Manchester consumer healthcare giant PZ Cussons said on Wednesday that it was planning to sell its St Tropez tanning brand and is reviewing its operations in Africa following a “strategic review of our brands and geographies.”
The Imperial Leather and Original Source maker said that following a strategic review, it has concluded that it has become “too complex for its size, with financial and human resources spread too thinly to generate consistent returns” and will refocus its portfolio “on where the business can be most competitive and where it can create most value for shareholders.”
First to go will be St Tropez, which the company acquired in 2010 for just over £60m, but now says it feels it will struggle to achieve further growth within its own stable “given the need to allocate resources across our diverse geographic and category footprint.”
Cussons added: “We therefore plan to realise shareholder value by initiating a process to sell the brand to an owner better placed to capture the brand’s significant long-term potential.”
Cussons is also to review its operations in Africa, particulalry the “complex” Nigerian market.
Chief executive Jonathan Myers said: “Today we are re-iterating our FY24 outlook, having delivered improved LFL revenue growth in Q3 on an improved volume trend. Nevertheless, 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.”
Proceeds from any transactions will initially be used to invest behind the organic growth of the business and to reduce gross debt further, and the ews of the plans came alongside a third-quarter trading update, in which the company said trading was in line with expectations..
Myers added: “The actions we are taking will crystallise value for our investors from assets better suited to alternative ownership structures.”
Shares were up 5.7 per cent at Wednesday’s opening following the announcement.
