Pre-Close Trading Update

Press Release

12 December 2013

THE GO-AHEAD GROUP PLC

("GO-AHEAD" OR "THE GROUP")

PRE-CLOSE TRADING UPDATE

Robust trading; full year expectations slightly ahead

Go-Ahead today announces its pre-close trading update for the six months ending 28 December 2013, ahead of its half year results which will be released on 20 February 2013.

Overall:

David Brown, Group Chief Executive of Go-Ahead, said:

"I am pleased with the continued robust performance across our operations. Our bus and rail divisions have both seen commercial revenue growth in the year to date. Performance in our Southern franchise was better than anticipated, and as a result our forecasts for the full year to 28 June 2014 are slightly ahead of our previous expectations.

 "Our bus operations continue to perform well and we remain confident in our target to achieve bus operating profit of £100m by 2015/2016.

"The performance of all three rail franchises has been good in the year to date.

"Our continued development of smart and mobile ticketing across our bus business is progressing well and in an industry first, we were delighted to launch "the key" on our Southern services, enabling passengers to travel on our trains and Transport for London services using just their smartcard.

 "We look forward to submitting a strong bid for the Thameslink franchise at the end of December and we continue to work hard on the Crossrail bid."

Bus:

Deregulated:

Our operations outside London continue to perform well and we remain confident in our full year expectations for this division. Growth in fare paying customers was partially offset by lower concessionary passenger numbers.

Expected half year trends*:

#The Olympic contract we delivered was on a gross cost basis. Passenger journeys were not recorded.

During the second quarter, Go North East submitted its response to Tyne and Wear's Integrated Transport Authority's consultation on bus services in the area. Go North East is the region's leading bus operator and independent surveys show that bus passengers in Tyne and Wear are the most satisfied of any UK metropolitan area. We recommend partnership working as the right outcome for both bus passengers and tax payers in the North East.

Regulated:Our London operations continue to deliver robust results with strong underlying revenue and mileage growth.

Expected half year trends*:

Rail:

Our rail division operates the Southern (including Gatwick Express), Southeastern and London Midland franchises through our 65% owned subsidiary Govia.

Robust revenue growth continued into the second quarter across all three franchises.

Southern delivered a better than expected performance in the second quarter and, as a result we now expect a slightly stronger full year result for the Group. Southern is still expected to enter revenue support at the 80% level during the second half of the financial year.

Our discussions with the Department for Transport regarding the proposed extension of the Southeastern contract are continuing.

As previously noted, reported passenger journeys across all train companies increased significantly due to a change in Department for Transport methodology in Travelcard allocations. After allowing for this change in methodology, underlying passenger journey growth is around 2% in all three franchises. Expected half year trends*:

** Passenger revenue and journeys associated with the Olympic and Paralympic Games are based on estimates.

Outlook:We continue to see a robust performance across both divisions and, as a result of better than expected performance in our Southern franchise, our forecasts for the full year are slightly ahead of our previous expectations.

The Group remains in a good financial position with strong cash generation and a solid balance sheet, underpinning the dividend policy and allowing flexibility to pursue value-adding opportunities. We continue to focus on our key strengths of providing high quality, locally-focused and innovative transport services.

N.B. Our £100m bus operating profit target excludes amortisation and exceptional items

\* The Olympic and Paralympic Games impacted on growth rates in the first quarter of the prior financial year. They have therefore been excluded for comparative purposes in these underlying figures.  

ENDS

Go-Ahead will be hosting a series of calls with analysts throughout the day.

For further information, please contact:

GO-AHEADGo-Ahead is a leading UK public transport operator, providing high quality services in the bus and rail sectors. Employing around 23,500 people across the country, over one billion passenger journeys are undertaken on our services each year. We are committed to operating our companies in a safe, socially and environmentally responsible way and are proud to have been reaccredited with Carbon Trust Standard after taking action on climate change. In addition to the travelling public, our customers include the Department for Transport, Transport for London (TfL) and local authorities.

BUSGo-Ahead is one of the UK's largest bus operators. With a fleet of around 4,400 buses, we carry nearly two million passengers every day. Our operations are focused on high density commuter markets. We have a strong presence in London, with around 24 per cent market share, where we provide regulated services for TfL. We operate deregulated services in Oxford, East Anglia, the South East, Southern and North East England. We also have a small yellow school bus joint venture in North America.

RAILThe rail operation, Govia, is 65 per cent owned by Go-Ahead and 35 per cent by Keolis. It is the busiest rail operation in the UK, responsible for nearly 30 per cent of all UK passenger rail journeys through its three rail franchises: Southern (which includes the Gatwick Express), Southeastern and London Midland. In December 2009, Southeastern began operating the UK's first high speed domestic rail service between Kent and London, significantly reducing journey times.

Legal disclaimerCertain statements included in this press release contain forward-looking information concerning the Group's strategy, operations, financial performance or condition, outlook, growth opportunities or circumstances in the sectors or markets in which the Group operates. By their nature, forward-looking statements involve uncertainty because they depend of future circumstances, and relate to events, not all of which are within the Company's control or can be produced by the Company. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Actual results could differ materially from those set out in the forward-looking statements. Nothing in this press release should be construed as a profit forecast and no part of these results constitutes, or shall be taken to constitute, an invitation or inducement to invest in The Go-Ahead Group plc or any other entity, and must not be relied upon in any way in connection with any investment decision. Except as required by law, the Company undertakes no obligation to update any forward-looking statement.