Mobico starts US school bus sale as H1 profits jump

21st Aug 2024 07:07

(Sharecast News) - Mobico shares surged by a fifth on Wednesday after the public transport operator started the sale process for its North American school bus business to cut debt and reported a jump in adjusted interim operating profit driven by positive demand and cost cuts.

Profit for the six months to June 30 rose 23.8% to £71.2m while on a pre-tax basis the company narrowed losses to £1.5m from £52m a year earlier. No dividend was declared as the group, formerly known as National Express, continues to deleverage.

It still expects adjusted operating profit for 2024 to be within the range of £185m to £205m.

"An immediate priority remains the reduction of debt and leverage. With that ambition in mind, we're pleased to report that the formal process for the sale of the North America School Bus business has begun, and is progressing in line with expectations," the company said.

Covenant net debt rose to £988m from £908m, while net debt at the end of June stood at £1.24bn. Mobico said it was on track to save £30m this year and would launch further plans to deleverage in the second half.

Alsa, the company's European unit which operates across France, Portugal and Switzerland, posted a 43.2% rise in operating profit to a record £82.5m.

Reporting by Frank Prenesti for Sharecast.com