Glasgow packaging group Macfarlane on track with profits despite ‘challenging conditions’

Macfarlane Group, the Glasgow-headquartered packaging provider, is managing to keep its profits on track despite cautioning that trading conditions are unlikely to improve in the near future.

Headquartered in Glasgow, Macfarlane Group employs more than 1,000 people at 39 sites, chiefly in the UK, as well as in Ireland, Germany and the Netherlands.

In a brief trading update to investors, the firm said its adjusted profit before tax for 2023 was expected to be ahead of last year and in line with its full-year expectations. While revenue in the year to date is 2 per cent below the same period last year, as weaker volumes and lower pricing affect most sectors, the group is managing to offset those pressures by “effective management of pricing and costs”, and seeing gains from recent acquisitions.

Good progress is being made in Europe, Macfarlane noted, with a strong contribution from PackMann acquired in 2022, and continuing organic growth. Headquartered in Glasgow, Macfarlane employs more than 1,000 people at 39 sites, chiefly in the UK, as well as in Ireland, Germany and the Netherlands.

Chairman Aleen Gulvanessian said: “In challenging conditions, the performance of the group this year has demonstrated the resilience of our business model and the benefit of effective management actions. The board does not expect trading conditions to substantially improve in the near term and the management team will continue to execute actions to maintain the group’s progress.”

Analysts at house brokerage Shore Capital noted: “We believe the group continues to trade on an unjustified discount to peers with similar industry qualities and to its historic valuation multiples. Macfarlane is a much more resilient, profitable and higher-quality business relative to the past five years.”