Packaging group Macfarlane posts 15% rise in profits

Glasgow-based packaging firm Macfarlane Group has reported its seventh consecutive year of profit growth.

The company said pre-tax profit climbed by more than 15% in 2016 to £7.8m, while sales were 6.3% up at £179.8m.

There was a strong performance from its packaging distribution business, which increased sales by 9% to £155.9m.

Macfarlane said organic sales growth was "challenging" in the first six months of the year, but strengthened in the second half to 3%.

Its performance was boosted by contributions from a series of acquisitions last year, including Nelsons for Cartons and Packaging, Colton Packaging Teesside and the packaging business of Edward McNeil.

'Positive action'

Sales in Macfarlane's manufacturing operations were down by 9%, at £23.9m, which the company largely attributed to "management actions to rebalance the mix of products in our labels business".

As a consequence of its acquisitions, the group's net bank borrowing at year-end stood at £15.3m, up from £11.6m the previous year.

Chairman Graeme Bissett said: "We will continue to focus on opportunities in sectors with strong growth prospects (including internet retail, third party logistics and national accounts) and to deliver high standards of service to all customers across a wide range of sectors.

"We will also maintain our programme of acquiring good quality businesses to augment organic growth.

"This is a strategy based on taking positive action, which has served all stakeholders in our business well in recent years and we remain confident that it will continue to do so."