Go-Ahead confident as passenger numbers rise

Apr 23 2009 By Karen Dent, The Journal

PUBLIC transport giant Go-Ahead is riding out the recession as increasing numbers of people use its buses and trains.

The Newcastle group, which also has an airport baggage handling wing, said income and passenger numbers on its buses rose by a similar rate to the 6.6% and 3.6% increases it reported for the first half of its financial year.

The update, covering Go-Ahead’s third-quarter from December 28 until yesterday, also revealed revenue increases on its three rail franchises - which are all in the south of country - of between 5% and 10%.
Go-Ahead, which employs more than 27,500 people and operates buses in the North East, London, Oxford and the South Coast, said three-quarters of its new bus passengers were people entitled to concessionary travel, such as pensioners.

Although the bad weather in February hit its rail operations, Go-Ahead said this year’s later Easter break helped to make up for that. Its rail division is called Govia and is 35% owned by European public transport group Keolis.

The three rail franchises Southern, Southeastern and London Midland are responsible for almost 30% of all train journeys in the UK and Govia is the country’s busiest rail service.

However, the recession is hitting the amount of cargo its aviation division handles, which decreased by a quarter compared to the same time last year as aircraft turnaround fell by around 15%. Go-Ahead is currently restructuring this area of the business and has already announced 450 job losses and the withdrawal from ground handling at Leeds airport. But it just signed another five-year deal renewing its contracts with Virgin.

Go-Ahead said today’s trading update was in line with its expectations and reinforced its confidence ahead of its full-year results, due out in June.

In the first half of its financial year, the company unveiled pre-tax profits of £58.9m and an operating profits of £64.6m.