National Express Group solid so far in 2013

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National Express Group has reported its Interim Management Statement for the year to date.

The group said it has made further progress in developing its pipeline of new business, including recent contract wins in German Rail and North America Transit, as well as the launch of new services in both UK and German Coach. The group said its key developments so far in 2013 included:

  • In Germany, winning two rail contracts, worth €1.6bn over 15 years, and launching three coach services under the city2city brand in April. 10,000 introductory tickets on city2city priced at €5 sold out quickly and the three initial routes have already seen promising demand;
  • UK Coach being selected to run coach services between London Luton Airport and London Victoria, starting in May 2013;
  • National Express Transit entering the important California market and growing annual revenue to $75m. Total revenue in North America School Bus was up 18%, reflecting the successful acquisition of Petermann in May 2012;
  • A continuing steady performance in Spain, despite the backdrop of austerity. Urban Bus in Spain increased like-for-like revenue by 5%, while increasing like-forlike growth in Morocco by 25%. Underlying revenue in Intercity Coach declined by 5%, with limited impact from recent rail discounting; and
  • c2c maintaining its position as the best performing UK rail franchise with a Public Performance Measure of 97.5%, supporting good revenue growth and profitability.

In America, underlying revenue was broadly flat, with new contract wins in last year’s bid season offset by a reduction in discretionary routes and more days being lost to winter weather than in the prior year.

UK Bus like-for-like commercial revenue increased by 3%, with continued growth in student travelcard sales. NX also successfully launched its smartcard scheme in Dundee. The group said poor weather impacted overall passenger volume, especially in concessionary travel, and profit was also constrained by last year’s reduction in the BSOG duty rebate. Nevertheless, April brought encouraging signs of growth, coupled with an increase in concession revenue.

Revenue in NX Coach services has grown by 1%. Passenger volume grew by 7%, offset by a 10% decline in concession revenue, following the previous withdrawal of the government funded scheme. In the busier seasonal period, Easter revenue was up 6% yearon- year.

The Group’s overall financial position remains strong. Capital expenditure in the first quarter of 2013 was over £40m, reflecting core fleet investment across the business; full year capital investment is expected to be £100m.

The group said it is on track to deliver its profit expectations for 2013.