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FirstGroup is savaged by loss at Greyhound
04.11.09
FirstGroup is hoping its dog of an American inter-city coach business picks up over Thanksgiving, Christmas and New Year after recession-hit Greyhound was found to have eaten into its British parent's profits.
FirstGroup today revealed a 20% dive in sales at Greyhound between March and September had translated into a 66% collapse in profits.
The £27 million drop in Greyhound operating profits in the half year to £14 million plunged FirstGroup to a 35% crash in underlying interim pre-tax profits of £69 million.
Greyhound was bought as part of the £1.9 billion group-transforming acquisition of US school buses operator Laidlaw two years ago. Chief executive Moir Lockhead's initial inclination was to sell Greyhound but he was persuaded to keep it.
“We have been cutting costs and we hear the US recession is coming to an end. The indications are things are getting better for Greyhound,” said Lockhead today.
Rising fuel costs and stalling passenger numbers also hit its UK buses, with profits down 15%. The interim dividend is up 10% to 6.65p.
