FirstGroup PLC (LSE:FGP) said trading across its First Bus and First Rail divisions has performed in line with expectations, according to a pre-close update released on Thursday, with the company maintaining its outlook for modest adjusted earnings per share growth in the 2026 financial year.
The transport group also improved its guidance for net debt in FY26, now expecting a range of £135 million to £145 million compared with the £140 million to £150 million forecast issued in December following the acquisition of Tootbus. The revised outlook reflects small changes to the bus portfolio, ongoing network optimisation and the addition of several bolt-on acquisitions.
FirstGroup has increased its fuel hedging coverage, securing around 88% of its fuel needs for FY27 and about 53% for FY28 after entering additional hedging agreements in February. The company has also hedged approximately 77% of its floating-rate electricity consumption for FY27 and 46% for FY28.
As part of its expansion strategy, the group has acquired two regional operators: J&B Coaches in Leeds and Hills Coaches in Wolverhampton.
Within its open-access rail business, Lumo has introduced extended services between Edinburgh and Glasgow and launched a new route connecting London Euston and Stirling, which is expected to reach full operation by July 2026. Meanwhile, First Rail continues preparations for the mobilisation of its London Overground contract ahead of the start date of May 3, 2026.
FirstGroup’s shares currently trade at roughly 6.6 times FY27 enterprise value to EBIT, compared with sector averages of around 8 to 10 times, and at about 8.5 times FY27 price-to-earnings.
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