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East Anglia: Profits leap at Hedingham, Chambers and Anglian Bus operator Go-Ahead

PUBLISHED: 11:43 04 September 2014 | UPDATED: 17:36 04 September 2014

David Brown, chief executive at Go-Ahead

David Brown, chief executive at Go-Ahead

© Guy Bell

Public transport operator Go-Ahead today reported strong growth in annual profits after a better than expected year for both its bus and rail divisions.

Go-Ahead posted revenues of £2.702billion for the year to June 28, up 5.1% compared with £2.672bn for the previous 12 months, restated to reflect accounting changes.

Bottom-line pre-tax profits were 44.5% higher, at £91.2million against £63.1m a year earlier, benefiting from a £15m one-off gain reflecting reduced pension liabilities which was partly offset by £3m of restructuring costs at its London Midland rail franchise.

Excluding exceptional items, pre-tax profits were 25.4% higher at £79.1million. A proposed total dividend for the year of 84.5p per share represents an increase of 3.5p per share or 4.35% compared with last year.

Go-Ahead said that all of its deregulated bus operations, which include the Chambers, Hedingham, Anglian Bus and Konectbus fleets in Essex, Suffolk and Norfolk, achieved revenue growth during the year.

Total revenue from deregulated services was 3.9% higher at £350.8m, representing growth of 4.3% stripping out the boost to the previous year’s figures from the London Olympics, and operating profit was up 15.1% at £41.9m, with margins improving from 10.8% to 11.9%.

The group’s regulated bus operations in London saw revenue grow by 6.1% to £449.7m, or by 7.5% excluding the Olympics effect, and operating profit was 7.2% higher at £41.6m, with margins slightly up at 9.3% against 9.2%.

Go-Ahead said the total operating profit for its bus operations of £83.5m represented “good progress” towards its target of £100m by 2015-16, with the figure having benefited from cost savings totaling £2.9m since the target was set in 2012.

The group’s rail division generated total revenue of £1.902bn, with passenger revenue up by 5.4% or by 7.6% excluding the impact of the Olympics. Operating profit grew by £8.2m to £19.7m, with margins improving to 1.0% from 0.6% the previous year.

Its London Midland, Southern and Southeastern franchises achieve passenger reveue growth of 6.8%, 5.8% and 4.3% respectively.

The year also saw Go-Ahead win the bidding contest for the new Thameslink, Southern and Great Northern franchise, which will operate as GTR (Govia Thameslink Railway) and is the largest deal of its kind ever awarded in the UK, although it missed out with a bid to operate the new Crossrail route.

Go-Ahead chief executive David Brown said: “The group performed very well in the financial year with our bus and rail divisions both delivering strong results, which were significantly ahead of our initial expectations for the year.”

He added: “Record numbers of passengers travelled on our services. Our deregulated bus division achieved a sector leading customer satisfaction score of 92%.

“Another key achievement in the year was winning the Thameslink, Southern and Great Northern franchise on the basis of both quality for the passenger and value for money to the taxpayer.

“We are also pleased to be on the shortlists for the Department for Transport’s Northern and TransPennine rail franchise competitions and we look forward to submitting strong bids, working collaboratively with industry partners.”

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