FACT CHECK: Is PZ leaving Nigeria?
On Wednesday, social media platforms were awash with the news that PZ Cussons, one of the most popular conglomerates in Nigeria, was packing up.
The news was given credence after a national daily published a report with the title “Nigeria PZ Cussons to Withdraw amid Tough Conditions”.
The content of the report, however, did not state if the Imperial Leather manufacturer was actually leaving.
This begs the question: is PZ leaving Nigeria?
The Leadership newspaper report was based on the half-year report published on the London Stock Exchange website on January 29.
In it, PZ made specific comments about the state of its affairs in the Nigerian market, most of which were not positive. It made a reference to the weak consumer disposable income as having a huge impact on its operations.
Apart from that, the report indicated that a weakening Naira and the forex regime were also unkind to its Nigerian businesses.
“The negative currency impact was caused by both the move to use the NIFEX exchange rate rather than the CBN rate to translate Nigerian results from 1 June 2018 (as indicated in the Group’s full-year results to 31 May 2018), as well as an underlying weakening of the Naira during the period.”
“The macroeconomic conditions in Nigeria remain extremely challenging and continue to have a significant negative impact on overall Group performance,” the chairman of PZ Group Caroline Silver said.
“Reflecting this, we now expect Group adjusted profit before tax for the year to be towards £70 million.”
Although Silver said the Group would streamline its activities in the country and “limit exposure to volatility in Nigeria, with more information to be provided in due course,” she maintained, in the same report, that PZ will maintain “strong market shares” in the areas it is doing well.
“We anticipate that consumer demand in all our key markets will remain subdued,” Silver said.
“Whilst these conditions prevail, we will maintain our strong market shares in key product categories in Nigeria until growth returns to the market.
“In Personal Care and Beauty across Europe and Asia, identified as sources of growth for the Group, we will continue to prioritise higher investment levels behind carefully targeted key brand and market opportunities.”
PZ businesses in Ghana and Kenya also recorded lower profits compared to prior period.
While PZ insisted it was going to limit its exposure to volatility in Nigeria, its chairman also stated that the company “will maintain our strong market shares in key product categories in Nigeria until growth returns to the market.”
Therefore, to say PZ is ‘withdrawing’ from Nigeria at this time is false.
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