East Anglia: Increased profits for National Express in final year of rail franchise
AN INCREASE in passenger numbers helped drive a rise in profits for the rail division of transport giant National Express during the last full year of its East Anglia train franchise, the group’s annual results revealed today.
National Express, which handed over the Greater Anglia franchise to new operator Abellio earlier this month after failing with a renewal bid, hailed a turnaround in its overall performance from a loss two years ago to a record profit of �180.2million last year, nearly double its 2010 haul of �97.3m.
Its UK rail division, which following the end of its East Anglia franchise now consists entirely of south Essex commuter route c2c, saw profits grow by 28%, from �33.8m to �43.4m.
Rail revenues increased by 8% compared with 2010, from �637.5m to �688.3million, with passenger numbers on both the East Anglia and c2c routes showing growth of 5% last year.
The revenue figure, which helped boost the division’s operating margin from 5.3% to 6.3%, also benefited from higher fares, with train operators having been allowed to raise their prices by an average of 6.2% in January last year.
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National Express added that, subject to the Government’s new bidding process proving attractive, it planned to bid for the renewal of the c2c franchise and for the next Great Western and Thameslink contracts.
Elsewhere across the group, National Express coach services in the UK recorded record profits of �34.9m, up from �32m, with margins at an all-time high of 13.5% as it abandoned promotional deals to offer “every day value pricing”.
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Profits at the group’s UK bus business, which operates in the West Midlands and Dundee, grew by from �28.3m to �32.7m, and there were also increased contributions from its coach and bus businesses in Spain and North America.
Today’s results are a far cry from 2009, when the group slumped to hefty losses as it counted the cost of its failure to keep hold of its East Coast rail franchise. restructuring charges and the impact of a series of takeover approaches.
Chief executive Dean Finch said: “In just two years National Express has moved from reporting losses to the record profits we have announced today. We carried more passengers than in 2010 and are now the best performing operator in many of our markets.”
And he added that the group would continue to prosper in 2012, with coach and bus passenger revenues expected to grow as commuters increasingly ditch cars and rail for cheaper forms of transport amid high fuel prices and fare increases.