FirstGroup poised for moderate FY growth

29th Sep 2010 07:21

Rail and bus operator FirstGroup said it is currently trading in line with management expections and is on track to deliver moderate earnings growth target for the full year.FirstGroup said earnings have benefitted from a mix of contract-backed and passenger revenue operations in the UK and North America."During the first half of the year we retained our strong focus on increasing cash generation as well as maintaining and improving margins across the group through rigorous cost control," the group said.Its UK Bus business performed steadily during the first half ended 30 September 2010 with like-for-like passenger revenues up by 1.3%.Its UK Rail business saw a increased passenger volumes across all of its rail franchises. Like-for-like passenger revenues grew by 4.4% in the period, despite the reduction in regulated fares from January 2010.In the US full year revenues at its Student business are expected to remain broadly in line with prior year. Its Transit business continued to perform well with US Dollar revenuesup by 4.5% during the period while Greyhound produced like-for-likepassenger revenue increase of 1.6%.FirstGroup said it remains confident of achieving its target ratio of 2.5x net debt: EBITDA by March 20111.The group added that as well as moderate growth in earnings for the year, the board also supports dividend growth of at least 7% per annum.