1. ITV Report

Owner of Southern franchise 'on track to meet financial targets' despite sliding revenues

The owner of the Southern rail franchise says it is on track to meet its financial targets for the full year despite sliding revenues at Govia Thameslink Railway.

Credit: PA
  • Go-Ahead Group said GTR passenger revenue fell 3% in the first quarter, as it came under pressure from months of strike action linked to planned changes to the role of conductors
  • Go-Ahead, which owns 65% of GTR, booked annual profits of almost £100 million last month, but chief executive David Brown said GTR does not make any money
  • The group is expecting to make a 1.5% margin on GTR over the seven-year period for which it holds the franchise

In its first-quarter update, the firm said:

Our expectations for the full year remain unchanged, with robust trading in the first quarter.

The group remains in a good financial position, with strong cash generation and a robust balance sheet."

Passenger revenue and journeys have been adversely affected by strike action during the period.

As previously reported, the additional resources being invested in GTR to support service delivery continue to impact margins in the short term. Our margin expectations for the life of the franchise remain unchanged.

– Go-Ahead Group