FirstGroup sees bus ticket milestone but losses widen

FirstGroup is one of the biggest public transport operators in the UK. Picture: Contributed
FirstGroup is one of the biggest public transport operators in the UK. Picture: Contributed
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FirstGroup has reversed further into the red but revealed that more bus passengers paid with contactless and mobile apps rather than cash on its local bus routes for the first time.

The Aberdeen-headquartered transport giant said 43 per cent of payments were made by cash, with 45 per cent made through non-cash methods. The remainder came from ticket sales via third parties.

The news came as the firm posted a £187.1 million statutory pre-tax loss for the six months to 30 September, from a deficit of £4.6m a year earlier, due to ongoing problems in its US Greyhound coach business.

On the company’s preferred underlying basis, which excludes one-off costs, it recorded a pre-tax profit of £28.7m, down from £42m.

The group is in the process of selling the Greyhound division and chief executive Matthew Gregory said several interested parties have come forward.

Strategies

Gregory told investors: "In the first half we continued to execute the clear commercial strategies in each of our divisions to ensure they deliver future progress and growth. In particular, we were pleased to have delivered another strong bid season and two complementary acquisitions in our largest business First Student, as well as the award of the West Coast Partnership to our rail venture with Trenitalia.

"We are, however, disappointed with the further deterioration in the US motor claims environment which has required an increase in insurance costs for our North American businesses.

"As ever, first-half trading mainly reflects the highly seasonal nature of the group’s operations, given the timing of the North American school holidays in our First Student business. Based on current trends and underpinned by our activities to reduce the cost base further, we are confident in delivering our trading expectations for the full year."

He added: “We are focused on rationalising our portfolio and are progressing through the detailed work to prepare for separation. We have taken a number of important steps since our announcement in May including the sale process for Greyhound, future UK bus pension scheme funding and the strengthening of our rail portfolio. We are intent on realising value for shareholders and will actively manage our entire portfolio by all appropriate means."

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