REG - Macfarlane Group PLC - Annual Results 2024
27/02/2025 07:15
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RNS Number : 6151Y Macfarlane Group PLC 27 February 2025
27 February 2025
MACFARLANE GROUP PLC
("MACFARLANE GROUP", "THE COMPANY", "THE GROUP")
ANNUAL RESULTS 2024
Group profit in line with market consensus
FINANCIAL HIGHLIGHTS
2024 2023 Increase/
(Decrease)
£000 £000 %
Statutory measures
Revenue 270,437 280,714 (4%)
Gross profit 105,372 105,681 0%
Operating profit 23,597 22,068 7%
Profit before tax 20,896 20,280 3%
Profit for the year 15,530 14,974 4%
Interim and proposed final dividend (pence) 3.66p 3.59p 2%
Diluted earnings per share (pence) 9.74p 9.34p 4%
Alternative performance measures(1)
Adjusted operating profit 27,402 27,637 (1%)
Adjusted profit before tax 24,969 25,849 (3%)
Adjusted diluted earnings per share (pence) 11.56p 12.21p (5%)
1 See notes to the financial information below for reconciliation of
Alternative Performance Measures to Statutory Measures.
· Group revenue reduced by 4% to £270.4m (2023: £280.7m).
· Group profit before tax increased by 3% to £20.9m (2023: £20.3m).
· Group adjusted operating profit as a percentage of revenue improved
to 10.1% (2023: 9.8%).
· Basic and diluted earnings per share were 9.76p per share (2023:
9.44p per share) and 9.74p per share (2023: 9.34p per share) respectively.
Packaging Distribution
· Packaging Distribution revenue decreased by 7% to £228.8m (2023:
£244.9m).
· Continued weak customer demand and selling price deflation have been
partially offset by a strong new-business performance and the benefit of the
acquisitions of Gottlieb in April 2023 and Allpack Direct in March 2024.
· Gross margins increased to 37.1% (2023: 35.7%) reflecting effective
management of input-price changes.
· Operating expenses reduced by 3% through management action.
· Adjusted operating profit decreased by 4% to £20.2m (2023: £21.0m).
· Operating profit increased by 5% to £17.3m (2023: £16.5m) due to
the net effect of changes to the fair value of deferred contingent
consideration related to acquisitions.
FINANCIAL HIGHLIGHTS
Manufacturing Operations
· Manufacturing Operations achieved revenue growth of 16% to £41.7m
(2023: £35.8m) reflecting:
o contributions from B&D Group, Suttons and Polyformes, acquired across
2023 and 2024; and
o marginally lower organic sales due to selling price deflation.
· Gross margins have remained strong at 43.2% (2023: 44.5%) with some
attrition due to selling price deflation.
· Operating expenses are being well controlled with the 14% increase
due to the impact of acquisitions.
· Adjusted operating profit increased 10% to £7.2m (2023: £6.6m).
· Operating profit increased 13% to £6.3m (2023: £5.6m).
Group
· Net cash inflow from operating activities of £25.4m (2023: £33.5m)
reflects the unwinding of opening working capital through 2023 due to the
easing of supply-chain constraints and stability through 2024.
· Net bank debt was £1.9m on 31 December 2024, following a net cash
outflow of £2.4m in the year, after £15.0m (2023: £16.6m) of investment in
acquisitions and capital expenditure.
· The Group negotiated an improved banking facility of £40.0m during
2024 which is committed until November 2027, with options to extend to
November 2029.
· The pension scheme surplus was £9.6m at 31 December 2024 (31
December 2023: £9.9m) with the Group not required to make further
contributions.
· Board proposes a final dividend of 2.70p per share (2023: 2.65p per
share) payable on 13 June 2025, taking the total dividend for 2024 to 3.66p
per share (2023: 3.59p per share) up 2% on 2023.
CHAIR'S STATEMENT
The markets in which Macfarlane Group PLC operates have been challenging
throughout 2024 and the management team has responded effectively, enabling
the business to produce a profit performance for the year in line with market
consensus.
We have also made good progress on implementing our sustainability agenda
which has resulted in a further reduction in our carbon footprint.
The performance of the Group in 2024 has been achieved through the hard work
and commitment of our people and I thank them for all their efforts, energy
and enthusiasm.
Financial
The Group has delivered resilient financial results through improvement in
new-business development, the completion of two high-quality acquisitions and
effective control of operating costs. These actions have enabled us to offset
sales price deflation and weaker demand. Management's effective response to
the difficult trading conditions is demonstrated through the improvement in
the operating profit margin.
The Group's strong operating cash flows enabled the continued allocation of
capital to invest in the business, fund good-quality acquisitions, progressive
dividend payments as well as maintaining a low level of net bank debt.
The Group has negotiated an improved borrowing facility of £40m with Bank of
Scotland PLC and HSBC UK Bank plc. This facility, which is available until
November 2027, provides options to extend it by a further two years and by an
additional £20m. It will support the continuing investment in the Group's
organic growth and acquisition strategy in the medium term.
The pension scheme remains in surplus and, following conclusion of the latest
triennial valuation, the company is no longer making contributions to the
scheme.
Sustainability
In 2024, the Group achieved a reduction in its Scope 1 and 2 carbon emissions
and completed the mapping of its Scope 3 emissions. The Group is committed
to reducing its direct impact on the environment through further
electrification of our delivery fleet and expanding the use of renewable
energy.
We continue to support our customers to help them navigate packaging
regulations and to ensure their products are effectively protected using the
minimum amount of packaging, made from the most sustainable materials and
packed using the most cost-effective processes.
Board Changes
On 1 January 2025, David Stirling was appointed to the Board as an independent
Non-Executive Director following the retirement of Bob McLellan on 31 December
2023. Having previously been Group CEO of Zotefoams plc, David brings
extensive listed-company and protective packaging industry experience which
will be of significant benefit to the Board.
Proposed Dividend
The Board proposes a final dividend of 2.70 pence per share, amounting to a
full-year dividend of 3.66 pence per share (2023: 3.59 pence per share), an
increase of 2% on 2023. Subject to the approval of shareholders at the
Annual General Meeting on Tuesday 13 May 2025, the final dividend will be paid
on Friday 13 June 2025 to those shareholders on the register on Friday 16 May
2025 (ex-dividend date 15 May 2025).
Outlook
We expect 2025 to be another challenging year within the markets in which we
operate, particularly with increased employment costs resulting from the
recent UK budget and the introduction by the UK Government of Extended
Producer Responsibility ("EPR") fees. Management is taking actions to
mitigate these incremental costs and we are working with our customers to help
them manage the impact of EPR.
We start 2025 with new-business momentum as customers increasingly recognise
the added-value we can offer both on an environmental and cost-savings basis.
The recently-announced purchase of The Pitreavie Group Limited ("Pitreavie")
demonstrates our continued ability to identify and execute high-quality
acquisitions and we have a strong pipeline of opportunities.
We are well positioned to continue our profitable growth in 2025.
Further enquiries: Macfarlane Group Tel: 0141 333 9666
Aleen Gulvanessian Chair
Peter Atkinson Chief Executive
Ivor Gray Finance
Director
Spreng Thomson
Callum Spreng Mob: 07803 970103
Legal Entity Identifier (LEI): 213800LVRYDERSJAAZ73
Notes to Editors:
· Macfarlane Group PLC has been listed on the Premium segment of the
Main Market of the London Stock Exchange (LSE: MACF) since 1973 with over 70
years' experience in the UK packaging industry.
· Through its two divisions, Macfarlane Group services a broad range
of business customers, supplying them with high quality protective packaging
products which help customers reduce supply chain costs, improve operational
efficiencies and sustainability and enhance their brand presentation. The
divisions are:
o Packaging Distribution - Macfarlane Packaging Distribution is the leading
UK distributor of a comprehensive range of protective packaging products; and
o Manufacturing Operations - Macfarlane Design and Manufacture is a UK
market leader in the design and production of protective packaging for high
value and fragile products.
· Headquartered in Glasgow, Scotland, Macfarlane Group employs over
1,000 people at 43 sites, principally in the UK, as well as in Ireland,
Germany and the Netherlands.
· Macfarlane Group supplies more than 20,000 customers, principally
in the UK and Europe.
· In partnership with 1,700 suppliers, Macfarlane Group distributes
and manufactures 600,000+ lines supplying to a wide range of sectors,
including: retail e-commerce; consumer goods; food; logistics; mail order;
electronics; defence; medical; automotive; and aerospace.
BUSINESS REVIEW
Group
Group revenue reduced by 4% and adjusted operating profit by 1% in 2024 with
continued weak demand from customers, sales price deflation and inflation in
operating costs being offset by an improved new business performance,
effective management of changes in input prices and the execution of two good
quality acquisitions. Operating profit grew by 7% due to the net effect of
changes in the fair value of deferred contingent consideration related to
acquisitions (2024: credit £0.8m; 2023 charge £1.5m). The Group has also
made progress against its ESG objectives, details of which will be set out in
the Annual Report and Accounts 2024.
Revenue Adjusted operating Operating Revenue Adjusted operating Operating
Profit(1) profit Profit(1) profit
Group performance
2024 2023
2024 £000 2024 2023 £000 2023
£000 £000 £000 £000
Segment
Packaging Distribution 228,763 20,158 17,331 244,938 21,044 16,511
Manufacturing Operations 41,674 7,244 6,266 35,776 6,593 5,557
Group total 270,437 27,402 23,597 280,714 27,637 22,068
% of Revenue 10.1% 8.7% 9.8% 7.9%
(1)See notes to the financial information below for reconciliation of
Alternative Performance Measures to Statutory Measures.
