Macfarlane confident of delivering higher profits

Packaging group Macfarlane today told investors it was confident of delivering annual profits “well above” last year’s results.

Macfarlane said operating profits from its packaging distribution arm will be 'well above' last year

The Glasgow-based firm, which in August reported a 52 per cent surge in first-half earnings, said sales at its packaging distribution arm are up 14 per cent year-on-year, helped by the recent acquisition of East Midlands rival One Packaging.

“Operating profit for the full year from packaging distribution is expected to be well above that achieved in 2014,” Macfarlane said.

The group added that sales from its manufacturing operations are showing signs of improvement in the second half of its financial year, but remain 2 per cent below last year.

“Demand weakness in customers’ export markets continues to negatively impact sales in packaging design and manufacture, and the exit of low-margin business in labels is impacting sales but improving margin,” it added.

“Operating profit for the full year in manufacturing operations is expected to be slightly above 2014 levels.”

Macfarlane, which employs more than 730 people across 25 sites, said that overall group profits continue to be “well above the corresponding period in 2014”, adding that this trend is expected to continue for the rest of the year.

Annual results, published in February, showed the firm’s pre-tax profits rose 19 per cent to £5.6 million in 2014.

Chairman Graeme Bissett said: “I am pleased to report that Macfarlane Group’s performance in the second half of 2015 continues to demonstrate good progress following the growth seen in the first half of the year. The board remains confident that our full-year expectations will be met.”