Menzies(john) Share Discussion Threads

[philanderer] 06/11/2014 12:31

On the watchlist.

Numis has retained 'add' but dropped it`s target from 761p to 450p

[1gw] 06/11/2014 10:05

Looks like Liberum has reiterated its Buy recommendation with a £6.00 target. This is well down from the £7.30 target they are reported to have had on 5th Sept and £8.47 target on 19th Aug, so they could reasonably be accused of being behind the curve. Still a £6 target is nice to see.

[1gw] 05/11/2014 14:48

Pugugly - no I don't know the covenant levels, but I think the business model is that the distribution side gets managed for cash to grow the aviation side.

Net debt increased from £103.5m at 31/12/13 to £113.4m at 30/6/14.

Net cash from operating activities was £35m in 2013 and in 1H14 was running ahead of 1H13 at £11m (vs £9m in 1H13).

In 2013 they used £27m on investing activities (including £10m acquisitions) and they paid out £16m in dividends. So they have 2 big levers(i.e. acquisition pace and dividend level) to pull if they need to divert ops cash to debt repayment.

[tanelorn] 05/11/2014 14:23

Money Week strikes again!! ( tipped this week as a buy!! ) - Try to wait for bottom, so was watching. May take 6 months to settle!.

[pugugly] 05/11/2014 14:22

Debt looks very high - Anyone any idea of the covenant levels?

[1gw] 05/11/2014 14:16

Looks like you might get your chance to buy sooner than you thought then hybrasil.

Doesn't seem to me like volumes are high enough today to mark proper capitulation, but I hope that when the analysts get a chance to think about the business in more depth they'll conclude today's fall was hugely overdone.

[hybrasil] 05/11/2014 14:08

looking at level 2 in the auction process shares for sale at £3.30

[1gw] 05/11/2014 09:58

I can't resist adding here and have just done so at 3.71.

I suspect the dividend will come under consideration although they are still generating cash from operations (2013 £35m cash from operating activities vs £16m of dividends paid, 2014H1 £11m of cash from operating activities vs £12m of dividends paid).

I also am trying to convince myself that problems at Heathrow should not be that material in the overall scheme of the business. According to the 2013 final results presentation (dated 4/3/14, slide 40), UK&I was only 22% of aviation revenue.

I wonder if when the dust has settled this does allow the group to entertain the possibility of separating the businesses (floating aviation).

All IMO, DYOR.

[envirovision] 05/11/2014 09:22

Increased short term debt coupled with reduced EPS. I take it the divi will be cut then.

[hybrasil] 05/11/2014 08:35

No looks like- it did.

I think the share has a way to fall. Im a buyer at 3£.

[1gw] 05/11/2014 08:10

Looks like the bear case won out in the short-term, at least in aviation. Craig Smyth booted out early. Don't suppose underperformance in aviation strengthens the case for immediate IPO of that business. And the underperformance could allow some kitchen-sinking when it comes to full-year results - or perhaps that is what they're doing with the IMS (overplaying the problems) and things will look marginally better when it comes to the full year results.

[1gw] 27/10/2014 19:44

I think the bear case runs something like:
o Distribution in terminal decline
o Aviation a bit volatile and currently subject to problems at Heathrow, unfavourable xrates and potentially an ebola-induced drop in flights to service.

I can't see any near-term catalyst for a big re-rating now (I'm not expecting any startling revelations in the IMS, in fact the risk is perhaps on the downside as the new CEO prepares the way for a bit of kitchen-sinking). I think the new CEO needs a bit of time to show what he can do. But give it a year or two and I think the company has great potential to re-rate as the market recognises the aviation business as the more significant part of the business going forward. There is also potential for someone to make a bid for the aviation side of the business, but I think it might be difficult to get the directors to agree to that. Maybe an activist investor could make the case for an IPO of the aviation side.

I topped up again at 5.09 (incl. costs) on 16th October after my 11th Sept buy at 5.67, so I'm done for a bit.

All IMO of course. DYOR.

[stpalm] 27/10/2014 11:15

1gw you seem to be the only person other than me who's interested but this. It looks really oversold now and im feeling the pain but also tempted to top up. If i do its bound to drop another £1 in short order so probably will wait till the tide turns. Do you have a bear case? Cant see why its dropped so far. Am i missing something apart from a brain?

[1gw] 11/9/2014 16:30

Well, if anyone is watching, that's me in for another chunk. IMO still a company with great potential, oversold on the basis of lack of interest and referendum fears (ok, plus maybe some disappointment with the interim results). Currency headwinds might have abated a bit as well recently.

[1gw] 06/9/2014 10:20

Another popular bulletin board this one. Interesting choice of new CEO and a fairly clear statement that he's not supposed to split the business according to The Times:
"The chairman moved to quell speculation that his new chief executive would aim to demerge Menzies' two businesses, arguing that the print distribution business would stay because it is the cash generator that secures the group as a whole."

I would have thought that investors and banks would be more than happy to finance further growth in a standalone aviation business on the back of a good management team and a sound strategy. And the reward to shareholders from allowing the 2 businesses to be rated separately (in terms of growth prospects and therefore p/e) could be considerable.

Have to give him 12 months to get his feet under the table and deliver some results first I suppose.

[1gw] 19/8/2014 07:42

Hmmmm, mixed results shall we say? Currency headwinds and some aviation yield pressure were expected, but I don't think the UK ground handling problems had been flagged. Still, distribution had a good 6 months.

