Bunzl plc Annual Report Annual 2010 York House 45 Seymour Street London W1H 7JT T 020 7725 5000 F 020 7725 5001 www.bunzl.com EVERYDAY ESSENTIALS EVERYWHERE Annual Report 2010 CONTENTS 01 Financial highlights BUNZL SHAREHOLDER INFORMATION 02 Our business 04 Chairman’s statement we are A GROwinG and 06 Chief Executive’s review Financial calendar 2011 ShareGift 16 Financial review Annual General Meeting 20 April Sometimes shareholders have only a small holding of shares which may be uneconomical to sell. Shareholders who wish to donate these SUCCessfUL GROUP with 19 Corporate responsibility Results for the half year to 30 June 2011 30 August shares to charity can do so through ShareGift, an independent charity 23 Board of directors 24 Directors’ report 2012 share donation scheme (registered charity no. 1052686). Further OPeratiOns ACROss the information about ShareGift may be obtained from ShareGift on 29 Corporate governance Results for the year to 31 December 2011 February 32 Directors’ remuneration report 020 7930 3737 or at www.sharegift.org. Annual Report circulated March AMeriCas, EUROPE and 41 Consolidated income statement 42 Consolidated statement of Shareholder security Shareholders are advised to be cautious about any unsolicited AUstralasia. comprehensive income Dividend payments are normally made on these dates: financial advice, offers to buy shares at a discount or offers of free 43 Consolidated balance sheet Ordinary shares (final) 1 July company reports. More detailed information about this can be 44 Consolidated statement of Ordinary shares (interim) 2 January found at www.moneymadeclear.fsa.gov.uk. Details of any share changes in equity We supply a variety of products that are dealing facilities that the Company endorses will be included in 45 Consolidated cash flow statement Analysis of ordinary shareholders Company mailings. everyday essentials for our customers 46 Notes At 31 December 2010 the Company had 5,761 (2009: 6,189) 74 Company balance sheet shareholders who held 352.5 million (2009: 351.5 million) ordinary Auditor to operate their businesses. 75 Notes to the Company financial shares (including treasury shares) between them, analysed as follows: KPMG Audit Plc statements 82 Statement of directors’ Number of % of issued Stockbrokers responsibilities Size of holding shareholders share capital J.P. Morgan Cazenove By outsourcing the purchasing, consolidation 83 Independent auditor’s report 0 – 10,000 5,166 2 Citigroup 84 Five year review 10,001 – 100,000 323 3 and distribution of a broad range of everyday 85 Shareholder information 100,001 – 500,000 168 11 Company Secretary P N Hussey items, our customers are able to focus on 500,001 – 1,000,000 49 10 1,000,001 and over 55 74 Registered office their core businesses, achieve purchasing 5,761 100 York House 45 Seymour Street efficiencies and savings, free up working London W1H 7JT Registrar Telephone 020 7725 5000 Computershare Investor Services PLC Fax 020 7725 5001 capital, improve distribution capabilities The Pavilions Bridgwater Road Website www.bunzl.com and simplify their internal administration. Bristol BS99 6ZY Registered in England no. 358948 Telephone 0870 889 3257 Fax 0870 703 6101 Forward looking statements Website www.computershare.com The Annual Report contains certain statements about the future outlook for the Group. Although the Company believes that the Investor centre expectations are based on reasonable assumptions, any statements Shareholders can manage their shareholding online at about future outlook may be influenced by factors that could cause www.investorcentre.co.uk. The Investor centre is our Registrar’s actual outcomes and results to be materially different. easy to use website, available 24 hours a day, 7 days a week, where the following services are available: • change of address; OUR MARKETS • view share balance information; and We provide a ‘one stop shop’ distribution and outsourcing • view dividend payment and tax information. service supplying a broad range of internationally sourced In order to register for the Investor centre, shareholders will need non-food products to a variety of market sectors. their shareholder reference number which can be found on either their share certificate or dividend tax voucher. Dividend payment by BACS Shareholders can have their dividends paid directly into their bank GrocerY FooDserVIce cleanING & safetY or building society account using the Bankers’ Automated Clearing 31% 30% 20% Service (BACS). This means that dividends will be in the account on the same day the dividend payment is made. Shareholders will receive their tax vouchers by post. To use this method of payment please contact our Registrar on 0870 889 3257 or visit the Investor centre website. Please note that this option will not override any existing dividend scheme mandate, which would need to be revoked This Annual Report