Rail franchises operators & contracts

13.11.18

GWR and SWR owner FirstGroup appoints new CEO as it announces fall in rail profits

FirstGroup has named Matthew Gregory as its new chief executive as it revealed widening half-year losses and warned about the profitability of its rail franchises.

Gregory has been the interim chief operating officer at the bus and rail provider (responsible for the Great Western Railway and South Western Railway franchises) since May 2018, alongside his role as chief financial officer which he has held since 2015.

Gregory replaces former boss Tim O’Toole who resigned in May following the announcement of a full-year loss, and the interim chief executive Wolfhart Hauser will revert back to his non-executive chairman role.

Gregory said: “It’s a great honour to lead FirstGroup and our 100,000 employees who are relied upon by millions of customers across the UK and North America each day.

“I believe we are now in a better position to make the most of our opportunities and create a stronger business for the future.

Hauser praised Gregory’s “strong leadership skills and strategic decisiveness,” and said the board had unanimously concluded that he was the right person for the role.

The appointment comes as the company reported interim pre-tax losses widening to £4.6m in the six months leading up to 30 September, increasing from £1.9m the year before and despite its revenue rising 19% to £3.3bn.

FirstGroup’s rail division saw its unadjusted operating profit fall from £30.2m to £27.5m, even as revenue increase by 80% to £1.2bn.

Whilst the operating profit was partially offset due to the costs of the withdrawal of its Greyhound services in Western Canada, the rail division dropped by 5.8% to £29.3m.

The company cited “macroeconomic uncertainty, infrastructure upgrade works across our networks, and the industrial action in SWR” as some of the causes, and confirmed that due to the postponed winter timetable upgrade it was in talks with the DfT “to work through potential commercial and contractual amendments” regarding SWR.

The company said that SWR has “experienced challenging trading with issues relating to infrastructure reliability, industrial relations and the effects of the revenue protection mechanisms included in the franchise.”

Responding to the figures, Matthew Gregory said: “We have made good progress in the first half delivering on our plans to strengthen the group, generating sustained cash flow to further reduce leverage and deploy to targeted growth.

“Our First Rail operations continued to focus on improving services for our passengers while maintaining overall profitability in a more challenging industry environment during the period.”

Image credit - Sterling750

Enjoying RTM? Subscribe here to receive our weekly news updates or click here to receive a copy of the magazine!

Comments

There are no comments. Why not be the first?

Add your comment

 

related

rail technology magazine tv

more videos >

latest rail news

Rail North Partnership review sets out recommendations

19/07/2019Rail North Partnership review sets out recommendations

A review of the Rail North Partnership, headed by Leeds Council leader cllr Judith Blake and rail minister Andrew Jones, has set out recommendati... more >
TfL announces 4G for London Underground in 2020

19/07/2019TfL announces 4G for London Underground in 2020

Transport for London (TfL) have announced that 4G will be available on parts of the London Underground from March 2020. The eastern half of ... more >
Study of light rail finds Manchester Metrolink one of best in the world

19/07/2019Study of light rail finds Manchester Metrolink one of best in the world

An international study of light rail systems has identified Metrolink as one of the best in the world. The system was rated as fifth best in... more >

editor's comment

23/01/2018Out with the old...

Despite a few disappointing policy announcements, especially for the electrification aficionados amongst us, 2017 was, like Darren Caplan writes on page 20, a year generally marked by positive news for the rail industry. We polished off the iconic Ordsall Chord (p32), hit some solid milestones on Thameslink (p40), progressed on ambitious rolling stock orders (p16), and finally started moving forward on HS2 (p14) ‒ paving the way for a New Ye... read more >

last word

Encouraging youngsters to be safe on the railway

Encouraging youngsters to be safe on the railway

This summer, Arriva Group's CrossCountry and the Scout Association joined to launch a new partnership to promote rail safety among young people. Chris Leech MBE, business community manager at the... more > more last word articles >

'the sleepers' daily blog

Apprentice to Co-leading the Rail Sector Deal

05/06/2019Apprentice to Co-leading the Rail Sector Deal

In a series of Q&A’s with key speakers on the run up to TransCityRail Midlands, we caught up with TransCityRail panellist and Amey’s commercial account director, Anna Delvecchio, for her insight into what the Rail Sector Deal means for the rail industry and its supply chain. Anna started her career as an apprentice at the age o... more >
read more blog posts from 'the sleeper' >

comment

The challenge of completing Crossrail

05/07/2019The challenge of completing Crossrail

With a new plan now in place to deliver Crossrail, Hedley Ayres, National Audit Office manager, major projects and programmes, takes a look at ho... more >
Preparing the industry to deliver trains for the future

04/07/2019Preparing the industry to deliver trains for the future

The move to decarbonise the rail network involves shifting to cleaner modes of traction by 2050. David Clarke, technical director at the Railway ... more >
Sunshine future beckons for South Wales Railways, says 10:10 Climate Action’s Leo Murray

02/07/2019Sunshine future beckons for South Wales Railways, says 10:10 Climate Action’s Leo Murray

Smart electrification is the way to boost clean energy resources, argues Leo Murray, director at 10:10 Climate Action. Contractors are clear... more >
Ambition doesn’t have to be expensive, says Midland Connect's Maria Machancoses

02/07/2019Ambition doesn’t have to be expensive, says Midland Connect's Maria Machancoses

The TCR Midlands conference is only days away and tickets are going fast for the sector event of the year at the Vox Conference Centre in Birming... more >

rail industry focus

View all News

interviews

Andrew Haines, CE of Network Rail, tells BBC News his organisation could issue future rail franchises

24/06/2019Andrew Haines, CE of Network Rail, tells BBC News his organisation could issue future rail franchises

By Ewan Quayle, Rail Technology Magazine Reporter Andrew Haines, the Chief Executive of Network Rail, has told the Today programme on R... more >