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John Menzies (LSE:MNZS) has announced that its turnover has risen marginally to £997.9m (H1 2012: £988.4m) due to increased turnover at Menzies Aviation, offsetting the expected decline at Menzies Distribution. The increase in turnover has led to an increase in the company’s dividend from 7.35p to 7.7p
Iain Napier, John Menzies Chairman said that “Despite challenging markets, the Group remains on track with an unchanged strategy delivering further growth at Menzies Aviation and cost mitigation actions at Menzies Distribution. Menzies Aviation continues to make progress with a solid trading performance in the period and today’s acquisitions continue to grow our market share in attractive existing and key new target markets. At Menzies Distribution whilst core markets remain challenging, the integration of Orbital Marketing Services is delivering to plan.
The Group is well positioned to progress in the second half and remains on track to deliver future growth for shareholders”.
Underlying operating profit was £26.1m at the half year (H1 2012: £27.0m). Both periods have been re-stated to reflect an increased pension service charge as a result of the implementation of IAS 19R. The increased charge has been allocated across the operating divisions and has had the effect of reducing underlying operating profit at Menzies Aviation by £0.5m at the half year (reduction £0.4m in the first half of 2012), and at Menzies Distribution by £0.7m (reduction £0.5m in the first half of 2012). Further details are disclosed in note 2 of the half-year financial statements.
At Menzies Aviation “profit momentum continued” according to a statement, whilst delivering a 10% increase in operating profit to £15.5m (H1 2012: £14.1m). Trading in the period benefited from prior-year management actions, contribution from acquisitions made during 2012 and continued contract gain momentum.
Highlights:
- Menzies Aviation
-sustainable growth operating profit up 10%
-contract win momentum continues
-two acquisitions completed post 30 June
-strategic entry into South America
-further growth in Australasia
- Menzies Distribution
-key publisher contracts renewed
-Orbital Marketing Services integration on track
-profits decline due to a reduction in magazine volumes
- 5% increase in interim dividend
