'Results in line with overall expectations'
Highlights
· Adjusted earnings per share* up 3.7% to 27.7 pence (2015: 26.7 pence )
· Dividend per share up 8.6% to 11.4 pence (2015: 10.5 pence )
· £187.0m (2015: £140.9m ) net capital investment from strong cash generation
o Investing in further enhancing customer experience on bus and rail to drive future growth
· Sale of "retail" part of megabus Europe to FlixBus
· Actions to stimulate growth in UK Bus: low fares strategy, digital improvements and continued investment
· One of two shortlisted bidders for new South West Trains rail franchise
· Strong financial position - successful re-financing of £400m bonds
· No significant change to our expected 2016/17 adjusted earnings per share
Commenting on the results, Chief Executive, Martin Griffiths, said:
"These are a solid set of results, with
further revenue and underlying profit growth. We are experienced at
managing the challenges we face, and the improvements and changes we are
making now should ensure that we continue to have a strong portfolio of
sustainable and growing businesses for the long-term.
"We are investing for growth and
improving the journeys of our customers through new digital tools,
smarter ticketing, and the introduction of greener and more comfortable
buses and trains. At the same time, we are taking a prudent approach to
controlling costs and ensuring our transport networks meet the changing
conditions and requirements of our customers.
"We have confirmed the sale to FlixBus of the retailing part of megabus Europe .
I am pleased that we will continue to operate a number of European
inter-city coach services as a contractor to FlixBus and we hope to
build on that new relationship.
"In North America, we have taken steps
to match our megabus.com inter-city coach services to changing patterns
of demand and we are well placed to expand our networks as conditions
improve.
"We note the result of the recent referendum in favour of the UK
leaving the European Union. As with other businesses, we are closely
following developments in this area. Although we have little business in
Europe outside the UK , we acknowledge the referendum result may lead to continuing economic, consumer and political uncertainty.
"Like other business sectors, we are
affected by reduced public spending and factors in the wider economy,
such as weakening consumer confidence and slowing growth in both UK
GDP and real earnings. Public transport also faces the challenge from
sustained lower fuel prices, the related effects of car and air
competition, as well as traveller concerns over global security.
Nevertheless, we have experienced management teams who are working hard
to stimulate growth and we have not significantly revised our
expectation of 2016/17 adjusted earnings per share.
"We remain positive on the long-term prospects for public transport and the Group remains in a strong financial position."
