A “big discrepancy” in the fares charged on FirstGroup’s buses in Aberdeen and other cities around the UK has been cut through a cap on increases in the Granite City, the company’s chief executive said yesterday.
Tim O’Toole was speaking after Aberdeen-based FirstGroup announced a big jump in profits and said its transformation plan was “beginning to deliver improving financial performance”.
Passengers using the group’s buses in its home city have long complained about having to pay more than people in other parts of the UK, and on shorter journeys.
But Mr O’Toole said a tight rein on fare increases in Europe’s energy capital had allowed prices in other parts of the country to catch up.
“We’ve held won most of our fares in Aberdeen,” he said, adding: “That big discrepancy has been eroded.”
Single fares for adults on the company’s buses in Aberdeen currently start at £1.30, with daytime passes for unlimited journeys costing £4.
A quick check on FirstGroup’s various websites yesterday shows these prices compare favourably with the group’s other bus operations around the UK.
In Glasgow, for example, singe fares start at £1.20 but day passes for the city are more expensive than Aberdeen at £4.30.
Mr O’Toole also said the Aberdeen bus operation and other successful parts of the overall business would not have to “carry the weight” of less profitable operations as FirstGroup’s fortunes improve.
He highlighted the group’s investment in award-winning “platinum” vehicles – offering leather seats, free wi-fi and television screens – as an example of how passengers in the Granite City were already benefiting from better services.
FirstGroup’s underlying pre-tax profits rose by 46.5% to £163.9million in the year to March 31 – up 81% to £105.8million on a statutory basis.
Total group revenue was 10% lower at £6.05billion, largely as a result of a shrinking rail division as well as bus businesses sold or closed and a currency exchange hit. On an underlying basis, turnover rose by 4.1%.
Nearly half of the company’s revenue is generated in North America, where FirstGroup runs school buses and Greyhound intercity coach services.
Mr O’Toole said adjusted earnings before interest, taxation, depreciation and amortisation totalling £624.4million were “heavily weighted” towards business across the Atlantic.
FirstGroup’s UK rail arm has suffered a string of disappointments lately, including it losing the battle to run east coast intercity services from Aberdeen and Inverness to London.
It also lost its Caledonian Sleeper services to Serco and failed to retain the ScotRail franchise it had held for 10 years, with Dutch rival Abellio having taken over on April 1.
But FirstGroup was given the green light to continue running its Great Western rail franchise until 2019 and there are other bidding opportunities on the horizon, including for west coast intercity services between Scotland and London.
Meanwhile, FirstGroup has begun the search for a new finance director after Chris Surch said he was to retire in January next year.