National Express Group PLC Annual Report and Accounts 2008 Making
Total Page：16
File Type：pdf, Size：1020Kb
National Express Group PLC Group National Express National Express Group PLC National Express Group PLC 7 Triton Square London NW1 3HG Tel: +44 (0) 8450 130130 Annual Report and Accounts 2008 Fax: +44 (0) 20 7506 4320 e-mail: [email protected] www.nationalexpressgroup.com Annual Report and Accounts 2008 Making travel simpler Glossary AGM Annual General Meeting Combined Code The Combined Code on Corporate Governance published by the Financial Reporting Council CPI Consumer Price Index CR Corporate Responsibility The Company National Express Group PLC DfT Department for Transport DNA The name for our leadership development strategy EBT Employee Benefit Trust EBIT Earnings Before Interest and Tax EBITDA Earnings Before Interest and Tax and also before depreciation and amortisation. It is calculated by taking normalised profit from operations and adding depreciation, fixed asset grant amortisation, normalised profit on disposal of non-current assets and share-based payments. EPS Earnings Per Share – The profit for the year attributable to shareholders, divided by the weighted average number of shares in issue, excluding those held by the Employee Benefit Trust and shares held in treasury which are treated as cancelled. EU European Union The Group The Company and its subsidiaries IAS International Accounting Standards IFRIC International Financial Reporting Interpretations Committee IFRS International Financial Reporting Standards KPI Key Performance Indicator UK Bus and Coach page 12 UK Rail page 18 LTIP Long Term Incentive Plan Net capital expenditure is the increase in net debt arising on the purchase of property, plant and equipment and intangible assets less proceeds from disposals of property, plant and equipment. It excludes capital expenditure arising from UK Rail franchise entry and exits and discontinued operations, which are included in these headings. Net debt is defined as cash and cash equivalents (cash overnight deposits, other short term deposits), and other Contents debt receivables offset by borrowings (loan notes, bank loans and finance lease obligations) and other debt payable. Overview Net interest expense is finance costs less finance income. Operational performance 01 NXEA National Express East Anglia Financial highlights 01 NXEC National Express East Coast Business at a glance 02 Normalised diluted earnings Chairman’s Statement 03 per share Earnings per share, excluding the profit or loss on sale of businesses, exceptional profit or loss on the Operating and Financial Review disposal of non current assets and charges for goodwill impairment, intangible asset amortisation, Introduction 04 exceptional items and tax relief on qualifying exceptional terms Strategy 05 Normalised profit Profit before tax, goodwill impairment, intangible asset amortisation and exceptional items Perfomance Review 08 UK Bus and Coach 12 (For the purposes of UK Rail 18 Directors’ Remuneration) North America 22 Normalised results are defined as the statutory result before the following, as appropriate: profit or loss on the sale of Spain 26 businesses, exceptional profit or loss on the disposal of non-current assets and charges for goodwill Relationships and Resources 30 impairment, intangible asset amortisation, exceptional items and tax relief on qualifying exceptional items. Other financial matters 31 Principal risks and uncertainties 32 Operating cash flow is intended to be the cash flow equivalent to normalised operating profit. Operating cash flow is defined as Critical accounting policies 33 the statutory cash flow including the following, as appropriate: cash generated from operations and Corporate Responsibility 34 proceeds from disposals of property, plant and equipment, and less the following, as appropriate: finance Governance lease additions, purchase of property, plant and equipment, purchase of intangible assets, payments to Board of Directors and Management 36 associates, payments in relation to exceptional items, UK Rail franchise entry and exit cash flows and Directors’ Report 38 discontinued operations’ cash flows. Corporate Governance Report 42 OFR Operating and Financial Review Directors’ Remuneration Report 49 RPS Railway Pension Scheme Independent Auditor’s Report to the SPAD Signal Passed at Danger Members of National Express Group PLC 57 TfL Transport for London Financial statements TOC Train Operating Company Group Income Statement 58 Group Balance Sheet 59 TSR Total Shareholder Return – the growth in value of a shareholding over a specified period assuming that Group Statement of Cash Flows 60 dividends are reinvested to purchase additional shares Group Statement of Recognised UK GAAP UK Generally Accepted Accounting Principles Income and