Coach and rail operator National Express has said it is returning to healthy profit margins sooner than management or the markets had expected.
The transport firm launched a business recovery plan in the summer as profit margins lagged competitors.
As a result, the company said profits would now beat market expectations.
It was helped by a return to modest revenue growth at its West Midlands bus business despite 4% lower mileage, thanks to a shake-up of its routes.
"The Board now expects normalised profit before tax for 2010 to be a little above current market expectations and markedly stronger than expected in January," the company said in its statement.
National Express' share price rose 2.8% at the open of trading on Friday, following the statement's release.
Revenues at its staple UK coach business - which is being reorganised - were up 3%, while those at its rail franchises - including Anglia and C2C - rose 7%.
Inter-city revenues at its Spanish coach business Alsa returned to growth for the first time since 2008.
Operating profit margins at its start-up North America business were up 50% compared with 2009.