John Menzies, the Edinburgh-headquartered global aviation services group, has gained a new chairman as it looks to overcome recent trading turbulence.
Dermot Smurfit has stepped down with immediate effect to be replaced in the chairman’s role by non-executive director Philipp Joeinig.
Smurfit joined the board of Menzies – one of Scotland’s oldest companies dating back to 1833 – in July 2016 and has overseen the group’s transformational acquisition of aviation business ASIG and the sale of its distribution arm.
Joeinig is seen as an industry high-flyer, having held a number of senior executive roles within Swissport International over a ten-year period, latterly as a member of the management board.
The change at the top comes just a week after Menzies issued a shock profit warning, saying its performance in the first half had fallen short of the mark.
Releasing a trading update ahead of next month’s interim results, the group pointed to the headwinds affecting the wider aviation market, including weak cargo volumes and flight schedule reductions. But the firm said its board still believed that the medium and long-term prospects for the business were “sound” with the actions being taken in the current year underpinning its expectations for 2020.
In addition to the change of chairman, Menzies’ senior independent director, David Garman, will become deputy chair.
He said: “On behalf of the board, we would like to recognise and record our sincere appreciation to Dr Smurfit for his significant contribution to our business. He has been an effective and excellent chairman and we wish him well with his future endeavours.”
The outgoing chairman said: “I wish the group and its 36,000 employees the very best for the future as it embarks on the next stage of its journey. I believe that this now requires an industry specialist to bring Menzies to a new level of excellence.”
Joeinig added: “I believe the group has a very exciting future and I look forward to working with the board and the management team as we look to progressively grow the business and deliver returns to our shareholders.”
Analysts at Shore Capital retained a “buy” stance on Menzies’ shares, noting: “Philipp Joeinig brings strong leadership experience to the role.”
Menzies became a pure aviation business after selling its news print distribution division to a private equity firm. The company began life as a book store business selling copies of The Scotsman over the counter.
In its recent trading update, the group stressed that it was implementing a range of actions including a previously flagged cost cutting programme that will deliver “at least” £10 million of savings, the majority of which will materialise in 2020. It is also undertaking a “revitalisation of our commercial offering”.