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LONDON (Alliance News) - Macfarlane Group PLC on Friday said its trading in the second half has outpaced the first half, as anticipated, and said it expects to post a rise in pretax profit for the full year.
The packaging and labelling company said sales in its Packaging Distribution arm are up 7% in the year to date on the back of new business wins secured in the first half. The gross margin for the business is slightly lower year-on-year, owing to a competitive market, but has improved in the second half, the company said.
Manufacturing sales are down 2% in the year to date, though gross margins and profitability have been maintained in the business, due to a shift to focus on higher added-value packaging design and manufacturing business.
The group's labels business has been under continued pressure due to the competitive self-adhesive labels market, it said. That pressure is not being offset entirely by continued growth in re-sealable labels, meaning performance in the division will be weaker for the full year than in 2013.
Overall, its expects its manufacturing division operating profit to be lower year-on-year.
The company reiterated its plan to pay a full dividend for the year.
Chairman Graeme Bissett said Macfarlane remains confident of meeting its expectations for the full year.
Shares in Macfarlane were up 4.5% to 36.84 pence on Friday.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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