Scotland business

Aberdeen-based FirstGroup posts sharp rise in profits

First Student buses Image copyright FirstGroup
Image caption FirstGroup's school bus division in North America help to lift the company's profits last year

Transport giant FirstGroup warned of ongoing economic uncertainty in the UK as it posted a jump in annual profits.

The firm saw underlying pre-tax profits rise 23% to £207m, following a strong performance from its First Student school bus operation in North America.

Aberdeen-based FirstGroup said its American arm benefited from the weak pound.

But the pound's impact on fuel costs left it nursing a £19.8m profits hit across its UK bus and rail divisions.

Overall group revenues over the year to 31 March were up 8.3%, at £5.65bn, with operating profit rising 12.7% to £339m.

Underlying operating profits in its bus operations fell 29% to £37m, while rail earnings dropped 26% to £53.8m.

The Aberdeen-based group also saw bus passenger revenues fall 0.6% on a like-for-like basis, after being hit by falling numbers of shoppers on the high street and ongoing issues with traffic congestion in some areas.

Image copyright FirstGroup
Image caption The transport group said bus passenger revenues were hit by falling numbers of shoppers on the high street

Meanwhile, like-for-like passenger revenues rose by 1.3% in its rail business, which includes the Great Western and TransPennine Express UK rail franchises, However, the company said growth was held back by a slowdown across the industry.

FirstGroup said trading conditions would continue to be uneven across the group.

It added: "The group faces a mixed trading environment with opportunities for steady progress in the North American divisions but continued economic uncertainty in the UK."

The group's year was marred by the crash on its Croydon Tramlink line last November, which killed seven people and injured more than 50 others.

Chief executive Tim O'Toole said the company remained "focused on understanding the exact cause of this incident and will continue to provide our full support to the ongoing investigations".

He added that the results of investigations may still not be known "for many months".

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