5th Jul 2019 08:48
(Alliance News) - John Menzies PLC performed worse than expected in the first half of 2019 because of challenges in the aviation market, the company said on Friday.
Menzies said fewer flights and weak cargo volumes have led to poor trading so far and earnings for 2019 will now not exceed last year's. In 2018, the aviation services provider earned GBP21.6 million in pretax profit and GBP1.29 billion in revenue.
Shares in the company were trading 17% lower at 378.95 pence each in London on Friday morning.
Chief Executive Giles Wilson said: "The overall aviation market is having a difficult year. This inevitably is having an impact on our full year outturn. However, I firmly believe in the structural growth dynamics within our industry and all historical data points to recovery."
"Accordingly, I believe we remain well placed to prosper. Since my appointment I have taken a number of actions to right size the business, we have also restructured our commercial teams to ensure we are ready to seize opportunities as they present themselves."
In May, Wilson said the firm was on track to meet its forecasts after it started the year "really well commercially". The company also announced it would make cutbacks to reduce company costs by GBP10.0 million.
In 2018, the company sold its print media arm Menzies Distribution Ltd for GBP74.5 million to investment fund managers Endless LLP but did add to its product portfolio in 2019, after it acquired aircraft de-icing company Airline Services Ltd for an undisclosed sum.
In what has been a commercially challenging year so far for the company, former CEO Forysth Black departed the firm in March, Wilson was named an interim before being appointed as the permanent replacement.
The company is scheduled to release its results for the six months to June-end on August 13.
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