TIDMGOG
RNS Number : 0640P
Go-Ahead Group PLC
24 May 2018
The Go-Ahead Group plc 4 Matthew
Parker Street, London, SW1H 9NP
Telephone 020 7799 8999
PRESS RELEASE
24 May 2018
THE GO-AHEAD GROUP PLC
("GO-AHEAD" OR "THE GROUP")
TRADING STATEMENT
FOR THE PERIOD FROM 31 DECEMBER 2017 TO 23 MAY 2018
The Go-Ahead Group plc today announces its trading update for
the period from 31 December 2017 to 23 May 2018. The next scheduled
market update is the Group's full year results for the year ending
30 June 2018 which will be released on 6 September 2018.
The year to date growth rates shown in this statement are for
the period from 2 July 2017 to 28 April 2018.
Overview
-- Overall full year expectations for bus unchanged; uplift in rail
-- Record customer satisfaction in our regional bus business
-- London bus expectations improved, with strong Quality Incentive Contract income in the period
-- Successful bid for a second bus tender in Dublin
-- Southeastern franchise extended to April 2019; bid submitted for new franchise
Go-Ahead Group Chief Executive, David Brown, said:
"In a challenging market environment with reduced retail
footfall and pressures on local authority budgets, our businesses
have performed well overall.
"In bus, our London operations have seen an improvement in
service performance resulting in higher Quality Incentive Contract
income. Revenue and passenger trends remain mixed across our
regional bus businesses.
"In rail, trading has been good in the period, largely due to
efficiency improvements and helped by the resumption of full
Southeastern services through London Bridge station. In partnership
with the industry, this week we began the introduction of the
largest timetable change in decades. The modernisation of the
network will lead to new routes, greater connectivity and increased
peak frequency through central London with the new technology of
automatic train operation.
"As part of our strategy to develop for the future of transport,
we announced the UK's largest demand responsive trial of
high-quality minibuses in Oxford - called 'Pick Me Up' - which will
begin operating next month. Passengers will use an app to route
journeys according to their needs. We are also working with
logistics partners including a pilot at our Crawley depot to manage
deliveries in the area.
"The Board is confident the Group will deliver full year results
that are slightly ahead of its previous expectations."
Bus
Regional
Year to date underlying growth rates*
Revenue Passenger journeys
-------- -------------------
c.0% c.(2)%
-------- -------------------
* Revenue and passenger journey growth rates exclude the impact
of a programme of route restructuring (estimated at -0.5%). This
principally reflects reductions to the route network in East
Anglia.
Revenue and passenger journey growth trends in regional bus
remain subject to challenging market conditions with the adverse
weather dampening growth rates since the half-year. Across the
division we continue to see growth in some regions and expect
regional bus profit for the second half of the year to be close to
last year's level.
Our customer-centric approach resulted in Go-Ahead achieving the
highest-ever passenger satisfaction score from Transport Focus
(91%), including achieving the highest scores for punctuality and
journey time.
London
Year to date growth rates
Revenue* Mileage* Peak vehicle requirement (PVR)**
--------- --------- ---------------------------------
c.3% c.0% c.(1)%
--------- --------- ---------------------------------
*Includes Singapore bus for the period from January in both
years.
** Peak vehicle requirement is the number of vehicles required
to operate the highest service frequency on a route. This measure
provides a useful indication of the volume of contract work being
operated from one year to the next.
In London bus, mileage was flat and peak vehicle requirement was
down as expected. Our continued improvements in operational
performance resulted in strong Quality Incentive Contract income
and was recognised by Go-Ahead winning Bus Operator of the Year at
the London Transport Awards. The timing of some contract losses
means that full year mileage is likely to be down by up to one per
cent.
We have maintained strong financial discipline in contract
bidding against a backdrop of budget pressure for our client
Transport for London with anticipated medium-term impacts on PVR
and mileage. Looking ahead, we have fewer contracts coming up for
renewal over the next two financial years. We therefore expect
significantly lower levels of capital expenditure and a
corresponding increase in free cash flow in those years.
Our bus operation in Singapore, reported within the London bus
division, continues to perform well, delivering high levels of
punctuality on behalf of the Land Transport Authority.
The second half of the year is expected to deliver operating
profitability at London bus that is comparable to the first half,
representing an improvement on our previous expectations.
Rail
The rail division operates the Southeastern and GTR franchises
through our 65% owned subsidiary Govia.
Southeastern
Year to date growth rates
Passenger revenue Passenger journeys
------------------ -------------------
c.3.5% c.1%
------------------ -------------------
Underlying passenger journeys and revenue growth have improved
since the half year, having recovered well from a reduction in
journeys during the Christmas period. This was boosted by the
resumption of full services through London Bridge station, after
three years of partial closure. Continued good progress in the
delivery of our efficiency programme has led to an increase in our
profit expectations for the year.
