In May, support services group John Menzies (MNZS) split its defined benefit pension scheme in two, placing responsibility for 17 per cent of the assets and liabilities with Menzies Distribution, which it was preparing to spin off with DX Group (DX). But the day before the group released these half-year numbers it announced that the deal had fallen through. Corporate affairs director John Geddes said the group was now “looking at all our options” for what to do next.
Elsewhere, the shift towards aviation is going well, with underlying operating profit for the division more than doubling to £21.7m, 72 per cent of the figure for the whole group. Contract wins last year drove ground handling volume up 13 per cent. During the period, the division won 87 new contracts and 59 contract renewals. Continuing to win aviation business is a priority for the rest of the year.
The takeover of ASIG, an aviation services business with handling and plane fuelling operations spanning seven countries, completed in February. The acquisition is still being integrated, but Mr Geddes said John Menzies was on track to deliver the roughly £10.5m in synergies previously flagged from the deal. He expects to have “completed all the heavy lifting” by the end of the year.
Analysts at Numis are forecasting pre-tax profit of £64.7m, giving EPS of 56.3p for the year to December 2017 (from £49.7m and 47.7p in 2016).
| JOHN MENZIES (MNZS) | ||||
| ORD PRICE: | 725.4p | MARKET VALUE: | £605m | |
| TOUCH: | 723.5-726.5p | 12-MONTH HIGH: | 732p | LOW: 465p |
| DIVIDEND YIELD: | 2.6% | PE RATIO: | 75 | |
| NET ASSET VALUE: | 153p* | NET DEBT: | 191% | |
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016** | 0.96 | 3.0 | -2.2 | 4.8 |
| 2017 | 1.17 | 0.5 | -4.3 | 6.0 |
| % change | +23 | -83 | - | +11 |
| Ex-div: | 19 Oct | |||
| Payment: | 17 Nov | |||
| *Includes intangible assets of £202m, or 243p a share **2016 EPS and DPS adjusted for Oct 2016 rights issue | ||||
