26th Nov 2025 09:31
(Alliance News) - Mobico Group PLC on Wednesday said it is taking "decisive" actions to improve performance after forecasting full-year operating profit towards the lower end of guidance.
The Birmingham, England-based public transport operator said these actions include a comprehensive cost savings programme and exploring options to sell UK bus assets ahead of franchising.
Executive Chair Phil White said: "We continue to focus on simplifying and strengthening the group, taking decisive actions to improve operational and financial performance."
White said Mobico is on track to deliver on guidance for the financial year of adjusted operating profit in the range of GBP180 million to GBP195 million, "albeit we expect this will be towards the lower end due to the competitive environment for UK Coach, reduced passenger numbers in UK Bus and a loss-making WeDriveU contract in WMATA."
In 2024, Mobico reported adjusted operating profit of GBP187.7 million.
White said key priorities are strengthening the balance sheet and improving profitability through strategic initiatives.
Shares in Mobico were 1.5% higher at 22.03 pence each in London on Wednesday morning.
In a trading update, Mobico said revenue increased 5.4% year-to-date to September 30 from the prior year.
In the third quarter, sales at the firm's Spanish bus business Alsa rose 4.1% on-year but the North American business WeDriveU saw sales edge down 0.9%.
UK revenue declined 3.2% in the quarter, with UK Coach down 7.4% reflecting increased competition on key routes which reduced passenger yields.
UK Bus sales increased 2.9% on-year in the quarter, although commercial revenue and passenger numbers both declined by 3.7% amidst lower consumer confidence more broadly.
Mobico said the business continues to work constructively with Transport for the West Midlands to prepare for the transition to franchising during 2027 to 2029.
Ahead of franchising, the group said it continues to "explore options" to sell the assets of the business.
German revenue increased by 14% due to a reduction in penalties resulting from actions taken throughout the year to improve operational performance.
Mobico also said talks with the five German public transport authorities are continuing.
Further, the company has decided not to exercise its voluntary option to redeem the hybrid on the first call date.
The coupon will reset in February 2026 to the new rate, which is derived from the five-year gilt plus the initial spread of 413.5 basis points. The first payment of the coupon at the higher rate is in February 2027.
In addition, the company has appointed KPMG LLP as its new auditor, replacing Deloitte.
To allow the new auditor time to prepare financial statements, the financial year end has been changed to the end of March from the end of December, effective immediately.
By Jeremy Cutler, Alliance News reporter
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