Yesterday, Bunzl continued its strategy of growth through acquisitions by expanding its Brazilian healthcare operations. The group said it had purchased Lamedid Comercial e Servicos, a manufacturer of medical and healthcare consumables such as syringes and catheters.
Bunzl has carved out a successful and sizeable niche by supplying the food retail industry with bags, stationery and display items or, in its own words: “Essential items the customer uses but does not actually sell.” Centralised bulk-buying that reduces costs allows Bunzl’s customers to focus on their core business.
Bunzl entered Brazil in 2008 and has so far bought companies in the safety, cleaning and hygiene sectors. Expect more purchases ahead.
The company posted its annual results last month, which were well received. In the year to December, revenues rose 14pc to £6.1bn, with pre-tax profits rising 17pc to £372.2m.
Analysts expect the company to deliver revenues of £6.2bn and pre-tax profits of £372m, giving earnings per share of 82p this year.
The dividend for the year is 32.4p, which is an inflation busting 15pc year-on-year rise. The payment date is July 1, ex-dividend May 7, and the prospective yield, based on the current forecast, is 2.1pc.
Bunzl remains a class defensive share. Hold.
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