Go-Ahead Group surges on higher profits

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Go-Ahead Group surges on higher profits
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Consumer travel operator Go-Ahead Group (LON:GOG) has said that performance beat expectations during the year ended 30th June despite revenues falling by 0.6% to £3.46 billion. Profits before tax rose by 6.5% to £145.7 million.

Chief Executive David Brown said: “Our bus operations performed resiliently with profits slightly up on last year despite a challenging market environment. Rail profits fell partly due to the expiry of the London Midland franchise in December, but one-off disposal gains at the end of the franchise and some cost improvement benefits at Southeastern led to a better performance than originally expected.

Our regional bus business received customer satisfaction levels of 91%, the highest ever recorded in the sector. Our London bus business also improved its operational performance with punctuality levels 12.5% better than last year. In rail, the timetable change in May was the largest in decades and will deliver substantial customer benefits. In Southern, the timetable change supported continuing improvement, with services now operating at the highest level of reliability since before the start of the current franchise…

Our international strategy has progressed well with two further contract successes – a second bus contract in Ireland and a fourth rail contract in Germany. Annualised revenue from the seven international contracts secured to date is now around £250m, and there is a good pipeline of upcoming opportunities in our target markets. We remain on track to meet our target of generating 15% to 20% of Group operating profit from international operations by 2022.

As we look ahead, we recognise that future transport needs of customers and society are changing, and we are actively pursuing initiatives to further benefit our customers. Projects include the launch of the UK’s largest demand responsive bus transport trial of high-quality minibuses in Oxford, working with logistics partners on utilising our spare depot capacity, environmentally friendly car sharing schemes, developing Mobility as a Service apps for end-to-end journeys, and launching a business accelerator programme for start-up and scale-up businesses looking to shape the future of transport”.

Go-Ahead Group shares were up by 10.40% at 1,805p (as of 12:40 BST).

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