First Group: General Discussion

[winston270twm]

NXWM got very close to buying RH & KR but it fell through when it became clear that they intended to operate it on different terms, effectively as a low cost operation.

Robert

Robert,

But why would the deal fall through based on how NXWM intended to operate it after purchase? Surely, as long as First got the asking price they wanted, it's up to NXWM to how they operate from there on in. I would have thought that NXWM's hands were tied on changing somethings to a degree, as staff terms & conditions would have to have been honored
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Appreciate where you're coming from Winston. It might be a case that perhaps First approached NXWM about KR/RH rather than sell to Rotala but then we're speculating. As I say, Worcester SHOULD be a good provincial moneyspinner and with the threat of QCs, they need some of those as well. Without looking at the detailed accounts, I wouldn't be surprised that after selling to Rotala, First still had to have a write down on the vehicle assets that passed to Diamond (mainly RH's Enviro 300s) and that is in addition to the property write down.

I would have thought that all write downs would have been included in the current accounts that are available to 31st March 2013. Afterall, Rotala only bought the 3 x E300's from First, as Simon Dunn confirmed on another forum that there was a difference of opinion between First & Rotala on valuations for the E300's, hence why Rotala didn't take all that were allocated to RH at the time the sale was being agreed.

I agree that WR should be a good earner and it was always thought that it was a highly profitable op, but judging by the most recent accounts it wouldn't take much to make it loss making
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Possibly??? That sounds like a guess

The facts are that FSE has performed poorly and in some former strongholds is now very weak. That is beyond question.

However, there's been a lot of baseless speculation with FSE having 3 different purchasers? Does that point to inside knowledge or idle speculation? The most amusing thing is that whilst UNO was supposed to buy part of Northampton, or 3 firms were buying Wyvern, no-one predicted London getting sold until a few days beforehand and NOT to the firms concerned.

I'm sure I suggested a sale of the London Op would raise the funds required to hit the £100 Million target, but didn't predict the likely purchasers

 

[Robertj21a]

Robert,

But why would the deal fall through based on how NXWM intended to operate it after purchase? Surely, as long as First got the asking price they wanted, it's up to NXWM to how they operate from there on in. I would have thought that NXWM's hands were tied on changing somethings to a degree, as staff terms & conditions would have to have been honored
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I'm not going to say much more but the *future* staff terms and conditions were indeed a key factor in the NXWM bid failing.

Robert

 

[winston270twm]

Robert,

But why would the deal fall through based on how NXWM intended to operate it after purchase? Surely, as long as First got the asking price they wanted, it's up to NXWM to how they operate from there on in. I would have thought that NXWM's hands were tied on changing somethings to a degree, as staff terms & conditions would have to have been honored
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I'm not going to say much more but the *future* staff terms and conditions were indeed a key factor in the NXWM bid failing.

Robert

Robert,

Do you know if there was any truth in NXWM making an offer to buy Worcester as well?

Regarding RH & KR and failed NXWM bid, I don't see it matters what you say as I was over 12 months ago now & the business has since been sold on to Rotala anyway

 

[Robertj21a]

Robert,

Do you know if there was any truth in NXWM making an offer to buy Worcester as well?

Regarding RH & KR and failed NXWM bid, I don't see it matters what you say as I was over 12 months ago now & the business has since been sold on to Rotala anyway

I've never heard of Worcester being included in any deal with NXWM.

It may well be over a year ago now but the people involved are still around and may not wish some aspects to become general knowledge.

Robert

 

[winston270twm]

I've never heard of Worcester being included in any deal with NXWM.

It may well be over a year ago now but the people involved are still around and may not wish some aspects to become general knowledge.

Robert

Fair enough Robert, thanks for your replies!

It wasn't so much of WR being included in the deal, I'd heard that NXWM had expressed interest in WR as well but were flatly turned down,

 

[overthewater]

Fair enough Robert, thanks for your replies!

It wasn't so much of WR being included in the deal, I'd heard that NXWM had expressed interest in WR as well but were flatly turned down,

Where did you "hear" about this talk?

 

[TheGrandWazoo]

Even the First Midland Red (Wyvern) accounts don't make fantastic reading for the WR & HD operations that were retained:

Accounts to 31st March 2013:

Turnover £14.6 Million
Operating Profit £61k
Loss on disposal of property to Rotala £1.205 Million
Post tax loss of £1.067 Million

I'm assuming all the above excluded the turnover & losses from Redditch & Kidderminster operations which transferred to Rotala ownership from 2nd March 2013.

Since those results, there hasn't been any significant network reviews, a handful of fares have been cut, plus a few newer used acquisitions have been taken in to stock, but we are yet to see any possible impact on First breaking up Wyvern and reducing the area where First day/week/month passes are valid

Those figures will have the turnover and losses from the operations now sold to Rotala. Turnover is down about £500k against 2012, so can be attributed to those 4 weeks being absent.

In the absence of any material change in the ops between 2012 and 2013, then you'd have to ask yourself why the op profit has changed so much. Appreciate that only 3 Enviros and 3 Darts were modern kit but wonder if the other fleet that went over (despite it being quite elderly) was also on the books at a higher value and a hit was taken?

