Aleen Gulvanessian

Sales in Q1 2025 saw a 14.2% increase compared to the same period in 2024. This growth was attributed to the benefit of acquisitions, emerging organic growth momentum in its Distribution arm, and a strong performance from its manufacturing operations.

However, Q1 profit lagged behind the prior year due to lower gross margins, duplicate costs associated with the ongoing consolidation of its East Midlands operations, and increased property and acquisition-related expenses.

The acquisition of The Pitreavie Group Limited, a prominent Scottish protective packaging business, was completed in January 2025. Macfarlane is actively working with Pitreavie’s management to achieve sales, cost, and sourcing synergies that are expected to benefit the group.

Looking ahead, Macfarlane anticipates an improved performance in the second half of 2025. Key drivers for this optimism include the completion of the East Midlands site consolidation, sustained organic growth in Distribution, new business development, continued strength in Manufacturing, and the realisation of synergies from the Pitreavie acquisition. The company is also taking steps to mitigate the financial impact of increases in National Insurance and the National Minimum Wage, which took effect from 1 April 2025.

Net bank debt stood at £13.0 million as of 31 March 2025, an increase from £1.9m at 31 December 2024, primarily due to the £13.9m net investment for the Pitreavie acquisition. The group confirmed it is operating comfortably within its £40m bank facilities, which are committed until November 2027.

At today’s AGM, chair Aleen Gulvanessian will further comment: “Market conditions continue to be challenging, and global economic uncertainty is impacting the behaviour of some customers.

“However, the group sees positive momentum in several areas, and we have a clear action plan for the remainder of the year which will enable Macfarlane to continue its progress.

“Our decision to commence buying back shares has been made following extensive dialogue with our shareholders. This reflects our capital allocation policy of investing in the business, making acquisitions, and returning capital to shareholders through dividends and, when appropriate, share buybacks.”