Nigerian consumers will soon see fewer Procter & Gamble (P&G) products on shelves, as the American multinational consumer goods company announced a limited market portfolio restructuring that includes pulling out of the Nigerian and Argentinian markets.
The decision, attributed to challenging macroeconomic and fiscal conditions in both countries, is expected to incur restructuring charges of $1.0 to $1.5 billion after taxes, primarily due to non-cash charges and foreign currency translation losses.
While the exact timeline for the complete withdrawal is yet to be determined, P&G anticipates incurring these charges throughout the fiscal years of 2024 and 2025, with the first charges appearing in the financial quarter ending December 31, 2023.
This news comes as a blow to Nigerian consumers who have long relied on P&G brands like Ariel detergent, Pampers diapers, and Gillette razors. The company’s exit from the market is likely to lead to job losses and increased competition among remaining players.
The restructuring also includes an impairment charge, bringing the total anticipated charges to approximately $2.0 billion to $2.5 billion after taxes. These charges will be reported as non-core charges, meaning they are not expected to impact the company’s core business performance.
P&G’s decision to exit Nigeria and Argentina highlights the challenges faced by multinational companies operating in emerging markets. Economic instability and volatile currencies can make it difficult for these companies to maintain profitability.
As the global economic landscape continues to evolve, it is likely that we will see more companies making similar strategic decisions in the years to come.