MARKET REPORT: National Express on track for recovery as commuters swap trains for coaches during rail strikes
A surge in demand for bus travel has boosted National Express as commuters stop their trains amid rail strikes.
As the post-pandemic recovery continued, the FTSE 250 group said scheduled bus revenues in the first three months of the year were 87 percent higher than the same period of 2022.
The increase was partly driven by a recovery from Covid, which caused parts of the network to shut down.
But it has also benefited from strikes that disrupted train services for more than nine months. However, the company had its own issues with bus drivers going on strike for six days during the quarter.
The strikes ended towards the end of last month after a better wage offer was accepted.
All aboard: National Express said revenue from scheduled buses in the first three months of the year was 87% higher than the same period of 2022
Revenues were up by a quarter to £774.4 million in the first three months of the year and shares were up 4.4 per cent, or 5.1 pence, to 120.4 pence.
An eight-day winning streak for London’s top index came to an end as the FTSE 100 fell 0.1 percent, or 10.67 points, to 7898.77. The FTSE 250 fell 0.5 percent, or 95.47 points, to 19,200.85.
UK inflation eased, but remained above 10 percent in the year to March. Analysts said the Bank of England is likely to continue raising interest rates – a prospect that is affecting property owners.
British Land fell 1.5 percent, or 5.8p, to 385.7p and Land Securities fell 1.3 percent, or 8.6p, to 637.4p.
Redde Northgate, the van rental company, saw higher profits amid strong demand.
Earnings for the year to April 30 should be at the higher end of the £149.6m to £164.4m analysts gave, it said. Shares rose 4.3 percent, or 15.5 pence, to 380 pence.
Pendragon had a better-than-expected first quarter as the car dealership’s profit rose 23 percent to £23 million. It expects to “comfortably outperform” its earlier 2023 expectations, climbing 5 percent, or 0.86p, to 18.06p.
Procook’s founder and CEO said trading will remain “challenging and unpredictable” following a dip in sales.
Daniel O’Neill’s comments came as the Gloucester cookware retailer’s sales fell by almost a tenth year-on-year to £62.3m for the 12 months to April 2.
It warned that it was only breaking even during the period. Shares fell 12.5 percent, or 3.8 pence, to 26.6 pence.
Online food delivery giant Just Eat Takeaway has raised its profit forecast for 2023 despite another sharp fall in orders – by 11 per cent in the UK and Ireland in the first quarter of the year and by 14 per cent across the group.
On a gross transaction value (GTV) basis, orders fell 6 percent in the UK and Ireland and 8 percent overall.
It now forecasts a profit of £243m for the year, up from £198m. The group has slashed costs to offset the slowdown in takeout demand as the boom amid the pandemic eases.
Last month it announced plans to cut about 1,700 delivery driver jobs and 170 headquarters positions. Just Eat employs approximately 15,000 people worldwide.
But CEO Jitse Groen said the recovery will return to order growth towards the end of the year.
He said: ‘Just Eat continues to recover from last year’s slowdown, with the Northern Europe and UK & Ireland segments leading the trend.
While the year-over-year GTV decline in the first quarter of 2023 is significant, the comparison is to the quarter with the second highest GTV of the pandemic.
“Our efforts to improve profitability are ahead of schedule.”
The company said the drop in orders by value improved throughout the first quarter, falling 5 percent in March.
It also revealed a plan to buy back up to £132 million worth of shares. The stock rose 0.1 percent, or 2p, to 1438p.