FirstGroup (FGP) H1 2025 earnings summary

Executive summary

• Delivered strong H1 2025 results with revenue and margin growth in bus and rail, portfolio diversification, and continued execution of strategic priorities.

• Announced a 13% increase in interim dividend to 1.7p per share and a new £50m share buyback, reflecting confidence in future growth.

• Upgraded to MSCI's highest ESG rating (AAA) and advanced bus fleet electrification, with 15% of fleet now zero emission.

• Strategic acquisitions in bus (Anderson Travel, Lakeside Coaches) and rail (Grand Union Trains WCML Holdings) expanded adjacent services and open access capacity.

• Fully discharged legacy US Greyhound pension obligations, recognising a £5.5m net settlement gain.

Financial highlights

• Adjusted revenue up 2.3% to £649.6m; adjusted operating profit stable at £100.8m; adjusted EPS up 4.9% to 8.5p.

• Interim dividend of 1.7p per share (+13% YoY); £125m returned to shareholders via buybacks and dividends in the last 12 months.

• Adjusted net debt at £0.2m after significant capex and buybacks; £165m invested in capex and growth over 12 months.

• Strong cash generation: £72.1m from operations in H1 2025; adjusted cash outflow of £7.8m, reflecting underlying strength.

• Statutory revenue was £2,344.1m (H1 2024: £2,207.0m); statutory profit before tax £70.3m (H1 2024: loss of £68.5m).

Outlook and guidance

• FY 2025 trading and outlook slightly ahead of previous expectations; First Bus targeting 10% adjusted operating margin in H2 2025.

• First Rail performance anticipated slightly ahead of prior expectations, driven by open access growth.

• Adjusted EPS expected to be maintained in FY 2026, with bus growth offsetting impact of nationalization of train operating companies.

• CapEx guidance: ~£125m in FY25 (mainly bus electrification), ~£100m in FY26 as fleet becomes well capitalized.

• Marginal adjusted net debt expected at FY 2025 year-end, with positive free cash generation after capex.