PZ Cussons LON: PZC reported higher revenue, operating profit and free cash flow for the year ended May 31, 2026, as growth across its four lead markets and top 10 brands supported increased marketing investment and a materially lower debt position.
Group revenue rose 5.4% to £541 million, representing like-for-like growth of 5.8%. Adjusted operating profit increased to £59.5 million, lifting the adjusted operating margin to 11%. On a comparison basis excluding the contribution of the former PZ Wilmar joint venture in both years, adjusted operating profit rose 24.5% and margin improved by 170 basis points.
Jonathan Myers said the company had seen “early signs of delivery” from its refreshed strategy, citing broad-based growth, higher brand-building investment, reduced foreign-exchange exposure in Nigeria and stronger cash generation. The company said it began fiscal 2027 in line with expectations and confirmed that its outlook remains consistent with market expectations.
Cash flow, debt reduction and dividend growth
Free cash flow increased to £54.7 million from £42.3 million a year earlier, aided by higher operating profit and lower cash exceptional items, partly offset by a working-capital outflow. Net debt fell to £25 million from £112 million, reflecting the cash-flow improvement, proceeds from the sale of PZ Cussons’ 50% stake in PZ Wilmar and sales of surplus non-operating assets.
The PZ Wilmar disposal generated £47.8 million of proceeds, while other surplus asset sales in Asia and Africa generated a further £27.6 million. Adjusted net debt to EBITDA, excluding cash held in Nigeria, stood at 0.7 times, below the company’s targeted range of 1 to 1.5 times.
Jan, who joined the company in late March after serving as interim chief financial officer at Severfield, said the stronger balance sheet gives PZ Cussons greater flexibility to invest in growth, support its dividend and consider bolt-on acquisitions or additional shareholder returns where appropriate.
The board proposed a 2.8% dividend increase, marking the first rise in four years and aligning with its progressive dividend policy.
Adjusted profit before tax rose to just over £50 million. However, adjusted earnings per share declined to £0.0714, which Jan attributed to a high effective tax rate and a greater minority-interest charge from strong growth in Africa, particularly in the electricals business where the company has lower net ownership.
Regional performance led by Nigeria
Nigeria was the largest contributor to group growth. Revenue in the country rose 22% to £133 million, with growth in both price mix and volume. Africa revenue increased to £168 million, up 14.7% on a like-for-like basis.
The company said double-digit growth was achieved across most of its largest Nigerian brands, while the Stella brand benefited from higher exports and efforts to extend demand beyond the seasonal harmattan dry period. Its Nigerian electricals business grew revenue by more than 20%, led by refrigeration products and supported by the company’s exclusive showroom network.
Africa operating profit also benefited from a £4.6 million gain associated with the revaluation of U.S. dollar-denominated liabilities after the Nigerian naira appreciated. Jan said the group’s reported operating profit included £5.4 million of FX gains overall and suggested that normalized operating profit, from which the company expects to grow in fiscal 2027, was closer to £54 million.
The company has reduced its exposure to future Nigerian currency movements by lowering foreign-currency liabilities in the local business. Jan said a 100-naira movement would now have an estimated £1.5 million effect on underlying operating profit, compared with more than £7 million historically.
In Europe and the Americas, revenue rose 0.9% on a like-for-like basis to £200 million. U.K. revenue increased 0.5% to £175 million, with growth across Carex, Imperial Leather, Original Source and Sanctuary Spa. Sanctuary Spa was the largest contributor, supported by Christmas gifting sales. Operating profit in the region was broadly flat as improved gross margins and cost control offset higher marketing expenditure.
APAC revenue increased 3.9% on a like-for-like basis to £173 million, though it was flat on a reported basis due to currency movements in Australia and Indonesia. Indonesia revenue rose 10.2% to £61 million, driven by the Cussons Baby relaunch, improved price mix and volumes, and growth in e-commerce channels including TikTok Shop and Shopee.
Australia and New Zealand revenue increased 4% to £91 million, supported by Morning Fresh, Radiant and Rafferty’s Garden. The company highlighted progress for Morning Fresh in automatic dishwashing products and said its one-liter Original Source pack helped lift sales. APAC operating profit declined as the group invested more heavily in marketing and absorbed depreciation in the Australian dollar and Indonesian rupiah.
Brand development and U.S. expansion
Myers said PZ Cussons’ partnership with Emerson Group helped return St. Tropez to growth in North America, where revenue increased 6.9% following two years of double-digit declines. The company said improvements to Amazon product pages, media efficiency and promotional activity helped more than double the brand’s growth rate on the platform, which is now St. Tropez’s largest U.S. customer.
St. Tropez did not grow in the U.K. during fiscal 2026, but Myers said retail sales improved sequentially heading into the 2026 summer season, reaching double-digit growth during the peak period and returning to market-share growth. The company plans a larger innovation pipeline for summer 2027, including four times as many new products and one patent-pending launch.
PZ Cussons also said Childs Farm, acquired in 2022, is now profitable and is expected to generate a post-tax return on capital employed above the company’s weighted average cost of capital in fiscal 2027. The brand recently entered all 4,600 Walmart stores in the U.S. after first securing online distribution. Myers cautioned that the U.S. remains a challenging market but said early feedback from shoppers and Walmart had been positive.
Fiscal 2027 outlook
For fiscal 2027, PZ Cussons said it expects adjusted operating profit to fall within the current market range of £58 million to £61.2 million. The company expects a more balanced profit split between the first and second halves than in fiscal 2026, when first-half results benefited from the timing of FX gains and second-half results included more marketing expenditure.
Management said it is monitoring potential cost inflation linked to conflict in the Middle East, but believes the large majority of inflation can be offset through mitigation actions already in place. Based on current spot rates, the company does not expect a material year-over-year FX impact and expects net debt to decline further on continued underlying cash generation.
About PZ Cussons (LON:PZC)
PZ Cussons plc manufactures, distributes, markets, and sells baby, beauty, and hygiene products in Europe, the Americas, the Asia Pacific, and Africa. The company offers toiletries, pharmaceuticals, electrical goods, edible oils, fats and spreads, nutritional products, shampoos, body washes, toothpastes, toothbrushes, skin and hair care products, food pouches, cereals, snacks, flavors, and fragrances; beauty soaps, lotions, wipes, creams, shower gels, foam-bursts, bar soaps, deodorants, bath infusions, handwashes, and conditioners; ointments; dishwashing liquids, dishwasher tablets, dishwasher gels, dishwasher capsules, rinse aids, liquid detergents, laundry soaps, and laundry solutions; and cooking and vegetable oils.
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