Macfarlane Group, the Glasgow-based protective packaging, design and distribution firm, said in an AGM trading update on Tuesday that it will commence a share buyback programme of up to £4 million, details of which will be announced separately this week.
Macfarlane said group expectations for the full year are unchanged.
“Sales in Q1 2025 were 14.2% ahead of the same period in 2024 with the benefit of acquisitions, signs of organic growth momentum in Distribution and a strong performance from our Manufacturing Operations,” said the firm.
“Profit in Q1 2025 was behind the same period in 2024 due to lower gross margins, duplicate costs related to the consolidation of our East Midlands operations, and increased property costs and acquisition related costs.
“In January 2025, Macfarlane completed the acquisition of The Pitreavie Group Limited, a leading protective packaging business in Scotland. Pitreavie is a well-managed business and we are working with management on sales, cost and sourcing synergies which will benefit the Group.
“We anticipate the Group’s performance to improve in H2 2025 as we complete the East Midlands site consolidation, build on organic growth momentum in Distribution, continue our progress on new business, maintain the strong performance of our Manufacturing Operations, and implement the benefits from Pitreavie synergies.
“Management is also taking actions to mitigate the impact of increases in National Insurance and National Minimum Wage which took effect from 1 April 2025.
“Net bank debt at 31 March 2025 was £13.0m compared to £1.9m at 31 December 2024, after the net investment of £13.9m for the acquisition of Pitreavie. The Group continues to operate well within its bank facilities of £40m and related covenants, which are committed until November 2027.
“The Group will commence a share buyback programme of up to £4m, details of which will be announced separately this week.”
Headquartered in Glasgow, Macfarlane employs over 1,000 people at 43 sites in the UK, Ireland, Germany and the Netherlands.
Macfarlane supplies more than 20,000 customers, principally in the UK and Europe.
Macfarlane chair Aleen Gulvanessian said: “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.”