16 March 2010

Macfarlane

NO RECOMMENDATION

10/08/2000

Macfarlane's malaise has been arrested with the sale of two subsidiaries, David Montgomery and Flopak. The packaging company's three remaining branches are restructuring by shifting away from manufacturing to providing services. The plastics branch will be providing services specifically for blue-chip companies wanting to outsource packaging supply main management. The merchanting division, which suffered static growth, will undergo rebranding in order to infuse the product with marketability. The third arm of the company, the labels branch, sustained operating profits of £3.6m, but again a new orientation towards service rather than manufacturing should serve to expand markets and profits for Macfarlane. CCF Charterhouse predict profits will rise to £16.2m for the year end December 2000, after a terrible fall of £12.5m, from £15.1m in 1998 to £2.6m in 1999.

Sector: General Industrials

Companies: Macfarlane Group

Market cap: £79.3m

PE Forecast: 7.4

Share price: 62.5p

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