HEAD, the rail and bus company, has posted better than expected profits, helped by a shift to public transport as high petrol prices keep drivers off the roads.
The group, whose GoVia joint venture with France’s Keolis operates the South-Eastern, London Midland and Southern rail franchises, said pre-tax profits rose 11 per cent to £97.6m in the 12 months to 2 July from £87.7m the previous year.
“Despite facing challenging economic conditions in the last 12 months and the adverse weather in the first half of the year, all of our operations have seen growth in like-for-like passenger revenue,” chairman Sir Patrick Brown said.
A surge in passengers across its rail division and deregulated bus services, which include Metrobus in Sussex and the Oxford Bus Company, helped drive revenues up by six per cent to £2.3bn from £2.2bn last year.
Go-Ahead’s London bus division, which provides services for Transport for London, saw revenues slide by 1.3 per cent but the group expects growth to pick up after recent contract gains.
Brown said: “Our bus and rail operations remain fundamentally strong and have benefited from passengers leaving their cars at home and choosing better value public transport alternatives.”
Despite its positive results, shares in Go-Ahead dropped by 5.5 per cent to 1,496p yesterday amid concerns among investors that the rail sector could face a tougher year ahead.
Shore Capital analyst Karl Burns said the government’s eight per cent hike in ticket prices next year “could be a net negative” on the firm.
“Furthermore, unemployment continues to rise and, given the group’s commuter focus, this could be another factor in slowing volume growth,” he added