Menzies confident after 80 per cent profits boost at half-time

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The Independent Online
A STRONG performance from John Menzies' distribution business helped boost half-time profits by 80 per cent at the retail and wholesale news group.

The company made pounds 3.8m (pounds 2.1m) before tax in the six months to 31 October, on turnover that rose 8.7 per cent to pounds 531.9m.

Ranald Noel-Paton, group managing director, said he expected the improved performance to carry through to the year-end. Last year, Menzies made pounds 25.4m before tax for the full year. Most of the profits come in the second half because the group's Christmas trade falls into that period.

'The signals are that progress is being made,' Mr Noel-Paton said, 'despite difficulties in most of the markets in which we operate.' The distribution business was proving resilient, seeing the benefits of greater volume and lower costs.

He believed there was 'no downside' for the group in the Monopolies and Mergers Commission's investigation into the news supply business. The retail side had been 'a bit of a curate's egg'. The John Menzies chain of newsagents turned in a flat performance but there was a 15 per cent improvement from Early Learning Centre, the 170-shop chain that sells educational toys, games and books.

Mr Noel-Paton said the closure of the ELC chain in the US, announced in December, would be wrapped up within the provisions made in the last set of accounts. A few shops were still trading but all would have shut by the end of this month.

The interim dividend rises 5.6 per cent to 3.8p a share, 0.9p higher than earnings per share of 2.9p (0.9p). The shares closed 16p stronger at 482p.