Bunzl beats economy, announces UK acquisition

Foodservice supplies distributor Bunzl has revealed that its UK and Ireland business has staved off the “sluggish” economy to deliver an improvement in profit during the third quarter.

In an interim management statement published to the market this morning, the company said that it was pleased with the performance of its operations in the UK for the period since 30th June 2012.

“UK and Ireland showed increased profits as a result of an improved operating margin in spite of a sluggish economy and continued modest underlying revenue growth,” it stated.

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Overall revenue for the group, including its North American and European activities, is up 5% during the quarter and 6% year to date. Bunzl said the growth was due to underlying revenue growth and the positive impact from acquisitions, net of the disposal of the UK vending business in August 2011.

The company also used the management statement to announce the acquisition of a new business in the UK.

It confirmed it was purchasing Indigo Concept Packaging Limited, a Leicester-based company that supplies retail packaging products to a variety of customers. Indigo was established 12 years ago and made sales of £6m last year.

Bunzl insists its acquisition pipeline is “promising” and said that it expects to complete more transactions this year.
Seven acquisitions have been announced so far this year with annualised revenues of £163m.

The company added that its strong cash flow and balance sheet left it well-positioned to consolidate the markets that it operates in.

“Although it is difficult to predict the future direction of economies globally, the board believes that the group’s businesses, which have leading positions in relatively resilient sectors, should continue to develop due to underlying growth and the positive impact from acquisitions,” it stated.

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