The company posted 2005 pre-tax profits of 3.6m following losses in 2004 of 262,000. Its packaging manufacturing arm, which includes labelling plants in Kilmarnock and Dublin, recorded a profit of 2.3m, an increase of 1.4m on the previous year.

Turnover was also up on 2004, by 5m to 127m.

According to chief executive Peter Atkinson (pictured right), the company is now on a firm footing to grow organically and through acquisitions.

"Labels is one area where we are looking to acquire," he said. "We are still in the early stages, but we now have the resources since the group became debt-free from the middle of 2005. All of our businesses are putting aggressive plans together for 2006."

"All of this has been achieved by disciplined executive action to a demanding plan set by the board two years ago," said Macfarlane chairman Archie Hunter (left).

In 2004, Atkinson outlined a strategy to go "back to the basics" of customer service, new business relationships and cost reductions.