21st Jan 2014 09:04
LONDON (Alliance News) - PZ Cussons PLC said Tuesday that revenue for the half-year was up 4.1% on the comparable period, in line with management expectations, as it boosted its interim dividend to 2.53 pence per share while reporting that its trading environment remains challenging.
In its half-yearly report for the six months to November 30 2013, the consumer products group, which operates in Europe, Asia and Africa, said pre-tax profit before exceptional items was boosted, up 7.9% to GBP47.6 million, up from GBP44.1 million.
PZ Cussons said revenue before exceptional items increased to GBP431.8 million, up 4.1% on the GBP414.8 million reported last year.
Exceptional charges of GBP4.5 million are related to the acquisition and integration of Rafferty's Garden, the supply chain optimisation project, and the group structure and systems project, said the company.
The firm reports operating profit for the period at GBP48.1 million, up 6.2% from GBP45.3 million.
PZ Cussons has raised its interim dividend payment by 7.7% to 2.53 pence per share from 2.35 pence, with basic earnings per share rising 3.7% to 6.66 pence from 6.42 pence per share.
The firm attributes its boosted revenue and profit to the acquisition of Rafferty's Garden - a GBP42.2 million cash acquisition that completed during the period - as well as the launch of new brands including Mamador and Devon's King and palm oil joint venture with Wilmar in Africa - which Chairman Richard Harvey said is operating well.
The acquisition of Rafferty's Garden marked the Group's entry into the Asian Food and Nutrition category, said the firm in a statement, "We are pleased with its performance since acquisition and are excited about its potential."
In its European division, the company records a "robust" performance for the UK's Washing and Bathing division, stating that new product launches remains key to attracting customers. All four brands in the Beauty division have seen good progress, and in particular St Tropez which has benefited from the appointment of Kate Moss as brand ambassador at the start of summer, it said.
PZ Cussons also recorded a strong performance in Poland in both Home Care and Personal Care and an encouraging growth in revenue and profitability performance in Greece.
Revenue for Europe was GBP175.1 million, up from GBP172.7 million last year, with operating profit, excluding exceptional items, for the region coming in at GBP25.3 million, up from GBP23.4 million.
The firm took a hit in its Asia business due to a significant weakening in exchange rates, though its underlying performance in Australia and Indonesia were strong. It said it continued expanding its Asian brand portfolio into neighbouring geographies during the period. Asia revenue rose to GBP90.7 million from GBP85.2 million, operating profit, excluding exceptional items was GBP8.1 million, down from GBP8.9 million.
In Africa, the company recorded revenue and operating profit growth in Nigeria across all categories and that the trading environment has slightly improved in the north of Nigeria despite ongoing disruption. Revenue in Africa rose to GBP166.0 million from GBP156.9 million, operating profit, excluding exceptional items was also up, reaching GBP14.7 million from GBP13.0 million in 2012.
Harvey said, "The Group has delivered a good result for the half year with growth in both revenue and profitability. This has been achieved despite a significant weakening in Asian currencies, and in particular the Australian dollar and Indonesian rupiah.
"Trading conditions in all geographies remain challenging and the Group's focus on innovation and brand development continues to ensure profitable growth is achieved in the markets and categories in which we operate," he said.
Looking ahead, Harvey said PZ Cusson's balance sheet remains strong and that the firm has the appetite to pursue further investment opportunities to fit with its strategic aims.
Harvey added, "Our overall performance since the period end has been in line with management expectations. Whilst the trading environment in most markets remains challenging, and in particular in Asia as a result of ongoing currency weakness, brand renovation and innovation continues to drive revenue and profit growth across the Group."
Shares in the company were trading down 2.40% at 386.71 pence per share Tuesday morning.
By Alice Attwood; [email protected]; @AliceAtAlliance
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