Aviation services company John Menzies yesterday revealed it had laid off more than 17,500 employees as it warned the impact of the coronavirus outbreak had “increased significantly” since March 10, extending across all of its operations in 34 countries.
Edinburgh-based John Menzies had, when it announced 2019 results on March 10, put its global workforce at more than 32,000. It said yesterday that the international and domestic airline customers it serves had grounded passenger flights “on an unprecedented scale” amid the Covid-19 pandemic.
The company added that what was clear was that the disruption would have “a very significant adverse impact on the group’s financial performance in the short term”. It declared it had reduced global headcount by more than 17,500 “in response to the dramatic fall in volume”.
It added: “Reductions are being supported in some countries by governmental schemes and we hope that in the fullness of time a high number of these employees can return to the business.”
John Menzies said it was engaged with the UK Government as it attempted to secure some of the emergency funding announced by Chancellor Rishi Sunak, and awaited “the refinement of the eligibility criteria for the Covid Corporate Financing Facility, which we... do not currently qualify for”.
The company added: “We are taking mitigating action wherever we can but the situation is very fluid. We are engaged in constructive discussions with our lending banks and we continue to review all options with regards to the group’s overall liquidity needs to ensure we are well positioned to withstand the impact of the virus on the aviation industry.”
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Chief executive Giles Wilson said: “John Menzies plc has existed since 1833 and been listed since 1962 but never have we faced such difficult and unpredictable times.”
He added: "Our industry has been one of the most affected by Covid-19 and we are doing everything we can to reduce costs whilst looking after the needs of our employees. I now look to our Government to support our business and for them to provide the support required to help the UK aviation sector to navigate this crisis.
"For the aviation supply chain to function it requires a strong inter-reliant chain of airlines, airports and service providers. Without these three components of the supply chain, working together, the sector will not function. Handlers such as Menzies are therefore essential to the recovery and future success of the UK and global aviation industry."
Shares in John Menzies fell nearly 11% to 74.8p yesterday.
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