is printed on Revive 50:50 Silk, a 50% recycled paper which in writing. is independently certified according to the rules of the Forest Stewardship Council (FSC). The composition of the paper is 25% de-inked post consumer waste, 25% Share dealing unprinted pre-consumer waste and 50% virgin fibre. All pulps used are elemental Bunzl plc shares can be traded through most banks and chlorine free and the manufacturing mill is accredited with the ISO 14001 standard for environmental management. stockbrokers. The Company’s Registrar also offers an internet and telephone dealing service. Further details can be found at www.computershare.com/dealing/uk or by telephoning 0870 703 0084. Designed and produced by Bunzl plc Annual Report 2010 Shareholder information 85 FINANCIAL HIGHLIGHTS +4% +4% Revenue Operating profit* +8% +8% Adjusted earnings per share* Dividend per share Growth Actual Constant exchange exchange 2010 2009 rates rates Revenue £m 4,829.6 4,648.7 4% 3% Operating profit £m 255.7 253.9 1% (1)% Operating profit* £m 306.7 295.7 4% 3% Profit before tax £m 225.2 216.0 4% 3% Profit before tax* £m 276.2 257.8 7% 6% Basic earnings per share p 49.1 46.4 6% 4% Adjusted earnings per share* p 60.6 55.9 8% 7% Dividend per share p 23.35 21.55 8% *Before intangible amortisation and acquisition related costs NON-FOOD RETAIL HEALTHCARE OTHER 8% 7% 4% Bunzl plc Annual Report 2010 Financial highlights 01 OUR BUSINESS WE HAVE FACILITIES IN 23 COUNTRIES ACroSS FOUR BUSINESS arEAS: NorTH AMERICA, UK & IrELAND, CoNTINENTAL EUroPE AND REST OF THE WorLD. NORTH AMERICA 50% of Group operating profit* £160.2m Operating profit* OUR MANAGEMENT TEAM Managers from across the Group meet to review performance, discuss trends affecting our businesses and seek further opportunities for growth and competitive advantage. MICHAEL RONEY CELIA BAXTER PAUL buDGE PAT LARMON Chief Executive Director of Group Managing Director President and CEO Human Resources UK & Ireland North America 02 Our business Bunzl plc Annual Report 2010 UK & IRELAND 1 8 % of Group operating profit* £59.5m Operating profit* REST OF THE WORLD 7% of Group operating profit* £23.8m Operating profit* CONTINENTAL EUROPE 25% of Group operating profit* £79.9m Operating profit* *Before intangible amortisation and acquisition related and corporate costs BRIAN MAY FRANK VAN ZANTEN PAUL HUSSEY NANCY LESTER KIM HETHERINGTON Finance Director Managing Director General Counsel and Director of Corporate Managing Director Continental Europe Company Secretary Development Australasia Bunzl plc Annual Report 2010 Our business 03 CHAIRMAN’S STATEMENT OUR SUCCESS IS BASED ON UNDERSTANDING CUSTOMERS’ REQUIREMENTS AND OUR ABILITY TO DELIVER EVERYdaY ESSENTIALS EVERYWHERE ADJUSTED EARNINGS PER SHARE p SHARE PRICE RANGE p UK GAAP 60.6 777 742 757 IFRS 55.9 710 52.7 675 643 627 616 45.1 578 41.7 547 542 38.7 488 482 486 482 443 32.1 408 405 29.7 31.3 28.6 368 345 01 02 03 04 05 06 07 08 09 10 01 02 03 04 05 06 07 08 09 10 REVENUE £bn OPERATING PROFIT* £m 323 312 4.8 UK GAAP 297 4.6 IFRS 4.2 259 01–05 continuing operations 241 3.6 218 3.3 183 171 2.9 158 164 2.3 2.4 2.1 2.2 01 02 03 04 05 06 07 08 09 10 01 02 03 04 05 06 07 08 09 10 *Before amortisation and acquisition related and corporate costs 04 Chairman’s statement Bunzl plc Annual Report 2010 In 2010 we saw a resumption of acquisition Employees activity that took us further into some of our Many companies comment that their key markets in the US, Denmark, Benelux, employees are their biggest asset but, Spain and Brazil while substantially increasing as Bunzl is not capital intensive, this is the size of our business in Switzerland and particularly true for us. During 2010 our extending our operations into Israel. people have continued to show their commitment and dedication to serve our Increasingly coordinating our procurement customers. We have had numerous examples internationally and continually refining and of our employees battling against adverse deepening our commitment to our customers weather conditions in various parts of the and markets, while looking to extend our world to get into work and maintain customer business into new geographies, remain service and deliveries. Their efforts and important elements of our strategy. Having dedication are, as always, greatly appreciated. pursued this strategy consistently over many years, we have built leading positions in a Credit facilities variety of market sectors across the Americas, The Group remains highly cash generative Europe and Australasia. and we continue to have access to diverse sources of funding to achieve our strategic Investment objectives. In 2010 our net cash inflow was Philip Rogerson We have over time steadily invested to £10 million despite cash expenditure of Chairman support our growth strategy, thereby £111 million on acquisitions and we agreed to enhancing the infrastructure of the Group.