Imperial Leather maker PZ Cussons has unveiled plans to sell off its St Tropez self-tanning brand and is reviewing its African operations amid ongoing woes in Nigeria.
The Manchester-based group said that, following a strategic review, it has decided to “refocus the group’s portfolio on where it can be most competitive”.
It will look to sell the St Tropez business – bought by PZ Cussons for £62.5 million in 2010 – to an owner “better placed to capture the brand’s significant long-term potential”.
The group said that, while it has made progress in boosting its performance across Africa, it is a “complex group of assets” and it will therefore look at strategic options for the business.
PZ Cussons’ performance has been hit hard by extreme volatility in the Nigerian economy, where it has a major market representing more than a third of its total sales, with the firm having slumped to a £94.2 million loss in the half-year to December.
The group has been affected by a prolonged slump in the value of the Nigerian naira, the country’s currency, which it said was on average 60% lower year on year in the first three months of 2024 as inflation has surged to 30-year highs of nearly 30%.
In an update on Wednesday, it revealed that revenues plunged 23.7% for the three months to March 31, but, with currency movements stripped out, like-for-like sales lifted 6.4%.
Sales by volume grew 0.2% against a first-half decline of 4.9%, thanks to improved trading across UK brands.
Excluding Africa, like-for-like revenues fell 2.9%, against a 3.9% drop in the first half.
PZ Cussons said: “In addition to the challenges of its significant exposure to Nigeria, the group is too complex for its size, with financial and human resources spread too thinly to generate consistent returns.
“This means its competitive advantages have been constrained in comparison to those of both larger multinational companies and some focused, smaller ones.”
Chief executive Jonathan Myers said: “The macro-economic challenges and complexities associated with operating in Nigeria are significant and there is much more to do to unlock the full potential of the business.
“As such, we have undertaken a strategic review of our brands and geographies and have embarked on plans to transform our portfolio, refocusing on where the business can be most competitive.”
Money from any sale will be used to invest in growth, with the company saying it will consider targeted acquisitions, as well as paying down debt.