Firstgroup: Profit at Avanti West Coast owner beats expectations
Transport giant Firstgroup has extended its share buyback program by £50m after annual revenue came in ahead of forecasts.
The additional £50m buyback program follows Firstgroup’s return of £92m to shareholders in the 2025 financial year.
The group also raised its dividend to 6.5p, up from 5.5p last year.
The FTSE 250 company told markets this morning that its adjusted revenue grew by seven per cent year on year, to £1.37bn.
Its adjusted operating profit margin increased from 15.8 per cent to 16.3 per cent, while adjusted profit before tax jumped by 18 per cent to £164.1m.
The company’s Bus division was the main driver of growth, along with further progress in Firstgroup’s Open Access arm.
Firstgroup’s bus deal
Last December, Firstgroup re-entered the London bus market with a £90m acquisition of the French-state backed public transport provider RATP Group, renaming it First Bus London.
It said demand across its bus and rail divisions remained strong, with passenger numbers and overall capacity up year on year.
“The growth in Bus profits, and Open Access Rail to a lesser extent in absolute terms, was an important demonstration of FirstGroup’s ongoing pivot towards more enduring and higher quality earnings streams,” Panmure Liberum analysts said.
CEO Graham Sutherland said: “We have further strengthened our businesses and continued to deliver against our strategy, including growing and diversifying our earnings in both First Bus and First Rail.
“This leaves us well placed to at least maintain our adjusted earnings per share in FY 2026, from a stronger base, as we continue to successfully navigate a period of transition in bus and rail in the UK.”
Panmure Liberum analysts rated Firstgroup a ‘Buy’, with a target price of 250p.
The company’s share price was 192p as of June 9, up nearly five per cent in the last month and 19 per cent in the year to date.