14th Aug 2018 10:12
LONDON (Alliance News) - John Menzies PLC said Tuesday it "significantly" improved its performance in the first half of 2018 as it focuses on its strategic goal of becoming a purely aviation business.
For the six months to June 30, the logistics firm posted revenue, including discontinued operations, up to GBP1.25 billion from GBP1.22 billion the year before. On a reported basis, revenue from continuing operations was GBP627.2 million, up 2.5% from GBP611.7 million the year prior.
The company registered a GBP2.9 million pretax loss in respect of the first half compared with a GBP500,000 profit a year ago. Excluding discontinued operations, however, pretax profit was GBP8.3 million.
On an adjusted basis, excluding net finance charges, group pretax profit was GBP28.5 million, up 15% year-on-year from GBP24.7 million.
"The group reported a loss before tax with stronger trading profit offset by exceptional and other items, particularly relating to the integration of acquisitions, the impact of the disposal of Menzies Distribution and the continuing de-risking of the defined benefit pension scheme," John Menzies explained.
The company incurred GBP26.0 million, which included a GBP20.8 million impairment charge, in costs related to the sale of its print media division Menzies Distribution. This was completed at the end of July and was in line with the goal of focusing resources entirely on expanding its position in what it considers the structurally growing aviation services market.
"I am very pleased to have concluded our strategic realignment that, subject to shareholder approval, will see the creation of John Menzies as a global pure-play aviation business and allow us to focus our management and capital resources on expanding our position in the structurally growing aviation services market," Chief Executive Officer Designate Forsyth Black said.
Additionally, the company said that trading in the second half of the year continues "to be in line with expectations" and the board remains confident in meeting its annual expectations.
The company held its interim dividend at 6.0 pence per share.
Meanwhile, in a separate release on Tuesday, the UK Competition & Markets Authority said it referred Menzies's acquisition of of aircraft de-icing company Airline Services Ltd for an in-depth merger investigation.
Menzies Aviation bought Airline Services from Airline Services & Components Group Ltd in April for an undisclosed sum.
The UK watchdog said it has identified competition concerns regarding de-icing services at Edinburgh, Glasgow and London Heathrow airports, and ground handling services at London Gatwick and Manchester airports.
"As Menzies and Airline Services are close competitors at these airports, the deal could result in less choice for airlines operating there, potentially leading to higher prices and lower quality services," the CMA said.
The watchdog said it will make a final decision by January 28.
John Menzies shares were trading 0.6% higher at 649.00p each on Tuesday.
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