John Menzies, the aviation services to news distribution group, today reported a 26 per cent fall in first-half profits as it shouldered £3 million of start-up costs to further expand its fast-growing ground-handling operation for leading airports.

Menzies said that its interim pre-tax profits dropped to £11.3 million, down from £15.3 million at the same time last year, with underlying profits before tax falling to £11.4 million, from £14.6 million.

The slide in profits came despite a 10.3 per cent overall rise in turnover to £826.5 million in the first half, helped by a 31 per cent jump in revenues at the aviation business.

In the news distribution division, Menzies suffered a fall in like-for-like sales of magazines, while sales of newspapers were “marginally ahead”, it reported.

The company sounded a warning over tough trading conditions ahead. It said that, with the aviation sector experiencing “turbulent times”, it would inevitably see some decline in trading volumes from this division.

At Menzies Distribution, it added that: “The problems facing the entire print media sector continue to have a detrimental effect for us as a result of the decline in core sales.”

However, Menzies said that the impact of tough trading conditions in the division was countered by increases in cover prices for newspapers and magazines, leaving the outlook for sales in line with recent trends.

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