PZ CUSSONS NIGERIA EMPTIES 2016 POT.

Ordinarily, PZ Cussons Nigeria would prefer to keep something for the next season but this year to May 2016, it more than emptied the pot to make shareholders happy.

According to a notice earlier released this week, the board of directors is recommending 50k per share dividend come annual general meeting billed for October 6 at Abuja.

This figure is 3k per share higher than the 47k earnings per share for the year in the audited results from which under normal circumstances, dividend should be declared with some left as retained earnings.

But of course, the times are clearly different now because the Naira, which is PZ Cussons Nigeria's reporting currency is down yet contribution to international group profit must be considered.

So the top up to fill the 3k gap will come from gentle and yes, legitimate dipping of cake sharing knife into retained earnings of previous years.

Yet, the truth also must be faced: PZ Cussons Nigeria, from the figures, had a rough year.

As usual, the one good bite PZ Cussons had within the was reducing selling and distribution expenses by 4.57% to N8825.6m as core revenue dropped by 4.92% to N69527.5m and cost of sale barely bowed down by 0.88% to N52209.7m.

Yes of course, income from non core operations more than doubled to N266.1m but that was much more outside management control just as interest income dipped by 8.08% to N210.3m followed by 34.3% increase in interest expense to N597.7m.

The other place PZ Cussons Nigeria would have indeed showcased clear teeth marks was administration expenses but it was puffed up instead by 18.1% to N5242.7m.

Thus, by year end May 2016, all these put together resulted in 52% dive in profit before tax to N3148.2m from 4.73% decrease in total income to N70003.9m dragging profit margin to 4.5% as against 8.92% in 2015.

One thing though, PZ Cussons Nigeria should have no problem finding the cash to pay the dividend, because at closing N12867.3m, there was more than enough in the treasury.

But a word of caution: liquidity position at N20829m working capital was not as solid as 2016's N22607.1m.

PZ CUSSONS NIGERIA: Nbn. Full year.
                       2016.     2015
Total income 70.0.      73.5
Core income 69.5       73.1
Cost of sale  52.2.      52.7
Selling etc     8.83.      9.25
Admin. Cost 5.24.      45.5
Other income 0.27    0.12
Interest inc.   0.21.    0.23
   " expense.  0.60.    0.44
Profit b4 tax 3.15.     6.56
Margin %     4.50.      8.92
Working cap. 20.8.  22.6
Cash.            12.9.    2.33

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