Shares of Edinburgh-based aviation servicing company John Menzies fell 3% on Tuesday after the firm reported a first-half loss and said it was affected by weak cargo volumes and the grounding of the Boeing 737 Max aircraft.

Menzies, which provides airport ground handling, fueling and cargo handling services for airlines, posted a first-half pretax loss of £4.4 million compared to a profit of £8.3 million a year earlier.

First-half revenue rose 4% to £649.9 million.

Berenberg analysts wrote: “Menzies is historically second-half weighted … We think a number of dynamics will feed through that give us confidence in full-year numbers being achieved.”

John Menzies CEO Giles Wilson said: “The first half result was impacted by the loss of exclusive licences in H2 last year and generally weaker markets.

“To address this we have taken a number of decisive actions that we expect will improve H2 2019 and underpin our growth ambitions in 2020.

“We continue to drive a company-wide focus on cost reduction, customer engagement and operational discipline, with profitable growth at the forefront of our agenda …

“Looking forward, I continue to see clear opportunities to grow profitably …”

In his outlook, Menzies chairman Philipp Joeinig wrote: “To address the current trading environment decisive actions have been taken that are delivering benefits to help underpin the outlook for 2019.

“We are right sizing the business and now we believe we have the platform required from which to drive the business forward.

“Accordingly, our expectation for 2020 remains unchanged with the expected benefit from the full year impact of the cost and efficiency improvement programme, excellent contract renewals, the renewed focus on opportunities with our key customers and the delivery of operational improvements within our underperforming stations. 

“We are delighted to have renewed our largest cargo contract globally with Cathay Pacific Airways in Australia and New Zealand for a further five years, we have successfully started new cabin cleaning contracts in the UK with easyJet and British Airways and recently signed a five year extension to our exclusive licence in Sint Maarten. 

“Looking forward, our medium to long term outlook remains positive with strong market dynamics and significant opportunities for growth underpinned by our excellent people and strong customer relationships.”