National Express restores dividend as profit surges

British transport group National Express resumed dividend payments and said it was eyeing acquisitions after its underlying pre-tax profit rose by 26 per cent in the first half and margins improved.

The company, which operates buses and coaches in the UK, Spain and North America, said underlying profit for the six months to end June rose to £95.5m ($156 million). Its operating margin improved by 150 basis points to 10.5 per cent.

National Express, which earlier this year reached a truce with rebel investor Elliott Advisors after it called for a boardroom shake-up, said it was now focusing on lowering its debt and investing in future growth, after reinstating its interim dividend at 3 pence per share.

"Having seen a rapid improvement in the operating and financial performance of the group, we are now firmly focused on delivering organic growth and supplementing it with bolt-on acquisitions," the group said in a statement on Thursday.

"We are making good progress in developing our plans to mitigate the challenges ahead in 2012 to continue to create shareholder value," it added.

The group said at the end of last month that first half revenues grew across its bus and rail businesses at home and abroad and that it expected to continue performing well in the second half of the year.