All of the divisions at bus and rail operator National Express (NEX) accelerated last year, managing a rise in revenues, profits and margins. The US school bus business stole the show with an adjusted operating profit rise of more than 60 per cent to £51.6m. This was helped by the fact that management's 'up or out' strategy secured a 5.3 per cent increase in contracts run. Finance director Matthew Ashley said the group exited seven contracts that would otherwise not have been as profitable.
The reported pre-tax profit figures were flattered by the absence of £24.8m in exceptional costs from 2014, although this wasn't the only reason behind the group's strong performance. The rail business swung back into profit, which Mr Ashley put down to reduced bidding costs last year - £5m in 2015 compared with £20m in 2014. The group has also designed marketing campaigns to focus on off-peak travel, which has encouraged more weekend travellers onto its trains. As a result, Mr Ashley said c2c revenue rose 9 per cent thanks to strong passenger volume growth. Its automatic delay repayment scheme and c2c app are also proving popular with commuters.
Analysts at Liberum expect adjusted EPS of 24.4p in the 2016 financial year compared with 23.4p.
| NATIONAL EXPRESS (NEX) | ||||
|---|---|---|---|---|
| ORD PRICE: | 317p | MARKET VALUE: | £1.6bn | |
| TOUCH: | 316p-317p | 12-MONTH HIGH: | 335p | LOW: 267p |
| DIVIDEND YIELD: | 4% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 160p* | NET DEBT: | 95% | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 2.24 | 129.0 | 19.9 | 6.0 |
| 2012 | 1.83 | 69.8 | 11.8 | 9.5 |
| 2013 | 1.89 | 64.4 | 11.1 | 9.8 |
| 2014 | 1.87 | 66.5 | 11.6 | 10.3 |
| 2015 | 1.92 | 124.4 | 20.9 | 11.3 |
| % change | +3 | +87 | +80 | +10 |
Ex-div: 28 Apr Payment: 20 May *Includes intangible assets of £1.2bn, or 242p a share | ||||