2025 Outlook
The Group continues to invest in actions to grow sales both organically and
through acquisitions. Despite the challenging market conditions the Group is
well positioned to benefit from improvements in the macroeconomic outlook.
Our strategy and business model have proved to be resilient and we expect 2025
to be another year of growth for the Group, underpinned by the acquisition of
Pitreavie at the start of 2025 which enhances both our Packaging Distribution
and Manufacturing operations, the strong new business pipeline building on the
progress made in 2024 and planned mitigation actions to offset the pending
increases in employment and regulatory costs impacting the UK.
BUSINESS REVIEW
Macfarlane Group's trading activities comprise Packaging Distribution and
Manufacturing Operations.
Macfarlane's Packaging Distribution business is the UK's leading specialist
distributor of protective packaging materials, with a growing presence in
Europe. Macfarlane operates in the UK, Ireland, the Netherlands and Germany
from 27 Regional Distribution Centres ("RDCs") and three satellite sites,
supplying industrial and retail customers with a comprehensive range of
protective packaging materials on a local, regional, and national basis.
Competition in the packaging distribution market is from local and regional
protective packaging specialist companies as well as national and
international distribution generalists who supply a range of products,
including protective packaging materials.
Macfarlane competes effectively on a local basis through its strong focus on
customer service, its breadth and depth of product offering and through the
recruitment and retention of high-quality staff with good local market
knowledge. On a national and international basis, Macfarlane has market focus,
expertise and a breadth of product and service knowledge, all of which enable
it to compete effectively against non-specialist packaging distributors.
Packaging Distribution benefits its customers by enabling them to ensure their
products are cost-effectively protected in transit and storage through the
supply of a comprehensive product range, single source stock-and-serve supply,
just-in-time delivery, tailored stock management programmes, electronic
trading and independent advice on both packaging materials and packing
processes. Through the 'Significant Six' (1) sales approach we reduce our
customers' 'Total Cost of Packaging', improve their sustainability performance
and reduce their carbon footprint. This is achieved through supplying
effective packaging solutions, optimising warehousing and transportation,
reducing damages and returns, and improving packaging efficiency.
(1) "Significant Six" represents the six key costs in a customers' packing
process being transport, warehousing, administration, damages and returns,
productivity and customer experience.
Packaging Distribution 2024 2023 2024
£000 £000 Change
Revenue 228,763 244,938 (7%)
Cost of sales (143,890) (157,458) (9%)
Gross margin 84,873 87,480 (3%)
Operating expenses (64,715) (66,436) (3%)
Adjusted operating profit (1) 20,158 21,044 (4%)
Amortisation (3,082) (2,983)
Deferred contingent consideration 255 (1,550)
Operating profit 17,331 16,511 5%
(1)See notes to the financial information below for reconciliation of
Alternative Performance Measures to Statutory Measures.
The main features of Packaging Distribution's performance in 2024 were:
· Organic revenue reduced by 8% compared to 2023 due to:
· Weak demand environment and selling price deflation; offset by
· New business 23% higher than 2023, with continued success from our
Innovation Labs and Significant Six programme.
· Revenue growth of £4.0m from the acquisitions of Allpack Direct in
March 2024 and Gottlieb in April 2023.
· Effective management of input prices resulting in an improvement in
gross margin to 37.1% (2023: 35.7%).
· Operating costs decreased by 3%, despite inflation in property and
labour costs, and represented 28.3% of revenue (2023: 27.1%).
· Improvement in adjusted operating profit as a percentage of revenue to
8.8% (2023: 8.6%).
· Adjusted operating profit decreased by 4% in 2024 due to the factors
above whilst operating profit increased by 5% due to the net effect of changes
to the fair value of deferred contingent consideration related to
acquisitions.
Future
The priorities for Packaging Distribution in 2025 are focused on growing
revenue and improving profitability through the following actions:
· Accelerate new business momentum through effective use of our leading
sales tools and processes - "Packaging Optimiser" (2), Significant Six and our
Innovation Labs.
· Accelerate the progress we have made in Europe through our "Follow the
Customer" programme and the PackMann acquisition.
· Realise the benefits of the new distribution centre in the East
Midlands.
· Progress further high-quality acquisitions in the UK and Europe.
· Support our customers to manage the impact of Extended Producer
Responsibility legislation and reduce their carbon footprint through offering
more sustainable packaging solutions.
· Continue to effectively manage input price changes.
· Strengthen our key supplier relationships.
· Develop both sales and cost synergies through the relationship with our
Manufacturing Operations, including the recent acquisition of Pitreavie.
· Achieve benefits from our information technology investments.
· Relaunch our web-based solutions offer to provide customers with more
effective online access to our full range of products and services.
· Reduce operating costs through efficiency programmes in sales,
logistics and administration and, where possible, mitigate the impact of
increases in National Insurance Contributions and National Minimum Wage.
· Maintain our focus on working capital management to facilitate future
investment and manage effectively the ongoing bad debt risk within the current
economic environment.
(2) Packaging Optimiser is a Macfarlane developed software tool that
measures the financial and carbon benefits of the Significant Six selling
approach.
Manufacturing Operations comprises our Macfarlane Packaging Design and
Manufacture business, GWP acquired in February 2021, Suttons acquired in March
2023, B&D Group acquired in September 2023 and Polyformes acquired in July
2024.
Manufacturing Operations designs, manufactures, assembles, and distributes
bespoke protective packaging solutions for customers requiring cost-effective
methods of protecting high value products in storage and transit. The primary
components we use are corrugate, timber, foam and specialist cases. The
businesses operate from six manufacturing sites, in Grantham, Westbury,
Swindon, Salisbury, Chatteris and Leighton Buzzard, and a sales/design office
in Barnstaple supplying both directly to customers and through the national
RDC network of the Packaging Distribution business.
Key market sectors are aerospace, space, medical equipment, electronics,
automotive, e-commerce retail and household equipment. The markets we serve
are highly fragmented, with a range of locally based competitors. We
differentiate our market offering through technical expertise, design
capability, industry accreditations and national coverage through the
Packaging Distribution business.
Manufacturing Operations 2024 2023 2024
£000 £000 Change
Revenue 47,458 40,929 16%
Inter-segment revenue (5,784) (5,153) 12%
External revenue 41,674 35,776 16%
Cost of sales (21,175) (17,575) 20%
Gross margin 20,499 18,201 13%
Operating expenses (13,255) (11,608) 14%
Adjusted operating profit(1) 7,244 6,593 10%
Amortisation (1,528) (1,051)
Deferred contingent consideration 550 15
Operating profit 6,266 5,557 13%
(1)See notes to the financial information below for reconciliation of
Alternative Performance Measures to Statutory Measures.
The main features of Manufacturing Operations performance in 2024 were:
· Increase in revenue of £6.5m, with growth from Suttons and B&D
Group acquired in 2023 and Polyformes acquired in 2024 being offset by selling
price deflation.
· As expected, selling price deflation caused the gross margin to weaken
slightly compared to 2023.
· Higher operating expenses, due to the impact of the acquisitions.
· Increase in adjusted operating profit of 10% but decrease in adjusted
operating profit as a percentage of revenue to 15.3% (2023: 16.1%) due to
selling price deflation.
The priorities for Manufacturing Operations in 2025 are to:
· Increase momentum of new business growth in target sectors, e.g.
medical, aerospace and space.
· Prioritise new sales activity in our higher added-value bespoke
composite pack product range.
· Work with our customers to effectively manage material price changes.
· Continue strengthening the relationship with our Packaging Distribution
businesses to create both sales and cost synergies.
· Achieve both sales and cost synergies through closer working with the
recently acquired businesses referred to above as well as Pitreavie acquired
at the start of 2025.
· Supplement organic growth through progressing further high-quality
acquisitions in the UK.
RISKS AND UNCERTAINTIES
The principal risks and uncertainties faced by the Group and the factors
mitigating these risks are detailed below. These risks are addressed within an
overall governance framework including clear and delegated authorities,
business performance monitoring and appropriate insurance cover for a wide
range of potential risks. There is a dependence on good quality local
management, which is supported by an investment in training and development
and ongoing performance evaluation.
Risks are identified and assessed through a range of "top down" and "bottom
up" analyses that are updated on a regular basis. This in turn provides the
basis for making informed risk-based decisions regarding the scope and focus
of assurance work, as described in the report of the Audit Committee in the
Annual Report 2024. In addition to scheduled updates from Finance, Health
& Safety, IT, Sales, Procurement, Sustainability and other business
functions, the Board and Audit Committee may seek assurance work in other
areas from time to time, either from internal sources or externally
commissioned work.
We continue to evolve our risk management processes to ensure they are robust,
effective, and integrated within our decision-making processes. We have
included a brief description of how we assess that each risk level has
changed. For risks shown as [ç è] the risk level is broadly similar
between 2023 and 2024. If the risk is shown as [é ê] the risk level has
increased or decreased respectively during 2024 and is being addressed
accordingly through mitigating actions by management.
We recognise the need to constantly review the risks and uncertainties faced
by the Group and ensure that any emerging risks are being identified and
actions being taken to mitigate. We have not added any new risks in 2024
although we continue to keep Artificial Intelligence ("AI") and related
technology developments under review to assess the likely risk and benefit to
the Group going forward.
