LONDON (Alliance News) - Go-Ahead Group PLC on Thursday reported a plunge in interim profit but said results were "ahead of expectations".
For the six months ended December 29, the FTSE 250 bus and train operator posted pretax profit down 45% to GBP44.2 million from GBP79.7 million in the comparative half a year ago.
Revenue rose by 4.9% to GBP1.92 billion from GBP1.83 billion a year prior, but operating costs increased 7.5% to GBP1.87 billion from GBP1.74 billion, eating into profit.
The company said that its operating profit of GBP64.5 million, was ahead of management expectations, despite falling 26% from GBP86.9 million a year before.
In terms of divisions, Bus operating profit was slightly ahead of the prior year at GBP46.9 million, bur Rail plunged to GBP17.6 million from GBP40.3 million due to the end of the London Midland franchise in December 2017.
"I'm pleased to report that our half year results are ahead of our expectations. Our bus operations showed resilience with profits slightly up on last year despite a challenging market environment. Whilst overall rail profits fell due to the end of the London Midland franchise in December 2017 and a lower result at GTR, they were ahead of expectations," Chief Executive Officer David Brown said.
Looking ahead, Go-Ahead said its full-year expectations have been increased principally due to the outperformance in rail.
"Our bus businesses have demonstrated stability, even in an increasingly challenging macro-economic environment, and we anticipate that operating profits for bus will be close to last year's, underpinning our ability to provide an attractive dividend to shareholders," the company added.
The transport company held its interim dividend at 30.17 pence per share.
Go-Ahead shares were trading up 2.8% at 1,968.00p early Thursday morning.
