Chairman's statement
I am pleased to report that the Group delivered a solid first half performance in line with our expectations, whilst at the same time making encouraging progress in positioning the business to manage the complexity and challenges of our industry. Our management team is highly experienced. We are focused on creating an ever stronger business, centred on our core operations that will deliver sustainable growth for the longer term and steady improvements in the passenger experience.
In bus we have continued to make progress towards our operating profit target. Importantly, customer satisfaction in regional bus continues to be at very high levels.
Our GTR and Southeastern franchises have continued to be impacted by disruption due to the London Bridge redevelopment, signalling and other infrastructure issues. We are working very hard with our industry partners to improve our service for passengers but many of the factors leading to underperformance are outside our direct control. Once these issues are addressed and investment projects complete I am confident we will see a dramatically improved service for passengers.
In rail our London Midland franchise has performed well and our passengers are seeing the benefits of the improvements we have made in this franchise over recent years thus demonstrating that, with our management expertise and commitment, we can deliver significantly improved performance and passenger satisfaction. In addition we have been successful in securing the London Midland direct award contract.
Our strength in operational delivery has seen Go-Ahead invest in new vehicles, technology and people, which have helped to drive underlying revenue and profitability across our Bus and Rail divisions. The competitiveness of our services has also provided the platform to win our first contracts in the German regional rail market and the Singapore bus market. I believe these wins are a strong credential for international opportunities and can add further to the shareholder returns that we generate from our UK businesses.
Dividends
We recognise the importance of dividends to our shareholders and dividends are an important element of the Go-Ahead investment proposition.
The Group has a sustainable dividend policy which is appropriate for the current business environment, where challenges continue alongside opportunities. The Group is in a strong financial position and your Board will continue to look for opportunities to create value for shareholders when it is prudent, financially and operationally, to do so.
Accordingly, the interim dividend has been increased by 6.5% to 28.33p (H1'15: 26.60p) and is payable on 12 April 2016 to shareholders registered at the close of business on 29 March 2016.
In the period, we were pleased to pay out last year's final dividend of 63.4p (H1'15: 59.0p), increasing the total dividend in respect of the full year ended 27 June 2015 by 6.5% to 90.0p (28 June 2014: 84.5p).