Doesn't change my view that it would be good to review whether now is the right time to split the business, once a new CEO is on board.

[1gw] 14/8/2014 14:38

Been in mnzs for many years and it's been good to me.

I think the business is at a very interesting point here. Aviation has clearly taken over from distribution in terms of earnings and the company has an interesting strategic choice ahead of it: continuing with the dual-business model where steady distribution cashflow helps smooth out the aviation ups and downs, or looking at splitting the business somehow.

Personally, I think this is a good time to bring in a new CEO, although I'm disappointed to see them lose Craig Smyth given the stellar rise of the aviation business. I would like to see a fresh set of eyes give serious consideration to a split since I think the market might well value the sum of the parts greater than the whole. A position in a mature, distribution "duopoly" being managed for cashflow and efficiency on the one hand and a fast-growing relatively new business on the other are difficult to lump together for analysis purposes. The aviation business seems mature enough now to stand on its own feet.

All IMO, DYOR etc.

[grahamburn] 12/8/2014 12:02

Brief analysis in the Tempus column in The Times today. It concludes that the results statement next Monday may well be accompanied by the announcement of a CEO for the group (the departure of Craig Smyth yesterday indicates he failed to get the new "top job"), whilst the difficulties of Swissport at Gatwick could provide the aviation division with an opportunity. All this, especially the appointment of a CEO, could be just the tonic for the shares. So, "buy" it says.

[stpalm] 06/8/2014 17:18

Poor old menzies, seems really unloved, never mind, Mr market will wake up at some point. Not massive massive upside but seems well run looong term ting. Yield not bad while u wait either! Anyone have a bear case? Or does nobody care?

[philanderer] 13/11/2013 08:37

Back on the watchlist..


12th november


Shareholders in distribution specialist John Menzies took delivery of a profit warning today but City experts told punters to keep a grip on shares.

The firm - which distributes newspapers and provides airport services such as ramp and cargo handling - tumbled to the bottom of the mid-tier table after warning there would be an impact on second half profits. Its aviation business is flying but issues at its distribution business (namely returns of sticker collections from newsagents and weak marketing services) are the problem.

But analysts at Liberum Capital said they "like the structural growth dynamics in aviation" and noted "improving newspaper industry trends" which showed newspaper circulation decline has levelled out and is now "better than at any point since October 2009".

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John Menzies (LON:MNZS) was downgraded by analysts at Numis Securities Ltd to a "hold" rating. They now have a GBX 774 price target on the stock.

[colinhy] 20/9/2013 21:15

Sep 20th, 2013
John Menzies's "Corporate" Rating Reaffirmed at N+1 Singer (MNZS)

John Menzies (LON:MNZS)'s stock had its "corporate" rating reiterated by research analysts at N+1 Singer in a report released on Friday, Analyst Ratings Network reports.

A number of other analysts have also recently weighed in on MNZS. Analysts at Panmure Gordon initiated coverage on shares of John Menzies (LON:MNZS) in a research note to investors on Wednesday, August 21st. They set a "buy" rating and a GBX 877 ($13.93) price target on the stock. Separately, analysts at JPMorgan Chase & Co. reiterated an "overweight" rating on shares of John Menzies (LON:MNZS) in a research note to investors on Wednesday, August 21st. Finally, analysts at Numis Securities Ltd reiterated an "add" rating on shares of John Menzies (LON:MNZS) in a research note to investors on Tuesday, August 20th. They now have a GBX 834 ($13.24) price target on the stock.

Five equities research analysts have rated the stock with a buy rating, John Menzies currently has a consensus rating of "Buy" and an average price target of GBX 852.67 ($13.54).

Shares of John Menzies (LON:MNZS) opened at 777.50 on Friday. John Menzies has a 52 week low of GBX 567.88 and a 52 week high of GBX 814.50. The stock has a 50-day moving average of GBX 764.3 and a 200-day moving average of GBX 739.0. The company's market cap is £470.7 million.

John Menzies PLC operates in two divisions: Menzies Aviation and Menzies Distribution. The Distribution segment provides newspaper and magazine distribution services across the United Kingdom along with marketing services.

[colinhy] 16/9/2013 08:11

App upgrade sees number of transactions increase by 70 per cent

13/09/13
The number of transactions being made using Menzies Distribution's smartphone app has increased by more than 70 per cent following an upgrade which allows users to manage magazine orders as well as newspapers.

The i-Menzies app upgrade was released in mid-August and in the first full week after its launch the number of transactions being made by retailers rose to 9,020. In the first week of August the number of transactions was 5,278.

An increasing number of retailers are choosing to use the app to manage their accounts predominantly to amend orders and make credit enquiries.

Customer Jane Williams, who has managed the Tudweiliog Store and Post Office in Gwynedd, North Wales, for 23 years, is among those now using the app for both newspaper and magazine orders.

She said: "I find the i-Menzies app very convenient to use. My daughter downloaded it for me on my iPad and I have been using it ever since. Previously, I would amend my newspaper and magazine orders by calling the customer service centre, but I had to ask them what I was getting and remember everything they said. Now I can see both orders for myself on my screen which is much easier and faster, and I don't have to pay for any phone calls."

She added: "I mainly run the shop on my own, so anything that saves time and money is useful."

hxxp://www.menziesdistribution.com/item/detail/p/33/id/105/ref/App-upgrade-sees-number-of-transactions-increase-by-70-per-cent