PZ Cussons announced on Wednesday that it will retain its Africa business, citing strong growth in its core markets of Nigeria, Kenya, and Ghana.
“…The fact that the Nigerian business has, since FY22, more than doubled the number of stores it serves directly has been a major contributor to the business’s growth in recent years,” the company said in a statement on its official website.
In April 2024, PZ Cussons initiated a strategic review of its Africa operations. As part of the review, the Group sold its 50% stake in PZ Wilmar Limited, a non-core edible oils business in Nigeria — to its joint venture partner, Wilmar International Limited, for $70 million.
Following the review, the board concluded that offers received for the remainder of the Africa business “did not reflect the inherent value of the business” and that the best outcome for shareholders would be to retain and grow the business, balancing its portfolio between developed markets (UK and ANZ) and emerging markets (Indonesia and Nigeria).
The company is expanding into new category adjacencies, focusing on men’s grooming and beauty through existing brands including Venus, Imperial Leather, and Premier. It is also exploring expansion into other African markets, leveraging its footprint in Nigeria and Kenya.
Strong long-term outlook
PZ Cussons highlighted the significant long-term opportunity in Africa, where the population is expected to grow by over 900 million in the next 25 years, more than half of global population growth. Nigeria alone is forecast to add over 100 million people, supported by urbanisation and a growing middle class.
Recent economic and currency trends have been favorable, driving strong, double-digit revenue growth in Africa during the first half of the financial year. Nearly 80% of Nigeria’s revenue comes from brands holding #1 or #2 positions in their categories.
The Group has implemented operational and financial measures to mitigate risks related to currency volatility and business disruption, including foreign exchange management and disciplined cash use. These measures will be reviewed regularly by the board.
Portfolio and asset optimisation
As part of its strategic review, PZ Cussons has divested over £70 million of non-core or surplus assets, including £7 million of further identified assets in Africa, with proceeds expected during the current financial year. The Group continues to explore property and portfolio optimisation opportunities, focusing on its core categories of Hygiene, Baby, and Beauty.
Jonathan Myers, CEO of PZ Cussons, said: “Since embarking on the strategic review of Africa, we have sold or identified non-core assets totaling over £70 million, strengthening our balance sheet. After careful evaluation, the Board believes it is in stakeholders’ best interest to retain the business.
“Africa is a market of great opportunity. With our strong heritage, well-known brands, and operational capabilities, we are well-positioned for long-term success. Momentum in our Africa business is strong, with double-digit revenue growth in the first half of the financial year.
“We will build on this performance and extend our category leadership, with nearly 80% of Nigerian revenue coming from brands in #1 or #2 positions. With appropriate guardrails in place to manage risk and volatility, we are confident that Africa will continue to be a significant contributor to Group growth, supporting a balanced portfolio of locally-loved brands across Developed and Emerging markets.”
