East Anglia: National Express recovery plans on track

TRANSPORT group National Express said today its recovery plans were on track, with the first three phases of its strategy having been completed successfully during the first half of this year.

The group, which currently holds the regional rail franchise for East Anglia but has failed to make the shortlist of bidders for a new contract starting next year, said margins and revenues had improved across its businesses while new bus contracts had been won in North America and Spain.

National Express suffered a torrid 2009 when the then Government took over control of its loss-making East Coast rail franchise and the group had to fight off a takeover approach and a rebellion by its biggest shareholder.

However, it is now into the second year of a recovery strategy put in place by new chief executive Dean Finch.

He said today: “Building on our encouraging revenue growth in the first half year, I expect National Express to deliver a significant improvement in financial performance this year, in line with current market expectations.

“Continued cost control has been increasingly supported by organic growth and targeted bid success. We are well placed to deliver industry leading margins, leverage further growth opportunities and explore additional value-creating possibilities.”

Revenue from its UK rail business, which includes National Express East Anglia (NXEA) and south Essex commuter route c2c, grew by 7% during the first half of this year.

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Despite NXEA having just been rated joint lowest in the country for overall passenger satisfaction, in the latest Passenger Focus survey, National Express said both its franchises had delivered a high level of operational performance, with its programme of investment in rolling stock also on schedule.

The group’s UK coach business also saw 7% revenue growth for its core network and its bus operations in the UK, North America and Spain also remained in growth, the group added.