Firstgroup to update after offer rejection

Aberdeen-based transport group Firstgroup is expected to update investors on its plans to deliver shareholder value when it unveils full-year results on Thursday.

Shares in the firm dived earlier this month after US private equity firm Apollo Management walked away from a possible bid for the company. First had said the approach from Apollo fundamentally undervalued the company and described it as “opportunistic”.

At the time, First, led by chief executive Tim O’toole, said it continued to believe in the “strong prospects for shareholder value creation available to the company” and will update the market on the current outlook alongside the results.

Apollo’s interest in First, which runs rail franchises including South Western Railway and owns Greyhound buses in the US, had been opposed by the Rail, Maritime and Transport union (RMT) as well as the Labour Party.

First has also come under pressure over its performance and structure, with activist investor West Face Capital pressing for operational changes. West Face owns a stake in the bus and rail operator and has raised concerns that its stock is currently undervalued.

In February, First reported a 10.7 per cent rise in year-todate revenue but, stripped of currency effects and excluding the South Western Railway franchise, that increase was just 1.1 per cent. It said all of its North American divisions struggled with “extremely challenging” weather conditions in January. 0 ‘Strong prospects’ – Firstgroup’s Tim O’toole