Record profits and revenue for National Express

Revenue was up 5.6 per cent from £2.32 billion in 2017 to a record £2.45bn with pre-tax profit rising 14.6 per cent from £156.4 million to £177.7m fro the group which also runs ALSA bus services in Spain, coach and bus services in North America and trains in Germany.

Group chief executive Dean Finch said: “I am delighted we have again delivered a record-breaking set of results. Revenue, profit and free cash all increased significantly, with organic top line growth in every division augmented by strategic acquisitions and cost control. Group normalised operating margin increased to 10.5 per cent.

“We ended the year strongly, with particularly outstanding performances in ALSA and UK coach.

“These record results again demonstrate the benefit of our increasingly diversified international portfolio of industry-leading businesses. Every division accelerated revenue growth in the second half of 2018 and made strategic acquisitions or complementary market expansions. Our strong cash generation allows us to capitalise on these opportunities, invest in innovative technologies to drive organic growth and further efficiencies, while consistently increasing returns to shareholders.

“A consistent record of success over the last five years has delivered compounded statutory profit before tax growth of over 20 per cent, whilst reducing gearing and improving return on capital employed. I remain confident we will grow revenue, profit and dividends further in 2019. As a measure of our confidence we again propose to increase the final dividend by 10 per cent.”

There was revenue growth in all divisions for Birmingham-based National Express.

UK revenue increased by 2.8 per cent to £577 million although UK bus revenue was flat at £273.8 million but passenger numbers rose 1.6 per cent to 235.9 million. UK coach revenue rose 5.4 per cent to £303.2m and passenger numbers by 6.7 per cent to 29 million.

Commercial West Midlands bus passenger growth was 1.1 per cent for the year.

Mr Finch said West Midland buses now had the largest contactless ticketing network outside of London, and daily price capping was in place.

The proportion of sales made through digital channels was up by more than 13 per cent for the year.

National Express is also using technology to improve management controls, drive service improvement and deliver efficiencies.

These systems, augmented by new management processes, are driving improvements, including higher average bus speeds in the West Midlands, against the national trend; reduced vehicle breakdowns and a reduction in accident frequency.

"We have now seen 18 months of commercial bus passenger growth in the West Midlands, as our increasingly targeted, contactless and digital ticketing is proving very popular. Against national trends, last year our West Midlands bus business both saw the first improvement in average journey times in 10 years," added Mr Finch.

The West Midlands bus business achieved its best ever satisfaction score of 88 per cent in the independent Transport Focus passenger survey.

This included increases of eight percentage points in value for money and four for punctuality.

"We continue to work closely with Transport for West Midlands and the West Midlands Mayor to improve services for passengers. With a strong and positive relationship we believe we will continue to prepare for the significant medium-term opportunities, such as the January 2020 introduction of the Birmingham Clean Air Zone and the 2022 Commonwealth Games, in partnership, rather than be distracted by the threat of regulation.

"Indeed, working with local councils and TfWM, we have secured funding to buy 29 electric buses, which will be introduced by the middle of next year," added Mr Finch.

From a growing commercial base in the West Midlands, the bus business has launched new services to Lichfield.

"These have outperformed expectations and we are exploring other similar opportunities for new services. We have already won several new tendered routes in the Black Country," said Mr Finch.