11th Dec 2012 07:00
The Go-Ahead Group plc 4 Matthew Parker Street, London, SW1H 9NPTelephone 020 7799 8999 |
Press Release
11 December 2012
THE GO-AHEAD GROUP PLC
("GO-AHEAD" OR "THE GROUP")
PRE-CLOSE TRADING UPDATE
Resilient performance in bus and rail; our expectations remain unchanged
Go-Ahead today announces its pre-close trading update for the six months ending 29 December 2012, ahead of its half year results which will be released on 21 February 2013.
Overall:
Trading in the second quarter of the year has remained robust and our expectations for the full year to 29 June 2013 remain unchanged.
David Brown, Group Chief Executive of Go-Ahead, said:
"I am pleased to report a resilient performance across our operations, with all of our companies seeing growth in commercial revenue in the year to date.
"Our bus division continues to perform well in a challenging economic environment and we are well placed to meet our target to achieve bus operating profit* of £100m by 2015/2016. Our passenger journey growth trends are sector leading and our London bus operations remain best in class.
"We continue to lead the transport industry in the development of smart ticketing. There are now over 300,000 passengers using our smartcard "the key" and the roll out of mobile ticketing across our bus operations is progressing well. We strongly believe that making travel more convenient for our passengers, combined with innovative and targeted marketing, will attract more people onto our services.
"All three rail franchises have delivered good passenger revenue growth in the year to date. We are committed to operating in the rail market and are helping to shape the future of the industry through our involvement in the Government's review of rail franchising. For the benefit of passengers, employees and tax payers, it is important that the franchising timetable resumes as soon as possible.
"Whilst we remain suitably cautious about the medium term wider economic outlook, we are encouraged by our robust performance."
* excluding amortisation, exceptional items and the impact of IAS19 revised
Bus:
Deregulated:Our operations outside London continue to perform well, with 5% growth in fare paying passengers partly offset by a weaker concessionary performance.
Expected half year trends*:
Revenue | Passenger journeys | |
Total | c.8% | c.5% |
Excluding acquisitions | c.4% | c.2% |
Regulated:Our London operations continue to deliver strong underlying growth. As anticipated, growth has begun to slow in the second quarter as we lap the introduction of new contracts during the prior year.
Expected half year trends*:
Revenue | Mileage | |||
Total | Underlying | Total | Underlying | |
(including Olympics) | (excluding Olympics) | (including Olympics) | (excluding Olympics) | |
Total | c. 17% | c. 14% | c. 11% | c. 10% |
Excluding acquisitions | c. 10% | c. 6% | c. 4% | c. 3% |
Rail:
Our rail division operates the Southern (including Gatwick Express), Southeastern and London Midland franchises through our 65% owned subsidiary Govia.
Revenue growth remains resilient across all three franchises.
As previously highlighted, the Southern franchise faces challenges but is expected to remain profitable in the year to 29 June 2013. We expect Southern to require revenue support at the 80% level when it becomes eligible in September 2013.
Southeastern continues to perform well, despite receiving 80% revenue support.
During the second quarter London Midland faced operational issues as a result of driver shortages. We acknowledge the impact this has had on our passengers and our priority is to ensure that a reliable passenger service is restored as quickly as possible.
Expected half year trends*:
Passenger revenue** | Passenger journeys** | |||
Total(including Olympics) | Underlying(excluding Olympics) | Total(including Olympics) | Underlying(excluding Olympics) | |
Southern | c.8% | c.7% | c.-1% | c.-1% |
Southeastern | c.13% | c.9% | c.4% | c.1% |
London Midland | c.13% | c.11% | c.3% | c.3% |
** Passenger revenue and journeys associated with the Olympic and Paralympic Games are based on estimates.Outlook:Although we remain cautious about the wider economic outlook, we continue to see a robust performance across both divisions, therefore our expectations for the full year to 29 June 2013 remain unchanged.
The Group remains in a good financial position with strong cash generation and a robust balance sheet, underpinning the dividend policy and allowing flexibility to pursue further value adding acquisitions*As we progress through the year, the impact of the Olympic and Paralympic Games on revenue and volume growth rates is diluted.
ENDS
Go-Ahead will be hosting a series of meetings with analysts throughout the day.
For further information, please contact:
The Go-Ahead Group | |
David Brown, Group Chief Executive | 020 7799 8971 |
Keith Down, Group Finance Director | 020 7799 8973 |
Holly Birch, Investor Relations Manager | 07837 612 661 |
Catherine Robertson, Investor Relations Manager | 020 7799 8984 |
Citigate Dewe Rogerson | |
Michael Berkeley | 020 7638 9571 |
Chris Barrie | |
Angharad Couch
|
GO-AHEADGo-Ahead is a leading UK public transport operator, providing high quality services in the bus and rail sectors. Employing around 23,000 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 4,600 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 30per 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.
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