PZ Cussons’ Tax Bill Jumps 388% To N32.15bn Despite Profit Surge

PZ Cussons Nigeria Plc recorded a sharp increase in its income tax expense in the 2026 financial year, with its tax bill rising by 388 per cent to N32.15bn, despite a significant improvement in revenue, operating profit and bottom-line earnings.

According to the company’s audited financial statements for the year ended May 31, 2026, income tax expense increased from N6.59bb in 2025 to N32.15bn, representing an additional tax burden of about N25.56bn year-on-year.

Despite the substantial increase in taxation, PZ Cussons Nigeria’s profit after tax surged to N45.17bn, compared with N10.07bn recorded in the previous financial year, representing an increase of about 349 per cent.

The strong bottom-line performance was driven largely by significant growth in revenue and operating earnings during the period.

Revenue increased by 22.5 per cent to N260.46bn, from N212.63bn in 2025, reflecting stronger sales performance during the year.

Gross profit also increased to N73.27bn, compared with N57.71bn in the preceding year, while operating profit rose sharply by about 307 per cent to N77.06bn, from N18.92bn.

Profit before tax followed the same upward trajectory, climbing from N16.66bn in 2025 to N77.32bn, representing an increase of approximately 364 per cent.

The surge in pre-tax earnings provided a significantly larger tax base, although the scale of the increase in tax expense was considerably higher than the growth in revenue.

The N32.15bn tax charge represented approximately 41.6 per cent of PZ Cussons Nigeria’s profit before tax, leaving the company with N45.17bn in profit after tax for the year.

Profit attributable to equity holders of the parent company also rose substantially to N43.16bn, compared with N9.21bn in 2025, while profit attributable to non-controlling interests stood at N2.01bn.

The company’s earnings per share equally improved significantly, rising to N10.87, from N2.32 in the previous financial year, reflecting the substantial improvement in profitability.

However, the stronger earnings performance came amid notable increases in some operating costs. Selling and distribution expenses increased by approximately 48 per cent to N26.51bn, from N17.90bn in 2025, while administrative expenses rose to N21.07bn, compared with N14.70bn a year earlier.

The company also benefited from a significant turnaround in foreign exchange performance during the period. PZ Cussons Nigeria recorded a foreign exchange gain of N11.84bn, compared with a foreign exchange loss of N7.78bn in 2025, providing a substantial boost to operating performance.

Other income also increased sharply to N39.92bn, from N1.80bn in the preceding year, further supporting the company’s earnings during the financial year.

The combination of stronger sales, improved gross margins, higher operating earnings, foreign exchange gains and increased other income helped the company overcome the impact of higher operating expenses and the substantial rise in its tax liability.

The company’s balance sheet also recorded a significant improvement during the period. Total equity moved from a negative N17.34bn in 2025 to N66.64bn at the end of May 2026, representing a major strengthening of its financial position.

Total assets stood at N159.57bn, compared with N168.90bn in the previous year, while total liabilities declined to N92.93bn, from N186.24bn.

The results indicate a significant turnaround in PZ Cussons Nigeria’s financial performance, but the sharp increase in taxation and rising operating expenses remain key issues for investors to monitor.

With income tax expense increasing by nearly four times within one financial year, the company will need to sustain its revenue and operating gains while managing its tax exposure and cost structure to preserve the substantial improvement recorded in net earnings.