PZ Cussons reiterates full-year guidance
By Abigail Townsend
Date: Wednesday 08 Feb 2023
(Sharecast News) - PZ Cussons reiterated its full-year outlook on Wednesday, despite the "challenging" economic climate, following a jump in interim revenues.
The FTSE 250 consumer goods group saw revenues rise 19% in the six months to £336.9m, while like-for-like sales improved 6.1%. Operating profits nudged 1% higher to £33.2m, and pre-tax profits increased 8% to £34.5m.
PZ Cussons - which owns Imperial Leather, Original Source and Carex, among others - said trading had been in line with expectations, despite inflationary pressures, weaker consumer confidence and a "softening" macroeconomic climate.
The firm also reiterated its full-year outlook, noting that it expects a stronger operating margin performance in the second half driven by improved trends in its Europe and America businesses, falling cost inflation and the full impact of price increases that were introduced in the last quarter.
Jonathan Myers, chief executive, said: "Despite the continued challenging macro environment, we have delivered another quarter of like-for-like revenue growth. Our first-half performance has been in line with expectations and we are reiterating our full year outlook.
"This is thanks to work we have done to make PZ Cussons a more resilient business and our focus on building stronger brands."
As at 0830 GMT, shares in PZ Cussons were down nearly 7% at 200p, however.
Victoria Scholar, head of investment at Interactive Investor, said: "PZ Cussons has been struggling with cost inflation, a weakening consumer and higher debt. Although it has been raising prices, customers are increasingly price sensitive given the cost of living squeeze."
Shore Capital, which has a 'hold' rating on the stock, said: "PZ Cussons is a business we have long admired, with a strong portfolio of brands across its geographies that provide a robust platform from which the business can deliver sustained growth and cash generation over the medium-to-long term. However, short-term challenges and constraints remain."
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