Edinburgh aviation services giant Menzies lands 'significant' contracts across Australia and New Zealand

Menzies, the Edinburgh aviation services giant in the process of being acquired by a Kuwaiti suitor, has secured “significant” contracts across Australia and New Zealand, just days after revealing a move back into profitability.

The firm said it had renewed and won several key contracts with airlines across Australia and New Zealand, including China Airlines, Fiji Airways, Virgin Australia, Thai Airways and Air Calin.

Menzies, one of Scotland’s oldest companies, is likely to be sold after bosses said recently they planned to accept a renewed takeover offer worth nearly £560 million.

Kuwaiti suitor National Aviation Services (NAS), a subsidiary of Agility, upped its bid for the company by around £90m after an earlier offer was spurned.

Menzies has been providing services to Fiji Airways at Auckland International Airport for more than a decade.

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Talks are ongoing, with a deadline having been extended recently to March 30.

Unveiling the latest business wins, Menzies said it had renewed its ground services contract with China Airlines at Sydney, Melbourne and Brisbane airports, marking ten years since it began working with the airline at Sydney. Since then, the partnership has expanded with the Scottish group now providing a range of services to China Airlines at Australia’s three busiest airports.

At Sydney and Melbourne airports, the firm has also renewed a contract with Thai Airways, which will see it continue to provide passenger and ramp services for the airline.

In New Zealand, Menzies has locked in a further term with Fiji Airways to provide air cargo handling services at Auckland, Christchurch and Wellington airports. This partnership began in 2011.

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Meanwhile, the firm will continue to be Air Calin’s cargo terminal operator at both Auckland and Sydney airports, building on a 15-year partnership with New Caledonia’s national carrier.

Alistair Reid, executive vice president, Oceania and south-east Asia, Menzies Aviation, said: “It is fantastic to see the momentum we have achieved across Australia and New Zealand with this series of key contract wins and renewals.

“These wins demonstrate Menzies’ consistent standards of excellence across both ground services and cargo, and the value of long-term co-operation with our airline customers. We’re looking forward to further deepening these relationships and to continued growth in the Oceania region.”

John Menzies started out in 1833. The newspaper and magazine distribution business was spun out in 2018, creating Menzies Distribution, leaving the rest of the firm to focus on providing aviation services.

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Last week, the London-listed aviation firm said revenue for 2021 came in at $1.4 billion (£1.1bn), up from $1.1bn in 2020.

The sales growth was buoyed by commercial deal-signing gaining pace, with net wins contributing $112m in incremental annual revenue.

Operating profit for the year was $59m, swinging from an operating loss of $124m in 2020, and pre-tax profit amounted to $30m, from a pre-tax loss of $155m. The “substantial” profit turnaround was attributed to air cargo resilience, returning flight volumes, continued management actions to control costs and reshape the business, and governmental support schemes.

In January, Menzies said it would be changing its reporting currency to US dollars from pounds, noting that the percentage of its services that are provided in the UK has reduced significantly.

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Menzies flies back into profitability as talks with Kuwaiti suitor continue

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