Go-Ahead profit hit by exceptional costs, warns on bus division targets

3rd Sep 2015 08:00

(ShareCast News) - Shares in Go-Ahead Group slumped after the rail and bus operator posted a 13.7% drop in pre-tax profit on the back of exceptional costs and said it will take longer to hit targets for its bus division.Pre-tax profit for the year ended 27 June fell to £78.7m from 91.2m last year as the group suffered £8.8m in exceptional costs. However, on an underlying basis, pre-tax profit rose £96.6m from £84.9m.Meanwhile, revenue rose 19% to £3.22bn thanks to a strong performance in the company's rail business.Go-Ahead proposed an increase of 6.5% in its full-year dividend to 90p per share.The company said that during the year, it submitted bids for the Department for Transport's Northern and TransPennine Express rail franchises and was shortlisted for TfL's London Overground contract.Chief executive David Brown said: "Despite facing a number of headwinds in the year, including lower passenger volumes and congestion in London as a result of infrastructure improvement works, we were pleased to deliver another year of record bus profits."We now expect to deliver £100m of bus operating profit in 2016/17, a year later than originally anticipated. We expect some of the headwinds experienced over the past year to reverse over time and this, along with reduced fuel costs, gives us continued confidence in the prospects for the bus division."At 1017 BST, shares were down 4.9% at 2,411p.