Full year results for the 12 months ended 28 June 2014

Significant and successful year; strong performance in both bus and rail divisions

Highlights

Strategic and operational progress

  • Won the UK’s largest rail franchise, Thameslink, Southern and Great Northern (TSGN)
  • Sector leading customer satisfaction of 92% in deregulated bus
  • Record passenger numbers in bus and rail
  • Shortlisted for Northern and TransPennine Express rail franchises

Delivering financially

  • Good progress towards bus operating profit target of £100m by 2015/16
  • Profit before tax and exceptional items increased by 25.4% to £79.1m
  • Adjusted earnings per share increased by 26.4% to 148.6p
  • Strong free cashflow and reduced net debt despite increased investment in the business
  • Proposed full year dividend increased by 4.3% to 84.5p per share in line with progressive policy

Contributing to society

  • Only operator in the sector to achieve Carbon Trust triple standard for carbon, waste and water reduction
  • First FTSE 350 company to be awarded the Fair Tax Mark
  • Continued improvements in fleet quality and underlying environmental performance

Financial summary:

FY’14
£m

Restated*
FY’13
£m

Increase/
(Decrease)
£m

Increase/
(Decrease)
%

Revenue

2,702.4

2,571.8

130.6

5.1

Operating profit

103.2

86.7

16.5

19.0

Operating profit margin (%)

3.8%

3.4%

 

0.4ppts

Net finance costs

(18.3)

(17.1)

(1.2)

(7.0)

Profit before tax and exceptional items

79.1

63.1

16.0

25.4

Profit before tax

91.2

63.1

28.1

44.5

Adjusted earnings per share (p)

148.6p

117.6p

31.0p

26.4

Proposed dividend per share (p)

84.5p

81.0p

3.5p

4.3

         

Cashflow generated from operations

184.3

126.0

58.3

 

Free cashflow

89.6

41.2

48.4

 

Net debt

(42.7)

(90.9)

 

Adjusted net debt

(260.0)

(299.6)

 

Adjusted net debt/EBITDA*

1.45x

1.87x

 

Notes:

Unless otherwise stated, references made to operating profit throughout this statement exclude amortisation and an exceptional credit of £12.1m (2013: nil)

* Restated for the adoption of IAS 19 (revised), detailed in note 3 to the financial statements

+ In accordance with our bank covenants adjusted net debt/EBITDA is calculated excluding the impact of IAS 19 (revised)

David Brown, Group Chief Executive, commented:

"Delivering for our customers is a prerequisite to the increasing financial strength of our business. The Group performed very well in the financial year with our bus and rail divisions both delivering strong results, which were significantly ahead of our initial expectations for the year. Overall operating profit was £103.2m, up 19.0% from last year.

"This was a particularly busy and exciting year for Go-Ahead in which we made excellent progress towards our strategic objectives. We remained focused on delivering high quality value for money services for our passengers and strengthened the finances of the business. We continued to make a positive contribution to society through the services we run, careful environmental stewardship and the taxes we pay.

"Both our bus and rail divisions performed well. Record numbers of passengers travelled on our services. Our deregulated bus division achieved a sector leading customer satisfaction score of 92%. Another key achievement in the year was winning the Thameslink, Southern and Great Northern (TSGN) franchise on the basis of both quality for the passenger and value for money to the taxpayer. We are also pleased to be on the shortlists for the Department for Transport’s Northern and TransPennine rail franchise competitions and we look forward to submitting strong bids, working collaboratively with industry partners.

"The end of the year marked the halfway point towards our bus operating profit target. We made steady progress towards our target in the year, and remain confident in our ability to achieve £100m of bus operating profit by 2015/16. The Group is in a very good financial position, with strong cash management allowing us to increase investment while reducing our net debt during the year. Our robust balance sheet supports our progressive dividend policy and allows us flexibility to pursue value adding opportunities. The Board’s confidence in the Group’s performance and prospects has allowed us to propose a full year dividend of 84.5p, an increase of 4.3%, in line with our policy.

"I am proud of our position as a responsible business. Reflecting our commitment to being an environmentally responsible operator, we became the only transport Group to be awarded the Carbon Trust triple standard for achievements in carbon, water and waste reduction during the year. I am also pleased that we have been recognised as the first FTSE 350 company to be awarded a Fair Tax Mark for our open and transparent approach to our tax affairs.

"Together these successes contributed towards us ending the year as a stronger Group with enhanced prospects for the future."

Ends

For further information, please contact:

The Go-Ahead Group
Sarah Boundy, Group Corporate Communications Director
sarah.boundy@go-ahead.com
www.go-ahead.com
07808 568 667

Go-Ahead

Go-Ahead is a leading UK public transport operator, providing high quality services in the bus and rail sectors. Employing around 26,000 people acorss the country, over one billion passenger journeys are undertaken on our services each year. We are committed to operating our companies in a safe, socially and environmentally responsible way and are proud to have been accredited with triple Carbon Trust Standard for reductions in carbon, water and waste. In addition to the travelling public, or customers include the Department for Transport, Transport for London (TfL) and local authorities.