Menzies Aviation doubles first-half profit
UK air cargo handler's turnover hits £300 million despite volcano effect
UK-based cargo handler Menzies Aviation reported a half-year underlying operating profit of £9.1 million (US$14m), compared with £4 million for the first six months of 2009.
Turnover increased by 13.8% to £300.9 million.
Menzies Group Chairman Ian Napier said: “Despite the effect of the Icelandic volcano – which cost the business £2.5 million – profits more than doubled as cargo volumes recovered”.
“Ground handling continued to grow, bolstered by further contract wins, including a significant gain with Lufthansa/bmi at London Heathrow.
“While some fragility exists within the industry, we continue to demonstrate our ability to secure major contracts with leading airlines at their hub locations.”
On a like-for-like basis, cargo tonnage increased by 24.8% on the first half of 2009, with growth witnessed across the network.
However, the group singled out the “significant volume increases” of Menzies Aviation’s operations in North America and the Netherlands, which it said would “turn these businesses – loss-making in 2009 – back to profitability”.
However Menzies stressed that structural issues remained in cargo handling.
“Overcapacity still exists, particularly at major airports, and we expect an element of predatory pricing to continue as handlers look to increase their shed utilisation.”
Menzies expects the strong start to the year to continue for its Aviation division, “albeit with stronger comparatives in the second half. On current volumes, the cargo business is now profitable”.
As for its cargo forwarding business, this had benefited from generally better market conditions, with bookings up sharply and some yield improvement.
Turnover increased by 13.8% to £300.9 million.
Menzies Group Chairman Ian Napier said: “Despite the effect of the Icelandic volcano – which cost the business £2.5 million – profits more than doubled as cargo volumes recovered”.
“Ground handling continued to grow, bolstered by further contract wins, including a significant gain with Lufthansa/bmi at London Heathrow.
“While some fragility exists within the industry, we continue to demonstrate our ability to secure major contracts with leading airlines at their hub locations.”
On a like-for-like basis, cargo tonnage increased by 24.8% on the first half of 2009, with growth witnessed across the network.
However, the group singled out the “significant volume increases” of Menzies Aviation’s operations in North America and the Netherlands, which it said would “turn these businesses – loss-making in 2009 – back to profitability”.
However Menzies stressed that structural issues remained in cargo handling.
“Overcapacity still exists, particularly at major airports, and we expect an element of predatory pricing to continue as handlers look to increase their shed utilisation.”
Menzies expects the strong start to the year to continue for its Aviation division, “albeit with stronger comparatives in the second half. On current volumes, the cargo business is now profitable”.
As for its cargo forwarding business, this had benefited from generally better market conditions, with bookings up sharply and some yield improvement.
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