Firstgroup shares go into reverse as firm reveals £187m loss

The brakes were slammed on shares in Firstgroup yesterday as the transport firm revealed a £187 million pre-tax loss in the six months to the end of September.

The Aberdeen-headquartered firm said the loss was due to ongoing problems in its US Greyhound coach business.

On the company’s preferred underlying basis, which excludes one-off costs, it recorded a pre-tax profit of £28.7m.

The company is in the process of selling the Greyhound division and chief executive Matthew Gregory said several interested parties have come forward, with management talking in detail with a handful of suitors.

He added: “We’ve had huge amounts of interest in the process. Everyone knows the business very well, so this is not an unknown technology or small technology that people understand.

“We expected a lot of people to have a look at it and the best people get to the front. As always, these things are never done until they’re done.”

But before selling the business, Firstgroup wrote down £124.4m from the value of Greyhound, and booked a £59.3m charge due to the “continued change in claims environment”.

Despite the issues in the US, Firstgroup said its UK bus and rail divisions are performing well, with bosses gearing up for taking over the West Coast Main Line from Virgin Trains next month.

Overall, the rail businesses saw revenues increase 8.1% to £1.32 billion for the six months to September 30, with like-for-like growth of 4.9%.

The firm said more bus passengers paid with contactless and mobile apps rather than cash on Firstgroup’s local bus routes for the first time in its history, the company has revealed.

According to bosses, 43% of payments were made by cash, with 45% made through non-cash methods.

Shares in Firstgroup fell 23.9p to close at 105.4p.