Arriva shrugs off fuel hikes as first-half earnings surge

BUS and rail group Arriva yesterday brushed aside fuel-cost concerns and said that half-year revenues would rise by more than 50 per cent amid strong performances across the group.

The firm, which runs more than 13,000 buses and trains across the UK and Europe, said the outlook for 2008 was positive, despite the fuel-price hikes blighting the transport sector.

Arriva confirmed it has fixed fuel at 28p a litre for 2008, roughly in line with last year's costs and had 75 per cent of next year's fuel prices set at 39p per litre on average.

Arriva shares have come under pressure recently, but the firm yesterday gave a bullish outlook for the year ahead.

It said it was "confident of reporting considerable revenue and earnings growth at both the half-year and for the full year".

Arriva's UK bus business had been buoyed by more passengers and network development.

The company has also acquired a new airport-based operations, Tellings Golden Miller, and Excel.

Its trains arm recorded "pleasing" trading, like-for-like passenger revenues at its new CrossCountry franchise – which stretches from Aberdeen to Penzance – up 10 per cent year on year in the first 24 weeks of the group's financial year.