Risk Description Mitigating Factors Change in Risk Level
Strategic changes in the market · The Group has a well-diversified customer base, giving protection from Increase é
changes in specific industry sectors, as well as a flexible business model
Failure to respond to strategic shifts in the market, including the impact of with a strong value proposition to meet the changing needs of customers. · Group businesses have been impacted by weak demand for packaging in a
weaknesses in the economy as well as disruptive behaviour from competitors,
number of key markets which has resulted in increased competitor pressure.
changing customer needs (e.g. changing customer priorities between online and · The Group strives to maintain high service levels for customers ensuring
physical buying) and the increasing regulatory interventions targeted at that customer needs are met. While enhancing its service offering and range · The Group has experienced increasing competitive activity from corrugate
improving sustainability could limit the Group's ability to continue to grow of products, the Group continues to invest in design, testing and information manufacturers entering the distribution space as declining volumes put
revenues or potentially contribute to a failure to meet market expectations. technology. These tools are intended to strengthen our business model by pressure on their traditional customer base.
supporting customer service teams in managing the complex and changing needs
We monitor this through Net Promoter Score (see Sustainability Report in the of customers and to respond to the increasingly competitive and dynamic · The Group has also experienced significant benchmarking activity across its
Annual Report 2024), an annual customer satisfaction survey (see operating environment. major customers. The effect of this is being partially offset by improvement
Sustainability Report in the Annual Report 2024) and regular interaction with
in new business performance, strong cost control and effective management of
customers including at our Innovation Labs. · The Group maintains strong partnerships with key suppliers to ensure that a changes in input prices.
broad range of products is available to respond to customers' requirements,
In addition, the Board monitors strategic market developments including including any changes in their environmental and sustainability priorities. · During 2025, the Group expects to return to revenue growth with a strong
significant regulatory changes. Maintaining close relationships with key suppliers in the protective packaging new business pipeline supported by investment in the Group's World Class
market enables us to understand and evaluate key trends and adapt our business training programme and investment in additional experienced sales resource in
Strategic changes in the market related to sustainability are covered below. model accordingly. our National Accounts teams.
· The Group is responding to strategic changes in the market through its:
· Follow the Customer programme in Europe;
· Significant Six selling proposition supported by it's the Packaging
Optimiser; and
· the development of its web-site.
Risk Description Mitigating Factors Change in Risk Level
Uncertain economic environment · The Group has scope to curtail capital expenditure and acquisition No change ç è
investment to preserve cash, if required.
Given the range of prolonged geopolitical and economic uncertainties within
· The UK and EU economies continued to experience challenging economic
the UK and other markets, there is an ongoing risk this will adversely affect · In the event of a significant reduction in customer demand the Group conditions during 2024.
our ability to deliver upon agreed strategic initiatives. We may also need would take rigorous actions to reduce operating costs and working capital
to adapt our business quickly in order to limit the impact upon the Group's investment. · The Group has experienced weak demand for its products across many of
results, prospects and reputation.
the markets in which it operates. The Group has responded through control of
· Mitigating factors set out in the financial liquidity, debt covenants operating costs, effective management of input prices and accelerating new
This risk is monitored through regular review of trading forecasts and market and interest rates risk set out below also apply to the Uncertain economic business performance. The Group is prepared to continue to manage its cost
conditions, considered at executive management and Board level. environment risk. base should demand remain challenging in 2025.
· To mitigate this risk, executive management monitors monthly revenue · The impact on the Group's operating costs from 1 April 2025 as a result
and cost performance and market trends closely and has action plans to respond of increases to National Insurance Contributions and the National Minimum
to any significant or prolonged trading pressures. Wage, announced in the November 2024 UK Budget is c£1.5m per annum.
· While the risk of high inflation has reduced in 2024, the Group has a
higher operating cost base as a result of significant inflation through 2022
and 2023.
Risk Description Mitigating Factors Change in Risk Level
Impact of environmental changes · Sustainability considerations are central to the organisation's value No change ç è
proposition, utilising our resource, expertise and business assets to support
The markets we operate in are changing, with: customers to use less packaging and provide more sustainable alternatives · The Group recognises the significance of our environmental obligations
through our Significant Six selling proposition. and has continued to make progress, including;
· customers increasingly aware of the environmental impact of their
packaging; · The Group has a sustainability strategy setting out the key · Extending the introduction of fully electric trucks to our fleet to 9
priorities that are most relevant to the business and which will be key to in 2024 (2023: 5);
· increasing environmental regulatory requirements for packaging mitigating both the transition and physical risks in this area, as set out in
suppliers, such as the Plastic Tax introduced in 2022 and the introduction of the Sustainability Report in the Annual Report 2024. · Investment in solar panels at sites with high energy use. Solar
the Extended Producer Responsibility ("EPR") levy in 2025;
panels were installed during 2024 at the Group's manufacturing site in
· The Group has a Head of Sustainability who chairs the Environment, Swindon;
· increasing likelihood of disruption to the operations of the Group Social and Governance ("ESG") committee consisting of senior leaders from
through extreme weather events such as flooding, storm damage and water across the Group. · Utilising the Innovation Labs to support customers in meeting their
stress, impacting the business directly and disrupting supply chains;
specific sustainability requirements and providing educational seminars
· The ESG committee oversees progress against the strategy and the focused on key environmental issues, including upcoming regulations;
· investors looking to invest in companies that demonstrate strong associated targets, addressing challenges proactively. The committee reports
environmental credentials; and directly to the Board. · Ongoing actions to support our customers to reduce their CO2
emissions, including using our 'Packaging Optimiser' tool;
· UK Government's commitment to net zero carbon emissions by 2050 and · The Group has established a working group to help prepare for the
the profound changes that is likely to drive across the economy. implications of EPR regulation and resulting fees due to commence in 2025. · The Group's Head of Sustainability leading on the impact of
environmental regulatory change, focusing on preparing the business for
If the Group is not proactive and transparent in how it is responding to this · The Group discloses and reports on climate issues and mitigations in compliance with the UK's EPR regulations and building the Group's capability
agenda, this could lead to a loss of employees, customers and investors. line with the Task Force on Climate-related Financial Disclosures ('TCFD') to support customers; and
Additionally, there is a transition risk, i.e. that we do not progress our best practice framework in the Annual Report 2024.
strategy at the right pace, or we take actions that prove to be incorrect as
· The Group's Scope 3 emissions have been mapped to provide a baseline
technology advances and markets transition. Regular reviews of our sustainability strategy are carried out at Board level of our entire carbon footprint. Engagement has begun with suppliers on carbon
to challenge performance against key milestones, as well as to ensure that reduction.
The Executive interact with investors twice per annum giving them the priorities are aligned with stakeholder objectives. This is overseen via Key
opportunity to assess the Group's progress against their expectations. Performance Indicators and regular reporting from the Head of Sustainability See the detailed Sustainability Report in the Annual Report 2024.
to the Executive on progress against our priorities.
The key measure the Group monitors is Scope 1 and 2 CO2 emissions. The Group
also assessed its Scope 3 emissions in 2024.
Risk Description Mitigating Factors Change in Risk Level
Supply Chain · The Group works closely with its supplier and customer base to effectively No change ç è
manage the scale and timing of price changes and any resultant impact on
The Group's businesses are impacted by disruption to our supply chains as well profit. Our IT systems monitor and measure effectiveness in these changes. · Input prices have continued to change throughout 2024 primarily due to
as inflationary pressures.
movements in timber, paper and polymer prices. The business has managed these
· Where possible, alternative supplier relationships are maintained to challenges robustly and gross margins have improved in 2024, reflecting the
In particular, changes to commodity-based raw material prices, manufacturer minimise supplier dependency. effort of our teams to mitigate these increases.
energy costs, foreign exchange movements as well as increased bureaucracy,
freight and tariff costs related to imports; lead to increases to supplier · We continue to benchmark our supplier base to ensure we have a broad view · Pricing of paper, which has the largest impact on the Group, increased in
input pricing and the potential for erosion of profitability within the across the packaging sector. H2 2024. However, future pricing trends remain uncertain due to the general
Group's businesses if we are unable to pass these onto customers.
weak market demand.
· We work with customers to redesign packs and reduce packing cost to
This risk is monitored through our procurement teams interacting with key mitigate the impact of cost increases, including switching to alternative · Over a long term period of volatile raw material pricing, the consistency
suppliers and management regularly reviewing the effectiveness of our price products to minimise the impact of packaging regulation including the Plastics of our gross margin performance demonstrates the effectiveness of our price
change programmes by monitoring gross margins by customer. Tax and the upcoming EPR legislation. management programme.
· The Group has a well-established supplier relationship management process · Supply conditions have been stable throughout 2024 with good availability
which is subject to periodic management review and internal audit. of supplier capacity, due to weak market demand, and lead times have remained
within acceptable parameters.
· We continue to support our customers on Total Cost Management as the method
to add value/reduce costs.
Risk Description Mitigating Factors Change in Risk Level
Acquisitions · The Group carefully reviews potential acquisition targets, ensuring that No change ç è
the focus is on high-quality businesses which complement the Group's existing
The Group's growth strategy has included a number of acquisitions in recent profile and provide good opportunities for growth. · The Group has made 20 acquisitions since 2014, including two in 2024 as
years. There is a risk that such acquisitions may not be available on
well as concluding the Pitreavie acquisition in January 2025.
acceptable terms in the future. · Having completed a number of acquisitions in recent years, the Group has
well-established due diligence and integration processes and procedures. · The Group has a strong pipeline of potential protective packaging
It is possible that acquisitions will not be successful due to the loss of key
acquisition opportunities in both the UK and Northern Europe.
people or customers following acquisition or acquired businesses not · The Group's management information system enables effective monitoring of
performing at the level expected. This could potentially lead to impairment post-acquisition performance, with earn-out mechanisms also mitigating risk in · European acquisitions are inherently higher risk due to the potential
of the carrying value of the related goodwill and other intangible assets. the post-acquisition period. effects of cultural differences, challenges in realising operational synergies
and having less depth in local management and support compared to UK-based
Execution risks around the failure to successfully integrate acquisitions · Goodwill and other intangible assets are tested annually for impairment. acquisitions. However, there are also important strategic opportunities for
following conclusion of the earn-out period also exist.
the Group in terms of extending service coverage with our organic "Follow the
Customer" programme as well as other integration synergies.
