UPDATE 2-Menzies profit surges on aviation; eyes acquisitions
(Adds FD comments in paragraphs 3,4,6 and 11, updates share movement)
* Eyeing acquisition with turnover of 5-10 mln stg - FD
* H1 underlying pretax profit 25.1 mln stg vs 19.3 mln stg
* Interim dividend raised by 40 pct to 7p
* Shares up 11 pct
By Juhi Arora
BANGALORE, Aug 16 (Reuters) - John Menzies Plc said it was scouting for acquisitions in its newspaper and magazine distribution and aviation businesses, and reported a higher first-half underlying pretax profit on continuing strong demand for its aviation services.
Edinburgh, Scotland-based John Menzies shares were up 11 percent at 505 pence at 1054 GMT on the London Stock Exchange.
John Menzies, which provides passenger handling services to Lufthansa , Emirates and EasyJet , said it would look at companies with 5-10 million pounds turnover.
"We are in a position (to look for acquisitions) given our debt is much lower than what it was," Finance Director Paul Dollman told Reuters.
The company's net debt stood at 99.7 million pounds as of June 30, 18 percent lower than last year.
Dollman said he was comfortable with consensus forecast of 55 million pounds for the full-year pretax profit, while in the aviation division he expects an underlying operating profit of 32 million pounds.
January-June underlying pretax profit rose to 25.1 million pounds from 19.3 million pounds a year ago.
Revenue rose marginally to 1 billion pounds, although sales at its distribution division fell from the year-ago period, when it benefited from the World Cup sticker sales.
The stunted growth in its newspaper and magazine distribution unit has led the company to shift focus to its higher-margin aviation services business.
However, the company, which circulates The Financial Times and The Independent, recently bought Media on the Move from Journey Group to expand in the travel industry.
"Its one of the things where...we need cost savings and new business revenues to offset the declines in the core (distribution) market and this is an example of new revenue streams," FD Dollman said.
John Menzies, which derives about 67 percent of its revenue from the distribution unit, raised interim dividend 40 percent to 7 pence. (Reporting by Juhi Arora in Bangalore; Editing by Don Sebastian)
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