FirstGroup lifts profit outlook as UK bus passenger numbers pick up

LONDON (Reuters) – The shares of British bus and train operator FirstGroup FGP.L jumped 9% on Tuesday after the company upgraded its profit outlook and said it was seeing interest from potential buyers for Greyhound and its other businesses in North America.

FirstGroup said that passenger numbers on its UK buses had accelerated in recent weeks to about 50% of pre-pandemic levels, while on UK railways, where it runs the Great Western Railway and South Western Railway, passenger numbers were still at about 30%.

Shares in FirstGroup, which are down 64% year to date, were up 9% at 44.9 pence at 0808 GMT.

The company said that a better than expected rebound in revenue and strong cost control meant that it now forecast a small adjusted operating profit for the March-September period.

Like all public transport providers in Britain, FirstGroup has been supported by government funding during the coronavirus pandemic to cover the costs of maintaining services despite user numbers plunging.

In both its rail and bus operations, FirstGroup said it was running 90% of pre-pandemic services.

On the planned sale of its North American businesses, announced in March and where the group operates Greyhound buses as well as school bus services in the United States and Canada, FirstGroup said the pandemic was affecting the speed of the sale but that interest was strong.

“The board is… encouraged by significant interest from potential buyers,” the company said in its statement on Tuesday.

Reporting by Sarah Young; Editing by Susan Fenton

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