This is monitored through regular reporting of acquisition prospects and
post-acquisition performance by executive management, with reporting to the · The Group has strengthened its European management team with the
Board. appointment of a Managing Director from 1 January 2025, with significant
experience running European operations and successfully executing
acquisitions.
Risk Description Mitigating Factors Change in Risk Level
Property · The Group adopts a proactive approach to managing property costs and Increase é
exposures.
The Group has a property portfolio comprising 1 owned site, 1 long leasehold
· Our property consolidation strategy has continued during 2024. There is no
and 55 short leasehold sites. This multi-site portfolio gives rise to risks · Where a site is non-operational the Group seeks to assign, sell or outstanding work on finalising exit costs following the expiry of leases.
in relation to ongoing lease costs, dilapidations, and fluctuations in value. sub-lease the building to mitigate the financial impact. There are known future exits from three existing operating sites. Provisions
have been established to cover the anticipated exit costs.
This risk is monitored on a regular basis and reported to the Board through · If this is not possible, rental voids are provided on vacant properties
internal reporting and input from external advisors. taking into consideration the likely period of vacancy and incentives to · The Group currently has no vacant or sub-let properties.
re-let.
· While the Group is managing its exposure to dilapidations and similar
· The Group engages with external property advisers to assess the level of property costs, the risk to the Group's future strategy and performance in
provisioning required for dilapidations and negotiate to minimise the final relation to property matters is increasing. The availability of suitable
costs. properties of the size and quality that the Group requires is becoming
increasingly challenging.
· In addition, rent reviews on existing properties have ranged from 15% to
101% through 2023 and 2024, resulting in increases to operating costs. This
reflects the significant increase in market rental rates for properties in the
locations and size that the Group occupies.
Risk Description Mitigating Factors Change in Risk Level
Cyber-security · The Group continually invests in its IT infrastructure to protect against No change ç è
cyber-security threats. This includes regular testing of IT Disaster
The increasing frequency and sophistication of cyber-attacks is a risk which Recovery Plans. · The Group was awarded Cyber Essentials by the National Security Centre
potentially threatens the confidentiality, integrity and availability of the
during 2024 and is working towards achieving Cyber Essentials Plus in 2025.
Group's data and IT systems. · We engage the services of a cyber-security partner to perform regular This demonstrates the Group's commitment to continuous improvement.
penetration tests to assess potential vulnerabilities within our security
These attacks could also cause reputational damage and fines in the event of arrangements. · The Group continues to invest in prevention/detection software and
personal data being compromised.
education programmes to mitigate the risks of cyber-security attacks.
· This is complemented by a program of cyber-security awareness training to
This risk is monitored through an ongoing program of compliance and controls ensure that all staff are aware of the potential threats caused by deliberate · With increasing geo-political uncertainties, the frequency and
auditing with input from external advisors. and unauthorised attempts to gain access to our systems and data. sophistication of cyber-attacks is anticipated to continue to evolve, and the
Group is committed to continually investing in upgrading its infrastructure to
respond to the changing threats.
· The Group continues to perform regular assessments of its cyber-security
resilience and make changes to our defences.
Risk Description Mitigating Factors Change in Risk Level
Financial liquidity, debt covenants and interest rates · The Group's borrowing facility comprises a committed facility of £40m, Decrease ê
which finances our trading requirements and supports controlled expansion,
The Group needs access to funding to meet its trading obligations, to support providing a medium-term funding platform for growth. · The Group continued to generate strong operating cash flows in 2024, which
organic growth and execute acquisitions. There is a risk that the Group may
were invested in maintenance and value-adding capital expenditure, earnings
be unable to obtain funds and that such funds will only be available on · A twice yearly viability assessment and sensitivity analyses is performed accretive acquisitions and dividends to shareholders with the Group operating
unfavourable terms. by management. well within its bank facilities throughout the year.
The Group's borrowing facility comprises a committed facility of £40m. This · Compliance with covenants is monitored on a monthly basis and sensitivity · The Group re-financed its banking facilities in 2024 with Bank of Scotland
includes requirements to comply with specified covenants, with a breach analysis is applied to forecasts to assess the impact on covenant compliance. PLC and HSBC UK Bank plc, with an enhanced £40m revolving credit facility now
potentially resulting in Group borrowings being subject to more onerous
in place until November 2027, with options to extend until November 2028 and
conditions. · The Board reviews the Group's capital allocation strategy and policy on a 2029. The new facility has standard covenants for Net Debt/EBITDA and
regular basis. EBITA/Net Finance Charges which the Group operates well within.
The Group regularly monitors net bank debt and forecast cash flows to ensure
that it will be able to meet its financial obligations as they fall due. · Interest rates payable by the Group have decreased during 2024 but are
expected to remain high for some time.
Risk Description Mitigating Factors Change in Risk Level
Working capital · Credit risk is controlled by applying rigour to the management of trade No change ç è
receivables by the Head of Credit Control and the credit control team and is
The Group has a significant investment in working capital in the form of trade subject to additional scrutiny from the Group Finance Director and Group · Bad debt write-offs in 2024 were broadly in line with 2023 and remain at a
receivables and inventories. There is a risk that this investment is not Financial Controller in line with the Group's credit risk process. relatively low level. The Expected Credit Loss allowance reflects the low
fully recovered.
level of historic bad debts in the Group.
· All aged debts are assessed using the Expected Credit Loss model, and
This risk is monitored through detailed reporting to local and executive appropriate provisions are made. · Aged stock over 6 months old has decreased in 2024 primarily due to weaker
management, which is reviewed in summary form by the Board.
demand and good management control. The Group is continually working to
· Customers who operate in sectors that are likely be significantly impacted reduce stock over 6 months and has adequate provisioning to cover any
by the current economic challenges, particularly those exposed to reduced potential stock obsolescence.
consumer demand and increases in operating costs, are closely monitored. Where
necessary, actions are taken to reduce our exposure to potential bad debts or · The economic environment is expected to remain challenging in 2025.
stock write-offs. Management will continue to take all appropriate steps to mitigate this risk
and limit the need for additional provisions or write-offs.
· Inventory levels and order patterns are regularly reviewed and risks
arising from holding bespoke stocks are managed by obtaining contract or order
cover from customers.
Risk Description Mitigating Factors Change in Risk Level
Defined benefit pension scheme · The scheme was closed to new members in 2002. Benefits for active No change ç è
members were amended by freezing pensionable salaries at April 2009 levels.
The Group's defined benefit pension scheme is sensitive to a number of key The scheme was closed to future accrual during 2022. · The IAS 19 valuation of the Group's defined benefit pension scheme as
factors including volatility in bond/gilt markets, the discount rates used to
at 31 December 2024 estimated the scheme surplus to be £9.6m, compared to a
calculate the scheme's liabilities, inflation and mortality assumptions. · A Pension Increase Exchange option is available to offer flexibility to surplus of £9.9m at 31 December 2023.
new pensioners in both the level of pension at retirement and the rate of
Small changes in these assumptions could cause significant movements in the future increases. · The triennial actuarial valuation at 1 May 2023 was completed in
pension surplus.
February 2024. Due to the positive funding position of the scheme, there is
· The investment profile is regularly reviewed to ensure continued no requirement for the Group to make further deficit repair contributions.
This risk is monitored through regular input from external pension advisors, matching of investments with the scheme's liability profile.
including six monthly IAS19 reviews and triennial actuarial valuations.
· The Group is working with trustees to prepare the scheme for buy-out.
· The scheme invests in Liability Driven Investments ("LDI") which hedge This process is not expected to be completed during 2025.
There is potential for increased defined benefit obligations as a result of the scheme against movements in the discount rate and inflation. These are
the Virgin Media case. This is monitored through specific interaction with leveraged instruments which require active investments and divestments to · The Group sets out its assessment of the potential implications of the
external advisors. maintain the level of leverage. Virgin Media case in notes to the financial information below.
Given the well-funded position of the Scheme the associated risks have reduced · The Group uses external advisers to provide guidance and support, where
significantly. However, given the complexity and age of the Scheme there required, including e.g. understanding and assessing the implications of the
remains some likelihood of unknown events that could result in a reassessment Virgin Media case.
of the Scheme's defined benefit obligations e.g. the Virgin Media case.
There are a number of other risks that we manage which are not considered key
risks. These are mitigated in ways common to all businesses and not specific
to Macfarlane Group.
Viability statement
The Board is required to formally assess that the Group has adequate resources
to continue in operational existence for the foreseeable future and as such
can continue to adopt the going concern basis of accounting. The Board is
also required to state that it has a reasonable expectation that the Group
will continue in operation and meet its longer-term liabilities as they fall
due.
To support this statement, the Board is required to consider the Group's
current financial position, its strategy, the market outlook and its principal
risks. The Board's assessment of the principal risks facing the Group and
how these risks affect the Group's prospects are set out above. The review
also includes consideration of how these risks could prevent the Group from
achieving its strategic plan and the potential impact these risks could have
on the Group's business model, future performance, solvency, and liquidity
over the next three years (starting from 1 January 2025).
