Bunzl shares at record high as profits rise
BUSINESS supplies distributor Bunzl showed its recession-proof qualities with a greater-than-expected 11 per cent rise in yearly pre-tax profit yesterday, boosting its already outperforming shares to a record high.
FTSE 100-listed Bunzl, which supplies supermarkets, hospitals and hotels with products ranging from carrier bags to toilet rolls, reported a 2011 pre-tax profit of £306.1m on sales six per cent higher at £5.11bn.
The group, which operates in 23 countries and serves clients such as John Lewis and Selfridges, said revenue in continental Europe and in the company’s largest market, North America, grew seven and 12 per cent, respectively, offsetting a one per cent fall in Britain and Ireland.
“We delivered organic growth of four per cent last year, our highest rate since 2006, thanks to winning new business and seeing existing customers doing more business with us,” Bunzl chief executive Michael Roney said yesterday.
“An improving US economy helped us grow there, but tough macro conditions have dragged growth in the UK and Ireland. It’s hard to predict numbers … but I believe we [will] continue to grow at the rate we have in recent years in 2012, despite the persistently challenging macro environment.”
The company, which has in recent years made two-thirds of its growth through takeovers, said it spent £185m on acquisitions last year, bringing in an additional £200m of sales.
Shares in Bunzl, which have risen seven per cent in the last month, hit a record 958p early yesterday before settling at 952p, valuing the group at almost £3.1bn.