I can't quite understand why the financial position would've worsened so markedly and, as far as I know, Worcester is a strong operation.

 

[winston270twm]

Where did you "hear" about this talk?

Through a contact of mine....
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Those figures will have the turnover and losses from the operations now sold to Rotala. Turnover is down about £500k against 2012, so can be attributed to those 4 weeks being absent.

In the absence of any material change in the ops between 2012 and 2013, then you'd have to ask yourself why the op profit has changed so much. Appreciate that only 3 Enviros and 3 Darts were modern kit but wonder if the other fleet that went over (despite it being quite elderly) was also on the books at a higher value and a hit was taken?

I can't quite understand why the financial position would've worsened so markedly and, as far as I know, Worcester is a strong operation.

Even if you strip out the £5.2 Million turnover of RH & KR & £0.270 Million loss, that would give the remaining business at WR & HD a turnover of £9.4 Million & an operating profit of around £331k. It's still only a 3.5% profit margin, Worcester was always thought to be a strong operation that generated healthy profits, but the figures seem to indicate otherwise

 

[DunsBus]

The ex-London President in Eastern Scottish livery, 32222 (LT52WUG) has been withdrawn from service following an accident and is currently parked up at Livingston depot, having sustained heavy damage to the front lower-deck nearside.

 

[Blindtraveler]

ouch. So theres another bus down.

 

[alexf380]

Photo here if you haven't seen it.
http://m.flickr.com/#/photos/chrisbridgman/11838070065/page3

First are gonna have to cough up either for its repair or replacement

 

[455driver]

Photo here if you haven't seen it.
http://m.flickr.com/#/photos/chrisbridgman/11838070065/page3

First are gonna have to cough up either for its repair or replacement

Or the insurers of the vehicle that hit it will!

This depends on what it hit and who was at fault of course!

 

[alexf380]

I believe the chat amongst the depot is that it hit a few parked cars as it traveled along a relatively narrow road

 

[Mr Manager]

Link to the photo does not work ?

 

[TheGrandWazoo]

Link to the photo does not work ?

Works ok for me

 

[mbonwick]

Try http://www.flickr.com/photos/chrisbridgman/11838070065
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http://www.telegraph.co.uk/finance/...-on-FirstGroup-as-activist-arrives-in-UK.html

 

[Sandy Drew]

The Swedish guy who holds a 3% stake in Firstgroup is again calling for the group to be split up. There's a new article in the Telegraph (or was it the Guardian! Will try to find a link online)


It's here... http://www.telegraph.co.uk/finance/...-on-FirstGroup-as-activist-arrives-in-UK.html

 

[overthewater]

Here is the link in Quote box, since the above breaks a rule.

Thomas Sandell, the FirstGroup activist investor, will ratchet up the pressure on the transport group’s management next week by attempting to win backing for his break-up plans.
The Swedish billionaire is believed to be flying into the City to meet investors, while his hedge fund, Sandell Asset Management, is also understood to be giving a presentation on its proposals at a Bank of America Merrill Lynch conference this week.
One top 10 shareholder, who has met Sandell Asset Management in the last couple of days, said the activist’s plans were “fundamentally interesting” but warned “there is a huge gulf between a plan sounding good on paper and actually executing it”.
In December, FirstGroup’s board rebuffed Sandell’s proposals to spin-off and float its US yellow school buses and transit business into a New York-listed company and sell Greyhound, its intercity bus provider.
Spinning off the US assets would allow the British firm to pay down debt, invest in its UK bus division and prepare bids for rail franchises which could boost shareholder value by more than 50pc, Sandell has argued.
However, a FirstGroup senior board member questioned whether Sandell’s 3.1pc stake gives it the right to propose the plans or call a shareholder meeting.
The board member said FirstGroup had analysed Sandell’s plan and had considered all of its options last year at the time of the group’s deeply discounted £615m rights issue.
“We came out very clearly, 'here’s our plan for the future, here are our targets’ so it would be very peculiar if a few weeks later someone pops up from the outside and says 'here do this’,” the board member said.
The shareholder also has significant concerns about whether Sandell’s hugely complex plans could be achieved against the backdrop of US concerns about the Federal Reserve tapering quantitative easing.
FirstGroup will unveil its third quarter results and host a capital markets day on Jan 23. Sandell representatives are expected to attend.
“We believe there is strong shareholder support for our ideas and this belief has been reinforced since our engagement with management became public,” a Sandell spokesman said.
A FirstGroup spokesman said the company stood by last month’s rebuttal to Sandell, when it claimed the investor’s proposal contained “a number of structural flaws and inaccuracies”.

 

[winston270twm]

The Swedish guy who holds a 3% stake in Firstgroup is again calling for the group to be split up. There's a new article in the Telegraph (or was it the Guardian! Will try to find a link online)

It's here... http://www.telegraph.co.uk/finance/...-on-FirstGroup-as-activist-arrives-in-UK.html

His hedge fund will need to seriously increase its stake to force the hand of the board or get some of First groups major investors behind him to back his plans.

 

[Morgsie]

First Potteries are crap

 

[overthewater]

Said company must be doing something right, since it makes money.

