PZ Cussons Plc announced its preliminary financial results for the year ended May 31, 2012. Revenue for the year came in at £858.9 million, a 4.7% increase over the previous year. However, the company's profits were impacted, as previously advised, by high raw material costs; a worsening trading environment in the Australian home care category; and the social and economic tensions in Nigeria.
The company did see a major launch in the U.K., post period end, of the Cussons Mum & Me line, a new brand of personal care products specifically designed for mothers and babies, and this financial period also saw the extension of PZ Cussons' beauty division portfolio with the acquisition of the Fudge hair care brand in January 2012.
Commenting on the results, Richard Harvey, PZ Cussons' chairman, said, “The group delivered revenue growth despite challenging trading conditions. Profits were lower with a robust performance in the U.K., strong trading in the beauty division and positive momentum in Indonesia, more than offset by specific market challenges in Nigeria and Australia, and the impact of the largest year-on-year increase in raw material costs we have experienced.
“Despite the external challenges, the group remains committed to driving profitable growth through brand renovation and innovation, and through further cost reduction. During the year, underlying revenue growth continued across the business, particularly in the U.K., in the beauty division and in Indonesia. As we start the current financial year this momentum, together with our new Cussons Mum & Me and Fudge ranges, will help to ensure this growth continues.
“Our exciting joint venture with Wilmar is on track with the Nigerian palm oil refinery due to be completed by the end of the calendar year.
“At the same time, we are working actively to reduce our cost base, and the supply chain optimization project announced in March will significantly reduce the overhead base of our manufacturing activities. Our balance sheet remains strong with only a small net debt position, and this gives us the capacity to pursue further investment opportunities which fit our strategic aims.
“Clearly the world remains uncertain and volatile. However, consumer demand for high quality innovative products serving day to day needs continues, and we are well placed to serve those needs with a strong distribution footprint in key geographic markets. Whilst the situation in the group’s important Nigerian market remains fragile, we are confident that the group will return to profitable growth in the current financial year. Overall performance since the year-end has been in line with expectations,” Harvey concluded.