Packaging company Macfarlane Group PLC (LON:MACF) today said profits grew for the seventh consecutive year on the back of higher sales.
Pre-tax profit in the year to 31 December 2016 rose 15.4% to £7.8mln from £6.8mln a year ago, while turnover increased 6.3% to £179.8mln from £1681mln.
Revenues were driven by the packaging distribution business, which achieved a 9% increase in sales to £155.9mln. The company said organic sales growth was “challenging” in the first half but strengthened in the second half to 3%.
Sales in the group’s manufacturing operations dropped 9%, at £23.9m. Macfarlane blamed "management actions to rebalance the mix of products in our labels business".
Net bank debt rose to £15.3mln at year end from £11.6mln in 2015, following acquisitions last year including Nelsons for Cartons and Packaging, Colton Packaging Teesside and the packaging business of Edward McNeil.
Chairman Graeme Bissett said: "We will continue to focus on opportunities in sectors with strong growth prospects (including internet retail, third party logistics and national accounts) and to deliver high standards of service to all customers across a wide range of sectors.
"We will also maintain our programme of acquiring good quality businesses to augment organic growth.
The pension deficit also increased to £14.5mln from £11.5mln as a fall in gilt yields reduced the discount rate used to measure the scheme's liabilities.
The dividend was lifted 7.1% to 1.95p from 1.82p.
Shares fell 5.62% to 63p in afternoon trading.