National Express, which will receive a Government subsidy of pounds 2.8bn to run trains over the next 15 years, made a profit of more than pounds 8m from its train division in the six months to June before restructuring costs to cover redundancies. Overall, National Express recorded a 39 per cent rise in underlying pre-tax profits to pounds 31.8m and boosted the interim dividend by 18 per cent to 4p.
Analysts believe the company will make around pounds 20m from trains in the current year, fuelling criticism that the government sold off the rail network far too cheaply.
One analyst said: "National Express will make a packet from these franchises. They are a gold mine and the group looks like it got a real bargain."
National Express has added its voice to the growing row between the train operating companies and Railtrack, owner of the UK's railway tracks and stations. The group has approached John Swift, the Rail Regulator, to voice concerns that it could be forced to pay millions of pounds a year to Railtrack under a controversial performance regime based on a reduction in delays caused by signalling or track failures. The group plans to put pressure on the Regulator to amend the scheme.
Colin Child, National Express finance director, said: "We have discussed the performance regime with the Regulator. We believe it should be set at another level."
National Express's comments come after an outcry from Connex South Central, the French-owned group which runs trains from London to Brighton, over the pounds 9m it has been forced to pay to Railtrack under the scheme. One source said: "This is a growing feeling in the industry that Railtrack has got off lightly and will continue to rake in the cash. We want to and will stop that."
National Express said it had a war chest that could stretch to several hundreds of millions of pounds to spend on acquisitions. It is eyeing up a host of targets at home and abroad.
Phil White, the group's new chief executive, said he was not just looking for transport acquisitions. He cited the group's attempt to buy the Welcome Break service stations from Granada, which failed at the last hurdle, as an example of the future deals that could be done.
National Express is also keen to expand its airport division. It has already put in a bid for the 51 per cent of Bristol Airport which is up for sale and has expressed an interest in running Luton airport. It will also bid for a number of the 13 local Australian airports which will be privatised this year.
National Express announced plans to introduce a combined bus and train ticket in Birmingham next month. It is also looking to introduce combined bus and train services throughout the Midlands. The company said it was confident it would get clearance from the Monopolies and Mergers Commission for its acquisition of ScotRail and Central Trains.Reuse content