Scotland-based Macfarlane Group, a protective packaging manufacturer, has reported a 4% decline in its profit for financial year 2023 (FY23), with figures falling to £14.9m ($18.8m) from £15.6m in FY22.

Despite this, the company's gross profit saw an 8% increase to £105.6m, and its operating profit rose by 3% to £22.06m in FY23.  

The company's revenue also experienced a decrease of 3% to £280.7m in FY23 compared with £290.4m in FY22. 

Basic and diluted earnings per share were reported at 9.44p and 9.34p respectively, influenced by a higher tax rate of 23.5% in 2023. 

Over the year, Macfarlane's profit before tax (PBT) grew by 2% to £20.3m after accounting for £1.5m related to the acquisition of PackMann, which exceeded performance expectations.  

Its adjusted group PBT also increased by 10% to £25.8m. 

The company's Packaging Distribution division faced a revenue decrease of 6% to £244.9m, attributed to weaker demand in the UK and Ireland, alongside sales price deflation.  

However, this was partially mitigated by strong new business performance, European sales momentum, and the benefits from acquisitions.  

Macfarlane chair Aleen Gulvanessian said: "I am pleased to report that, against a backdrop of challenging market conditions, Macfarlane Group has once again demonstrated the resilience of its business model and achieved another year of profit growth in 2023.  

“Group profit before tax in 2023 was ahead of the previous year. This profit growth has been achieved through the completion of three high-quality acquisitions, effective management of input prices, good progress in Europe and stronger new business momentum which has offset weak customer demand in the UK and Ireland, sales price deflation and inflation in operating costs.”