National Express owner Mobico has posted plunging profits and revealed its finance boss will stand down in the wake of accounting issues that twice delayed full-year results.
Shares in the group, which rebranded as Mobico from National Express last year, tumbled as much as 11% as it reported a 36% fall in underlying group pre-tax profits to £92.9 million for 2023.
On a statutory basis, it remained deep in the red with pre-tax losses of £98.3 million, although this is an improvement on the £225.3 million of losses seen in 2022.
The results were initially due to be reported on February 29, but had to be delayed twice due to accounting problems with its German rail arm, which were caused by unexpected changes to indices used by the country’s statistics office.
Mobico said chief financial officer James Stamp will stand down at the group’s annual general meeting on June 11.
He will replaced by Helen Cowing on an interim basis, who joins the company on May 8 ahead of taking on the role on June 11.
She has previously acted as group chief financial officer for firms such as Octopus Group, Selecta Group and Ideal Standard International.
Mobico chief executive Ignacio Garat said the firm’s results were “below the expectations we set ourselves at the beginning of the year”.
He added that the delays due to the additional work relating to the German rail business were “regrettable”.
“Although group revenue growth was encouraging, driven by passenger demand and actions taken to recover inflation, this has not translated into an improvement in reported profitability,” he said.
Figures showed that revenues rose 10.9% on a constant currency basis.
Mr Garat signalled further fare hikes for passengers, saying “our focus remains on delivering the benefits of our restructuring programs and in recovering inflationary costs through pricing”.
In an update on first quarter trading released alongside the results, the group also showed that group-wide revenue growth slowed to 6.7% on a constant currency basis, with lower revenues in Germany and North America.
But it said that underlying earnings are expected to rise in 2024, to between £185 million and £205 million, up from £168.6 million in 2023.
In the UK, the firm said UK revenues rose 9.5%, thanks to an 18.3% surge in its bus division on the back of fare increases, a rebound in passenger numbers and without disruption this year from driver strikes.
It said UK coach revenues rose by 3.4%, but cautioned over possible further action to restructure its flagging private coach hire company, National Express Transport Solutions (NXTS).
Last October, it shut two depots within NXTS in Gillingham, Kent, and Sydenham, London, and warned on Monday that “all potential options are being considered, including further rationalisation and rightsizing” as it continues to overhaul the division.