**Summary of FirstGroup plcs Half-Year Financial Report (H1 2026):**
FirstGroup plc, a leading UK public transport provider, reported a robust performance for the first half of its financial year ending September 27, 2025. The company highlighted a positive earnings trajectory, driven by portfolio growth, improved earnings quality, and diversification. Key financial highlights include
**Revenue Growth** Adjusted revenue increased by 30% to £833.6 million, primarily due to growth in bus revenues, contributions from First Bus London, and progress in First Rails open access and rail services.
**Profitability** Group adjusted operating profit reached £103.6 million, with growth from acquisitions and cost efficiencies partially offset by higher National Insurance contributions and the conclusion of the SWR NRC.
**Earnings Per Share (EPS)** Adjusted EPS grew by 16% to 9.9p, supported by a share repurchase program and operational improvements.
**Cash Flow** Free cash outflow was £35.6 million, primarily due to accelerated investment in First Bus, including electrification initiatives.
**Dividend** An interim dividend of 2.2p per share was declared, in line with the companys progressive policy.
**Debt Management** Adjusted net debt was £207.6 million, with a forecast year-end net debt of £125-135 million, reflecting strong cash generation and investment in growth.
**Operational Highlights**
**First Bus** Adjusted operating profit increased by 4% to £42.7 million, driven by pricing actions, operational efficiencies, and the integration of First Bus London. Passenger volumes stabilized, with concessionary growth offsetting commercial declines.
**First Rail** Open access passenger journeys increased by 2%, with revenue growth in both open access and rail services. The company is on track to double its open access capacity in the next 2-3 years, supported by new rolling stock and track access rights.
**Electrification and Sustainability** FirstGroup is at the forefront of fleet and infrastructure electrification, with over 1,280 zero-emission buses (23% of the fleet) and investments in battery energy storage solutions.
**Strategic Initiatives**
**Business Restructuring** The company made good progress on its restructuring plan, delivering £6 million in savings toward a £15 million target.
**Acquisitions and Growth** The acquisition of Tetleys Coaches and a minority stake in Palmer Energy Technology bolstered the business and coach segment and supported electrification efforts.
**Franchising and Partnerships** FirstGroup is actively participating in regional franchising opportunities and evaluating strategic acquisitions to enhance its market position.
**Outlook**
FirstGroup anticipates modest growth in adjusted EPS for FY 2026, with continued investment in portfolio diversification. The company remains focused on its UK-centric growth strategy, leveraging its strong balance sheet and disciplined capital allocation to deliver sustainable value for stakeholders.
**CEO Commentary**
CEO Graham Sutherland emphasized the companys robust performance, progress in growing and diversifying the business, and commitment to delivering on strategic objectives. He highlighted the companys strong position to capitalize on emerging opportunities in the evolving UK transport sector.
**Financial Review and Capital Allocation:**
The company reaffirmed its capital allocation framework, prioritizing investment in growth, progressive dividends, and returning surplus cash to shareholders. The interim dividend reflects this commitment, and the company aims to maintain a strong balance sheet with a medium-term target of less than 2.0x adjusted net debt to EBITDA.
**Principal Risks and Uncertainties**
FirstGroup continues to monitor economic conditions, geopolitical developments, and regulatory changes, particularly in the context of UK transport policies. The company remains focused on mitigating risks through strategic planning and operational resilience.
Overall, FirstGroups H1 2026 results demonstrate resilience, strategic progress, and a clear path toward sustainable growth in the UK transport sector.