Menzies returns to FY profit in 2021, updates on possible all-cash offer

Aviation firm Menzies said on Tuesday that it had returned to profit in 2021 after seeing revenues grow more than a quarter year-on-year and also issued an update on a possible all-cash offer for the group.

Menzies stated full-year revenues were up 27% at $1.35bn, helping the group post an annual underlying profit of $76.0m, reversing the prior year's $24.0m loss.

The London-listed firm said its "substantial profit turnaround" reflected air cargo robustness, returning flight volumes, continued management actions to control costs and reshape the business, and governmental support schemes

Menzies also said a strong cash flow performance had resulted in substantial cash and undrawn banking facilities, with available liquidity of $225.0m,

Chairman and chief executive Philipp Joeinig said: "The rebalancing of our business as a major aviation logistics player continues at pace. We have seen significant growth in our air cargo business by winning contracts and widening the global reach of our network, while our fuel and ground services businesses go from strength to strength.

The reshaped business is emerging strongly from Covid and our opportunity for growth is significant. Our future growth will be driven by continued recovery in volumes, growth in the global aviation market, further commercial gains and the successful conversion of our exciting business development pipeline. As a result of significant management action to reduce costs, we expect that this growth will be achieved while delivering structurally higher margins."

Separately, Menzies announced that it was in discussions with NAS, a subsidiary of Agility, regarding its final proposal for a possible all-cash offer for the group of 608.0p per share.

Following the start of an offer period on 9 February, NAS was required to either announce a firm intention to make an offer for Menzies or state it did not intend to make one by 9 March.

However, as discussions were ongoing between Menzies, Agility and NAS and, to allow further time for these discussions to take place, Menzies has requested that the Panel on Takeovers and Mergers extend the PUSU Deadline until 30 March.

As of 0910 GMT, Menzies shares were down 3.54% at 490.0p.