Acquisitions help Macfarlane to increase profit despite slowdown in customer demand
Packaging firm Macfarlane withstood a slowdown in customer demand after strong contributions from a number of recently acquired businesses.
The Glasgow-based firm saw its pretax profit increase 13 per cent in the first half of the year while its revenue climbed two per cent. It upped its interim dividend by four per cent to 94p.
In its packaging division, which makes up the vast majority of its revenue, the contribution from PackMann, acquired in May 2022, and Gottlieb, bought in April this year, helped to offset lower demand from customers in the UK and Ireland.
In its manufacturing division meanwhile, a boost from its acquisition of Suttons in February this year helped Macfarlane to balance lower demand in “certain industrial markets”.
“We have executed two high quality acquisitions which are both performing well, we continue to make good progress in Europe and have positive new business momentum. The inflationary impact of operating cost increases has been offset by effective input price management,” chair Aleen Gulvanessian said.
The group is trying to develop its customer base in Europe and also said it was looking to progress further “high-quality acquisitions” in the UK and Europe.
In the second half of the year it wants to develop its standing in new target areas such as defence and the medical business.
Macfarlane kept its profit expectations for the full year unchanged, saying its diverse customer base and management of inflationary pressures would help it achieve its targets.
Data revealed yesterday showed that many firms are seeing a slowdown in customer demand on the back of higher interest rates.