 

[Morgsie]

They hike their fares up every year for students, when I started university back in 2008 it was £1.45, now it is £1.75. You wait for one bus and 2 tourn up.

First are the hegemonic operator in my part of the world. Good thing Arriva/Wardle are expanding, perhaps they can give First a run for their money.

 

[TheGrandWazoo]

They hike their fares up every year for students, when I started university back in 2008 it was £1.45, now it is £1.75. You wait for one bus and 2 tourn up.

First are the hegemonic operator in my part of the world. Good thing Arriva/Wardle are expanding, perhaps they can give First a run for their money.

Well, fares will go up over time. Using the average CPI, the fare should have gone up from £1.45 to £1.65, but this does fail to capture the full effect of the fuel escalator so £1.70 is probably closer but yes, it is above where it should be

Now, I confess that the Potteries isn't an area I know well but how are Arriva coping with the council cuts, given that Wardle was founded on a fair chunk of tendered work? Are they taking on stuff commercially? Or are they redeploying stuff and staff onto new commercial work against First?

However, a new MD in the much respected Nigel Eggleton may well indicate some new impetus in First Potteries which has been chronically underfunded in recent years - S reg Ultralow anyone?? And are the G reg all Leyland Olympians still going??

 

[Morgsie]

Well, fares will go up over time. Using the average CPI, the fare should have gone up from £1.45 to £1.65, but this does fail to capture the full effect of the fuel escalator so £1.70 is probably closer but yes, it is above where it should be

Now, I confess that the Potteries isn't an area I know well but how are Arriva coping with the council cuts, given that Wardle was founded on a fair chunk of tendered work? Are they taking on stuff commercially? Or are they redeploying stuff and staff onto new commercial work against First?

However, a new MD in the much respected Nigel Eggleton may well indicate some new impetus in First Potteries which has been chronically underfunded in recent years - S reg Ultralow anyone?? And are the G reg all Leyland Olympians still going??

The prices are student fares.

Arriva/Wardle expanded but has cut services recently.

I do not know about stock but there are a few old double deckers in service

 

[Robertj21a]

Well, fares will go up over time. Using the average CPI, the fare should have gone up from £1.45 to £1.65, but this does fail to capture the full effect of the fuel escalator so £1.70 is probably closer but yes, it is above where it should be

Now, I confess that the Potteries isn't an area I know well but how are Arriva coping with the council cuts, given that Wardle was founded on a fair chunk of tendered work? Are they taking on stuff commercially? Or are they redeploying stuff and staff onto new commercial work against First?

However, a new MD in the much respected Nigel Eggleton may well indicate some new impetus in First Potteries which has been chronically underfunded in recent years - S reg Ultralow anyone?? And are the G reg all Leyland Olympians still going??

Most of the older stuff is still at Potteries, but just about to be replaced by slightly less old Volvos from Leicester. If only Potteries was to care about the fleet appearance it might not get so many brickbats thrown at it.

Robert

 

[Surreyman]

February 'Buses' mag, notes that Doncaster depot is upgrading B7TL/ALX 400 Double Deckers to full DDA spec, for a number of First companies.
(Note, buses registered from 01/01/2001 are automatically DDA compliant, the vehicles being upgraded are W & X reg examples from 2000).
So thats a few less (d/deck)vehicles that have to be replaced by the 31/12/2016 D/deck deadline.
I am assuming that all the ex London 'deckers moved out are DDA compliant including the pre 2001 examples.

 

[SWTH]

They hike their fares up every year for students, when I started university back in 2008 it was £1.45, now it is £1.75. You wait for one bus and 2 tourn up.

First are the hegemonic operator in my part of the world. Good thing Arriva/Wardle are expanding, perhaps they can give First a run for their money.

I'm sorry but if a 30p fare increase over six years - an average of a 5p increase per annum - is 'hiking their fares up' then you really need to get out into the real world.

Here in Cornwall First have just doubled their cheapest fare from 90p straight to £2. When your student fare goes straight from £1.75 to £3.50+ overnight, then you can moan.

 

[overthewater]

Back in Livingston, A number of revisions will take place, I believe it will increase the prv?

 

[F1Ken]

February 'Buses' mag, notes that Doncaster depot is upgrading B7TL/ALX 400 Double Deckers to full DDA spec, for a number of First companies.
(Note, buses registered from 01/01/2001 are automatically DDA compliant, the vehicles being upgraded are W & X reg examples from 2000).
So thats a few less (d/deck)vehicles that have to be replaced by the 31/12/2016 D/deck deadline.
I am assuming that all the ex London 'deckers moved out are DDA compliant including the pre 2001 examples.

Colchester has some ALX400's in new livery doing the job the old Volvo Olympians were doing. I Think the Olympians are gone now.

Plaxton Presidents run the chelmsford route.

 

[TheGrandWazoo]

The prices are student fares.

Arriva/Wardle expanded but has cut services recently.

I do not know about stock but there are a few old double deckers in service

Why would student fares increase at a different rate? Looks like they'll be a cascade of ex Leicester midlife kit to get rid of a lot of dross. However, some new kit might be nice...