John Menzies, which is currently in takeover talks, saw its revenue climb 27% to $1.35bn in 2021 compared to $1.1bn in 2020 and it expects cargo to fuel further improvements.
The aviation services group said its underlying operating profit was $76m, up $100m since 2020 when it was hit by the Covid-19 pandemic and recorded a $24m loss.
The company said the “substantial profit turnaround” reflects air cargo robustness, returning flight volumes, continued management actions to control costs and reshape the business, and governmental support schemes.
The air cargo services business saw revenues increase 39% year on year to $574m, which represented year on year growth of 39%.
This was driven by “commercial success and new cargo locations”, particularly in the US where the firm won a contract with Avianca at Miami.
As a result, the volume of cargo handled reached 1.7m tonnes in 2021 compared with 1.2m tonnes a year earlier.
The company’s Air Menzies International forwarding revenues were 33% higher than the prior year, driven by stronger yields, the extension of reach and higher volumes.
“We have benefited from restricted cargo capacity reflecting the reduced passenger flights and seaport congestion in some markets,” the company said.
“We expanded our network of air cargo warehouses from 49 to 58 and the number of freight forwarding depots from 21 to 24.”
Since 2019, operations have been launched in Iraq, Pakistan, Costa Rica, Guatemala and El Salvador.
The group is also focusing on its sustainability strategy, with a goal to be carbon neutral by 2023.
John Menzies said growth in air cargo services is expected to continue: We anticipate that our air cargo business line will continue to grow reflecting ongoing, strong demand for fast and flexible logistics solutions for moving freight worldwide.
It added: “[The] cargo market is strong, supported by Boeing’s forecast of 4% p.a. global growth to 2039.”
A takeover proposal by Agility subsidiary National Aviation Services (NAS) was recently approved by John Menzies, however, the board of Menzies said that the deadline for the announcement of a firm intention to make an offer has been extended from March 9 to March 30.
The “final” proposal from NAS was an cash offer of 608 pence per share. The deal has been valued at around £550m.
This follows earlier approaches from NAS to the board regarding possible all cash offers for Menzies at 460 pence, 510 pence and 605 pence per Menzies share.
Menzies operates at 212 airports in 38 countries.