Menzies trapped in terror turbulence

Patrick Hosking12 April 2012

A CLUTCH of airlines going bust and a steep increase in terrorism insurance premiums has hit John Menzies, the Scottish group reshaping itself as an aviation services business.

It warned that while it had yet to see any sustained improvement in the trading conditions in the aviation sector since the 11 September terrorist attacks on the US, there were some encouraging trends.

'Confidence is returning and airlines are adding flights back on,' said chief executive David Mackay, unveiling eight-month figures because of the group's planned change of year-end. Menzies set aside £2.5m to cover the bad debts of collapsed airlines, including British Airways franchise National Jets Italia, Trans Brazil and Canada 3000. It also warned that its insurance premiums for war and terrorism risks had rocketed by £2.5m to £6m a year.

Overall, aviation lost £3.8m while the other side of the business, newspaper wholesaling, made £16.5m. After restructuring charges and exceptional write-downs, the group recorded a pre-tax loss of £21.1m. A final dividend of 6.6p makes a total of 12.1p for the eight months to December, which on an annualised basis is unchanged on last year.

Mackay said he had no plans to retire before May 2003. The company started advertising for a successor last week, offering base pay of £500,000 plus bonus - one of the biggest pay packets in Scotland.

Create a FREE account to continue reading

eros

Registration is a free and easy way to support our journalism.

Join our community where you can: comment on stories; sign up to newsletters; enter competitions and access content on our app.

Your email address

Must be at least 6 characters, include an upper and lower case character and a number

You must be at least 18 years old to create an account

* Required fields

Already have an account? SIGN IN

By clicking Create Account you confirm that your data has been entered correctly and you have read and agree to our Terms of use , Cookie policy and Privacy policy .

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in