Imperial Leather and Carex maker PZ Cussons has revealed a return to profit but said there is “more to do” in its overhaul.
The Manchester-based group swung to a £6.5 million pre-tax profit for the year to May 31, against losses of £95.9 million the previous year.
It revealed like-for-like sales growth of 8%, nearly double the 4.4% seen in 2023-24, thanks to price actions in Africa and a better performance in the UK.
Shares lifted 11% by noon in trading on Wednesday.
But on an underlying basis, pre-tax profits fell 8.1% to £41.1 million.
Chief executive Jonathan Myers said: “We have delivered good momentum across most of our portfolio, driven by our renewed focus on more competitive brand activation, strengthened innovation and successful commercial partnerships.
“At the same time, we have taken action to address our cost base, as we embed our new operating model.”
He added: “We know there is more to do to fully transform PZ Cussons into a business with stronger brands in a more focused portfolio, delivering sustainable, profitable growth.”
The group – which owns a raft of labels also including Original Source, Childs Farm and Sanctuary Spa – said UK trading was boosted by “seasonal gifting” surrounding Christmas, Valentine’s and Mother’s Day, which it said added around £3 million to revenue growth.
But it revealed a cost of around £3 million from the UK’s new Extended Producer Responsibility (EPR) packaging tax, which it said it would look to offset “over time”, helped by a review of its entire packaging portfolio in the UK.
Despite this, it said underlying earnings in the European and Americas division – including the UK – rose by £4.2 million over the year to £36.8 million.
But it said that since the year end, “challenging trading” in its self-tanning range St Tropez is set to see like-for-like sales in the European and Americas division fall 2% to the end of September.
Comparative sales in the wider group are set to rise by 10% to the end of September.
The firm is expecting underlying operating profits to rise to between £48 million and £53 million in 2025-26, up from £47.8 million in 2024-25.
PZ Cussons is leading an overhaul that is seeing it sell its 50% stake in PZ Wilmar.
But it announced in June that it would hold on to St Tropez more than a year after putting it up for sale.
It said staff will be incentivised to boost the brand’s performance.
PZ Cussons bought the beauty business for £62.5 million in 2010, and it has become one of the UK’s biggest self-tanning brands sold in retailers across the country.
However, it has struggled against weaker demand in the US, reporting a double-digit drop in sales over the latest financial year.
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