Firstgroup counts cost of big freeze

31st Mar 2010 07:37

The impact of severe weather in the UK and North America during the fourth quarter is expected to hit Firstgroup's annual operating profit by approximately £16m, the bus and train group said today.FirstGroup added sales at its US Greyhound bus business would be down 14% down for the year to end-March due to the continued weakness of the North American economy, while revenues at its US contract division were also stuttering. UK rail is going well, while UK buses' performance is steady.The underlying performance since January has continued on track and the group is on course to achieve its earnings and cash targets for the year, it added. Fuel costs increased by £100m this year, but were offset by hedging, while costs across the group have been cut by over £200m per annum."Looking ahead to the new financial year the global economic outlook remains uncertain and in particular we expect to see continued pressure on public spending budgets in North America. Against this backdrop we expect moderate earnings growth," the statement said.