The Board considers the Group's viability as part of its ongoing programme to
manage risk. Each year the Board reviews the Group's strategic plan for the
forthcoming three-year period and challenges the Executive team on the plan's
risks. The plan reflects the Group's businesses, which have a broad spread
of customers across a range of different sectors. The assessment period of
three years is consistent with the Board's review of the Group strategy,
including assumptions around future growth rates for our business and
acceptable levels of performance.
Financial modelling and scenarios
The Group's existing bank facilities comprise a £40m committed facility with
Bank of Scotland PLC and HSBC UK Bank plc, which is available until November
2027 with options to extend to November 2029. The Group has performed
resiliently during 2024, despite the ongoing challenging market conditions,
which gives confidence in the strength of the underlying business model. The
Directors have also considered the longer-term economic outlook for the UK.
Given the current uncertainty of the economic outlook we have modelled a
'severe but plausible downside' scenario as described below. In forming
conclusions, the Directors have also considered potential mitigating actions
that the Group could take to preserve liquidity and ensure compliance with its
financial covenants.
A detailed financial model covering a three-year period is maintained and
regularly updated. This model enables sensitivity analysis, which includes
flexing the main assumptions, including future revenue growth, gross margins,
operating costs, finance costs and working capital management. The results
of flexing these assumptions, both individually and in aggregate, are used to
determine whether additional bank facilities will be required during the
three-year period and whether the Group will remain in compliance with the
covenants relating to the current facility. Whilst the current facilities are
committed until November 2027 we have assumed the Group will take up the
option to extend the existing facility for a further two years which will be
on the same terms currently in place.
We have modelled a range of scenarios, including a base case, a downside
scenario, a severe but plausible downside and a reverse stress test, over the
three-year horizon. The 'severe but plausible downside' scenario is
conservative in assuming, compared to the base case, revenue reductions of 10%
and gross margin reductions at the rate of 2% in each of the three years, with
no reduction in costs. Even under this scenario, and before reflecting any
mitigating actions available to Group management, the Group forecasts
compliance with all financial covenants throughout the period and would not
require any additional sources of financing.
The Group has also modelled a reverse stress test scenario. This models the
decline in revenue that the Group would be able to absorb before breaching any
financial covenants. Such a scenario, and the sequence of events that could
lead to it, is considered to be remote, as it requires revenue reductions of
c.16% per annum between 2025 and 2027, compared to the base case, before there
is a breach in financial covenants in the period under review and is
calculated before reflecting any mitigating actions.
Even in the severe but plausible scenario, Macfarlane Group is forecast to
have sufficient liquidity to continue trading, comfortably meeting its
financial covenants and operating within the level of its facilities for the
foreseeable future. However, in this scenario, management would also be able
to take significant mitigating actions to reduce its costs and conserve cash.
Viability statement
Conclusions
For this reason, the Board considers it appropriate for the Group to adopt the
going concern basis in preparing its financial statements.
The Board also has a reasonable expectation that the Group will continue in
operation and meet its longer-term liabilities as they fall due.
Cautionary Statement
The Chair's Statement and the Business Review set out above have been prepared
to provide additional information to members of the Company to assess the
Group's strategy and the potential for the strategy to succeed. It should not
be relied on by any other party or for any other purpose.
This report and the financial statements contain certain forward-looking
statements relating to operations, performance and financial status. By their
nature, such statements involve risk and uncertainty because they relate to
events and depend upon circumstances that will occur in the future. There are
a number of factors, including both economic and business risk factors, that
could cause actual results or developments to differ materially from those
expressed or implied by these forward-looking statements.
These statements are made by the Directors in good faith based on the
information available to them up to the time of their approval of this report.
Nothing in this Preliminary Announcement should be construed as a profit
forecast or an invitation to deal in the securities of the Group.
Responsibility Statement of the Directors
The responsibility statement below has been prepared in connection with the
Company's full annual report for the year ending 31 December 2024. Certain
parts of the full Annual Report are not included within this announcement.
The Directors of Macfarlane Group PLC are
A. Gulvanessian Chair
P.D. Atkinson Chief Executive
I. Gray Finance Director
J.W.F. Baird Non-Executive
Director and Senior Independent Director
L.D. Whyte Non-Executive Director
D.B. Stirling Non-Executive Director
To the best of the knowledge of the Directors (whose names and functions are
set out above):
· The financial statements, prepared in accordance with International
Financial Reporting Standards, give a true and fair view of the assets,
liabilities, financial position and profit for the Company and the
undertakings included in the consolidation taken as a whole;
· The Strategic Report, incorporated into the Directors' Report in the
Annual Report, includes a fair review of the development and performance of
the business and the position of the Company and the undertakings included in
the consolidation taken as a whole, together with a description of the
principal risks and uncertainties that they face; and
· Pursuant to Disclosure and Transparency Rules, Chapter 4, the
directors consider that the Company's annual report and financial statements,
taken as a whole, are fair, balanced and understandable and provide
information necessary for the shareholders to assess the Company's and the
Group's position and performance, business model and strategy.
Peter
Atkinson
Ivor Gray
Chief Executive
Finance Director
27 February 2025
27 February 2025
Macfarlane Group PLC
Consolidated income statement
For the year ended 31 December 2024
Note
2024 2023
£000 £000
Continuing operations
Revenue 3 270,437 280,714
Cost of sales (165,065) (175,033)
Gross profit 105,372 105,681
Distribution costs (11,165) (10,485)
Administrative expenses (70,610) (73,128)
Operating profit 3 23,597 22,068
Net finance costs 4 (2,701) (1,788)
Profit before tax 20,896 20,280
Tax 5 (5,366) (5,306)
Profit for the year 15,530 14,974
Earnings per share from continuing operations
Basic 7 9.76p 9.44p
Diluted 7 9.74p 9.34p
Consolidated statement of comprehensive income
For the year ended 31 December 2024
2024 2023
Note £000 £000
Items that may be reclassified to profit or loss
Foreign currency translation differences - foreign operations (150) (45)
Items that will not be reclassified to profit or loss
Remeasurement of pension scheme liability 10 (362) (1,967)
Tax recognised in other comprehensive income
Tax on remeasurement of pension scheme 11 91 492
liability
Other comprehensive expense for the year, net of tax (421) (1,520)
Profit for the year 15,530 14,974
Total comprehensive income for the year 15,109 13,454
Macfarlane Group PLC
Consolidated statement of changes in equity
For the year ended 31 December 2024
Share Share Revaluation Own Translation Retained Total
Capital Premium Reserve Shares Reserve Earnings £000
Note £000 £000 £000 £000 £000 £000
At 1 January 2023 39,584 13,573 70 (7) 216 52,584 106,020
Comprehensive income
Profit for the year - - - - - 14,974 14,974
Foreign currency translation differences
- - - - (45) - (45)
Remeasurement of pension liability
10 - - - - - (1,967) (1,967)
Tax on remeasurement of pension liability
11 - - - - - 492 492
Total comprehensive income - - - - (45) 13,499 13,454
Transactions with shareholders
Dividends 6 - - - - - (5,484) (5,484)
New shares issued 154 408 - (9) - (553) -
Share-based payments - - - - - 586 586
Total transactions with shareholders 154 408 - (9) - (5,451) (4,898)
At 31 December 2023 39,738 13,981 70 (16) 171 60,632 114,576
Comprehensive income
Profit for the year - - - - - 15,530 15,530
Foreign currency translation differences
- - - - (150) - (150)
Remeasurement of pension liability
10 - - - - - (362) (362)
Tax on remeasurement of pension liability
11 - - - - - 91 91
Total comprehensive income - - - - (150) 15,259 15,109
Transactions with shareholders
Dividends 6 - - - - - (5,750) (5,750)
New shares issued 162 515 - (21) - (656) -
Purchase of own shares - - - (392) - - (392)
Share-based payments - - - - - (270) (270)
Total transactions with shareholders 162 515 - (413) - (6,676) (6,412)
At 31 December 2024 39,900 14,496 70 (429) 21 69,215 123,273
Macfarlane Group PLC
Consolidated balance sheet at 31 December 2024
Note 2024 2023
£000 £000
Non-current assets
Goodwill and other intangible assets 97,970 87,495
Property, plant and equipment 10,607 9,210
Right of Use assets 41,077 35,001
Other receivables 35 35
Deferred tax assets 11 145 335
Retirement benefit obligations 10 9,636 9,921
Total non-current assets 159,470 141,997
Current assets
Inventories 19,049 17,523
Trade and other receivables 55,015 53,792
Current tax asset 469 225
Cash and cash equivalents 9 12,928 7,691
Total current assets 87,461 79,231
Total assets 3 246,931 221,228
Current liabilities
Trade and other payables 50,263 50,623
Provisions 1,044 401
Current tax liability 1,035 983
Lease liabilities 9 7,223 7,307
Bank borrowings 9 14,846 7,164
Total current liabilities 74,411 66,478
Net current assets 13,050 12,753
Non-current liabilities
Deferred tax liabilities 11 10,937 9,472
Deferred contingent consideration 2,330 504
Provisions 327 1,329
Lease liabilities 9 35,653 28,869
Total non-current liabilities 49,247 40,174
Total liabilities 3 123,658 106,652
Net assets 123,273 114,576
Equity
Share capital 12 39,900 39,738
Share premium 12 14,496 13,981
Revaluation reserve 70 70
Own shares (429) (16)
Translation reserve 21 171
Retained earnings 69,215 60,632
Total equity 3 123,273 114,576
Macfarlane Group PLC
Consolidated cash flow statement
For the year ended 31 December 2024
Note
2024 2023
£000 £000
Profit before tax 20,896 20,280
Adjustments for:
Amortisation of intangible assets 4,610 4,034
Depreciation of property, plant and equipment and ROU assets 10,757 9,574
Deferred contingent consideration adjustment (805) 1,535
Loss/(profit) on disposal of property, plant and equipment 39 (3)
Share-based (credit)/charge (270) 586
Net finance costs 2,701 1,788
Operating cash flows before movements in working capital 37,928 37,794
(Increase)/decrease in inventories (646) 5,733
Decrease in receivables 1,883 7,453
Decrease in payables (2,233) (7,021)
Decrease in provisions (359) (1,599)
Other non-cash movements (150) -
Adjustment for pension scheme funding 361 (1,179)
Cash generated by operations 36,784 41,181
Deferred contingent consideration paid (1,492) -
Income taxes paid (6,773) (5,374)
Net finance costs paid (3,091) (2,298)
Cash inflow from operating activities 25,428 33,509
Investing activities
Acquisitions, net of cash acquired 8 (10,600) (14,466)
Proceeds on disposal of property, plant and equipment 45 90
Purchases of property, plant and equipment (2,925) (2,175)
Cash outflow from investing activities (13,480) (16,551)
Financing activities
Dividends paid 6 (5,750) (5,484)
Purchase of own shares (392) -
Drawdown/(repayment) on bank borrowing facility 8,386 (2,323)
Repayments of leases (8,251) (7,510)
Cash outflow from financing activities (6,007) (15,317)
Net increase in cash and cash equivalents 5,941 1,641
Cash and cash equivalents at beginning of year 6,987 5,346
Cash and cash equivalents at end of year 12,928 6,987
2024 2023
Reconciliation to consolidated cash flow statement £000 £000
Cash and cash equivalents per the consolidation balance sheet 9 12,928 7,691
Bank overdraft - (704)
Balances per consolidated cash flow statement 12,928 6,987
Bank overdrafts are included in cash and cash equivalents because they form an
integral part of the Group's cash management.
