FirstGroup shares were up 1.6% to 135p in late morning trading on Tuesday, after the travel company reported an operating profit rise to £806.1 million in FY 2022 against £285.8 million in FY 2021.
FirstGroup said its operating profit climbed on the back of easing pandemic travel restrictions, with a consequential growth in passenger volumes.
The company also mentioned a stronger First Rail performance than expected at the start of the year and central cost reductions ahead of plans following the sale of its three North American businesses for a combined enterprise value of $4.6 billion.
The firm announced a revenue fall to £5.5 million compared to £6.8 million last year, however, FirstGroup confirmed a pre-tax profit spike to £654.1 million from £115.8 million, linked to the sale of its American businesses
The group also noted a decline in net debt to £619 million against £2.6 billion.
FirstGroup said its trading outlook remained uncertain as a result of broader macroeconomic volatility, however the company mentioned it expected to make significant progress in FY 2023.
First Bus has reportedly hit 76% of 2019 passenger volume recently, with the level expected to grow in the coming year, weighted in HY2 2023.
First Rail is projected to perform strongly in FY 2023, with current trading ahead of management expectations.
FirstGroup commented that it was also on track to realise a further £5 million in previously announced central cost savings.
“The transformed Group has momentum and we expect to make significant further progress in the year to March 2023,” said FirstGroup CEO Graham Sutherland.
“With leading positions in bus and rail, a strong balance sheet and a clear purpose, FirstGroup has many opportunities ahead to deliver sustainable shareholder value creation while delivering the vital services that are key to achieving society’s sustainability and economic goals.”
The company noted an EPS surge to 60.2p compared to 6.5p, and announced a dividend per share of 1.1p, resulting in a total dividend of £8.1 million.