Bunzl: Shares in FTSE 100 giant tumble after issuing warning
Shares in outsourcing giant Bunzl tumbled early on Tuesday after it warned “more persistent” than expected deflation would weigh on profit in 2024.
The impact is likely to be felt most by its Continental Europe division, however Bunzl still anticipates a “strong increase” in group full-year adjusted operating profit when compared with 2023.
Shares fell more than six per cent in early deals.
Group revenue will come in three per cent higher at constant exchange rates, driven by a spate of acquisitions.
Bunzl has snapped up 13 firms over the course of the year, bringing its total committed spent to a record £850m
It completed the acquisition of Dublin-based foodservice business C&C Group in October, followed by Comodis, a distributor of cleaning and hygiene product in the Rhône-Alpes region of France, in December.
Bunzl in August pledged to allocate around £700m per annum, largely in “value-accretive acquisitions,” as it looks to return to its target leverage range by the end of 2027.
“2024 will be another year of significant progress for Bunzl, demonstrating the continued growth and resilience of the business model,” chief executive Frank van Zanten said in a statement.
“We continue to execute on our capital allocation commitments, and welcome C&C and Comodis to the Group, enhancing our offerings in the UK and France, whilst also confirming a further £200m share buyback over 2025.”
Shares are up over six per cent this year to date.