6th Jul 2022 15:55
(Alliance News) - Trainline PLC stands to benefit from a recovery in demand for travel across Europe amid an influx of US tourists to the UK this summer, as well-documented chaos at airports continue.
Trainline on Wednesday raised its full-year guidance after reporting a "faster than anticipated recovery" in rail passengers.
The rail and coach ticketing platform said net ticket sales in the four months to June 30 were 16% above pre-Covid levels.
"This performance reflects a faster than anticipated recovery in rail passenger volume across Europe - including a notable resurgence of inbound customers from the US - as well as the benefit of Trainline increasing its investment in its international business," Trainline explained.
The company now expects full-year net ticket sales growth between 18% and 27% versus pre-Covid levels. It expects revenue to be 22% and 31% above pre-virus levels.
It had previously expected net ticket sales in a GBP3.8 billion to GBP4.2 billion range, between 2.0% and 13% above the pre-Covid figure. Revenue was expected to land between GBP280 million and GBP300 million, which would have been between 7.3% and 15% above pre-virus levels.
The stock was up 22% at 343.10 pence on Wednesday, the best performer in the FTSE 250.
Trainline has until now made a slow recovery from the pandemic as ongoing restrictions in 2021 and the shift to working from home impacted demand. However, the group has reaped the benefit as customers returned to the railways after the worst of the pandemic subsided.
Its upbeat outlook comes after International Consolidated Airlines Group SA's British Airways hired a new operations chief as flight cancellations continue to soar.
Rene de Groot, who currently leads operations at Dutch airline KLM, will move to British Airways as chief operating officer on October 1. He joined Air France KLM SA's KLM in 1990 as a pilot and continues to fly for the carrier.
British Airways has been one of the worst affected airlines in terms of cancellations in recent months, as the aviation industry struggles to cope with the spike in demand for travel amid staff shortages.
The Independent reported that by the end of last month the carrier had cancelled 17,600 flights – one out of every nine planned departures - for the key summer season, which runs from April until October.
"Even though plenty of people are still working from home and don't miss their daily commute on public transport, there has been a big uptick in train travel in general. That's music to the ears of Trainline whose share price has soared after it upgraded earnings guidance," commented AJ Bell's Russ Mould.
"An increase in tourists visiting Europe has led to greater demand for tickets and no doubt the chaos across airports has encouraged more people to travel by rail than plane," Mould added.
By Arvind Bhunjun; [email protected]
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