Menzies Aviation dives to loss as coronavirus hammers air traffic
Baggage handlers Menzies Aviation swung to a £39m loss in the first half of the year as the coronavirus pandemic hammered the aviation industry.
Chairman Philipp Joeinig warned that the firm was not yet “out of the woods”, with the disease continuing to squeeze global travel demand.
The figures
Having posted a £17.9m profit in the same period last year, Menzies fell into the red with a £39m loss for the period ending 30 June.
Revenue fell 33 per cent, from £649.9m to £431.5m, as passenger flight volumes plunged 43 per cent over the six months.
The Edinburgh-based firm said that it had also taken £27.6m exceptional charges related to resizing its cost base and dealing with redundant assets.
It added that it had available cash resources of over £175m at 31 August.
Menzies said that it expected revenue to come in at a similar level in the second half, but said profitability would benefit from “a more significant contribution from various government support programmes and continuing tight cost management”.
It added that it expected to record “modest” revenue growth in the next financial year.
Shares in the London-listed firm, which are trading at roughly a quarter of pre-pandemic levels, slipped another 0.5 per cent this morning.
What Menzies said
“The first six months of the year have seen us operate in unprecedented times due to the Covid-19 pandemic.
“The impact on our global operations has been material, but I am very pleased with how we have reacted. We acted decisively to reduce costs and moved to right-size our operations.
“As a result, our liquidity position is good, and we are well placed to navigate through the winter season and beyond.
“Like others in aviation, we know we are not out of the woods yet. We continue to keep a strong grip on our costs, whilst encouraging governments across the world to react to the exceptional impact Covid-19 continues to have on the industry and extend their support schemes, as recovery will be gradual.”