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UK’s National Express reports Q3 growth amid merger talks

By Jenni Reid

09:08, 14 October 2021

A National Express coach drives in front of the London Eye
Coach operator National Express said UK passenger numbers were nearing pre-pandemic levels – Photo: Shutterstock

British coach operator National Express reported improved revenue in the third quarter, sending shares in the company up on Thursday morning. 

Revenue for the quarter ended 30 September was just 17% lower than the same period in 2019, the pre-pandemic year, according to the company. Revenue in the second quarter of this year reached 76% of the same quarter in 2019.

The share price of the London-listed public transport operator was up 2.7% during the morning trade. 

It also confirmed that it remained in talks with rival Stagecoach over an all-share combination, though stressed that no offer was guaranteed. Stagecoach’s share price was up by 2.4% on Thursday morning. 

Pandemic recovery 

National Express said it was mitigating the financial impact of ongoing driver shortages, which were particularly affecting its US school bus driver business. The company had hedged fuel, one of its main costs, into 2023. 

In the UK, bus patronage was back at 76% of pre-Covid levels. The company also has a Spanish subsidiary, ALSA, where passenger numbers are at 65% of pre-Covid levels and 90% of revenue levels, according to the trading update. 

The firm expects to end the year with around £800m in cash and said underlying profit before tax for 2021 would be in line with previous forecasts. It would continue to be supported by the UK government’s Bus Recovery Grant until April 2022. 


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“The trend of improving performance has continued through the third quarter,” said Ignacio Garat, National Express chief executive. “I am pleased to say that our ongoing focus on cost management along with our long-established procurement and fuel hedging programmes mean that we have seen no material impact from input cost inflation.”

Merger questions

The prospect of a Stagecoach takeover was raised by the company on 21 September. 

Under the terms of the potential deal, Stagecoach shareholders would receive 0.36 new National Express shares for each Stagecoach share, giving them a 25% stake in the merged group, the company said at the time. 

Today, the firm noted that the deal “could deliver significant growth and cost synergies, as well as strong value creation for both sets of shareholders” and that “discussions and reciprocal due diligence continue”.

Stagecoach this week reported journey numbers were 70.1% of the figure for the equivalent period in 2019, with half-year financial results expected on 8 December. 

Read more: Stagecoach continues takeover talks with National Express

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