The company, Europe's largest independent ground handler, said 1997 profits would include a charge of pounds 475,000 because of changes in the accounting treatment of Heathrow Cargo Handling, its joint venture with Air France.
A goodwill write-off of pounds 2.5m in the 1996 accounts will also be taken against reserves.
Last year's results will be further affected by a pounds 300,000 reduction in income from its de-icing business due to the mild weather in November and December.
Profits this year will be hit by the loss of business from Air UK, Servisair's second biggest customer, which is withdrawing from a number of routes and reducing services on others.
The loss of income is expected to be in the region of pounds 1m - less than 10 per cent of the pounds 14m worth of business Servisair does with Air UK.
Results this year will also be reduced by around pounds 1.2m because of changes in the law relating to profit-related pay and an increase in pension charges.
Servisair made pre-tax profits of pounds 7.1m in 1996 on sales of pounds 154m and analysts had been pencilling in profits of pounds 8m for 1997 and pounds 10.1m for the current year. Despite the loss of work from Air UK, the company said it anticipated satisfactory growth in underlying trading this year.
- Michael Harrison