Transport giant the Go-Ahead Group has announced good progress in its bus and rail businesses in an upbeat trading update.
The Newcastle-based firm released a pre-close update for the year ending June 28 2014, ahead of its full year results announcement in September.
The firm is one of the UK’s largest bus operators with a fleet of around 4,600 buses, carrying around two million passengers a day.
It also operates three rail franchises – Southern, Southeastern, including the London to Kent HS1 service, and London Midlan.
From September it takes over the Thameslink, Southern and Great Northern franchise, the largest rail franchise in the UK in terms of passenger numbers, trains, revenue, and staff.
Updating shareholders, group chief executive David Brown said he expects rail profits to be higher than expected.
Brown said: “Overall performance in our bus and rail businesses is good.
“Our full year expectations for our bus operations remain unchanged and we now expect the rail division to deliver operating profit ahead of our previous expectations, with second half profits slightly lower than first half.
“In May, we were delighted to be awarded the Thameslink, Southern and Greater Northern franchise by the Department for Transport and we are working hard to prepare for the start of the contract in September 2014.
“We look forward to delivering customer improvements and value for money for taxpayers through this important and complex franchise.
“Our regulated and deregulated bus operations continue to deliver a consistent performance and we remain on course to achieve our operating profit target of £100m by 2015/16.”
The company said solid underlying growth in revenue and passenger journeys has continued into the fourth quarter, with growth in both commercial and concessionary travel.