Distribution and outsourcing group, Bunzl (LON:BNZL) said this morning that trading for the first six months of the year had been in line with expectations with group revenues up 2%. Operating margins have improved, largely as a result of cost reduction initiatives taken and the absence of currency losses which affected interim profits last year. This is understood to have improved overall group profitability.
In North America the strong underlying revenue growth of the first quarter has continued, led principally by additional business with existing customers. Although revenue in the UK & Ireland in the first half is below the same period last year due to the persisting difficult economic conditions, the improvement in operating margin has resulted in an increase in profits. In Continental Europe trading is ahead of the first half of last year due to the impact of recent acquisitions. The Rest of the World has shown excellent growth due to the favourable impact of currency translation, strong underlying growth in Brazil and a significant improvement in operating margin in Australasia.
Bunzl has completed a string of acquisitions in recent months, including Spanish business Juba Personal Protection Equipment S.L. at the end of May; Israeli business M.S. Global Ltd and its trading subsidiary, Silco (Utensils) A.S. Ltd in April and Swiss company Weita Holding AG in March. In the year to December 2009, Bunzl posted an 11% rise in revenues to £4.65bn and pre-tax profits of £257.8m.
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