By Modupe Gbadeyanka
The decision of federal government of Nigeria to shut the land borders across the country has taken a huge toll on the performance of PZ Cussons Nigeria Plc.
In the half year results of the company announced on Monday, the makers of several household products in the country said its revenue declined by 3.2 percent to N33.95 billion from N35.05 billion achieved in the first half of last year.
The gross profit declared by the firm in the period ended November 30, 2019 broadly decreased by 34.4 percent to N5.79 billion from N8.83 billion. This was significantly affected by the rise in the cost of sales, which jumped by 7.4 percent to N28.15 billion from N26.22 billion.
However, selling and distribution costs reduced to N4.63 billion from N5.12 billion, while the administrative expenses rose to N2.67 billion from N1.99 billion, with an operating loss of N1.50 billion as against an operating profit of N1.72 billion in the same period of last year.
Business Post reports that the other income increased to N87.78 million from N59.26 million, while the interest income dropped to N176.04 million from N190.45 million, with the interest cost jumping to N293.67 million from N95.79 million.
PZ Cussons Nigeria, in the results, declared a loss before tax of N1.58 billion in contrast to a profit before tax of N1.35 billion in the first half of last year and a loss after tax of N1.58 billion compared with the profit after tax of N1.22 billion in the corresponding period of last year. In the same vein, the company said its earnings per share (EPS) stood at -40 kobo versus 31 kobo in H1 2018.
A look at the performance of PZ Cussons Nigeria in the second quarter of its present financial year (September 2019 to November 2019) showed that things went bad for the company as revenue declined to N18.14 billion from N19.17 billion in the same period of 2018, with the cost of sales rising to N15.06 billion from N14.86 billion and the gross profit declining to N3.08 billion from N4.30 billion.
However, selling and distribution costs reduced to N2.34 billion from N2.87 billion, while the administrative costs rose to N1.21 billion from N88.33 million.
The company, which has its UK parent body controlling 73.27 percent of its stake, declared a loss before tax of N484.46 million as against the N1.56 billion PBT in Q2 2019 and a loss after tax of N484.46 million in Q2 2019 versus N1.43 billion PAT, with an EPS of -12 kobo compared with 36 kobo in the second quarter of 2018.
Two weeks ago, Business Post reported the parent company of PZ Cussons Nigeria lamented that the closure of borders in Nigeria as well as activities at the Lagos ports were badly affecting the performance of the company. The firm had said “challenging market conditions across key geographies” was affecting its revenue. READ THE REPORT HERE
Adedapo Adesanya