- Shares up 57% over the past year
- First Rail division sees strong demand
- FirstGroup shortlisted for Elizabeth Line bid
Shares in FirstGroup (FGP) were marginally higher as the FTSE 250 transport company said full year group adjusting operating profit and group adjusting earnings for 2024 was going to be ‘slightly ahead of previous expectations’ due to the robust performance from First Rail.
The group anticipates an adjusted net cash position of between £60 million to £70 million (for the year to 31 Mar), with circa £40 million of the ongoing share buyback programme still to be completed post year-end.
‘Trading in the First Rail division has been slightly ahead of the group’s expectations due to strong performance in the division’s Open Access operations because of continued strong demand, effective yield management, and the settlement of certain one-off infrastructure and other claims during the period,’ the company said.
Trading in First Bus was also strong and in line with the group’s expectations and the company said it is making progress with the electrification of the First Bus fleet and infrastructure.
STRONG FIRST HALF
FirstGroup reported results for the 27 weeks to 30 September 2023 that showed adjusted operating profit of £100.6 million, compared to £66.1 million in the same year ago period.
The company also returned circa £67 million to shareholders through the group’s share buyback programme and agreed a landmark £100 million strategic decarbonisation joint venture with Hitachi.
Analysts estimate FirstGroup net profits of roughly £95 million on revenues of £4.7 billion in the current year, figures that are due to be reported 11 June.
SCOTTISH OPPORTUNITIES
FirstGroup is also examining options north of the border, with discussions ongoing with Transport Scotland and Network Rail to extend several of its Lumo London-Edinburgh trains to and from Glasgow. If successful, the new services will run with the existing Lumo fleet of all-electric trains at some point in the second half of the 2025.
‘Lumo... has been a key growth driver for the company since launch in 2021’, said analysts at Berenberg said in a research note. ‘While we note that this proposal is at a very early stage, we think that any additional services or extensions to Lumo would be a positive development for FirstGroup.’
