First Group (FGP) Dividends

Financial summary:

Group overview:

  * Trading for the first half was in line with management's expectations and
    our multi-year transformation programme is on track

  * Encouraging progress with First Student turnaround and good performances in
    First Transit and UK Rail

  * Core Greyhound customers and some local UK Bus markets not yet seeing
    benefit of improving economic trends

  * Reported revenue decreased by 10.9%, in part reflecting structural changes
    in Rail revenues which have no material impact on operating profit, prior
    period revenues from UK Bus operations now sold/closed, and foreign
    exchange. Excluding these items, revenue increased by 3.9%

  * Adjusted operating profit increased by 2.4% and adjusted attributable
    profit more than doubled

  * Statutory operating profit decreased by 11.5%, with prior period
    benefitting from gain on UK Bus disposals

  * Seasonally higher mid-year net debt: EBITDA ratio of 2.5 times (2.2 times
    as at 31 March 2014). Five year, £800m revolving credit facility signed in
    the period

  * On course to achieve our medium term financial targets

FIRSTGROUP PLC

PRELIMINARY RESULTS

FOR THE YEAR TO 31 MARCH 2013

* Overall trading for the Group in line with management's expectations

* Proposed fully underwritten £615m capital raising transaction announced
separately today to remove the constraints of the current balance sheet and
enable the business to continue to invest for future returns, while
reducing leverage

* No final dividend proposed. New progressive dividend policy announced
today.

* First Student - recovery plan on track, building on progress made from a
more efficient operating model and uniform practices

* First Transit - strong growth underpinned by good contract wins, disposal
of First Support Services consistent with our strategy to focus on core
businesses

* Greyhound - margin expansion despite economic headwinds, further expansion
of Greyhound Express to new markets

* UK Bus - completed portfolio reshaping with c.£100m of disposals, including
sale of London depots announced in April. Comprehensive programme to
restore performance and increase revenue and patronage delivering early
positive results

* UK Rail - continued strong performance, franchise extensions currently
being negotiated and positioned for resumption of franchising process

* Cash flow in line with expectations

INTERIM MANAGEMENT STATEMENT

FirstGroup plc, the leading transport operator in the UK and North America, reports the following update on trading from 1 October to 31 December 2012 (the third quarter).

Overview

Trading for the Group, excluding the one-off effect of Hurricane Sandy, during the third quarter was in line with our expectations. Despite the economic conditions that prevail, we continue to strengthen the business for the future by taking actions that will lead to improved performance and sustainable growth.

We were pleased by continued strong support from fixed income investors in November, which led to our issue of £325m of 10-year bonds being significantly oversubscribed. The proceeds were used to pay down debt, as part of our strategy to reduce reliance on bank borrowings and extend our debt maturity profile.

As part of the Group's stated strategy to reposition its UK Bus division to focus on those areas that offer the greatest potential for growth, we are pleased to announce the sale of our Birkenhead and Chester bus businesses to Stagecoach Group plc for a consideration of £4.5m. On completion of the sale our Birkenhead and Chester bus depots as well as a leased outstation in Wrexham and around 110 vehicles and approximately 290 employees will transfer to Stagecoach.

Commenting Giles Fearnley, First's Managing Director, UK Bus said:

"Birkenhead and Chester are businesses where we have previously seen lower than average margins and they are not core to our operations. They fit better with Stagecoach's existing portfolio in the area and also allow us to realise efficiencies in support costs. The sale of these operations marks further progress in disposing of selected assets and businesses as we review the scope and scale of our portfolio and reposition it for the longer term. We are progressing our detailed programme to recover performance and equip our UK Bus business to achieve sustainable revenue and patronage growth."

FIRSTGROUP PLC HALF-YEARLY RESULTS TO 30 SEPTEMBER 2012

FirstGroup plc ("FirstGroup" or "the Group") is the leading transport operator in the UK and North America. With approximately 124,000 employees we carry 2.5
billion passengers every year across our bus and rail networks in the UK and our school bus, transit and intercity coach operations in the US and Canada.

