Firstgroup has posted a £327 million loss for the financial year to 31 March, prompting CEO Tim O’Toole to ‘step down’.
Shares in Firstgroup have fallen since the announcement this morning, with the company blaming its US-based bus firm Greyhound’s “inability to overcome the structural shift taking place in its long-haul markets” in the wake of increasing capacity on low-cost airlines.
The group says that while its Great Western and South Western rail franchises remain profitable, the Transpennine Express is projected to make a loss of £106.3 million over the remainder of the contract.
Wolfhart Hauser, executive chairman of Firstgroup, commented: “The board is examining all appropriate means to mobilise the considerable value inherent in the group. Initial actions from its evaluation are underway, including conducting a full external review of Greyhound’s business model and prospects, which will conclude in the coming months.”
Along with its financial report, the group announced that Tim O’Toole would step down as CEO, with Hauser to become interim executive chairman until a replacement is hired. CFO Matthew Gregory will become interim COO in addition to his existing duties.
O’Toole said: “The time is right for me to step aside. Today’s results clear the way for the new approach sought by our chairman and the board.”