PZ Cussons swings to a loss after Nigerian naira devaluation

The Carex soap maker said the devaluation had ‘significant implications on our reported financials’.

PZ Cussons owns Carex soaps, among other brands (PZ Cussons/PA) (PA Media)

PZ Cussons, the maker of Carex soaps, has seen shares plummet after last year’s 70% devaluation of the Nigerian naira pushed it to a loss.

The FTSE 250 company swung to a £95.9 million loss for the year ending May 2024, down from a £61.8 million profit the year before.

Chief executive Jonathan Myers said that despite “strategic” progress, the devaluation of the naira had “significant implications on our reported financials”.

He added: “We have worked hard to mitigate the impact of this on the group, while continuing to serve Nigerian consumers who are facing unprecedented inflation and economic difficulties.”

We have worked hard to mitigate the impact of this on the group, while continuing to serve Nigerian consumers who are facing unprecedented inflation and economic difficulties

Chief executive Jonathan Myers

Shares in the company fell 7% on Wednesday, while PZ Cussons also slashed its annual dividend to shareholders by 44% to 3.6p.

It comes after the firm said it was exploring the sale of its entire African business earlier this year, and put its tanning business St Tropez up for sale, as part of a turnaround plan.

Mr Myers added: “We are progressing with our plans to sell St Tropez and have received a number of expressions of interest for our African business, recognising the potential of our brands and people, which could lead to a partial or full sale.”

Russ Mould, an analyst at AJ Bell, said PZ Cussons showed “some signs of progress”, pointing to a reduction in the company’s debt pile.

He added: “However, partly due to accounting changes related to preparing the African unit for sale, the company faces even greater sensitivity to the naira in the current financial year.

“Having been at the helm since 2020, Jonathan Myers will be under pressure to deliver meaningful change and soon, with the divestment of the St Tropez tanning brand in progress.”