FirstGroup now expects small first-half profit as passenger numbers crawl higher

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FirstGroup now expects small first-half profit as passenger numbers crawl higher

FirstGroup PLC (LON:FGP) said its financial performance had been stronger than expected in the past few months and now expects to make a small underlying profit in the first half of the year.  

UK bus passengers have recovered to around 50% of pre-pandemic levels in recent weeks, up from a low point of roughly 10% of pre-pandemic levels, while passenger levels on its train franchises still average only around 30% of pre-pandemic levels.

READ: FirstGroup shares jump by a fifth on US sale talk

Recoveries of US school bus revenues were said to be at 70% of pre-pandemic levels, its First Transit coach travel arm’s services were at 67% and Greyhound buses are below 40%.

The company, which is supported by the UK government’s decision last month to continue providing funding support to the travel industry, said liquidity levels have improved since April, in part reflecting positive cash from operations, with around £850mln in committed funds available.

Directors reiterated their confidence in “comfortably” meeting banking covenants as at September 30, 2020, with net debt expected to be twice the size of underlying profits (EBITDA) versus the 3.75 ratio required by the covenant.

Proactiveinvestors.co.uk

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