John Menzies’ air cargo services were “more resilient” in 2020, with its cargo forwarding business delivering a record performance boosted by strong yields.

Overall revenue was down 37 per cent at constant currency, as the impact of the global reaction to the Covid-19 crisis hit hard. A decrease in flight activity led to a 49 per cent year-on-year reduction in flight volumes in ground handling and fuel services.

Measures were taken to reduce costs and optimise the company’s cash position, helped by “significant support” from global government schemes and effective cash management. Some £30 million of fixed costs have been removed, of which two-thirds are considered permanent. Operations and headcount have been “right sized” in line with the reduced volume.

Menzies said it was also continuing with a long-term strategy to rebalance its global portfolio mix. The company commenced operations in Baghdad, Iraq, while it completed the acquisition of Royal Airport Services in January 2021, delivering ground and air cargo services at eight locations across Pakistan. A five-year contract was signed with Wizz Air in Budapest, while “significant” air cargo contracts with Qatar Airways were signed at seven locations on three continents.

John Menzies’ chairman and chief executive Philipp Joeinig said: “The Covid-19 pandemic has brought about unprecedented challenges to our business as the effects on travel continued to have a significant impact on our global operations. Despite the difficulties it presented we acted decisively, adjusting the size of our operations and ensuring sufficient liquidity was maintained. We remain a strong business and well placed to benefit as the market recovers and the industry returns to structural growth.

“Looking forward we will continue to deliver against our strategic priorities. We are winning new contracts, entering new markets and optimising our portfolio. As flight volumes recover, I am confident that we will emerge as a more agile, resilient and profitable business with a sharply focused footprint and portfolio.”

The company anticipates a slow increase in volumes in the second quarter of 2021, with a stronger recovery during the second half of the year. However, Menzies does not anticipate a return to the volumes witnessed in full year 2019 before full year 2023.