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I agree. Nigeria should have been exited many years ago. I think I commented that 3/4 years ago. It has been like a millstone etc.
This app is becoming increasingly difficult to use as they pile more and more adverts etc. on.
Pleased to see the RNS this morning. There is too much complexity and too many unknowns for PZC ever to be valued correctly in its present form. Lets hope that a simplification of the corporate structure, improved repatriation of funds from Nigeria and the selling of a few properties around the world will unlock some shareholder value.
As for selling St Tropez, I'm not so sure. Selling one of your fastest growing brands is a risky strategy. Let's hope the price is right!
And it’s continued to do so.
Up from .5 to .7 in the past month which is a 40% increase.
This needs to be sub 75p and even at that level one requires clarity regarding business viability.
I sincerely hope so, because I've joined the fun as of 4pm today.
85.2p paid. Feels cheap, but let's see.
Green shoots have appeared.
I would think the profits from outside Africa are just about enough to service the debt, but only just, so it's a bit of a zombie company for me. The dividend is unsustainable from a cash point of view.
There's certainly a horrible mismatch between having debt in hard currencies and trapped cash in a massively weakening currency. The profit from the Africa segment is essentially an accounting mirage i would say. Typically profits are flattered by high inflation because selling prices increase between buying the raw materials and selling the finished goods. In any case, the profits can't be repatriated so are essentially worthless in terms of servicing debt or paying dividends.
No idea what will happen in respect of the Nigerian economy or capital controls so it's all a bit too hard to value. Best scenario would be a takeover, but suspect the combination of family holding and uncertainty over Nigeria means it's unlikely.
FY23 cash 256m (201m) in NGN H124 cash 128 (201m in NGN devalued to 77.4m) managed to repatriate 13m means it repatriated nothing, Nigeria business is 35% of revenue and that 35% cannot be realised, it was not a choice to accumulate £200m usd worth of NGN, the business cannot swap the NGN it's accumulated, considering PZ intends to buy out NCI which has equity of minus 9m for estimated 25-50m. Factoring that in, loss attributable to owners of parent was 87.8m with comprehensive loss of 135.9m not including cost of buying out NCI, until there is evidence PZ can actually effectively repatriate money from Nigeria, PZ is unviable, opinions and thoughts?
You are more informed than Me on this Co but everything has a price. Unilever or Proctor could add this as a bolt on straight away given their established brands. Probably just a wish regarding takeover, but the Company needs to sort out its markets hence the current S.P. It does look vulnerable though.
30% owned by the founding family. Typically families only sell when there has been a messy divorce. I would never expect a takeover for this company.
Bought a few on takeover gamble.
The economic reforms in Nigeria will eventually come good. The short term shock of removing oil subsidies and devaluing the Naira are stoking inflation and hurting PZC but give it time to adjust and being in Africa’s second biggest economy will pay off. The demographics in Africa and potentially for growth are in stark contrast to Europe.
I'm in deep but am I missing something ?
Is this overlooked ? Doesn't seem much action from a SP that is sooo low.
Thoughts ?
:-)
Uncle Doug
Yes indeed I tend to agree with you as it bounced off 110 very quickly...Come on Unilever...but not at 62p surely
My own calculations put the current NAV figure (as of 2nd Dec 23) at 62p. And that's taking into account the latest cash position of £128.1m, which was a lot higher before the Nigerian Naira devalutation.
I’ve been here a long time. Initially attracted by the mini Unilever potential and then agreeing with the current strategy. However it was obvious that Nigeria was the Achilles ‘Hell’ 3/4 years ago they started to reduce exposure but stopped from going to zero or very limited. I suppose now too late and must wait for currency to recover…!?!? Anyway well down but thinking might just take my medicine.
LOL. Spare change for these guys! The amount invested so miserly it's hit the SP down even more. Absolute incompetence from the BOD here. The only question is where and when will the bottom be found.
I've just been trying to work out the same. There'll be a point at which this becomes greatly oversold.
Usually a good sign but hey common dig deeper should this be the case or is it awards of some sort
do any of you guys have a nav figure? i have a ‘back of the *** packet’ figure of 77p per share but i stand corrected.
I anticipated this dropping but not to this extend. My short from 129p doing very well.
Big thanks to the super incompetent board for making me wealth(ier)
I don't think PZC should completely exit from Nigeria. Even though there is a lot of corruption in this country, it also has a lot of future growth potential and it would be a pity if PZC missed out on that. The Nigerian Niara is however a very unstable currency and the company should not have so much of this currency in cash. Most of the cash generated from its Nigeria operations should be converted into US dollars and that way the company's overall cash position is protected from further devaluations in the Niara.
Indeed this is what I don't understand either - Not really familiar with the financials but how much would they have to write down if they just simply left the corrupt state and sold it to whoever? Instead they are trying to buy out existing minority shareholders. The only way they can recover is if the price of oil rockets as Nigeria tends to spend like there's no tomorrow when oil surpluses are good
Wouldn't think there's enough cash flow to interest PE. The company excludes corporation tax payments from their definition of free cash flow - wasn't aware those payments were discretionary!
I know the company has been in Nigeria a long time, but should/could they exit? That would leave a far more focused and appealing business for investors.