Investors have thawed to PZ Cussons, after full-year results revealed a bounce back to profitability at the troubled personal care group.
Shares jumped 12.2% on Wednesday as PZ Cussons reported an operating profit of £20.6m, up from a loss of £83.7m the year before.
Finally getting a grip on sustained currency issues in its African business unit – which led to last year’s blow of £107.5m in financial exchange losses for the group – PZ Cussons said it had delivered “good progress” in its turnaround.
While CEO Jonathan Myers warned there was “more to do”, he said the year to the end of May 2025 had been one of “continued progress, driven by our renewed focus on more competitive brand activation, strengthened innovation and successful commercial partnerships”.
He pointed to additional action to cut the group’s cost base by £5m-£10m over the next year, and an upcoming reduction in net debt thanks to the sale of its 50% share in palm oil venture PZ Wilmar for an expected £51m after costs.
The group’s results beat Investec expectations, which upgraded its forecast for the company’s operating profit in FY26 by 7.6% to £49.5m.
The jump in share price will be welcome for existing investors, who have seen the stock decline 65% in value over the past five years.
PZ Cussons has suffered in recent years thanks to “tough economic conditions” in some of its global markets – yet thanks to its strategic turnaround plan was “well positioned” to grow, according to JP Morgan analyst Edward Hockin.
Rapid growth in the company’s African business, driven by nearly 20 price hikes to combat rampant inflation and some volume gains, helped propel like-for-like revenues to 8% growth in 2024.
An overall 2.7% decline in stated revenues brought turnover down to £513.8m, thanks largely to a still-depressed Nigerian naira. Excluding the African business, PZ Cussons delivered 0.3% like-for-like revenue growth on an 0.7% volumes rise.
While encouraged by the progress against the company’s strategic plan to focus on ‘must win’ brands, Hockin held firm on a ‘neutral’ view of the stock for now.
“It may take time for trading conditions to improve and the new strategy to start seeing its benefits, and pending the completion of its portfolio transformation agenda,” he explained.
The group’s results beat Investec expectations, which upgraded its forecast for the company’s operating profit in FY26 by 7.6% to £49.5m.
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