Revenue and profit are both up at the £153.8m-turnover company, which is keen on companies that work in complementary sectors to its own.
“We’d like to be in Kent and strengthen our position in Scotland,” chief executive Peter Atkinson told PrintWeek. “The packaging distribution market is very fragmented. There are a lot of very good quality local companies.”
The Glasgow-based company, which reported a 13% year-on-year rise in sales in Q1 2015, announced a £3m capital raise in its latest accounts. This is backed up by “significant funds supported by banks”, according to Atkinson.
He said that both Lane Packaging and Network Packaging were “performing beyond expectations”.
Both were bought on a two-year in and out deal, where 75% of the purchase cost was paid upfront and 25% after two years subject to performance, a way of staggering the payment to the owner.
Atkinson said this had been a positive way to approach the acquisitions. "We got to know the business and share ideas," he said.
The company, which reported a 7% rise in sales to £153.8m in its 2014 accounts (2013: £143.9m), is seeing its biggest growth in selling protective packaging to the internet retail sector, with Asos, Marks & Spencer, Home Retail Group and Lakeland among its clients.
Increasingly it is being asked to source – it does not print the packaging itself but specifies from the manufacturer – packaging with branding on the inside, to deter theft when deliveries are left in a public place.
“We’re increasingly getting demand from our clients for that type of printing’” he said, adding that clients wanted to give customers the “comfort” of seeing their branding when they open their purchases.
Meanwhile European customers are also interested in Macfarlane’s “help to understand the UK”. It has gone into a two-year partnership with South African firm Novopak to approach the European market.
“It’s early days, it’s slow but for us - it’s probably a five-year bet, a five-year investment. We think that at some point in time customers are going to start ordering on a pan-European basis, and we want to talk advantage of that five-year window,” Atkinson told PrintWeek.
Meanwhile sales at its labels design and print business have been flat. But that disguises growth in its resealable products, which is up 5%, while self-adhesive is down by the same amount.
“The labels market is clearly closely related to the retail market with our clients mainly FMCG manufacturers who sell to supermarkets. We’re simply being impacted by the pressure of the sector. Our focus is in resealable where there is greater product differentiation,” Atkinson said.
Macfarlane Group is comprised of three companies: distributor Macfarlane Packaging, its labels business which designs and prints self-adhesive and re-sealable labels and Packaging Design and Manufacture, which specialises in designing and producing protective packaging for high value, fragile products.
It has 18 distribution sites, three label printing sites, two bespoke packaging sites and two head offices, spread throughout the UK, Sweden and Ireland and around 730 staff.
