Firstgroup Plc · LSE:FGP
Firstgroup — Merger or Acquisition (December 2024)
12 slides from Firstgroup's merger presentation, Dec 10, 2024
Slide 1: Acquisition of RATP London
Acquisition of RATP London 10 December 2024
Slide 2: A significant acquisition for FirstGroup
A significant acquisition for FirstGroup The acquisition of RATP London will further diversify our portfolio, materially grow our earnings in the medium term and allow us to enter the London bus market at scale Acquisition overview Agreement to purchase RATP Dev Transit London (‘RATP London’) and
Slide 3: RATP London overview
RATP London overview One of London’s principal bus operators with a c.12% market share operating out of ten depots in Central and West London A key operator in an attractive market with well-established franchise model Fleet of c.1,000 buses with an average fleet age of 6.8 years c.3,700 emplo
Slide 4: London is an established market with strong fundamentals
London is an established market with strong fundamentals Bus remains the key mode of transport in London, with revenue generated through route level gross cost contracts that provide operators with visibility and security of earnings A resilient market1 A £2.1bn market, c.46% of the UK bus market
Slide 5: Financial Overview
Financial Overview VH45171 First
Slide 6: A material contribution to Group earnings in the medium term
A material contribution to Group earnings in the medium term Acquisition overview Enterprise value of £90m Financed with £45 million in cash and the assumption of RATP London’s asset backed vehicle finances leases (c.£45 million); maintains the Group’s balance sheet flexibility Four owned depo
Slide 7: An improving contract portfolio
An improving contract portfolio As RATP London’s route contract portfolio evolves over the next five years, annual revenues are expected to grow to £300-350m, with operating margins in line with historical London levels of c.6-7% 22% RATP London 2023 revenue of £271 million: 40% 41% 64% 72% 72% -
Slide 8: Positive contribution from FY 2026
Positive contribution from FY 2026 Group: earnings neutral in FY 2026 with growth thereafter Financial Interest: c.£6m increase in FY 2026 interest cost including IFRS 16 relating to the Acquisition performance First Bus: some contribution from RATP London to FY 2026 adjusted operating profit,
Slide 9: Conclusion
Conclusion First
Slide 10: Conclusion
Conclusion A significant transaction that will transform our First Bus business and materially grow earnings in the medium term Strong strategic rationale, delivering growth and diversification of earnings An excellent entry point into London, as the market recovers A strong management team
Slide 11: First
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Slide 12: Important notice
Important notice This presentation includes statements that are, or may be deemed to be, forward-looking statements. These forward-looking statements can be identified by the use of forward-looking terminology, including (but not limited to) the terms anticipates, believes, could, estimates, expects