MARKET REPORT: Rail strikes put National Express in the fast lane

MARKET REPORT: Rail strikes put National Express in the fast lane after commuters switched to buses to avoid travel chaos

Bus  and coach operator National Express rode to the rescue for Britons caught up in rail strikes as commuters switched to buses.

It hailed a recovery in passenger numbers and resumed dividend payments for the first time since 2020 when services were hit by Covid restrictions. Shares jumped 10.8 per cent, or 13.4p, to 137.4p.

Last year Britain faced a wave of rail strikes, forcing commuters to work from home or find other ways to travel. National Express’s UK bus division reported a 39 per cent increase in passengers.

And nearly 10 per cent of new customers during the strikes bought another ticket within a month to travel on a non-strike day. Revenue in its Spanish transport business Alsa exceeding €1billion (£887million) for the first time.

It remained upbeat over driver shortages and wage inflation that have hampered its schools bus division in North America.

All aboard: Bus and coach operator National Express hailed a recovery in passenger numbers and resumed dividend payments for the first time since 2020

Across the group, passenger journeys shot up 23 per cent. Revenue rose 29.4 per cent to £2.81billion for 2022 but its losses widened from £84.9million to £209.9million because of a writedown at Alsa.

Peel Hunt warned that the ‘risk of strikes hangs over the stock’. Services could come under severe pressure after more than 3,000 West Midlands drivers voted to strike from March 16 over pay.

The FTSE 100 climbed 0.4 per cent, or 29.11 points, to 7944.04 while the FTSE 250 fell 0.1 per cent, or 18.95 points, to 19851.65.

M&G was in sharp focus after Sky News reported that the fund manager could be in line for a takeover bid from the Australian investment bank Macquarie. It dipped 0.9 per cent, or 2p, to 217.3p. 

There was also a boost for GSK after the US Food and Drug Administration’s backed the safety and effectiveness of the pharma giant’s vaccine to treat adults aged 60 and above who have respiratory syncytial virus.

It is expected to make a decision by May 3. Shares inched up 1.2 per cent, or 16.8p, to 1438.8p.

Stock Watch – Capita

Capita surged to its highest level for more than a year after the outsourcer cheered the success of its years-long turnaround strategy.

It jumped 19.7 per cent, or 5.74p, to 34.86p as it slashed its debt by 45 per cent to £482million after selling a slew of businesses last year.

Capita, whose work includes collecting the BBC licence fee, made a profit of £74million for 2022, once all the divisions that have been sold were stripped out, from a loss of £123million a year earlier. 

Revenue rose 2.4 per cent to £2.8billion.

Beazley fell 5.1 per cent, or 35p, to 647.5p after its profit slumped 48 per cent to £160m for 2022, as the Lloyd’s of London insurer, which joined the blue-chip index for the first time in December, reported an investment loss of £151million.

The value of its written premiums increased by 14 per cent to £4.4billion.

Aston Martin gained 5.3 per cent, or 10.9p, to 218.5p after Deutsche Bank raised the luxury car maker’s target price to 155p from 145p a day after its results for 2022 showed signs of a turnaround.

Also flying high was Wizz Air. The airline added 4.3 per cent, or 112p, to 2731p after it carried nearly 3.7m passengers last month.

WH Smith joined a growing list of companies which have suffered cyber attacks in 2023. The stationery and book firm said information such as current and former employee data was accessed.

The update followed reports of cyber attacks this year at Morgan Advanced Materials, JD Sports and Royal Mail. WH Smith fell 1.9 per cent, or 30p, to 1554p.

Vesuvius, which makes smelting equipment and technology for steel plants, also suffered a cyber attack last month and expects to pay a one-off cost of between £3million and £5million. It cheered a record results for 2022 with revenue 25 per cent to £2.1billion while profit jumped 62 per cent  to £207million. Shares rose 2.7 per cent, or 11.2p, to 434.2p.

Begbies Traynor rose 1.3 per cent, or 1.8p, to 139p to after the restructuring specialist bought Mark Jenkinson & Son, the Sheffield firm that specialises in property auctions, for £400,000.

The over-50s holiday and financial services firm Saga slumped 4.8 per cent, or 8.4p, to 166.1p after it failed to reach an agreement with Open Insurance over the sale of its underwriting business.