SHARES in Macfarlane Group have jumped by more than three per cent after it carried the sales momentum it built up in the second half of last year into 2015.
The Scottish packaging firm said sales were up 13 per cent and profitability was stronger in the first four months of the year thanks to major contract wins and successful acquisitions.
Sales in Macfarlane's dominant packaging distribution arm have increased up 16 per cent compared with the first four months of 2014, driven by contracts with major internet retailers Hut, Lakeland and Home Retail Group. Six per cent of that figure relates to organic growth, with the remainder generated by its acquisition of two packaging firms, Lane Packaging and Network Packaging, in England last year.
Macfarlane secured the deal with Home Retail Group, the company behind Argos, Homebase and Habitat, in December, and expects it to generate £2 million of revenue this year.
It is now the company's sole supplier of packaging distribution solutions, with Home Retail Group in line to become one of Macfarlane's top 10 UK customers.
The Lakeland partnership is expected to drive £1m of sales per year.
Macfarlane said sales in its manufacturing operations, which designs and produces protective packaging for high value, fragile products, are running at similar levels to 2014, with profitability slightly up. However, MacFarlane its labels business, which makes self-adhesive and re-sealable labels for fast-moving consumer groups, is being affected by competition in the UK retail sector.
Speaking after the company's annual general meeting in Glasgow, where shareholders voted in favour of all resolutions, chief executive Peter Atkinson said the year to date had been a "mixture of good organic growth, and the benefit of acquisitions."
Having told shareholders that the company has a short-list of 30 acquisition targets, he said "we have a number of opportunities where we are quite well down the process."
He added: "[It is] unlikely we will announce anything in the first half of this year, but [there is] a possibility we will announce something in the second half of the year."
Mr Atkinson said Macfarlane did not have a preferred outcome from this week's general election, stating that the campaign has not had any unsettling effect on the business.
He does not subscribe to the view that a deal struck between Labour and the SNP in the event of a hung parliament will lead to economic chaos.
Mr Atkinson said: "I honestly don't think it would. Everybody is too sensible now to allow things to go to economic chaos. The answer is no."
Shareholders voted in favour of a final dividend of 1.15p per share payable on June 4 at yesterday's AGM.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article