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Bunzl Sees 6% Revenue Growth At CER, Announces Acquisitions In Canada, Australia

Distribution and outsourcing group Bunzl Plc (BNZL.L, BZLFY.PK) Wednesday said it expects full-year revenue growth of about 6 percent at constant exchange rates, with operating margin in line with last year. The company also said it has acquired businesses of McCordick Glove & Safety Inc in Canada, and Atlas Health Care Pty Ltd. in Australia.

According to Bunzl, acquisition growth is a key element of the Group's growth strategy and current environment for acquisitions remains positive. In addition, the company said its strong cash flow and balance sheet should continue to enable it to take advantage of opportunities.

In a pre-close statement ahead of its full year ending December 31, the company noted that the increase in annual revenues reflects underlying revenue growth and positive impact from acquisitions net of the disposal of the UK vending business in August 2011.

Underlying revenue growth for the year is projected to be nearly 2.5 percent compared to a challenging comparative in the second half due to a particularly strong performance in North America last year.

Including the acquisition of McCordick Glove & Safety and Atlas Health Care, it has announced nine acquisitions year to date, with annualized revenue from 2012 acquisitions of around 210 million pounds.

Toronto-based McCordick is a distributor of gloves and other personal protection equipment. Revenue in the year 2011 was C$53 million. Based in Adelaide, Atlas Health supplies medical consumables to healthcare sector, whose revenue for the year ended June 30, 2012 amounted to A$21.9 million.

Commenting on the acquisitions, Michael Roney, chief executive of Bunzl said, "McCordick Glove enables us to enter the personal protection equipment sector in Canada which is a product area where we have already been very successful in a number of countries...Atlas Health Care is an excellent addition to our existing healthcare supplies operations in Australia and gives us an enhanced market position in this growing sector."

Bunzl has recently refinanced some of its debt facilities by raising $350 million of fixed interest rate borrowings in the US private placement market with maturities ranging from seven to 11 years at an average interest rate of 3.4 percent.

BNZL.L is currently trading at 1,017 pence, down 49 pence or 4.6 percent, on a volume of 341,530 shares on the LSE.

by RTT Staff Writer

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