FirstGroup swings to a loss after pension costs but backs full-year outlook

Bus and rail operator FirstGroup swung to a loss in the first six months of the financial year as it faced a large one-off hit from its pension plans.

The business said it made a pre-tax loss of £68.4 million in the six months to the end of September, down from an £8.7 million profit a year earlier.

Much of the loss was down to a hit that First Bus took when it ended its participation in two local government pension funds, and moved employees to another plan instead.

It said it had recognised adjusting charges of around £142 million as a result.

Stripping out this and other one-off items, the business said it had actually expanded its adjusted pre-tax profit from £32.9 million to £71.3 million.

The business backed its outlook for the financial year.

FirstGroup runs the Avanti West Coast, Great Western Railway and South Western Railway lines in the UK, as well as First Bus.

“I am pleased to report another set of very strong results for the first half of our 2024 financial year,” said chief executive Graham Sutherland.

“First Bus is delivering sustainable revenue growth as we continue to transform the business and our First Rail division also performed well.

“This is testament to the capabilities and continued hard work of all our teams across the group.

“We are a resilient and profitable business which is well-positioned to create long-term, value-accretive growth.

“Leveraging our leading positions in bus and rail, supported by our strong balance sheet, enables us to continue to play a critical role in supporting governments’ economic, societal and environmental goals.”