12th Dec 2019 08:28
(Alliance News) - PZ Cussons PLC on Thursday said it expects its performance to improve in the second half of its current financial year, though annual results are still seen below the prior year's.
In addition, the personal healthcare products manufacturer said Chief Executive Officer Alex Kanellis - who has been with the company since 1993 - will retire at the end of January 2020.
A search for Kanellis's successor has been initiated, PZ Cussons said, and the process is expected to be completed in the first half of 2020. In the meantime, Non-Executive Chair Caroline Silver will become executive chair, with effect from the beginning of February 2020.
"During his 13 year tenure as chief executive officer, Alex has led numerous initiatives which have shaped the business, including the acquisition of the brands which now underpin the group's growth and future potential," said Silver.
"The group is now ready to move onto the next chapter under new leadership and we are confident that the opportunities to return to profitable growth are significant."
Turning back to operations, the Manchester-headquartered company said challenging market conditions across key geographies led to a decline in revenue and operating profit in the six months to the end of November compared with last year.
Regionally, in Europe & the Americas, the Imperial Leather and Original Source brands continued to achieve market share growth, while revenue and profit in the UK were hurt by "continuing consumer uncertainty".
Turning to Asia Pacific, PZ Cussons noted that there was continued "good" revenue and profit growth in Indonesia, driven by Cussons Baby, offset by lower revenue and higher promotional costs in Australia. The company said revenue from this region was hurt by higher manufacturing costs related to raw materials and the strengthening of the Indonesian rupiah.
Africa revenue, meanwhile, declined in the first half, due to weakness in the company's Home and Personal Care brands. Profitability was hurt by continued consumer pricing pressure, continuation of charges associated with the Port in Lagos in Nigeria and the closure of the borders limiting exports.
As a result, PZ Cussons said it expects a stronger second half, but full-year revenue and adjusted pretax profit will be modestly below the prior year on a like-for-like basis.
The company will publish its interim results on January 28, it said.
PZ Cussons shares were trading 0.6% lower in London on Thursday morning at 192.60 pence each.
By Evelina Grecenko; [email protected]
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