National Express aims to build its bus network

NATIONAL Express is cashing in on Britons' need to watch the pennies by growing its UK bus business and launching a campaign promoting "more cost-effective" modes of transport.

The firm yesterday said the economic turbulence had resulted in more households seeking cheaper ways of getting about, and it hopes to build on that trend by adding more buses to its fleet and enticing customers to use its coaches with special offer fares.

The transport giant is adding 120 buses to its West Midlands fleet this year and also intends to roll out further coach routes as the economic doom and gloom shows no sign of abating.

National Express, which handed back running of the East Coast Main Line to the UK government in November 2009, also hinted at future franchise opportunities for its rail division.

News of the growth plans came as the firm, which earlier this year fought off an attempt by rebel investor Elliott Advisors to force boardroom change, posted a 26 per cent rise in pre-tax profits to 95.5 million for the six months to 30 June. Revenues during the period were up 6 per cent to 1.1 billion.

Chief executive Dean Finch said: "We continue to invest in growth and are well placed to deliver further operational improvements.

"As we complete our margin recovery programme, we are focused on organic growth, new contract wins, and carefully targeted opportunities in attractive markets."

He proposed reinstating the company's interim dividend at 3p per share.

John Lawson, an analyst at Investec Securities, said all divisions had performed well in the consensus-beating results.

He said: "A good performance overall although we temper our underlying view with the knowledge that National Express is recovering from a low base and the backdrop remains tough."

National Express's forthcoming marketing campaign is likely to highlight potential money savings if households switch to from using cars to buses.

Shares in the firm closed up 4.4 per cent at 261.3p.