Investment accounts
Adult accounts
Child accounts
Choosing Fidelity
Choosing Fidelity
Why invest with us Current offers Fees and charges Open an account Transfer investments
Financial advice & support
Fidelity’s Services
Fidelity’s Services
Financial advice Retirement Wealth Management Investor Centre (London) Bereavement
Guidance and tools
Guidance and tools
Choosing investments Choosing accounts ISA calculator Retirement calculators
Share dealing
Choose your shares
Tools and information
Tools and information
Share prices and markets Chart and compare shares Stock market news Shareholder perks
Pensions & retirement
Pensions, tax & tools
Saving for retirement
Approaching / In retirement
Approaching / In retirement
Speak to a specialist Creating a retirement plan Taking tax-free cash Pension drawdown Annuities Investing in retirement Investment Pathways
Mobico profits fall despite revenue growth
(Sharecast News) - Mobico Group reported a fall in profit in its 2023 results on Monday, below the expectations it set at the start of the financial year, despite continued revenue growth. The FTSE 250 company, formerly known as National Express Group, reported 12.2% rise in revenue, which it put down to sustained efforts in pricing adjustments and boosting passenger volumes across its operations.
It reported a record-breaking year for ALSA, and a significant recovery in North America school bus operations.
However, its adjusted operating profit decreased to £168.6m, from £197.3m year-on-year.
The board said that decline was primarily due to cost inflation, reduced Covid subsidies, and lower profitability in the German segment.
Mobico recorded a statutory operating loss of £21.4m, influenced by restructuring costs of £30m and a £99m charge related to the German rail onerous contract provision.
The group announced new leadership appointments during the year, with a focus on driving growth and operational efficiencies.
Efforts were underway for restructuring in the UK, including the NXTS turnaround, while challenges were persisting in the German market due to labour scarcity, lower productivity, and high inflation.
Mobico said it was optimistic looking ahead, with ongoing pricing adjustments and restructuring initiatives expected to deliver further benefits.
The company said it had secured 43 new contracts, valued at over £1bn, aligning with its 'Evolve' strategy and expanding its presence in key target cities.
Despite a slight increase in covenant net debt and gearing, the group improved its debt maturity and liquidity by refinancing a significant portion of its credit facilities.
Looking ahead, Mobico said it expected adjusted operating profit in the range of £185m to £205m for the 2024 financial year.
"Our 2023 results are below the expectations we set ourselves at the beginning of the year," said group chief executive officer Ignacio Garat.
"The delays due to the additional work relating to the German rail business was regrettable but it is now concluded.
"Although group revenue growth was encouraging, driven by passenger demand and actions taken to recover inflation, this has not translated into an improvement in reported profitability."
Garat said progress was still made in transforming the business, with new leadership appointed in North America school bus and the UK and Germany making a tangible impact, while the first phase of its 'Accelerate' cost efficiency programme delivered ahead of expectations.
"Our focus remains on delivering the benefits of our restructuring programs and in recovering inflationary costs through pricing, while maintaining a relentless focus on the quality of our offering to support growth.
"Opportunities remain to create a more appropriate and sustainable cost structure and we will not hesitate to take action where there is a clear strategic and financial benefit."
Reporting by Josh White for Sharecast.com.
Share this article
Related Sharecast Articles
Important information: This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Past performance is not a reliable indicator of future returns.
Award-winning online share dealing
Search, compare and select from thousands of shares.
Expert insights into investing your money
Our team of experts explore the world of share dealing.
Policies and important information
Accessibility | Conflicts of interest statement | Consumer Duty Target Market | Consumer Duty Value Assessment Statement | Cookie policy | Diversity and Inclusion | Doing Business with Fidelity | Fidelity gender pay report | Investing in Fidelity funds | Legal information | Modern slavery | Mutual respect policy | Privacy statement | Remuneration policy | Security | Statutory and Regulatory disclosures | Whistleblowing policy
Please remember that past performance is not necessarily a guide to future performance, the performance of investments is not guaranteed, and the value of your investments can go down as well as up, so you may get back less than you invest. When investments have particular tax features, these will depend on your personal circumstances and tax rules may change in the future. This website does not contain any personal recommendations for a particular course of action, service or product. You should regularly review your investment objectives and choices and, if you are unsure whether an investment is suitable for you, you should contact an authorised financial adviser. Before opening an account, please read the ‘Doing Business with Fidelity’ document which incorporates our client terms. Prior to investing into a fund, please read the relevant key information document which contains important information about the fund.
This website is issued by Financial Administration Services Limited, which is authorised and regulated by the Financial Conduct Authority (FCA) (FCA Register number 122169) and registered in England and Wales under company number 1629709 whose registered address is Beech Gate, Millfield Lane, Lower Kingswood, Tadworth, Surrey, KT20 6RP.