FirstGroup first quarter trading as expected
Trading for FirstGroup Plc during the first quarter of its 2014/15 financial year was in line with management’s expectations, according to an interim management statement. The company said its transformation programmes are progressing well. In its UK Bus operations, like-for-like passenger revenue increased by 2.7% during the period. As it rebases its local fares and networks, it is stimulating passenger growth with like-for-like volumes increasing 2.7% in the first quarter. To date, it has completed 12 major redesigns together with numerous other upgrades and initiatives. The programme of significant network changes is now nearing completion, though its management structure is now locally focused to ensure commercial opportunities continue to be developed.
First said its operating discipline, cost optimisation and focused investment in its fleets and people are improving its UK Bus service delivery and increasing customer satisfaction. Although it admits there is still some way to go, the interim statement said it is delivering its plan as forecast to restore double digit margins to this side of its business by 2017. It expects improvements in underlying revenue and margin in both the first and second half of 2014/15 compared with the prior year, with progress particularly weighted to the second half of the year as it reaches the anniversaries of a number of fares changes. Mobile ticketing has been introduced on its networks in Aberdeen, Worcester and Manchester. It is on track to complete the roll out of mobile ticketing systems nationwide by December 2014.
Chief Executive, Tim O’Toole, said, ‘Trading during the first quarter was in line with our expectations and our transformation programmes are on track. In First Student we are encouraged by the progress we have made to address pricing in our contract portfolio and by our overall retention rate which, to date, is at the upper end of our planning assumptions. In UK Bus and Greyhound the actions we are taking are achieving good growth. Across the Group we are confident that we have the right programmes underway to build on our market-leading positions and improve performance to create sustainable value over the medium term and beyond.’