FirstGroup posted a better-than-expected annual operating profit and proposed an additional share buyback programme, helped by higher passenger levels in its buses on the back of a UK government scheme to cap fares.

The Aberdeen-based company, which has been stripped of the TransPennine franchise, launched an additional buyback of shares worth £115 million following proceeds from exiting the North American market.

Current trading and the outlook for 2024 were in line with expectations, it said.

Adjusted operating profit for the year ended 25 March came in at £161 million compared with £106.7m last time.

The board has proposed a final dividend of 2.9p per share, making a total dividend 3.8p per share (FY 2022: 1.1p per share).

Chief executive Graham Sutherland said: “We have delivered a strong financial performance in FY 2023. In First Rail, our teams have worked extremely hard on our service objectives, and the notable success of our open access operations is further recognition of the considerable expertise and ambition of our team.

“In First Bus, we are seeing the benefits of actions we have taken to transform the business, and we are establishing ourselves as leaders in decarbonisation as we accelerate the electrification of our bus fleet to deliver value not just for FirstGroup but for all our stakeholders.”

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