16th May 2014 09:21
LONDON (Alliance News) - John Menzies PLC maintained its outlook for the full year, but said the year will be more weighted to the second half as trading through the end of April was behind the same period the year before.
In a statement ahead of its annual general meeting Friday, the aviation services and print media distributor said that, due to the mild winter, its de-icing activities were down during the start of the year. Meanwhile, start-up costs for recently won contracts were higher than the previous year.
In its Aviation segment, the company said it continued to win new contracts, including a new contract with Delta Air Lines Inc and a ten-year exclusive ground handling and plane fuelling license in Iraq, won as part of a consortium that it led.
Ground handling was up 10% during the year to date, due to acquisitions and contract wins. Cargo tonnes were up 3% on a like-for-like basis, due to contract wins, John Menzies said.
In its Menzies Distribution business, print media volumes were in line with internal forecasts, it said. As the FIFA World Cup approaches, sales of football trading stickers "continue to be a feature". However, it said it would not know what the returns would be on stickers until the third quarter of the year.
It continued to progress its rationalisation of the distribution business, closing sites at High Wycombe and Bangor, and consolidating its magazine packing operations for the South East to its site in Maidstone.
Shore Capital maintained its Buy rating for John Menzies, noting that whilst "the start up costs associated with new contracts will act as a drag on 1H numbers, with the benefit of the new contract wins coming through in the 2H, our full-year estimates remain unchanged."
Shares in John Menzies were trading down 0.4% at 663.50 pence Friday.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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