Expense 61 Notes to the Consolidated Accounts 62 This Annual Report and Accounts is printed on on Revive This annual report is available at Five Year Summary 130 Pure White Silk and Uncoated, 100% recycled papers with ww.nationalexpressgroup.com/ar2008 Shareholder information FSC certification. The composition of the paper is 85% de-inked post-consumer waste and 15% unprinted Designed and produced by Radley Yeldar (London) Shareholder information 131 pre-consumer waste. All pulps used are Elemental Chlorine Free (ECF) and the manufacturing mill is accredited with the and Hudson Wright Associates. Dividends and financial calendar 132 ISO 14001 standard for environmental management. If you Printed by Park Communications Limited Corporate information 132 have finished reading this report and no longer wish to retain it, please pass it on to other interested readers or dispose of Glossary 133 it in your recycled paper waste. Thank you. National Express Group PLC National Express Group PLC 133 Annual Report and Accounts 2008 Annual Report and Accounts 2008 North America page 22 Spain page 26 Overview Operational performance Financial highlights Strong performance in delivery of Rail franchises in Continuing revenue 2008, including meeting all first year commitments for East Coast. +5.9% Robust growth in UK Bus and Coach, with enhanced to £2,767.0 million (2007: £2,612.3 m) efficiencies and cost savings from integration. Normalised* operating margin excluding discontinued operations Excellent customer retention in North America bus, supported by $38 million new contracts; 9.2% steady progress in Business Transformation (2007: 8.1%) project with pilot now in two US states. Normalised* profit before tax In Spain, full benefit of Continental Auto integration, delivering over 40% profit growth in local currency. +9.7% Outlook to £194.1 million (2007: £177.0 m) Normalised* diluted earnings per share Rail business expected to remain profitable in 2009, despite recessionary environment, through delivery of revenue and cost initiatives in East Coast and revenue +11.6% support in East Anglia. to 93.6p (2007: 83.9p) North America and UK Bus benefiting from Total dividend per share for the year lower economic sensitivity, combined with ability to manage service and cost base in Spain and UK Coach. 22.72p (2007: 37.96p) Strong focus on cash management and debt reduction, supplemented by rebased dividend, * Normalised results are the statutory results excluding the profit or loss on the to deliver additional cash benefit in excess of sale of business, exceptional profit or loss on sale of non-current assets and charges for goodwill impairment, intangible asset amortisation, exceptional £100 million in 2009. items and tax relief on qualifying exceptional items. National Express Group PLC 01 Annual Report and Accounts 2008 Overview Business at a glance More on page 12 UK Bus and Coach UK Bus UK Coach National Express West Midlands National Express Coaches National Express Coventry Eurolines National Express Dundee Airlinks National Express London Kings Ferry National Express Midland Metro We operate over 2,300 buses, We provide Britain’s only scheduled carrying approximately 320 million national coach network and serve passengers a year and employ more than 1,700 destinations, providing 7,500 people in the West Midlands, approximately 18.5 million passenger Dundee and London. journeys each year, and employ 1,800 people. More on page 18 UK Rail UK Rail c2c National Express East Anglia National Express East Coast We provide 164 million passenger journeys per year and employ 7,000 people. More on page 22 North America North America Durham School Services Stock Transportation The North American division focuses on student transportation. It operates over 15,000 buses. The division employs over 22,000 people. More on page 26 Spain Spain ALSA Continental Auto We are Spain’s leading private operator of coach and bus services. The division provides nearly 180 million passenger journeys per annum and employs over 6,800 people. $ More available online at www.nationalexpressgroup.com 02 National Express Group PLC Annual Report and Accounts 2008 Overview Pages 01 p 03 Chairman’s Statement Operating and Financial Review Pages 04 p 35 Governance Pages 36 p 56 Financial statements Pages 58 p 130 Shareholder information Pages 131 p 132 During 2008 we delivered strong revenue 2009, compared to last year, and sets a and profit growth for National Express. dividend which we see as a sustainable Total Group revenue grew nearly 6% to base for the future. We are also focusing almost £2.8 billion. We increased normalised on a restrained period of capital investment profit before tax by almost 10% to £194.1 and have identified opportunities to reduce million. At the same time, we improved our working capital.