Shares in National Express Group PLC (LON:NEX) were travelling higher on Thursday morning after the public transport company said bright trading over summer has kept it on track to hit its full-year targets.
In the three months ended 30 September, the Birmingham-based group said pre-tax profits jumped 12.3% compared to the same period last year, while revenues also rose to 6.4%.
UK resilient despite terrorism, increased competition
A 2.5% increase in passenger numbers across the group helped to boost the numbers, as did the “particularly pleasing” performance of its UK business in a “challenging” market.
National Express said recent terror attacks in the UK and increased competition hadn’t had any real effect, with the company tweaking its prices and routes to drive passenger growth.
The improved performance translated to a £1mln year-on-year increase in UK bus profits, the company said in its third quarter trading update.
Spain and North America strong, too
It wasn’t just at home that National Express enjoyed a robust quarter, its Spanish subsidiary ALSA remains on course to deliver record full-year results after it recorded passenger and revenue growth of 4.1% and 2.1% respectively in the period.
Revenues in North America grew 13.7% and, on an annualised basis, stand at over £211mln (US$280mln) now having more than doubled in the past 18 months.
National Express reckons there’s much more room to grow its presence over in the States as well.
On track with full-year targets
“We have delivered another strong performance and remain on track to deliver our targets for the year,” said chief executive Dean Finch.
“I am pleased that we have both successfully addressed our challenges and exploited our strengths. We have reversed UK Bus' decline; continued to secure growth in UK Coach despite the impact of terrorism; enjoyed perhaps our best summer in Spain; and secured a very strong school start up in North America, allied with the emergence of additional exciting growth opportunities.
He added: “This momentum will be further underpinned by the significant fuel cost savings we will see in 2018.
“Fundamentally, this underpins our determination to deliver ever-improving shareholder returns, building on our recent performance.”
Shares rose 3.5% to 354.7p early on Thursday.