Overview:

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PRE-CLOSE TRADING UPDATE

FirstGroup plc ("the Group") reports the following update on trading for the six months to 30 September 2012 ("the period") ahead of its half-yearly results to be announced on 7 November 2012.

Overall trading

Despite continued economic uncertainty, overall trading for the Group during the first half of the year is in line with our expectations. With a resolute focus on creating a stronger business for the future we have taken action to improve performance and deliver sustainable growth.

First Student

First Student has made good progress in addressing performance and strengthening its operating model. Although there remains significant work to be done, the business is now set on the path to recovery. We achieved a retention rate of 90% and delivered a successful start up to the new school year. US Dollar revenues on a like-for-like basis are expected to be down by 3.8 % for the period and as previously stated, we expect the operating margin for the full year to exceed the 2010/11 performance.

First Transit

First Transit continues to deliver a steady trading performance in line with our expectations. US Dollar revenues are expected to increase by 3.2 % on a like-for-like basis. We continue to achieve strong contract retention rates of over 90% and progress a pipeline of new business opportunities.

Greyhound

We continue with the modernisation of Greyhound including the roll out of our popular Express service. During the period like-for-like revenue growth is expected to be 1.7% reflecting the impact of the sluggish economic environment and lower fuel prices on summer trading. We have however, mitigated this impact through the actions we have taken over recent years which has enabled us to leverage the positive effects of a more flexible operating model. Our Greyhound Express product continues to prove popular with customers and, having rolled out services to Texas and California during the summer, we are developing plans to extend to further new cities in the autumn.

UK Bus

Our UK Bus division is expected to deliver like-for-like passenger revenue growth of 2.5% in the period. Challenging economic conditions continue to impact a number of our urban operations however, during the period our operations in the North of England and Scotland saw improved revenue growth whereas, in keeping with industry trends, we saw a reduction in concessionary volumes in our businesses in the South. We were delighted to successfully complete the smooth delivery of our contract to provide spectator transport to the London 2012 Games. While there remains considerable work to be done in our UK Bus division, we have seen some early positive signs in some of our markets.
We have a clear direction and are executing a detailed plan to recover performance and equip the business to achieve increased revenue and patronage growth, including continuing to work through our programme of disposals. As previously stated, we expect UK Bus operating margin to be approximately 8% in the full year.

UK Rail


Our UK Rail division achieved a further period of solid performance with like-for-like passenger revenue expected to increase by 8.1%. All of our rail franchises made a strong contribution to this performance and we remain focused on ensuring the quality of our existing operations while continuing to develop opportunities from the re-franchising programme. We are shortlisted for all three rail franchises currently out for tender.

On 15 August, the Department for Transport (DfT) announced that we have been awarded the contract to operate the InterCity West Coast franchise. The incumbent operator Virgin Rail Ltd, a joint venture between Virgin Group and Stagecoach Group plc, is pursuing a legal challenge against the DfT in relation to the franchise award. We have every confidence in the DfT's process which is rigorous, detailed and fair and in which bids are thoroughly tested. Our focus is to ensure a smooth transition with continuity for staff and passengers alike and to deliver the many benefits and improvements we are offering without delay or disruption. We continue to prepare for a successful mobilisation on 9 December 2012.

Outlook

Commenting, Tim O'Toole, Chief Executive said:

"I am pleased to report overall trading for the first half of the year is in line with our expectations. With a fundamentally strong and diverse portfolio of operations we are focused on driving a greater performance and delivering improved growth and returns. While there is significant work to do we are satisfied with the progress of the actions we have taken, though we remain mindful of the uncertain economic backdrop.

"We have leading positions in a sector that is a key enabler of economic growth and we are confident that the actions we are taking will strengthen the business for the future. Therefore, reflecting its longer term view, the Board remains committed to its current policy of dividend growth of 7.0% through to the end of the financial year 2012/13."