(Reuters) - Business supplies distributor Bunzl (LON:BNZL) said on Wednesday first-quarter growth had slowed as grocery and retail business in its biggest market North America remained sluggish, and posted a small rise in group revenue.
Bunzl shares fell 10 percent in early trade after the company's total revenue saw a mere 2.5 percent rise at constant currency, compared with a 14 percent growth a year earlier.
Underlying revenue growth in North America was about 1 percent due to a lagging grocery and retail business, which was dented by price inflation and weak demand, the company said.
The company, which has operations in about 30 countries, also blamed slower growth on wider economic conditions across nations it operates in.
JPMorgan (NYSE:JPM) said the slowdown was not due to any contract losses at the company, which supplies a disparate range of products from disposable tableware to packaging supplies, latex gloves and cleaning chemicals.
Bunzl, which has made over 150 acquisitions since 2004, expanded into grocery and retail in North America with acquisitions but higher costs and lower margins have pressured the segment, also hurting its overall margins.
Bunzl, which supplies to customers in various sectors including government, healthcare and food service, also said it acquired Netherlands-based packaging supplies company Coolpack.
The company, known for making small acquisitions to boost the business and consolidate its fragmented end markets, also said potential acquisitions for the year was "promising".