Blog: Katy AskewConsumer goods giant PZ Cussons expanding Africa food business

Katy Askew | 22 May 2013

Personal care group PZ Cussons has said it is making progress in expanding its African edible oils business and is preparing to launch a consumer food brand in the country.

PZ Cussons first began trading in Africa over 100 years ago. In 2010, the group launched PZ Wilmar Ltd - a Nigerian JV with Wilmar International - to build a palm oil refinery in the country and build up an associate food ingredients business.

The company recently completed construction of the refinery "on time and to budget" and the group said production began during the January to April trading period.

With sales of bulk oil already under way, PZ Cussions provided a little more detail on its plans for the June launch of a consumer food ingredients brand - Mamador - at a presentation on Africa yesterday (21 May).

Management was upbeat on the company's prospects in the market and, while food remains a small proportion of the Imperial Leather maker's revenue, it clearly has plans for the long-term development of the sector.

And it wasn't just management that struck a positive note on the group's prospects in the African food sector. Panmure Gordon analyst Graham Jones noted: "PZ Cussons revealed a major new brand, Mamador, which... should convert consumers from badly produced, cottage industry cooking oil to a safe, hygienic consumer brand."

He added: "Nigeria undoubtedly faces many challenges, but we see PZ Cussons as very well placed to benefit from the huge potential the country offers."

The African food business is far from poised become a significant part of the PZ Cussons portfolio. However, PZ Wilmar should be viewed as a slow-burning growth stream that has significant potential to expand in the long-run.

Indeed, the fledgling edible oils business will likely benefit from the highly experienced PZ Cussons management team and the strong distribution and logistical infrastrucutre that the company boasts in Africa.


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