There was rising concern in the City today about what social unrest in Nigeria could mean for the profits of some of Europe’s largest companies.
Soap and shampoo maker PZ Cussons this morning issued a second profits warning in less than four months, blaming turmoil in Nigeria, its biggest single market and Africa’s most populous country. “Given the importance of Nigeria to the group, the impact of the continuing tensions in the country will be significant, resulting in the group’s overall performance being some way below expectations,” the company told the stock market.
Shares in the maker of Imperial Leather soaps and Carex anti-bacterial hand washes fell 32.2p to 301.5p.
Nigeria seems at risk of breaking apart: violence between different faiths is now common in a nation that enjoyed an oil boom in the Seventies but is riven with corruption.
Other large firms — including Diageo and Unilever — do business in Nigeria. But shares in both companies were steady today and analysts say the impact on them as well as on Coca-Cola and SAB Miller will not be as hard as that felt by PZ Cussons.
The soap-maker said continuing social instability in northern Nigeria has hit sales particularly badly.
Panmure Gordon, one of PZ Cussons’ brokers, cut its pre-tax profit forecast for the present financial year to the end of May, from £102 million to £89.1 million. Analysts had already cut their full-year profit forecasts for Cussons after it warned in January the environment in Nigeria may worsen.
http://www.thisislondon.co.uk/business/business-news/growing-tensions-in-nigeria-cast-shadow-over-european-firms-7586548.html
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