Macfarlane Group PLC
Notes to the financial information
For the year ended 31 December 2024
1. General information
The financial information set out herein does not constitute the Company's
statutory accounts as defined in Section 435 of the Companies Act 2006 and has
been extracted from the full statutory accounts for the years ended 31
December 2024 and 2023.
The financial statements for 2024 were approved by the Board of Directors on
27 February 2025. The auditor's report on the statutory financial statements
for the year ended 31 December 2024 was unqualified pursuant to Section 498 of
the Companies Act 2006 and did not contain a statement under sub-section 498
(2) or (3) of that Act.
The financial information for 2023 is derived from the statutory accounts for
2023 which have been delivered to the registrar of companies. The auditor has
reported on the 2023 accounts; their report was (i) unqualified, (ii) did not
include a reference to any matters to which the auditor drew attention by way
of emphasis without qualifying their report and (iii) did not contain a
statement under section 498 (2) or (3) of the Companies Act 2006.
2. Basis of preparation
The Group's business activities, together with the factors likely to affect
its future development, performance and financial position are set out above.
The Group's principal financial risks in the medium term relate to liquidity
and credit risk. Liquidity risk is managed by ensuring that the Group's
day-to-day working capital requirements are met by having access to committed
banking facilities with suitable terms and conditions to accommodate the
requirements of the Group's operations. Credit risk is managed by applying
considerable rigour in managing the Group's trade receivables. The Directors
believe that the Group is adequately placed to manage its financial risks
effectively, despite any economic uncertainty.
The Group's has a committed borrowing facility of £40m with Bank of Scotland
PLC and HSBC Bank UK plc in place until November 2027. The facility bears
interest at normal commercial rates and carries standard financial covenants
in relation to interest cover and leverage.
The Directors are of the opinion that the Group's cash forecasts and revenue
projections, which they believe are based on appropriate market data and past
experience taking account of reasonably possible changes in trading
performance given current market and economic conditions, show that the Group
should be able to operate within the current facility and comply with its
banking covenants. The Directors have modelled a range of scenarios, including
a base case, a downside scenario, a severe but plausible downside and a
reverse stress test, over the three-year horizon, as set out in the Viability
Statement above.
After making enquiries, the directors have a reasonable expectation that the
Company and the Group have adequate resources to continue in operational
existence at least for the next twelve months. For this reason, they continue
to adopt the going concern basis in preparing the financial statements for the
year ended 31 December 2024.
Key sources of estimation uncertainty
The preparation of financial statements requires management to make estimates
and assumptions that affect the amounts reported for assets and liabilities as
at the balance sheet date and the amounts reported for revenues and expenses
during the year. Due to the nature of estimation, the actual outcomes may well
differ from these estimates. The directors have assessed the impact of climate
change and consider that this does not have a significant impact on these
financial statements. The key sources of estimation uncertainty that have a
significant effect on the carrying amounts of assets and liabilities in the
next twelve months are discussed below:
Retirement benefit obligations
The determination of any defined benefit pension scheme liability is based on
assumptions determined with independent actuarial advice. The key assumptions
used include discount rate and inflation rate, for which a sensitivity
analysis is provided in Note 10. The directors consider that those
sensitivities represent reasonable sensitivities which could occur in the next
financial year.
Key sources of estimation uncertainty (continued)
Valuation of deferred contingent consideration
The valuation of deferred contingent consideration at both acquisition date
and the balance sheet date is measured at fair value. This involves the
assessment of forecast future cash flows against earn-out targets agreed with
the sellers of acquired businesses over a period of up to two years. This
assessment is based on the directors' best estimate using the information
available at the relevant dates. However, there remains a risk that the actual
payment differs from the amount assumed as consideration within the PPA
accounting as detailed in note 8 and from the amount recorded as a liability
at the balance sheet date. Deferred contingent considerations are recognised
as a liability in trade and other payables and are remeasured to fair value of
£5.5m at the balance sheet date, of which £2.3m is due in more than one
year, based on a range of outcomes between £Nil and £7.3m. Trading in the
post-acquisition period supports the remeasured value of £5.5m.
Critical accounting judgements
Property provisions
Property provisions of £1.4m have been recognised as at 31 December 2024
(2023: £1.7m), representing the directors' best estimate of dilapidations on
property leases. The directors have made the judgement that no provision is
required for certain property leases where there is no intention to exit,
having considered a number of factors including the extent of modifications to
the property, the terms of the lease agreement, and the condition of the
property.
No other significant critical judgements have been made in the current or
prior year.
Alternative performance measures
In measuring the financial performance and position, the financial measures
used in certain limited cases are derived from the reported results in order
to eliminate factors which due to their unusual nature and size distort
year-on-year comparisons to a material extent and/or provide useful
information to stakeholders. Where such items arise, the directors will
classify such items as separately disclosed and provide details of these items
to enable users of the accounts to understand the impact on the financial
statements.
To the extent that a measurement under Generally Accepted Accounting
Principles ("GAAP") is adjusted for a separately disclosed item, this is
referred to as an Alternative Performance Measure ("APM"). We believe that the
APMs defined below, and the comparable GAAP measurement, provides a useful
basis for measuring the underlying financial performance and position of the
Group and its businesses when compared to similar companies.
Adjusted operating profit is defined as operating profit before customer
relationships and brand values amortisation and deferred contingent
consideration adjustments.
Adjusted profit before tax is defined as profit before tax, customer
relationships and brand values amortisation, and deferred contingent
consideration adjustments.
Adjusted diluted earnings per share is defined as diluted earnings per share
before, customer relationships and brand values amortisation per share and
related tax per share and deferred contingent consideration adjustments per
share.
Alternative performance measures (continued)
Alternative performance measures Customer relationship/ brand values amortisation Deferred contingent consideration adjustments Tax Statutory measures
£000 £000 £000 £000 £000
Year to 31 December 2024
Adjusted operating profit 27,402 (4,610) 805 - 23,597 Operating profit
Adjusted profit before tax 24,969 (4,610) 537 - 20,896 Profit before tax
Adjusted diluted earnings per share (pence) 11.56p (2.89)p 0.34p 0.73p 9.74p Diluted earnings per share (pence)
Year to 31 December 2023
Adjusted operating profit 27,637 (4,034) (1,535) - 22,068 Operating profit
Adjusted profit before tax 25,849 (4,034) (1,535) - 20,280 Profit before tax
Adjusted diluted earnings per share (pence) 12.21p (2.51)p (0.96)p 0.60p 9.34p Diluted earnings per share (pence)
Net bank funds/(debt) also represents an APM as defined and reconciled to the
statutory measure in note 9.
3. Segmental information
The Group's principal business segment is Packaging Distribution, comprising
the distribution of packaging materials and supply of storage and warehousing
services in the UK. This comprises 85% of Group revenue and 73% of Group
operating profit. The Group's Manufacturing Operations segment comprises the
design, manufacture and assembly of timber, corrugated and foam-based
packaging materials in the UK. This comprises 15% of Group revenue and 27% of
Group operating profit.
