Bunzl’s North American division absorbed a punishing first half, with profit tumbling double digits even as the broader company posted modest top-line gains. The British distribution giant now faces a high-stakes turnaround in its largest market while managing deflationary pressure across Europe.
The results, released Aug. 26, show a company caught between opposing forces. Global revenue climbed 4.2% to $7.7 billion at constant exchange rates. Yet organic sales barely budged, and adjusted operating profit fell 7.6% to $545.9 million. Operating margin compressed a full percentage point, settling at 7.0%.
North America, which accounts for 53% of total revenue, proved the weakest link. Sales there slipped 2.3% to $4.1 billion, while organic revenue dropped 1.2%. Operating profit cratered 14.7% to $265.9 million. Margin shrunk by 100 basis points to 6.4%.
Execution struggles within the company’s flagship foodservice and grocery segment drove most of the damage, Bunzl said. That unit operates in a difficult macroeconomic climate. Strip it out, and the rest of North America held steadier, though uncertainty still weighed on results.
CEO Frank van Zanten acknowledged the pain but pointed to internal fixes. “Actions taken in our largest business in North America have re-energized the team,” he said, citing early positive signals that matched expectations. He cautioned that some initiatives won’t yield meaningful improvement until well into 2026.
Meanwhile, Continental Europe remains bogged down by deflation and soft demand. The French operation suffered the worst of it, though Benelux showed improvement.
Bunzl continued its acquisition spree with five deals completed year-to-date. The latest, involving Quindesur and Guantes Internacionales, closed the same day results were announced.
For the full year, management expects moderate revenue growth at constant exchange rates, fueled mainly by acquired businesses. Operating margin should land modestly below 8.0%, a 30-basis-point decline from the prior year. The North American recovery, however, remains the defining storyline.
