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Buses drive up First Group's profits

PUBLISHED: 09:01 14 May 2009 | UPDATED: 09:31 06 July 2010

The East Anglian bus operations of First Group have helped contribute to an annual rise in revenue and profits.

Across the transport group, which has operations in the UK and North America, pre-tax profits rose 31pc to £326.

The East Anglian bus operations of First Group have helped contribute to an annual rise in revenue and profits.

Across the transport group, which has operations in the UK and North America, pre-tax profits rose 31pc to £326.4m in the year to March 31.

But profits at its rail division fell 21pc due to the impact of the recession on its franchises serving London.

The group, which is the UK's largest rail operator with a portfolio including First Great Western, First Scotrail and First Capital Connect, said the economic woes meant rail revenues growth slowed to 9.5pc in the year and profits slipped to £94.2m from £120m a year earlier. However, the Aberdeen-based company said the impact of the recession was mitigated by revenue support schemes from the Department of Transport.

In its UK bus arm, featuring a fleet of 9,000 buses and a market share of 23pc, revenues increased by 7pc and operating profits lifted 9.8pc to £134m.

A First Group spokesman said the east of England bus operations had contributed to those figures, with the X1 service - which operates between Lowestoft and Peterborough - having seen a 15pc increase in revenue year on year.

First Group said the division had benefited from improvements in service quality, more efficient working practices and investment in new vehicles.

The North American business, which operates 60,000 yellow school buses and the Greyhound intercity coach service, generated revenues of £2.87bn and saw profits increase 72.5pc to £294.6m at constant currency rates.

Greyhound improved profits in the year but saw revenues come under pressure from the third quarter onwards as a result of the US economic downturn. It has taken steps to cut operating costs, including through a programme to lower staff numbers by 1,100 by next month.

The company has also implemented a significant cost efficiency drive in UK rail, including through an undisclosed number of staff cuts.

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