National Express on the right road to meet expectations

BIRMINGHAM-based public transport group National Express has said it remains on track to achieve “a good revenue and profit performance in 2012”.

Dean Finch, group chief executive, said the business was on target to deliver full year results in line with board expectations.

“The group remains on course to deliver its 2012 targets, despite the significant challenges of prevailing economic conditions and government austerity measures,” he said.

“By focusing on good value, high quality transport services, we have delivered growth across our core bus and coach operations, supplemented by a strong performance in rail. Recent bid wins from an expanding pipeline of opportunities, combined with strong cash generation, underpin our platform for growth in the medium term.”

In a pre-close update, the company said its UK Bus division, which includes Travel West Midlands, had seen commercial revenue increased 4% in the year to date. It said investment in the fleet had helped to achieve this.

It added that with a new concessionary agreement in place for the next three years, the business was well placed to continue to deliver growth over the medium term.

Core revenue from non-concession passengers in its UK Coach division grew 2% in the year to date, while last year’s withdrawal of the government concession subsidy has been seen as a minor offset from a good performance on Olympic contracts.

New routes and yield management are driving passenger volume recovery, it added, with core Coach passenger volume up 4% in the year.

It said c2c remained the best-performing rail franchise in the country and had seen good revenue growth.

Strong growth in its Spanish and US operations also helped to boost performance.

“Our financial position remains robust, with a strong non-bank and bank funding profile, and a balance of debt maturities in place. We were pleased to note the recent change to Positive from Stable outlook for the group’s debt rating by Moody’s Investors Service,” said the statement.
“With the group’s recent investment programme complete and a focus on capital-light development opportunities, we are driving strong cash generation and free cash flow across our businesses.”
National Express will announce its full year results on February 28, 2013.