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PZ Cussons Nigeria has reported a staggering N44.5 billion exchange rate loss for the first quarter of the new financial year ending August 2023.

This revelation came to light in its latest group financial statements, which laid bare the acute impacts of forex unification on the financial health of corporations. 

This substantial exchange rate loss has had a pronounced effect on PZ Cussons’ finances, plunging the company into an operating loss of N40.2 billion for the period in question.

This marks a drastic downturn from the N734.9 million operational profit reported just one year prior. 

The period ended with the company incurring a loss after tax of N38.6 billion, a significant deviation from the N1.4 billion profit achieved in the corresponding period of the previous year. 

The implications of this are considerable: 

The magnitude of the exchange rate losses has obliterated the company’s retained earnings, which stood at N34.4 billion at the close of the last financial year in May 2023. 

  • This loss has decimated its retained earnings to a mere N565.2 million, casting doubt on the company’s ability to declare dividends. 
  • In accordance with Nigerian law, dividends are disbursed from retained earnings. Nonetheless, PZ Cussons might consider counterbalancing the retained earnings with its share premium account. 
  • Despite this possibility, it is improbable that PZ Cussons will adopt such a measure, especially with the prospect of further exchange rate losses on the horizon. 

Amidst this financial turmoil, PZ Cussons maintains a robust cash balance of N111.1 billion, a notable increase from N101.6 billion at the end of the previous financial year. 

The company has strategically placed approximately N76.6 billion of its cash reserves in short-term bank deposits, a move that has generated N2.1 billion in interest income during this timeframe.


A more detailed examination, however, indicates that PZ Cussons has trade and other payables amounting to N116.1 billion, a factor that might impinge on its cash position. Nevertheless, its working capital remains healthy at N24.6 billion. 

The company’s net debt stands at about N28 billion, primarily attributed to the $40.26 million loan secured from its parent company in July 2022. Interestingly, this loan does not accrue interest. 


PZ Cussons has established a strong presence in the manufacture, distribution, and sale of an extensive selection of consumer goods and home appliances through its depots.

These products, which include detergents, soaps, cosmetics, refrigerators, freezers, and air conditioners, are recognized as leading brands across Nigeria. Additionally, the group facilitates the distribution of products for Harefield Industrial Nigeria Limited, a related business entity. 

Bottom Line

while the exchange rate loss has posed significant challenges for PZ Cussons, the company’s substantial cash reserves and diverse product portfolio may provide a buffer against the financial headwinds it currently faces. 

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