Bunzl PLC on Wednesday said revenue was up in the first quarter, boosted by acquisitions and strong product cost inflation, as it backed its full-year guidance.

The London-based distribution services company said first quarter revenue increased 8.4% at actual exchange rates, and 1.2% at constant currency.

The firm noted that at constant exchange rates, organic growth was 0.6%, driven by underlying revenue growth of 1.5%, but offset by a 0.9% negative trading day impact.

Bunzl said acquisitions added 2.7% growth, whilst the company’s disposal of its UK healthcare business cut revenue by 2.1%.

Underlying revenue growth saw continued support from product cost inflation in Europe and the UK & Ireland, as well as the US, Bunzl said. However, in the US, underlying growth was hurt by volume softness in the food-service sector, ‘some of which is anticipated to be temporary’, the company said.

Growth in the rest of the world was hurt by the decline in Covid-19 related sales.

Looking forward, Bunzl said it expects 2023 revenue to be higher than that of 2022, ‘driven by both organic growth and announced acquisitions, and partially offset by a small impact from the UK healthcare disposal.’

Chief Executive Frank van Zanten said: ‘Our performance over the quarter continues to demonstrate the resilience of the Bunzl business model and its strategy.

‘Our pipeline is active and our balance sheet remains strong, and we see significant opportunities for further acquisition growth to supplement our resilient organic growth.’

Bunzl shares fell 2.5% to 3,123.00 pence each in London on Wednesday morning.

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