PZ Cussons Plc is under pressure from shareholders demanding greater accountability and a clearer path to profitability after the company scrapped its plan to delist from the Nigerian Exchange Limited (NGX).
During the company’s Facts Behind the Figures presentation at the NGX House in Lagos, investors criticised the management for poor financial performance, lack of transparency and failure to pay dividends in recent years.
Recall that in September 2023, PZ Cussons (Holdings) Limited—the parent company and majority shareholder announced plans to delist from the Nigerian stock market, offering minority shareholders N21 per share as part of the process. However, investors rejected the offer, demanding N40 per share, and the Securities and Exchange Commission (SEC) ultimately dismissed the delisting application after shareholder resistance.
Shareholders accused the parent company of attempting to shortchange them and failing to be forthright in its dealings. National President of New Dimension Shareholders, Patrick Ajudua called for a restructuring of foreign-denominated loans to mitigate exchange rate risks. He also stressed the need for the company to negotiate for extended repayment plans to ease financial strain.
In addition, he urged the firm to adopt a long-term strategic vision to drive profitability. Similarly, Boniface Okezie, Chairman of the Progressive Shareholders Association of Nigeria (PSAN), criticised the company for its years-long failure to pay dividends, stressing that management must align its strategies with shareholder interests. PZ Cussons’ financial troubles deepened in February 2024 when it reported a troubling financial position.
Its liabilities exceeded its assets, and it posted a loss of over N46 billion after tax in its Q2 2023/2024 results. Management attributed the company’s struggles to government reforms, including fuel subsidy removal and naira devaluation, which significantly increased operating costs.
Presenting the half-year financial results for November 2024, PZ Chief Financial Officer Oludare Ebenezer Elusakin noted that the company’s energy costs surged by 43 per cent.
The company operated with a volatile exchange rate between N1,601/$1 and N1,695/$1. Its net assets remained negative, and loss after tax stood at N5.5 billion.
Despite a 42 per cent revenue increase to N96.5 billion, gross profit improved by 23 per cent to N27 billion, and operating profit before tax rose by eight per cent to N10.9 billion, shareholders remained dissatisfied.
With shareholders demanding urgent reforms, PZ Cussons’ management faces mounting pressure to navigate its financial troubles, improve transparency and rebuild investor confidence.
As the company marks 125 years of operations in Nigeria, investors insist that its commitment to staying in the market must be backed by concrete actions to restore profitability and shareholder value.
