- Sixth consecutive quarter of revenue growth
- On track to exceed £68.1 million PBT consensus
- Nigeria disruptions have ‘largely dissipated’
Shares in PZ Cussons (PZC) rose 4.2% to 195p after the consumer goods group reported robust third quarter trading and assured investors that full year pre-tax profit should be ‘at least in line’ with the £68.1 million called for by consensus forecasts.
While management at the Carex hand wash-to-Imperial Leather soap maker remains ‘alert to ongoing external volatility’, PZ Cussons pleased with the news its Europe & the Americas region returned to strong revenue growth in the quarter and with significantly improved margins at that.
SIX ON THE SPIN
Manchester-headquartered PZ Cussons delivered its sixth consecutive quarter of revenue growth in the period ended 4 March 2023, with like-for-like sales growing 6.2% as it benefited from price increases and product mix improvements.
Total sales rose 13.5% to £166 million, reflecting the full period contribution of Childs Farm, the baby and child personal care brand bought just over a year ago.
The Europe & the Americas business saw ‘particularly strong performances’ from the St. Tropez tanning brand in the US and the combined Imperial Leather and Cussons Creations portfolio, although Carex sales declined amid a broader decline in UK hand hygiene product sales as the pandemic boom continued to fade.
DEMAND DISRUPTIONS DISSIPATE
The FTSE 250-listed company, whose other everyday brands include Morning Fresh and Original Source, said its Asia Pacific performance was driven by strong growth in Australia and sustained share gains across major brands.
All of PZ Cussons’ ‘Must Win Brands’ are in ‘good growth’ in Africa, where the one fly in the ointment was a weaker showing from the important Nigerian market as bank note changes and an election in February disrupted demand.
Encouragingly, PZ Cussons insisted these disruptions have ‘largely dissipated’ and it is now seeing a return to more normal demand patterns.
WHAT DID THE CEO SAY?
CEO Jonathan Myers commented: ‘We have delivered another quarter of mid-single digit revenue growth, in line with our longer-term ambition. This represents a sixth consecutive quarter of growth, with the business underpinned by the strength and depth of our portfolio and our ongoing strategy to invest behind our brands, build internal capabilities and serve consumers better.’
Myers continued: ‘As anticipated, performance has strengthened in Europe & the Americas, with a return to revenue growth and a marked improvement in profitability in the quarter. As a result, we remain confident in delivering against full year 2023 expectations and that further strategic progress will be made in the balance of full year 2023 and into 2024.’
