Menzies issues profit warning

Logistics group John Menzies today issued a profit warning, saying its airport cargo and ground handling division has had "much weaker than expected" volumes.

Freight and cargo volumes are one of the main indicators of economic weakness, leaving Menzies directly in the firing line.

Shares in the group fell almost 20 % as it warned the division's profits would probably miss analysts' expectations by about 10%. Annual profit for the division would be between £14 million and £16 million.

Chairman William Thomson said: "Airlines are significantly cutting schedules and cargo volumes are poor, driven by the price of oil and falling consumer demand."

Industry data shows global airport cargo fell nearly 8% in August. The next 18 months will be a challenge, said Jon Lienard, analyst at Brewin Dolphin. Menzies fell 47p to 222¼p.