(Reuters) -British business supplies distributor Bunzl posted a decline in half-year profit on Tuesday, as the company grapples with cost challenges and slower-than-expected sales volume improvement in its largest business in North America.
Bunzl, a company that supplies stationery and food packaging to businesses, is facing challenges in its North American distribution, including weak sales and higher costs, alongside pricing pressures in key markets such as Europe.
However, the company resumed its 200 million pounds ($270.2 million) share buyback, which it had paused in April, and reiterated its annual guidance of moderate revenue growth and operating margin moderately below 8%.
“Actions taken in our largest business in North America have re-energised the team and we are seeing early positive indicators of success,” CEO Frank van Zanten said in a statement.
Bunzl’s adjusted operating profit fell 7.6% at constant currency to 404.5 million pounds for the six months ended June 30.
Separately, it also announced the acquisitions of Guantes Internacionales, a personal protective equipment distributor based in Mexico, and Quindesur, a Spanish distributor of foodservice and cleaning & hygiene products.
($1 = 0.7402 pounds)
(Reporting by Unnamalai L in Bengaluru; Editing by Rashmi Aich)
