Bunzl PLC has released its Q1 trading statement, reporting that its business model continues to perform well, with adjusted operating profit in line with expectations. The Group's revenue in the first quarter declined by 2.4% at constant exchange rates, with underlying revenue declining by 5.4% as expected. This was mainly driven by volume reduction in the US foodservice redistribution business and the ongoing impact from transitioning customer specific inventory in the US retail business. Acquisitions contributed growth of 2.9% at constant exchange rates. The Group's guidance remains unchanged from the FY results announcement, expecting slight revenue growth in 2024, driven by acquisitions, with underlying revenue declining slightly. The operating margin over the quarter was strong, supporting the outlook for the year.
The Group has made strategic progress, with a strong margin performance in 2023. It is taking appropriate action to pursue opportunities for volume growth in its foodservice redistribution business in North America. The Group's pipeline for acquisitions is active, and its balance sheet remains strong. Additionally, the UK Competition and Markets Authority has indicated no further questions on the acquisition of Nisbets, subject to clearance by the Irish competition authority expected during the first half of 2024. The Group has also completed its anchor acquisition in Finland of Pamark and sold its business in Argentina to the management team.
Frank van Zanten, Chief Executive Officer of Bunzl, commented, "We are taking appropriate action to pursue the opportunities for volume growth in our foodservice redistribution business in North America and this focus on organic growth, alongside our ongoing actions to further improve profitability and returns will enhance the Group's prospects over the medium term. After a strong start to the year for acquisitions, our pipeline is active and our balance sheet remains strong."