News Column

John Menzies First-Half Profit And Revenue Hit By Strong Pound

August 19, 2014

Rowena Harris-Doughty

LONDON (Alliance News) - John Menzies PLC Tuesday reported a decline in profit for the first half of the year, hit by a fall in revenue and the persistent strength of sterling.

The aviation services and print media distribution company reported a pretax profit of GBP14.2 million for the six months to June 30, compared with GBP18.4 million a year earlier, as revenue fell to GBP944.4 million, down from GBP951.8 million in the first half of 2013.

The company said its results on a reported basis were hit by the strength of the pound against other currencies in which it operates. On a constant currency basis, John Menzies said group revenue was up GBP27.1 million to GBP1.03 billion, with underlying operating profit marginally ahead at GBP26.2 million, compared with GBP26.1 million in the first half of last year.

John Menzies increased its interim dividend by 5% to 8.1 pence per share from 7.7 pence the year before, and gave a confident outlook for the business.

"The medium and long term outlook for the business remains positive. The contract pipeline is strong, new licence opportunities are coming on stream, and we continue to pursue acquisition opportunities," it said.

John Menzies said it continues to progress despite challenges faced in its Aviation division, in terms of continued airline pricing pressure and operational issues within its UK ground handling business.

Menzies Aviation is a provider of passenger, ramp and cargo services.

"Notwithstanding these, we have enjoyed a very strong contract win season, and Aviation remains well placed to continue to grow in a market with positive growth dynamics," said Chairman Iain Napier in a statement.

The company said its Distribution business - which provides distribution and marketing services to the newspaper and magazine supply chain in the UK and Ireland - posted a good first half, boosted by collectible sales and the benefits of its rationalisation programme, which will conclude at the end of 2015.

John Menzies shares were trading 3.0% lower at 621.50 pence early Tuesday.

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Source: Alliance News

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