Bunzl Financial Results
Bunzl has published its half yearly financial report for the six months ended 30 June 2021 ending June 30 2021. Highlights include:
- Good revenue growth of 6.3% at constant exchange rates, supported by a strong recovery in the base business and acquisitions;
- Resilience through the pandemic, with underlying revenue 5.7% higher than in the first half of 2019;
- Adjusted operating profit increase of 14.7% at constant exchange rates and corresponding rise in adjusted earnings per share of 18.1%;
- Reported operating profit up 8.8% and reported basic earnings per share up 13.8%;
- Continued strong cash generation with cash conversion of 100%, and net debt to EBITDA of 1.4 times with substantial headroom for acquisition growth;
- Dividend per share growth of 2.5% reflects the Group’s commitment to ensuring sustainable dividend growth;
- Two further acquisitions announced on August 31, taking the total to eight acquisitions year to date, pipeline remains active.
“As our first half results have demonstrated, our colleagues continue to navigate the challenges associated with the pandemic incredibly well,” said Frank van Zanten, CEO of Bunzl. “While some regions have seen a strong recovery, others have experienced greater pandemic-related restrictions at various points over the last six months. One of the key strengths of our decentralized business is the ability to respond to local situations, enabling a consistent focus on delivering the right solutions for our customers. Whilst we are now seeing a reversal in COVID-19 related sales, this has been more than offset by the recovery experienced in our base business over the first half. The Group’s performance over the first half and the excellent underlying revenue growth we have delivered over a two year period demonstrate the resilience of our diversified portfolio.”
Van Zanten also discussed the company’s outlook for 2021 saying that it remains unchanged. “Looking ahead, we expect future growth to be supported by a recovery in the base business and economic activity, enhanced hygiene trends and our differentiated offering of sustainable and responsible solutions. We look forward to our Capital Markets Day on 11 October 2021, where we will give further insight on the strategic priorities for Bunzl.”
Bunzl Agrees to Acquire US Based Safety Business and Health Care Distributor
Bunzl plc announced that it has entered into agreements to acquire a US based safety business and a medical supplies distributor with operations in Australia and Singapore. This announcement on September 14 brings the number of acquisitions in 2021 to ten.
McCue Corporation (“McCue”), based in Boston, Massachusetts, is a leading business in the distribution of safety and asset protection solutions, and provides Bunzl with a strong position in this fast growing market segment. Supported by a strong portfolio of innovative own brand solutions and smart products, McCue specializes in the distribution of products such as safety barriers, floor railings and bumpers, for use in warehouses and high footfall environments spanning sectors such as grocery and ecommerce. The business has operations in Massachusetts, Texas and California, as well as in the UK and other international markets.
The business has delivered very strong double digit annual growth over the last three years. This trajectory continues, supported by the growth in ecommerce-based distribution activities, the importance of health and safety measures in operating environments, and the increasing prevalence of higher value warehouse equipment which increases the importance of asset protection. The business has an operating margin above the level typically experienced in the Group’s safety businesses. The acquisition is subject to competition clearance in the US and is expected to complete later this year.
MedShop is an online distributor of medical supplies and devices to a diverse range of healthcare customers, predominately in Australia. The business has a strong digital platform and operations in Melbourne and in Singapore. The acquisition completed in early September.
