Arriva profits up 40%

Source: Supply Chain Digital

Date :22/08/2008 09:08:32

Arriva plc, the bus and train operator, reported a 40 percent increase in pre-tax profit on Friday August 22, reflecting rising demand for its bus and rail operations.

London's biggest bus operator saw a 59 percent increase in revenue in the first six months to June 30, which included the first contribution from its UK CrossCountry rail franchise.

Arriva, which took over the rail franchise last year, said revenue had risen by £1.4 billion from £902 million last year.

Pre-tax profits climbed to £66.3 million, up from £47.3 million in the first half of 2007. Operating profits in the UK rail arm jumped to £14.8 million from £1.1 million a year earlier.

Passenger numbers on the service improved 10 percent year-on-year, the transport group said.

Europe

Arriva also operates in 12 European countries.

The company’s European operations delivered a 50 percent increase in revenue to £626 million and a 24 percent rise in operating profit of £34.9 million. This was boosted by the acquisition of 80 percent of Hungary bus business Interbus Invest.

Arriva said it was well-placed to avoid an economic downturn because of the long-term nature of its rail and bus operating contracts, which underpin its future earnings.

The company also said that higher fuel prices and slower macro-economic growth was a challenge to the industry but also presented an opportunity. "We have attractive value-for-money propositions, both for fare-paying passengers looking to switch from more fuel-intensive car and air journeys, and for public authorities as they increasingly acknowledge the proven financial benefits of private-sector service delivery," Arriva said in a statement.