Bunzl Makes Two Acquisitions, Releases Half-Year Results

Espomega is a leading redistribution business in Mexico, supplying a variety of safety products, including gloves and protective clothing. The UK-based Fulfilment Store is engaged in the procurement and fulfilment of promotional products and marketing point-of-sale materials.

Bunzl plc announced that it has entered into an agreement to purchase a business in Mexico and has also acquired a business in the UK.

Based in Monterrey, Espomega is a leading redistribution business supplying a variety of safety products, including gloves and protective clothing, throughout Mexico. Revenue in the year ending 31 December 2013 is expected to be approximately MXN550 million (c.£28 million). Completion of the acquisition of Espomega is due to take place at the end of August.

The Fulfilment Store (TFS) is based in Rugby and is engaged in the procurement and fulfilment of promotional products and marketing point-of-sale materials for customers in the UK across various market sectors. Revenue in the year ended 31 December 2012 was £8 million.

Commenting on the acquisitions, Michael Roney said: “The acquisition of Espomega will expand significantly our safety business in Mexico being a sector we entered there with the purchase of Vicsa Safety at the end of last year. The business has an excellent range of own brand products which will extend our product offering to our customers throughout the region. Following the purchase of MDA earlier this year, the acquisition of TFS will further strengthen our business in the UK which is focused on marketing and point of sale materials and extend our service capabilities in these types of products into additional market sectors. We are delighted to welcome the employees of both businesses to Bunzl.”

Bunzl plc also published its half yearly financial report for the six months ended 30 June 2013.

 H1 13  H1 12*  Growth  
as reported  
at constant  
 Operating profit£188.8m£165.1m14%12%
 Profit before tax£167.6m£149.0m12%10%
 Adjusted earnings per
 Interim dividend10.0p8.8p14% 
 Operating profit£150.6m£134.6m12% 
 Profit before tax£129.4m£118.5m9% 
 Earnings per share27.8p25.9p7% 
  • Revenue, profit before tax and adjusted earnings per share all increase by at least 10%
  • Committed acquisition spend year to date of £203 million including the Espomega and TFS acquisitions announced today
  • Group operating margin up 10 basis points to 6.4%
  • Rest of the World operating profit up 48% at constant exchange rates
  • Continued strong cash flow with operating cash flow** to operating profit of 103%
  • Strong track record of dividend growth continues with an increase of 14%

* Restated on adoption of IAS19 (revised 2011) ‘Employee Benefits’
Before intangible amortisation and acquisition related costs
** Before acquisition related costs

Commenting on today’s results, Michael Roney, Chief Executive of Bunzl, said: "These results once again demonstrate the resilience and reliability of our business model and strategy with double digit growth in revenue, earnings and dividends. Looking forward, although the macroeconomic outlook remains challenging in some markets, we believe that our strong competitive position and the opportunities to consolidate our fragmented markets further should enable the Group to show continued growth during the rest of the year. We have a promising acquisition pipeline and have had an encouraging start to the second half of 2013 with the announcement today of two acquisitions, Espomega in Mexico and TFS in the UK."


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