Mobico: National Express owner begins to turn a corner
National Express owner Mobico has said it is on track to hit operating profit targets for the full year, following a torrid period that saw its chief finance officer exit and shares plummet.
The bus and coach firm said it expected to report an operating profit of between £175m and £205m, on an adjusted basis.
In a statement to markets, Mobico noted passenger demand over the third quarter had driven revenue growth of 12 per cent across the group.
This included a particularly strong performance from its Spanish segment ALSA, where revenue soared by a nigh on a quarter year-on-year.
UK revenue, however, dipped two per cent, with National Express’s coach service no longer benefitting from long-running rail strikes.
National Express owner hit by volatility
Mobico has endured a torrid share price performance over the past two years.
The period included the departure of the firm’s CFO after accounting issues delayed publication of a prior financial report, and a big profit warning earlier in the year.
However, shares in the National Express owner have recovered somewhat and are up nearly 20 per cent in the last six months.
The FTSE 250 transport operator has been looking to cut costs, particularly by selling its struggling North American school bus business.
It said on Thursday that “productivity and cost reduction programmes” were set to deliver £40m in savings in 2024 and £50m in annualised savings thereafter.
“Plans for organic deleveraging progressing well, with £25m cash savings targeted in 2024 and £50m for 2025,” the National Express owner added in a statement for markets.
Ignacio Garat, group chief executive, said: “As we move at pace to strengthen the foundations of our business – including through our focus on reducing leverage – improving returns will follow. We look forward to providing further updates on our progress.”