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PZ Cussons Ghana Falls Most in 2 Weeks After Reporting Loss

Oct. 1 (Bloomberg) -- PZ Cussons Ghana Ltd., a distributor of soaps, cosmetics and pharmaceutical products, fell the most in more than two weeks after reporting a fiscal first-quarter loss.

The stock dropped 1.1 percent to 90 pesewas by the close in Accra, the capital, the most since Sept. 13. Almost 50,000 shares were traded, equal to 11 times the three-month daily average.

PZ recorded a loss of 280,943 cedis ($128,872) in the three months through August from a profit of 1.2 million cedis in the same period a year ago, the company said in a statement e-mailed by the Ghana Stock Exchange today. Earnings were impacted by exchange-rate losses and competition from cheap imports, PZ said in the statement. Revenue rose 46 percent to 21.8 million cedis.

PZ shut a factory in the port city of Tema in December, Charles Janney, director of human resources and corporate affairs, said on Aug. 27. The cedi depreciated 13 percent against the dollar this year, the worst in Africa after the rand and the Namibian dollar, which is pegged to the South African currency.

“While the company is trying to restructure its operations by shutting down its manufacturing unit, this first quarter performance may not sit too well with some investors,” Armah Akotey, head of brokerage at Databank Financial Services Ltd. in Accra, said by phone. “Cost of sales almost doubled.”

PZ is the best performer on the Ghana Stock Exchange’s Composite Index this year, rallying fivefold, compared with the gauge’s 69 percent increase. The company’s relative strength index has been above the 70 level that signals to technical traders a stock is overbought since Sept. 13.

To contact the reporter on this story: Moses Mozart Dzawu in Accra at mdzawu@bloomberg.net

To contact the editor responsible for this story: Vernon Wessels at vwessels@bloomberg.net

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