First Group reduces cash generation targets

Shares in transport firm First Group fell on news the company now expects net cash generation to be in the range of £100m to £115m for 2011/12 due to fewer disposals as a result of the economic and regulatory climate.

The firm, which had been targeting an inflow of £150m for the period, said the economic problems had affected "the realisation of appropriate value and timing."

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First Transit continued in line with expectations, while revenue growth at Greyhound accelerate, with like-for-like passenger revenue increasing by 5.9% during the period.

In the UK Bus business, like-for-like passenger revenue increased by 1.8% during the period, although the weak economic environment continued to present challenging trading conditions, particularly in Scotland and the North of England, where a significant portion of the group's urban operations are concentrated.

The firm is consequently achieving lower growth rates in these areas as it sees a widening north-south divide.

In UK Rail, the firm saw another strong performance with like-for-like passenger revenue increased by 8.0%.

The share price fell by 1.04% to 323.1p by 08:45.

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