Cussons slips up as consumer confidence tumbles

SHARES in PZ Cussons tumbled more than five per cent after the Imperial Leather owner said annual profit is expected to be “towards the bottom end” of estimates.

The group cited tough trading in the UK, where revenue and profitability in its UK washing and bathing division have been hit by plunging consumer confidence.

It pointed to consumers shopping “more cautiously” as a result of economic uncertainty and inflation out-stripping wage growth.

“While new product launches have been well received, these have not been sufficient to compensate for the wider volume and margin shortfall,” PZ Cussons warned.

Nigeria is also causing the company cause for concern.

PZ Cussons said Nigerian wages have lagged “significant cost inflation”, impacting consumer spending in the country.

As a result of its woes, PZ expects pre-tax profit to come in at the low end of its £80 million to £85m range.

Last year, pre-tax profit was £88m.

PZ Cussons, which also owns St Tropez sun tan lotion and Original Source shower gel, is embarking on initiatives to get back on track. It has kicked off a £10m plan to cut its overhead base and increase the speed at which new products are brought to market.

PZ Cussons’s performance in the Australian, US and Indonesian markets was strong, it added.

Shares closed down 12.6p at 220.2p.