London Midland keeps Go-Ahead on track for growth

TRANSPORT group Go-Ahead has announced strong full year results boosted by good revenue growth in its deregulated bus and rail businesses – which include London Midland.

Revenue for the year was up 5.5% at £2,423.8m (2011: £2,297.0m), with operating profit at £110.2m (2011: £115.1m), down 4.3%. Underlying operating profit increased by £8.1m, as the prior year included £13m outlay for one-off rail contract management benefits.

Pre-tax profit reduced by £0.3m, or 0.4% to £84.5m (2011: £84.8m) and adjusted earnings per share were up 5% at 141.9p (2011: 135.2p).

The group’s bus business was strengthened by five acquisitions in the second half of the year for a total cash consideration of £29.3m.

London Midland achieved particularly strong underlying growth over the year and recently scored its highest ever customer satisfaction rating of 87%. Passenger journeys were up 7.4%, benefitting from award winning marketing campaigns aimed at driving off-peak demand. As a result of this performance London Midland remains the only franchise of its time that is not in receipt of revenue support.

Also, London Midland, in partnership with key industry players, has been working on an innovative project to increase capacity on the West Coast Main Line by modifying trains to enable them to run at a maximum speed 110mph. Once operating, the trains will create faster services into London Euston as well as increasing capacity on one of the most intensively used networks in Europe.

Passenger revenue at London Midland grew by 13.3% (2011: 8.6%) in the year and passenger numbers increased by 7.4% on (2011: 7.2%).

David Brown, Go-Ahead chief executive, said: “Over the last year, Go-Ahead has made significant progress in building a stronger group and delivering on our strategic goals.

“Against a challenging economic backdrop, we have continued to drive growth across our bus and rail companies and carried a record number of passengers on our services.

“Overall, the group’s rail division performed well during the period, with strong operational performance across all three franchises and good passenger revenue growth, particularly in London Midland.”