During the period, the DfT confirmed a 12-week extension to the
current Southeastern franchise to 1 April 2019. We have steadily
improved customer satisfaction and reliability over the past four
years and will continue to focus on delivering the best possible
service for our passengers through the extension period. Govia has
been shortlisted for the next South Eastern franchise to be awarded
by the DfT in the Autumn.
GTR
We continue to deliver improvements on GTR with higher passenger
satisfaction levels on our Thameslink service than at any point
since 1999, according to the latest National Rail Passenger
Satisfaction (NRPS) survey which showed an 83% overall satisfaction
rate, an increase of 10% over the previous year. New trains, more
punctual services, better information and more helpful staff have
helped to improve results according to the independent national
passenger watchdog Transport Focus. Better punctuality on Southern
has also seen passenger satisfaction climb by 7% over the previous
year to 72%. We continue to work hard to drive further
improvement.
The introduction earlier this week of the largest timetable
change in decades boosts capacity for our passengers with almost
400 more trains running every day and space into London for an
extra 50,000 passengers in the morning peak.
Discussions with the DfT regarding a number of contractual
variations are ongoing.
International development
The Group was made preferred bidder for a second bus tender in
Dublin by Ireland's National Transport Authority. This will bring
the total number of routes operated by Go-Ahead in the Irish
capital to 30. The contract will run for five years from early 2019
with a possible two-year extension. The mobilisation of our
existing Dublin bus contract and German rail contracts continue to
progress ahead of their respective 2018 and 2019 start dates.
Meanwhile, our development team continues to pursue value adding
opportunities in current and new international markets, where there
is a strong pipeline of bid opportunities in both bus and rail.
S
For further information, please contact:
The Go-Ahead Group
David Brown, Group Chief Executive 020 7799 8971
Patrick Butcher, Group Chief Financial Officer 020 7799 8973
Mitesh Kotecha, Interim Head of Investor Relations 020 7799 8984
Citigate Dewe Rogerson
Michael Berkeley/Chris Barrie/ Angharad Couch/ Eleni Menikou/Toby Moore 020 7638 9571
GO-AHEAD
Go-Ahead is a leading UK public transport operator, providing
high quality services in the bus and rail sectors. Employing around
27,000 people across the country, over one billion passenger
journeys are undertaken on our services each year. We are committed
to operating our companies in a safe, socially and environmentally
responsible way and are proud to have been accredited with triple
Carbon Trust Standard for reductions in carbon, water and waste. In
addition to the travelling public, our customers include the
Department for Transport, Transport for London (TfL) and local
authorities.
BUS
Go-Ahead is one of the UK's largest bus operators. With a fleet
of around 5,200 buses, we carry over two million passengers every
day. Our operations are focused on high density commuter markets.
We have a strong presence in London, with around 24 per cent market
share, where we provide regulated services for TfL. Outside London,
we operate services in Oxford, East Anglia, the South East,
Southern and north east England. In September 2016, the Group began
operating a bus contract in Singapore, on behalf of the Land
Transport Authority.
RAIL
The rail operation, Govia, is 65 per cent owned by Go-Ahead and
35 per cent by Keolis. It is the largest rail operation in the UK,
responsible for over 30 per cent of all UK passenger rail journeys
through its rail franchises: GTR (Govia Thameslink Railway) and
Southeastern.
Disclaimer
Certain statements included in this press release contain
forward-looking information concerning the Group's strategy,
operations, financial performance or condition, outlook, growth
opportunities or circumstances in the sectors or markets in which
the Group operates. By their nature, forward-looking statements
involve uncertainty because they depend of future circumstances,
and relate to events, not all of which are within the Group's
control or can be produced by the Group. Although the Group
believes that the expectations reflected in such forward-looking
statements are reasonable, no assurance can be given that such
expectations will prove to have been correct. Nothing in this press
release should be construed as a profit forecast and no part of
these results constitutes, or shall be taken to constitute, an
invitation or inducement to invest in The Go-Ahead Group plc or any
other entity, and must not be relied upon in any way in connection
with any investment decision. Except as required by law, the Group
undertakes no obligation to update any forward looking
statement.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
TSTPGUPGAUPRGWW
(END) Dow Jones Newswires
May 24, 2018 02:00 ET (06:00 GMT)
Go-ahead (LSE:GOG)
Historical Stock Chart
From Apr 2024 to May 2024
Go-ahead (LSE:GOG)
Historical Stock Chart
From May 2023 to May 2024