Bunzl plc (BNZL) Q2 2025 Earnings Call

Investor webinar replay

Replay transcript excerpt

Good morning and thank you for joining Bonsall's 2025 half-year results presentation. After a short introduction, I will focus on updating you on our North America and continental European businesses. After this, Richard House, our CFO, will walk through our financial performance, leverage and outlook. We will then move to Q&A. But first, I want to thank all of my Bonsall colleagues for their hard work and dedication in what has been a challenging operating environment for many. I know many of you are working tirelessly to support customers and to deliver an improved performance in the second half of the year. I will start by summarizing performance over the first half. Bonsall delivered revenue growth of 4.2% at constant exchange rates. Growth was driven by acquisitions with underlying revenue broadly stable. However, group-adjusted operating profit declined by 7.6% at constant exchange rates, with our operating margin reducing by around 100 basis points to 7%. This has been driven by certain larger businesses within North America and continental Europe, with both business areas seeing a similar level of margin decline as the group overall. I will spend much more time discussing these shortly. Our cash conversion was better than we expected at 97%, although free cash flow declined by 22% due to our operating profit decline. We ended the period with an adjusted net debt to EBITDA of 1.9 times slightly better than guidance, driven by good cash conversion. Richard will discuss leverage in more detail later, but we are now broadly in line with our target leverage range. Our capital allocation priorities remain unchanged, and within this we remain committed to sustainable annual dividend growth. We are therefore announcing a 0.5% increase in the interim dividend today. A...