2024 2023
£000 £000
Group segment -Revenue
Packaging Distribution 228,763 244,938
Manufacturing Operations 47,458 40,929
Inter-segment revenue Manufacturing Operations (5,784) (5,153)
External revenue 270,437 280,714
Packaging Distribution 20,158 21,044
Manufacturing Operations 7,244 6,593
Adjusted operating profit 27,402 27,637
Packaging Distribution 17,331 16,511
Manufacturing Operations 6,266 5,557
Operating profit 23,597 22,068
Finance costs (2,701) (1,788)
Profit before tax 20,896 20,280
Tax (5,366) (5,306)
Profit for the year 15,530 14,974
Assets Liabilities Net assets
£000 £000 £000
Group segments
Packaging Distribution 189,768 (110,832) 78,936
Manufacturing Operations 57,163 (12,826) 44,337
Net assets 2024 246,931 (123,658) 123,273
Assets Liabilities Net assets
£000 £000 £000
Packaging Distribution 176,740 (94,757) 81,983
Manufacturing Operations 44,488 (11,895) 32,593
Net assets 2023 221,228 (106,652) 114,576
2024 2023
£000 £000
Packaging Distribution
Total and external revenue 228,763 244,938
Cost of sales (143,890) (157,458)
Gross profit 84,873 87,480
Net operating expenses (64,715) (66,436)
Adjusted operating profit 20,158 21,044
Amortisation and deferred contingent consideration adjustments (2,827) (4,533)
Operating Profit 17,331 16,511
Manufacturing Operations
2024 2023
£000 £000
Total revenue 47,458 40,929
Inter-segment revenue (5,784) (5,153)
External revenue 41,674 35,776
Cost of sales (21,175) (17,575)
Gross profit 20,499 18,201
Net operating expenses (13,255) (11,608)
Adjusted operating profit 7,244 6,593
Amortisation and deferred contingent consideration adjustments (978) (1,036)
Operating profit 6,266 5,557
4. Net finance costs
2024 2023
£000 £000
Interest on bank borrowings 950 878
Interest on leases 1,921 1,420
Net interest income on retirement benefit obligation (see note 10) (438) (510)
Finance charge relating to deferred contingent consideration 268 -
Net finance costs 2,701 1,788
5. Tax 2024 2023
£000 £000
Current tax
United Kingdom corporation tax at 25.0% (2023: 23.5%) 5,363 5,615
Foreign tax 795 460
Adjustments in respect of prior years (58) (38)
Total current tax 6,100 6,037
Deferred tax
Current year (899) (731)
Adjustments in respect of prior years 165 -
Total deferred tax (see note 11) (734) (731)
Total tax charge 5,366 5,306
The standard rate of tax based on the UK average rate
of corporation tax is 25.0% (2023: 23.5%). The increase in 2024 is due to the
corporation tax rate increasing from 19% to 25% effective from 1 April 2023.
Taxation for other jurisdictions is calculated at the rates prevailing in
these jurisdictions.
The actual tax charge for the current and previous
year varies from the standard rate of tax on the results in the consolidated
income statement for the reasons set out in the following reconciliation:
2024 2023
£000 £000
Profit before tax 20,896 20,280
Tax on profit at 25.0% (2023: 23.5%) 5,224 4,766
Factors affecting tax charge for the year:-
Difference in rate for deferred tax (25%) on pensions - 25
Deferred contingent consideration adjustments not allowable for tax (134) 360
Non-deductible expenses 100 127
Difference on overseas tax rates 69 66
Changes in estimates related to prior years 107 (38)
Tax charge for the year 5,366 5,306
Effective rate of tax for the year 25.7% 26.2%
6. Dividends 2024 2023
£000 £000
Amounts recognised as distributions to equity holders
in the year:
Final dividend for the year ended 31 December 2023 of 2.65 per
share (2022 - 2.52p per share)
4,221 3,990
Interim dividend for the year ended 31 December 2024 of 0.96p per
share (2023 - 0.94p per share)
1,529 1,494
5,750 5,484
A proposed dividend of 2.70p per share totalling £4,300,000 will be paid on
13 June 2025 to those shareholders on the register at 16 May 2025 (ex dividend
date 15 May 2025). This is subject to approval by shareholders at the Annual
General Meeting on 13 May 2025 and therefore has not been included as a
liability in these financial statements.
7. Earnings per share
The calculation of the basic and diluted earnings per
share is based on the following data:
2024 2023
£000 £000
Earnings for the purposes of earnings per share
Profit for the year 15,530 14,974
Number of shares in issue for the purposes of calculating basic and diluted 2024 2023
earnings per share
No. of No. of
shares '000 shares '000
Weighted average number of shares in issue 159,461 158,542
Less shares held by the EBT (278) -
Weighted average number of shares in issue for the
purposes of basic earnings per share 159,183 158,542
Effect of Long-Term Incentive Plan awards in issue 340 1,788
Weighted average number of shares in issue for the purposes of calculating
diluted earnings per share
159,523 160,330
Basic Earnings per share 9.76p 9.44p
Diluted Earnings per share 9.74p 9.34p
8. Acquisitions
On 13 March 2024, Macfarlane Group UK Limited ("MGUK") acquired 100% of
Allpack Packaging Supplies Limited ("Allpack Direct"), for a total potential
consideration of £5.5m and inherited net cash/bank balances of £1.9m. Full
potential contingent consideration of £0.75m is payable in the second quarter
of 2025, subject to certain trading targets being met in the twelve-month
periods ending on 28 February 2025.
On 6 July 2024, MGUK acquired 100% of Polyformes Limited ("Polyformes"), for a
total potential consideration of £11.6m and inherited net cash/bank balances
of £0.6m. Full potential contingent consideration of £4.8m is payable in
the third quarters of 2025 and 2026, subject to certain trading targets being
met in the two twelve-month periods ending on 30 June 2025 and 2026
respectively.
£1.5m was paid in 2024 to the sellers of PackMann Gesellschaft für
Verpackungen und Dienstleistungen mbH ("PackMann"), acquired in 2022, as the
profit targets were met for the twelve-month periods ending 31 May 2023 and 31
May 2024.
£1.25m was paid in 2024 to the sellers of A.E. Sutton Limited ("Suttons"),
acquired in 2023, as the profit target was met for the twelve-month period
ending 29 February 2024.
£0.25m was paid in 2024 to the sellers of A & G Holdings Limited
("Gottlieb"), acquired in 2023, as the profit target was met for the
twelve-month period ending 30 April 2024.
Contingent considerations are recognised as a liability in trade and other
payables and are remeasured to fair value of £5.5m at the balance sheet date,
all due within one year, based on a range of outcomes between £Nil and
£7.3m. Trading in the post-acquisition period supports the remeasured value
of £5.5m. The £5.5m relates to the acquisitions of Gottlieb (£0.5m),
Allpack Direct (£0.5m) and Polyformes (£4.5m). The settlement of the
amount initially recognised upon acquisition is reflected in cash flows from
investing activities, with the element of the payment relating to any
subsequent remeasurement included within cash flows from operating activities.
The impact of the acquisitions of Allpack Direct and Polyformes on 2024
results and if the acquisitions had been completed on the first day of 2024
are set out below:
From date of acquisition If completed 1 January 2024
Revenue Profit Revenue Profit
£000 £000 £000 £000
Allpack Direct 2,442 525 2,930 630
Polyformes 5,335 822 10,670 1,644
Fair values assigned to net assets acquired and consideration paid and payable
are set out below:
Allpack Prior Year 2024
Direct Polyformes Acquisitions Total
£000 £000 £000 £000
Net assets acquired
Other intangible assets 2,277 7,166 - 9,443
Tangible assets (inc. ROU assets) 24 2,125 - 2,149
Inventories 185 695 - 880
Trade and other receivables 1,084 1,802 - 2,886
Cash and bank balances (note 9) 1,862 621 - 2,483
Trade and other payables (324) (1,855) - (2,179)
Current tax liabilities (185) (307) - (492)
Lease liabilities - (1,709) - (1,709)
Deferred tax liabilities (note 11) (575) (1,905) - (2,480)
Net assets acquired 4,348 6,633 - 10,981
Goodwill arising on acquisition 1,093 4,549 - 5,642
Total consideration 5,441 11,182 - 16,623
Contingent consideration on acquisitions
Current year (701) (4,344) - (5,045)
Prior years - - 2,997 2,997
Total cash consideration 4,740 6,838 2,997 14,575
Net cash outflow arising on acquisitions
Cash consideration (4,740) (6,838) (2,997) (14,575)
Cash and bank balances acquired 1,862 621 - 2,483
Net cash outflow - acquisitions (2,878) (6,217) (2,997) (12,092)
Net cash outflow arising on acquisitions
Net cash flow from operating activities - - (1,492) (1,492)
Net cash flow from investing activities (2,878) (6,217) (1,505) (10,600)
Net cash outflow - acquisitions (2,878) (6,217) (2,997) (12,092)
9. Analysis of changes in net debt
Cash &cash Bank Lease Total
equivalents borrowing liabilities debt
£000 £000 £000 £000
At 1 January 2024 7,691 (7,164) (36,176) (35,649)
Cash movements 2,754 (7,682) 8,251 3,323
Non-cash movements
New leases - - (11,208) (11,208)
Acquisitions 2,483 - (1,709) 774
Disposal - - 107 107
Lease modifications - - (2,210) (2,210)
Exchange movements - - 69 69
At 31 December 2024 12,928 (14,846) (42,876) (44,794)
Due within one year 12,928 (14,846) (7,223) (9,141)
Due after more than one year - - (35,653) (35,653)
At 31 December 2024 12,928 (14,846) (42,876) (44,794)
Net bank debt 2024 12,928 (14,846) (1,918)
Net bank funds 2023 7,691 (7,164) 527
Cash and cash equivalents (which are presented as a single class of asset on
the face of the balance sheet) comprise cash at bank and other short-term
highly liquid investments with maturity of three months or less.
