London, 21 August 2024 - Shares in Mobico Group, the former National Express, surged over 10 per cent in early trading after the company reported a significant increase in operating profit for the first half of 2024.
The FTSE 250 transport operator saw adjusted and reported operating profit rise by 23.8 per cent to £71.2 million in the six months ending 30 June, driven by a surge in passenger numbers.
This strong performance was underpinned by a record half-year for the companyâs European coach and bus segment, ALSA. ALSA, which operates in France, Portugal, Switzerland, and other European countries, reported a 43.2 per cent increase in operating profit to £82.5 million.
Revenue for the group rose by 5.4 per cent to £1.7 billion, while pre-tax profit remained steady at £25.4 million.
Ignacio Garat, Mobico Group Chief Executive, highlighted the positive passenger demand and revenue growth, stating: "Mobico has delivered a good performance in the first half of 2024, with continuing positive passenger demand and revenue growth."
He added: "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.â
The positive results come after a challenging period for Mobico, which faced rising costs across its operations and saw its full-year results suspended due to accounting issues in its German business.
A key part of the company's turnaround strategy has involved the sale of its struggling North American School Bus unit, which has been impacted by staff shortages and inflationary pressure.
Mobico confirmed that the sale process for this unit is now âunderwayâ and progressing âin line with expectations.â
Despite the positive performance, investors will not receive a half-year dividend payout.
Mobicoâs UK operations reported a deterioration in adjusted operating losses to £12.6 million, attributed to a reduction in rail strikes during 2024. However, revenue for the UK division rose by 7.8 per cent to £307.3 million.
Looking ahead, Garat expressed confidence in achieving an adjusted operating profit of between £185 million and £205 million for the full year 2024. He also stated that addressing the company's leverage remains a priority, with new organic debt reduction initiatives planned for the second half of the year.
