The addition of new rail operations in Germany have contributed to an 11 per cent rise in total revenue for National Express at the start of 2016.
In a Q1 Interim Management Statement, National Express said all divisions had recorded increased revenues and it was on course to meet profit projections and free cash flow and leverage targets.
Group profit before tax is up from last year. This is despite higher bid costs and a “significant” rise in the c2c franchise premium, the company said.
In the statement, National Express said c2c passenger numbers were up 7 per cent – this is in the context of a total underlying passenger growth of 3 per cent across the entire group. It also described the start of its new rail operations in Germany as “successful” and that it expects that part of the business to break even this year.
National Express is also in the running for the East Anglia rail franchise, which is due to be announced in the summer, and is preparing bids for Manchester Metrolink and an unspecified German rail contract.
Dean Finch, group chief executive, said: “I am pleased that we have carried our strong momentum from 2015 into the first third of this year, achieving growth in passenger numbers and an increase in revenues across all divisions.
“Our established businesses continue to grow, year-on-year, and our new businesses in Germany and Bahrain are already carrying millions of passengers, through a combination of innovation, partnership and customer service, underpinned by a relentless focus on operational excellence. We also believe this experience helps position us well for other emerging opportunities.
“It is these successes that convince us that our strategy of diversification into new markets in a measured way, when the conditions are right, remains the right one.”