10. Pension scheme
Macfarlane Group PLC sponsors a defined benefit pension scheme for former UK
employees - the Macfarlane Group PLC Pension & Life Assurance Scheme
(1974) ("the Scheme"). One of the trading subsidiaries, Macfarlane Group UK
Limited is also a sponsoring employer of the Scheme. The Scheme is currently
in surplus and disclosure of the respective proportions of the Group surplus
are included and disclosed in the financial statements of each of the two
participating employers.
The Scheme is an HMRC registered pension scheme, administered by a Board of
Trustees composed of employer-nominated representatives and member-nominated
Trustees which is legally separate from the Group. The Scheme's investments
are held separately from those of the Group in managed funds under the
supervision of the Trustees. The Trustees are required by law to act in the
interest of all classes of beneficiary in the Scheme and are responsible for
investment policy and the administration of benefits. Macfarlane Group PLC,
based on legal opinion provided, has an unconditional right to a refund of
surplus assets assuming the full settlement of plan liabilities in the event
of a wind up of the Scheme. Furthermore, in the ordinary course of business
the trustees have no rights to unilaterally wind up the Scheme, or otherwise
augment the benefits due to members of the Scheme. Based on these rights, any
net surplus in the Scheme is recognised in full.
The Scheme provides qualifying employees with an annual pension of 1/60 of
pensionable salary for each completed years' service on attainment of a normal
retirement age of 65. Pensionable salaries were frozen for the remaining
active members at the levels current at 30 April 2009 with the change taking
effect from 30 April 2010. As a result no further salary inflation applies for
active members who elected to remain in the Scheme. Active members' benefits
also include life assurance cover, with the payment of these benefits at the
discretion of the Trustees of the Scheme. The Scheme was closed to new
entrants during 2002. The Scheme was closed to future accrual on 30 November
2022 with the 3 remaining active members transferring to the Group's defined
contribution pension scheme.
On leaving active service a deferred member's pension is revalued from the
time of withdrawal until the pension is drawn. Revaluation in deferment is
statutory and since 2010 has been revalued on the Consumer Price Index ("CPI")
measure of inflation. Revaluation of pensions in payment is a blend of fixed
increases and inflationary increases depending on the relevant periods of
accrual of benefit. For pensions in payment, the inflationary increase is
currently based on the Retail Price Index ("RPI") measure of inflation or
based on Limited Price Indexation ("LPI") for certain defined periods of
service.
During 2012, Macfarlane Group PLC agreed with the Board of Trustees to amend
benefits for pensioner, deferred and active members in the Scheme by offering
a Pension Increase Exchange ("PIE") option to pensioner members and a PIE
option to all other members at retirement after 1 May 2012.
In June 2023, the UK High Court issued a ruling in the case of Virgin Media
Limited v NTL Pension Trustees II Limited and other ("the Virgin Media case")
relating to the validity of certain historical pension changes. The ruling
was upheld at the Court of Appeal in July 2024. After seeking external legal
advice the Group has concluded that they are not aware of any issues that
would require any adjustment to the defined benefit obligations and no further
action is required at this stage.
Balance sheet disclosures
The Scheme's qualified actuary from Aon carries out triennial valuations using
the Projected Unit Credit Method to determine the level of deficit/surplus.
For the most recent triennial valuation at 1 May 2023, the results of this
valuation showed that the market value of the relevant investments of the
Scheme was £71,900,000 and represented 109% of the actuarial value of
benefits that had accrued to members.
The investment classes held by the Scheme and the Scheme surplus, based on the
results of the actuarial valuation as at 1 May 2023, updated to the year-end
are as shown below:
2024 2023
£000 £000
Investment class
Multi-asset diversified funds 2,879 10,198
Liability-driven investment funds 32,589 32,052
Multi-asset credit funds 10,234 9,824
Securitised credit funds 16,895 13,047
Other (cash and similar assets) 1,511 7,402
Fair value of Scheme investments 64,108 72,523
Present value of Scheme liabilities (54,472) (62,602)
Scheme surplus 9,636 9,921
The Trustees review the investments of the Scheme on a regular basis and
consult with the Company regarding any proposed changes to the investment
profile. Liability-Driven Investment Funds are intended to provide a match of
100% against the impact of movements in inflation on pension liabilities and
against the impact of movements in interest-rates on pension liabilities.
During 2024 adjustments were made between investments to maintain the overall
allocations in line with the Trustees' strategic asset allocation.
The ability to realise the Scheme's investments at, or close to, fair value
was considered when setting the investment strategy. 100% (2023: 100%) of the
Scheme's investments can be realised at fair value on a daily or weekly basis.
The remaining investments have monthly or quarterly liquidity. However, whilst
the regular income from these helps to meet the Scheme's cash flow needs, they
are not expected to be realised at short notice from a strategic perspective.
The present value of the Scheme liabilities is derived from cash flow
projections and the expected return of the assets over a long period and is
thus inherently uncertain.
The Scheme's liabilities were calculated on the following bases as required
under IAS 19:
Assumptions 2024 2023
Discount rate 5.50% 4.50%
Rate of increase in salaries 0.00% 0.00%
Inflation assumption (RPI) 3.20% 3.20%
Inflation assumption (CPI) 2.80% 2.70%
Life expectancy beyond normal retirement age of 65
Male currently aged 55 (years) 22.3 22.3
Female currently aged 55 (years) 24.1 24.0
Male currently aged 65 (years) 21.8 21.8
Female currently aged 65 (years) 23.4 23.3
2024 2023
Movement in scheme surplus £000 £000
At 1 January 9,921 10,199
Administration costs incurred (361) (71)
Employer contributions - 1,250
Net finance income (see note 4) 438 510
Remeasurement of pension scheme liability (362) (1,967)
At 31 December 9,636 9,921
Funding
UK pension legislation requires that pension schemes are funded prudently.
Following the triennial actuarial valuation of the Scheme at 1 May 2023, the
Company agreed with the Pension Scheme Trustees, that no contributions were
required. The next triennial actuarial valuation is due at 1 May 2026.
Sensitivity to key assumptions
The key assumptions used for IAS 19 are discount rate, inflation and
mortality. If different assumptions were used, then this could have a material
effect on the results disclosed. Assuming all other assumptions are held
static then a movement in the following key assumptions would affect the level
of the deficit as shown below:
2024 2023
Assumptions £000 £000
Discount rate movement of +3.0% 19,505 22,531
Inflation rate movement of +0.25% (521) (599)
Mortality movement of +0.1 year in age rating 123 141
Positive figures reflect a reduction in the Scheme liabilities and therefore a
reduction in the Scheme deficit or increase in the Scheme surplus. The
sensitivity information has been prepared using the same method as adopted
when adjusting the results of the latest funding valuation to the balance
sheet date and is consistent with the approach adopted in previous years.
The sensitivities shown reflect average movements in the assumptions in the
last three years. All information assumes that the average duration of Scheme
liabilities is twelve years.
11. Deferred tax 2024 2023
£000 £000
At 1 January (9,137) (8,117)
Transfer to Corporation Tax
Acquisitions (note 8) (2,480) (2,243)
Credited in income statement (see note 5) 734 731
Credited in other comprehensive income
Remeasurement of pension scheme 91 492
liability
At 31 December (10,792) (9,137)
Deferred tax assets
On accelerated capital allowances/timing differences 145 335
Disclosed as deferred tax assets 145 335
Deferred tax liabilities
On accelerated capital allowances/timing differences (1,406) (1,072)
On retirement benefit obligations (2,409) (2,481)
On other intangible assets (7,122) (5,919)
Disclosed as deferred tax liabilities (10,937) (9,472)
At 31 December (10,792) (9,137)
12. Share capital 2024 2023
£000 £000
Allotted, issued and fully paid:
At 1 January 39,738 39,584
New shares issued 162 154
At 31 December 39,900 39,738
Share premium
At 1 January 13,981 13,573
New shares issued 515 408
At 31 December 14,496 13,981
The Company has one class of ordinary shares of 25p each, which carry no right
to fixed income. Each ordinary share carries one vote in any General Meeting
of the Company.
On 19 March 2024, the Company issued 648,000 ordinary shares of 25p at a value
of 104.40p to settle 2021 share awards under the Company's 2016 Performance
Share Plan.
13. Related party transactions
Transactions between the Company and its subsidiaries, which are related
parties, have been eliminated on consolidation and are not disclosed.
Details of individual and collective remuneration of the Company's Directors
and dividends received by the Directors for calendar year 2024 will be
disclosed in the Group's 2024 Annual Report and Accounts.
The directors are satisfied that there are no other related party transactions
occurring during the year which require disclosure.
14. Post balance sheet events
On 10 January 2025, MGUK acquired 100% of the protective packaging
manufacturer and distributor The Pitreavie Group Limited and its subsidiary
Pitreavie Packaging Limited ("Pitreavie") based in Scotland for a maximum cash
consideration of £18.0m, including a deferred contingent consideration of
£4.0m payable over two years. In addition, an estimated completion
adjustment was paid to MGUK of £3.4m with net debt inherited of £4.1m.
Pitreavie is a leading player in Scotland in the design, manufacturing and
distribution of protective packaging, primarily in the food & drink,
energy, electronics and industrial sectors, with more than 150 employees.
Due to the recent nature of the acquisition and size of the transaction, the
Group is in preliminary stages of its fair value assessment of the assets
required and the liability assumed under IFRS 3 Business Combinations. The
completed fair value exercise and provisional disclosures will be reported in
the Group's 2025 interim results.
15. Posting to shareholders and Annual General Meeting
The Annual Report and Accounts will be sent to shareholders on Friday 11 April
2025 and will be available to members of the public at the Company's
Registered Office from Friday 2 May 2025.
The Annual General Meeting will take place at 12 noon on Tuesday 13 May 2025.
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