3rd Oct 2013 08:21
LONDON (Alliance News) - Rail and bus operator FirstGroup PLC will keep its Great Western Main Line Franchise for another 23 months, the UK government said Thursday, as the company reported that trading has been in line with its expectations in the first half of its fiscal year with UK rail passenger revenues continuing to rise.
The government said it had awarded FirstGroup the franchise, which runs between London Paddington and southwest England and south Wales, for a further 23 months until September 2015. It said the company had pledged to increase WiFi coverage on its trains, increase the number of standard class seats on key services, provide more sleeper carriages on trains to Cornwall, and more electric trains for Thames Valley routes.
The government will give the rail operator GBP4.6 million to upgrade stations in most need across the franchise area.
It also said it would negotiate one further short-term franchise deal before it tenders a long-term deal.
FirstGroup said it has started negotiating to extend its First Capital Connect franchise, which runs services between Brighton and Luton and Bedford.
It has been shortlisted on two new longer-term franchises: Essex Thameside and a new franchise that will bring existing Southern, Thameslink and Great Northern franchises into one.
In a trading statement, FirstGroup said like-for-like passenger revenue at its UK rail division is expected to be up 5.7% in the six months to the end of September.
It expects to report a 1.6% increase in like-for-like passenger revenue at its UK bus division, on volume growth of 0.6%, the first growth in several years.
In the US, the company runs Greyhound buses, student bus service First Student airport transit service First Transit.
It said Greyhound was still being hit by weak economic conditions, with like-for-like revenue expected to be down 2.4% for the six month period. It saw tentative signs of improved trading in the summer, but will remain focused on keeping costs down.
First Student and First Transit performed better, with like-for-like revenues up 1.2% at First Student in dollar terms and up 8.4% at the transit business.
"I am pleased to report overall trading for the first half of the year is in line with our expectations, despite continued economic headwinds in some of our markets," FirstGroup Chief Executive Tom O'Toole said in a statement.
FirstGroup shares were up 1.1% at 122 pence early Thursday.
By Steve McGrath; [email protected]; @stevemcgrath1
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