Go-Ahead’s annual results beat expectations
Sep 2 2010 by Karen Dent, The Journal
PUBLIC transport giant Go-Ahead revealed better that expected annual results today but said the outlook was hard to predict as it waited for the Government to wield the axe in next month’s spending review.
The Newcastle business, which boasted more than one billion passenger journeys for the first time in the year to July 3, is concerned that Government support for the bus industry could be reduced as part of the cost cutting measures.
The bus and rail firm said its over all profits dropped by almost a quarter to £88.7m because of lower rail subsidies from the Department of Transport, but the fall was smaller than financial analysts had expected.
t was also offset by higher income from Go-Ahead’s high-speed rail services which helped boost annual revenues to £2,201.6m from £2,187.2m in 2009.
The company runs the Southeastern and Southern rail franchises in a joint venture with French company Keolis as well as operating around 3,800 buses in the North East, London, the South and South East and Oxford. It also has a joint venture to run yellow school buses in the US.
But during the year, it got out of its unprofitable airport cargo and ground handling business. That meant the group’s employee numbers dropped from 27,177 to 22,570.
Go-Ahead spent £37.2m on new acquisitions, including snapping up Arriva's Hexham depot operations while selling its Ashington depot to Arriva. The company also bought East Thames Buses from Transport for London, Arriva's Horsham depot in West Sussex, plus Plymouth Citybus and Konectbus in East Anglia.
Go-Ahead chairman, Sir Patrick Brown, said: We have sold most of our aviation services division and started our yellow school bus joint venture in North America.
“We have also acquisitively grown our bus operations in the UK, leading to more than one billion annual passenger journeys on our bus and rail operations for the first time in our history.
“We are working closely with the new Government and welcome its review of future rail franchising announced in July 2010. In summary, we are in good financial shape and continue to believe in the fundamental strengths of public transport.”
But he added the group continued to be cautious about the UK’s economic prospects and its effects on the business.
“The outlook for the next financial year remains difficult to predict, including any impact from the Government's Comprehensive Spending Review expected to be announced in October 2010,” said Sir Patrick.
