Go-Ahead Group stalls as rail division profits head south

By PETER RANSCOMBE
Published on 02/09/2012 00:00

BRITAIN’S economic woes will dent profits at one of the UK’s biggest rail and bus operators on Thursday.

Go-Ahead Group – which runs London Midland, Southeastern and Southern rail services as well as 3,900 buses carrying 1.7 million passengers a day – is expected to report a 4 per cent fall in operating profits to £110.5 million in the year to 30 June.

The fall in profits will be caused by weaker trading in its rail division, which accounts for nearly 30 per cent of all UK journeys, as passenger growth has been slowed by the UK’s double-dip recession.

The owner of PC World and Currys is set to continue its sales revival on Thursday as it benefits from its outperformance against struggling rivals.

Dixons Retail Group has emerged as one of the big winners in its sector, helped by the high-profile difficulties at Argos, BestBuy and Comet.

Numis analyst Matthew Taylor expects the firm’s rising sales to continue into its first quarter with small gains throughout the year.

Budget hotel chain Travelodge will be hoping to secure its future on Tuesday when landlords are asked to back a vital rescue deal.

Creditors – including a raft of landlords across the UK – will vote on a plan that will see rent payments slashed across more than 100 hotels.

The group – which operates more than 500 hotels across the UK, Ireland and Spain and employs in excess of 6,000 staff – wants to offload 49 hotels to other operators, while the landlords of a further 109 are being asked to accept a 25 per cent cut in rent. The remaining 347 will be unaffected.

House broker Paul Morland at Peel Hunt thinks half-year sales at Edinburgh-based dating website operator Cupid will be higher than the market is currently expecting after it bought a French rival.