National Express backs rail despite popularity of buses and coaches

http://www.guardian.co.uk/business/2012/feb/29/national-express-uk-rail-commitment

Version 0 of 1.

Public transport group National Express has said it will not turn its back on the UK rail sector despite belt-tightening passengers being driven towards its coach and bus businesses.

Profits for 2011 rose by 12% to £180m, despite a greatly reduced rail operation, after the group's disastrous involvement in the east coast mainline and subsequent loss of the Greater Anglia franchise.

However, the group insisted it wanted to play a part in UK rail, even if future growth was not dependent on it – but only on terms that were reasonable. It is looking to bid for three rail franchises in the next two years.

Chief executive Dean Finch said: "In just two years National Express has moved from reporting losses to the record profits we have announced today. We carried more passengers than in 2010 and are now the best performing operator in many of our markets."

Further austerity measures, fuel and train fare increases in 2012, are expected to continue to push passengers on to the cheaper modes of travel National Express provides. Coach passenger numbers were slightly up overall, and particularly in crisis-hit Spain. Austerity has also produced rapidly rising sales of its discount student coach cards in the UK, with 36% more being sold year on year. Revenues continued to grow in its US school bus operations.

The group's Spanish coach operations were the biggest contributor to operating profits, at £90.1m.

Finch said: "We've got real momentum in the business right now and significant opportunities to build on our successes."

He said that a key focus will be continuing control of costs, largely driven by better procurement and vehicle management – an area in which he said the company had in years gone by been "pretty slack".