Mobico shares jump as National Express owner reports surge in profit
Mobico Group has reported a near-quarter increase in operating profit as its European coach and bus segment delivered a record half-year.
On an adjusted and reported basis, group operating profit rose 23.8 per cent to £71.2m in the six months ended 30 June, driven by increasing passenger numbers.
Pre-tax profit levelled out at £25.4m, while revenue rose 5.4 per cent to £1.7bn.
Shares rose over 16 per cent by mid-afternoon.
The FTSE 250 transport operator, formerly known as National Express, also confirmed the process of selling off its struggling North American School Bus unit is now “underway,” with progression “in line with expectations.”
It comes after a torrid year and a half in which the group grappled with rising costs across its operations and saw its full-year results suspended amid accounting issues related to its German business.
A key part of the operator’s turnaround strategy has involved the sale of its North American school bus business, which has dragged on the bottom line amid staff shortages and inflationary pressure.
Ignacio Garat, Mobico Group Chief Executive, said: “Mobico has delivered a good performance in the first half of 2024, with continuing positive passenger demand and revenue growth.
“ALSA has delivered record H1 results, underpinning the overall growth of the group.” Alsa, Mobico’s European unit, which spans across the likes of France, Portugal and Switzerland, reported a 43.2 per cent rise in operating profit to £82.5m.
“We have retained, won and successfully mobilised significant new business across different parts of the group and our cost-reduction initiatives have delivered savings slightly earlier than expected,” Garat added.
“Addressing our leverage remains a priority and in addition to commencing the formal sale process for North American School Bus, we have identified new organic debt reduction initiatives that will deliver in the second half. We remain confident of achieving FY 24 Adjusted Operating Profit of between £185m and £205m.”
Investors will not receive a half-year dividend payout.
In the UK, Mobico reported a deterioration in adjusted operating losses to £12.6m, which it said reflected the reduction in rail strikes in 2024. Revenue rose 7.8 per cent to £307.3m.