PZ Cussons Nigeria has reported its first annual loss since 2020 for the financial year ending 31 May 2024, as indicated by its audited financial statements released on Friday.

The accounts reveal that the post-tax loss escalated to N76 billion, while foreign currency liabilities reached an unprecedented level.

The Nigerian division of the Manchester-based British consumer goods company, PZ Cussons Plc, experienced a staggering increase of over 3,000 percent in foreign exchange losses, rising from N5 billion to N157.9 billion during the review period. Nigeria remains PZ Cussons' largest and most varied market, as stated on the company's website.

This significant foreign exchange loss exacerbates the financial challenges faced by the manufacturer of popular homecare and body care products, including Morning Fresh, Canoe, and Premier Cool, which fell into a negative asset position in the second quarter, resulting in a negative shareholders' fund of N23.2 billion. This figure increased by 18.7 percent during the review period.

PZ Cussons Nigeria is heavily dependent on imports for its raw materials and has outstanding debts to international trade partners, leading to a rise in current liabilities from N94.7 billion to N119.3 billion compared to the previous year.

The Nigerian monetary authorities' decision to devalue the naira twice between last June and this January, aimed at aligning the official exchange rate with market rates and attracting foreign investment, resulted in a roughly 70 percent decline in the naira's value against the dollar.

This depreciation has increased PZ Cussons Nigeria's payables, as the company earns revenue in naira but fulfills most of its trade obligations in foreign currencies.

The outstanding debts to trade partners that require prompt settlement now total N90.6 billion, up from N79.9 billion a year earlier.

PwC, the independent auditor, refrained from commenting on the company's financial status and did not identify any significant audit issues in the financial report, despite the uncertainty surrounding the company's strategies to improve its negative asset position. "We have concluded that there are no significant audit matters to report," stated PwC.

In March, the attempt by the parent company to acquire PZ Cussons Nigeria in its entirety failed after British investors proposed purchasing shares from minority shareholders at a price below the market value.

For the reporting period, revenue increased to N152.2 billion, representing a one-third rise compared to 2023. The company also benefited from a tax credit of N32.2 billion, contrasting with the previous year's tax liability of N6.1 billion.