Glasgow-headquartered Macfarlane Group PLC, the protective packaging specialist, has issued a trading update this morning.

Macfarlane Group PLC Interim Results 2021

Dylan MacdonaldMacfarlane Group, Macfarlane Packaging


Financial Highlights  

H1 2021


Restated (1)

H1 2020


Year on Year



Group turnover 133,513 105,509 26.5%
Operating profit before amortisation and impairment (2)

Operating profit

Profit before tax













Interim dividend (pence) 0.87p 0.70p 24.3%
Basic earnings per share (pence) 3.83p 1.79p 114.0%


  • Restatement, as previously noted for 2019 comparatives in the Annual Report and Accounts for 2020, resulting in a reduction in turnover and profit before tax of £0.1m relating to backdated duty, with details set out on page 14.
  • Details set out on page 15, note 2.

Macfarlane Group PLC (“Macfarlane Group”, “Macfarlane” or “the Group”) announces its unaudited results for the six months ended 30 June 2021.


  • Macfarlane Group grew its sales by 26.5% versus H1 2020 to £133.5m, while operating profit before amortisation and impairment at £11.1m and profit before tax at £7.8m have both more than doubled.
  • This also represents a 24.2% increase in sales and a doubling of profit before tax compared to the same period in 2019, prior to any impact from Covid-19.
  • The Board expects that the Group’s full year outlook for 2021 will be ahead of its previous expectations, despite the challenges we are expecting in H2 2021.
  • Packaging Distribution achieved strong sales growth of 21.3% and growth in operating profit before amortisation and impairment of 71.4% versus H1 2020.
  • Manufacturing Operations saw an encouraging recovery in both sales and operating profit before amortisation and impairment.
  • The acquisitions of GWP Holdings Limited (“GWP”) and Carters Packaging (Cornwall) Limited (“Carters”) in H1 2021 have contributed £8.1m of sales and £1.9m of operating profit before amortisation and impairment versus 2020.
  • Profit before tax is stated after charging amortisation of customer relationships and brand values of £1.6m (H1 2020: £1.3m), goodwill impairment of £1.0m and finance costs of £0.7m (H1 2020: £0.7m).
  • Net cash inflow from operating activities of £11.3m reflects increased activity and continuing good management of working capital (H1 2020: £16.6m).
  • Net bank debt at 30 June 2021 was £8.7m, an increase of £8.1m from 31 December 2020 following £12.2m of investment in the acquisition of GWP and Carters. The Group is operating well within its existing bank facility of £30.0m which runs until 31 December 2025.
  • The pension scheme was in surplus at 30 June 2021 compared to a deficit at 31 December 2020 of £1.5m. The improvement is due to continued contributions from Macfarlane Group and an increase in the discount rate, offset by lower investment returns during the period.
  • Basic earnings per share are up 114.0% to 3.83p per share (H1 2020: 1.79p per share).
  • Interim dividend increased by 24.3% to 0.87p per share (H1 2020: 0.70p per share).


Stuart Paterson, Chairman of Macfarlane Group PLC, today said: –

“Macfarlane Group achieved good sales growth in the first half of 2021, benefiting from the ongoing structural shift to e-commerce retail and recovery in certain industrial sectors which were affected by Covid-19 in the first six months of 2020. Despite ongoing difficult operating conditions due to Covid-19, significant inflationary pressure on input costs and supply shortages of some materials, the business has produced a strong profit performance.  Our people have excelled, maintaining service to our customers in the most challenging environment.

Packaging Distribution has grown sales through strong demand from existing customers in the e-commerce retail and medical sectors and recovery in a number of industrial sectors.  Demand from the aerospace, high street retail and hospitality sectors continues to be weak. New business activity has increased significantly compared to the same period in 2020 and Carters has traded strongly since acquisition.

Manufacturing Operations has benefited from the acquisition of GWP, which is performing ahead of expectations, and a strong recovery in the Packaging Design and Manufacture business which returned to profit following the restructuring actions we took in H2 2020.  Labels’ profitability is below the same period in 2020 due to higher costs to serve customers offsetting growth in sales.

After re-assessing projected profits and cash flows in Manufacturing Operations, an impairment of historic goodwill held at consolidated level of £1m has been charged in H1 2021.

It is pleasing to report that the effective management of operating cash has enabled the business to finance two further good quality acquisitions through our existing bank facility. In addition, the pension scheme is now in surplus.

The performance of the business in the first half of 2021 continues to demonstrate the effectiveness of our strategy and the resilience of our business model.  We expect the second half of 2021 to be challenging as we anticipate further inflationary pressure on input prices, continuing supply constraints on most raw materials and operating costs increasing due to staffing pressures.  However, the Group has previously demonstrated effective management of these challenges and, as a result of this and the performance in H1 2021, the Board expects the Group will exceed its previous expectations for the full year.

The Board is recommending a 24.3% increase in the interim dividend to 0.87p per share to be paid on 14 October 2021 to shareholders on the register as at 17 September 2021.”

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