20th Mar 2023 14:16
(Alliance News) - FirstGroup PLC on Monday said it extended the West Coast partnership contract with the UK Department for Transport, but Alexander Paterson at Peel Hunt said it was "disappointing" that a National Rail contract has not been awarded to the company.
The Aberdeen, Scotland-based transport company said the West Coast contract arrangements were set to expire on March 31 and have now been extended to October 15, "broadly" under the same terms and conditions.
The contract comprises of the operation of Avanti West Coast and the shadow operation of the HS2 programme.
Peel Hunt's Paterson said that the contract being retained is "positive" but added it was "slightly disappointing that a National Rail Contract has not been awarded".
FirstGroup said that discussions are ongoing with the UK DfT regarding a longer-term National Rail contract for the West Coast partnership, though it did not expand on how the discussions were progressing or whether they were approaching a conclusion.
Chief Executive Officer Graham Sutherland said performance at Avanti is "steadily improving", adding that, since the introduction of the new timetable in mid-December, the number of services has increased by more than 40% compared to last summer, with "more seats and better frequencies".
Consequently, Peel Hunt made no changes to its forecasts for the firm and reiterated its 'buy' rating.
Shares in FirstGroup were down 0.8% at 103.80 pence on Monday afternoon in London.
By Heather Rydings, Alliance News senior economics reporter
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