Preliminary figures for Go-Ahead Group showed that the Group’s rail division did particularly well in the year ended 30 June, providing the largest part of the group’s revenue and operating profit growth.
For 2006-07, rail revenue increased by £326.4 million to £1,071.3 million, while the division’s operating profit was up £23.6 million to £66.1 million.
Part of the change – approximately £284 million of the revenue increase and £13.2 million of the operating profit increase – was accounted for by franchise changes part way through the previous year.
But the Group, which operates two franchises and starts a third in November, warned that high passenger levels, particularly on Southern, mean that capacity remains a challenge, while future profits could suffer as subsidies drop but costs rise.
The rail figures represent Go-Ahead’s 65 per cent share in the overall GoVia partnership, which holds the two current Southeastern and Southern franchises.
Overall the Go-Ahead Group – which includes a number of bus companies as well as airport and parking services – saw revenue increased by £363.3 million, or 24.8 per cent, to £1,826.9million.
Group operating profit was £118.1 million (up £20.3 million or 20.8 per cent); profit before tax increased by £18.2 million, or 19.8 per cent, to £110.1 million.
The Southeastern operations enjoyed improved operating performance, with public performance measure (PPM) levels at close to 90 per cent. Passenger journeys reached 147 million in the year – a seven per cent growth – and passenger satisfaction ratings were at 74 per cent.
On Southern, PPM levels were close to 90 per cent and the customer satisfaction rating was up slightly at 81 per cent. Passenger income increased by 14.1 per cent compared to last year, mostly due to a rise in passenger journeys of 9.1 per cent to over 135 million.
Go-Ahead says the figures reflect both the strong economic conditions and improved performance but warns that, at such levels, capacity remains a challenge for the industry.
Southern has secured its franchise to September 2009 and won the contract to operate the Gatwick Express from May 2008.
GoVia has also won the new West Midlands franchise, which will be branded London Midland when operations start next month.
Next year, although the passenger market is assumed to remain buoyant, operating profits could drop because of a reduction in DfT subsidies to the two south-east franchises combined with ongoing cost pressures.
Go-Ahead chairman Sir Patrick Brown said: “Our goal in the rail division is to provide the highest quality of service combined with financial discipline.
“This has consistently led to strong passenger growth, well controlled costs, and higher operating profits.”