drop it recorded same period last year.
• PZ Cussons being a consumer goods company is very much exposed to the weakness in purchasing power of a lot of Nigerians.
• Another problem it has had is the insurgency in the North which has badly hurt growth from that part of the country.
• The company had last year suggested that it was looking to the east and western part of the country to drive growth this year
• However, the current capital controls on foreign used goods may well help impact positively on made in Nigeria goods and people shift to locally made goods and well-known products such as those sold by PZ.