First’s third quarter trading positive
FirstGroup’s trading in the third quarter of its financial year has been in line with management’s expectations. First UK Bus’s transformation programme was reported as being on track, with overall like-for-like passenger volume growth of 1.4% in the period, despite mixed local economic conditions across its portfolio. Its volumes continue to be driven principally by growth in commercial passenger volumes (up 2.8% on a like-for-like basis in the period). The company claims this is in response to the work it has done to improve its commercial proposition through selected fare rebasing, network redesigns and additional investment in fleet and ticketing.
As anticipated, First’s UK Bus decision began to achieve positive yield in the period, with overall like-for-like passenger revenue increasing by 2.7%. Key elements of its plans to restore double digit margins in the division over the medium term have continued to progress. These include more disciplined operations, further fleet investment and mobile and smart ticketing initiatives. It is on track to deliver the cost efficiencies targeted for the second half, and this, coupled with continued passenger volume and price momentum, is expected to result in margin progress for the financial year as a whole. It remains committed to maintaining strong partnerships with local authorities throughout its markets. It claims that experience of its existing partnerships demonstrate that this model is the most ‘responsive, efficient and cost effective’ way to achieve its shared aims of higher bus passenger volumes, investment in bus fleets and increased use of smart and mobile ticketing, with competitive fare levels.