FirstGroup profits up as passenger numbers recover

Transport firm FirstGroup has reported a rise in profits amid cost reductions and a recovery in passenger numbers.

The bus and train operator's results came a week after the company rejected a £1.2bn takeover proposal from an American private equity firm.

Its adjusted operating profits rose to £226.8m for the year to 26 March, compared with £220.2m a year earlier.

The Aberdeen-based company said profit from continuing operations surpassed its expectations for the year.

Meanwhile, total revenues declined to £5.58bn, from £6.84bn a year earlier, due to disposals.

FirstGroup said revenues on continuing operations grew amid an increase in bus passenger numbers following pandemic disruption, while it also witnessed growth in rail.

FirstGroup said it expected to make progress over the current year, despite uncertainty in the economic backdrop.

It added that it would benefit from a further £5m in cost savings over the year.

Executive chairman David Martin said: "We have delivered on our commitments this year to refocus the business, de-risk the balance sheet and unlock value for shareholders.

"As a cash generative business with a strong balance sheet, FirstGroup is well placed to invest in the services our passengers want, to sustain our path to a zero-emission bus fleet, and to actively consider additional value creation opportunities to leverage our market leading public transport expertise."

Last week, the group turned down a takeover proposal, saying the 118p-a-share upfront cash part of an unsolicited approach from I Squared Capital "significantly undervalued FirstGroup's continuing operations and its future prospects".