Bunzl PLC (LSE:BNZL) hiked its half-year dividend 6.8% as it said inflation was proving “somewhat supportive” to its profit margins.
Revenues for the FTSE 100-listed non-food product distributor came to £5.7bn in the first half of the year, 16.1% higher than a year ago, or 12.4% if currency swings are taken out.
Adjusted operating profits rose 12.2% to £411.4mln, statutory profit before tax rose 7.6% to £296.6mln and earnings per share 4.6% to 66.2p.
An interim dividend of 17.3p was declared, up from 16.2p last time and the biggest hike in the last few years.
Growth was driven by product cost inflation and continued volume recovery in the non-Covid-related base business, and by growth from acquisitions, of which there were six made in the period, following 14 in the previous year.
Falling sales of hand-gel and other pandemic-linked products meant there was a 4% decline for the Cleaning, Hygiene, Safety and Healthcare division, but Foodservice & Retail was up 21% and Grocery & Other rose 11%.
Chief executive Frank van Zanten said the company was “agile in navigating substantial inflation and supply chain disruption”, which was “enabled by the depth and flexibility of our global supply chains”.
He said there was an “active” acquisition pipeline, with £988.4mln of balance sheet headroom from committed bank facilities and £1.4bn of net debt at 1.6 times underlying earnings.
“We believe the merits of joining Bunzl have been amplified over the last few years, supporting our long-term strategic commitment to investing in businesses that drive growth and returns for the group.”