If John Menzies (MNZS) was just its aviation business, these would have been a strong set of numbers. Sadly, weakness in the newspaper and magazine distribution business took the shine off. Group underlying earnings per share (EPS) fell 5 per cent to 65.6p; the statutory figures shown in our table are distorted by one-off losses in 2012. Broker N+1 Singer cut its 2014 adjusted EPS forecast by 11 per cent to 61.8p (from 65.5p in 2013) to reflect a currency headwind and higher tax rate.
The aviation business, which provides passenger and cargo-handling services, grew underlying operating profit at constant currency by 11 per cent to £38.5m. Menzies notched up 92 new contracts, adding £15.6m of revenue, and renewed another 114 contracts worth £104m in annual revenue. Three acquisitions were made during the year, including Columbian business Desacol, which marked the group's first foray into Latin America.
But weak magazine sales, particularly in celebrity titles as consumers turn to the internet rather than magazines for gossip, depressed trading at the distribution business. Underlying operating profits sank 12 per cent to £24.3m. Finance director Paula Bell says Menzies is committed to keeping the distribution business as its cash profile is helpful and it is "worth more to us than anyone else".
JOHN MENZIES (MNZS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 645p | MARKET VALUE: | £394m | |
| TOUCH: | 647-650p | 12-MONTH HIGH: | 842p | LOW: 645p |
| DIVIDEND YIELD: | 4.1% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 157p* | NET DEBT: | 107% | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 1.73 | 22.0 | 25.8 | 8 |
| 2010 | 1.84 | 37.5 | 47.8 | 19 |
| 2011 | 1.90 | 52.5 | 71.8 | 24 |
| 2012 | 1.90 | 28.1 | 31.3 | 25.2 |
| 2013 | 1.91 | 42.1 | 50.1 | 26.5 |
| % change | +0 | +50 | +60 | +5 |
Ex-div: 21 May Payment: 20 Jun *Includes intangible assets of £127m, or 208p a share | ||||
