FirstGroup's shares slump after transport firm swings to a loss

 
Helen Cahill
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Transport firm FirstGroup's share price slumped today after it unveiled a loss in its half-year results, despite an increase in revenues.

The figures

For the six months to 30 September, group revenue rose 8.1 per cent to £2.77bn from £2.56bn during the same period a year before. But, the rail and bus group made a £1.9m loss, down from a profit of £11.1m.

At time of writing, FirstGroup's share price was down 5.9 per cent to 103p.

Why it's interesting

It has been a significant year for FirstGroup; in August, it received the all-clear from the competition watchdog for its South Western franchise. The Competition and Markets Authority was concerned because FirstGroup already operated the Great Western Railway franchise, running the sole other train service between London and Exeter.

Read more: South Western price cap offer by FirstGroup and MTR accepted by CMA

The company said today that it normally benefits from a seasonal change in the second half of the year. In addition, the business is continuing its goal to reduce costs for the year as a whole, and FirstGroup expects to bring in a "substantial" amount of cash.

The results were slightly better than analysts were expecting, according to Liberum's Gerald Khoo.

What FirstGroup said

Chief executive Tim O'Toole said: "The overall trading performance and significantly increased free cash generation of the group in the first half was consistent with the plans we outlined at the start of the financial year. Solid performances from most of our businesses are partially obscured by the impact of the recent severe hurricane on our operations in Puerto Rico."

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