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LONDON (Alliance News) - Packaging and labels company Macfarlane Group PLC on Thursday said it looks set to meet its expectations for the full year as its pretax profit jumped in the first half on the back of stronger revenue.
Macfarlane said its pretax profit in the half year to June 30 was up to GBP1.9 million, 52% higher than the GBP1.2 million it posted a year earlier, as group sales rose to GBP78.6 million from GBP70.1 million. Profit and sales both benefited from solid organic growth and acquisitions the company made in 2014.
The company said it is continuing to grow its presence in the internet retail sector, where customer trading patterns are weighted to the second half and from which it expects to get a seasonal uplift in sales in the last six months of the year. As a result, the group said it looks on track to hit its expectations for the full year.
Packaging distribution sales rose by 16% in the half, driven by acquisitions and by 7.0% organic growth in sales. Gross margins also improved in the division. Manufacturing sales were down by 5%, however, due what the company said was its decision not to enter into pricing battles in the labels sector.
Macfarlane said it will pay an interim dividend of 0.53 pence per share, up 6.0% year-on-year.
"Our strategy is to continue to deliver sustainable profit growth through focussing on added value products and services in our key UK market sectors combined with the execution of value enhancing acquisitions. The performance of the business continues to reflect the successful implementation of this strategy," said Chairman Graeme Bissett.
Shares in Macfarlane were up 6.3% to 48.88 pence in early trade.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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