Rory McKenzie's questions to BUNZL (BZLFY) leadership • Q4 2022
Question
Rory McKenzie asked about current price trends and the pass-through of costs like oil. He also sought details on the new fixed-price contract with Bunzl's largest customer, questioning its pros and cons versus a cost-plus model. Finally, he requested clarification on the acquisition-related charges and any associated impairments.
Answer
CFO Richard Howes explained that the company is seeing inflation annualize rather than new price increases, with only minor deflation in plastics. He noted the acquisition charge includes standard transaction costs and non-material earnout adjustments. CEO Frank van Zanten detailed the new contract with their largest customer, explaining the shift to a fee-per-delivery model eliminates the risk of margin squeeze from product cost deflation, which had been a challenge in the past. This new structure provides better visibility and stability.