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John Menzies losses deepen as pandemic hits commercial airline travel

By BFN News | 07:44 AM | Tuesday 29 September, 2020


Aviation services group John Menzies posted a deeper first-half loss after its business was hammered by pressure on the commercial airline sector caused by the Covid-19 crisis. Pre-tax losses for the six months through June amounted to £80.1 million, compared to losses of £4.4 million year-on-year. Revenue dropped 33% to £431.5 million amid a 43% decrease in passenger flight volumes. The loss included a £27.6 million charge to profits, comprising £26.3 million of restructuring expenses to downsize the business and transaction costs related to setting up a new business in Iraq. Looking ahead, John Menzies said it expected revenue in the second half to be similar to the first half, with profits benefiting from government support programmes and cost control. Flight schedules in the winter season were expected to be substantially lower, the company said. Substantial strides, meanwhile, had been made expanding its cargo-handling portfolio. 'We currently anticipate market conditions will remain challenging through the winter and the early part of next year, but expect a sustainable recovery in activity levels thereafter, contributing to modest revenue growth in 2021 over 2020,' John Menzies said. 'Whilst cautious on the pace of activity level recovery over the next 18 months, our restructured cost base and the rationalisation of the global portfolio should enable the group to generate higher returns as volumes improve.' Story provided by StockMarketWire.com

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