National Express revs up for £350m spree

National Express disclosed yesterday that it has a £350m warchest to spend on takeovers and further expansion of its existing train, bus and coach businesses as it announced forecast-busting annual results driven by rail passenger growth.

National Express disclosed yesterday that it has a £350m warchest to spend on takeovers and further expansion of its existing train, bus and coach businesses as it announced forecast-busting annual results driven by rail passenger growth.

Unveiling a 17 per cent rise in pre-tax profits to £63m for 2004, the group also announced plans to reward investors with a £100m share buyback and an 18 per cent in the final dividend.

Profits from National Express's eight rail franchises, which operate nearly a third of the country's trains, increased by 76 per cent to £58.5m. The improvement was attributed to a 5 per cent increase in passenger numbers and the replacement of the loss-making ScotRail franchise, which was won by FirstGroup, with the new One franchise which operates Greater Anglian services from Liverpool Street.

Phil White, the chief executive, said the rail division had also benefited under the industry performance scheme with punctuality across all the franchises now running at 89 per cent against the Government's target of 85 per cent.

He said National Express had seen strong growth in its traditional coach business, particularly on the Birmingham-London route where it operates a half-hourly shuttle service.

He said the group was beginning talks with the Strategic Rail Authority over the impending loss of its Gatwick Express rail service which is being subsumed into Go-Ahead's Southern Trains franchise.

Profits from the bus division slipped 7 per cent to £44.2m after changes to the concessionary fare scheme in the West Midlands where National Express has the biggest of its operations. It is looking to expand in the London bus market after last year's takeover of Connex's bus services in the capital.