Source - Alliance News

Mobico Group PLC on Tuesday said it would delay the publication of its annual results, as the company warned that increased provisions needed to be made relating to its German rail business.

Shares in Mobico fell 13% to 73.35 pence in London on Tuesday morning.

The annual results are now expected to be published before the end of March, with an exact date to be confirmed in due course. They were due for release on February 29.

The Birmingham-based public transport provider, formerly known as National Express, said the German rail business had been impacted by industry-wide driver shortages, energy price volatility and lower energy cost recovery than previously anticipated.

As a result, Mobico expects the ‘onerous’ contract provision as at December 31 to increase by between £40-70 million.

This will be utilised over the remaining life of the contract between 2024 and 2033.

Mobico said it recently identified that accounting judgements made relating to the business, including in the financial year ended December 31, 2022, should be subject to further review.

The delay in publication of financial results will allow management to conclude its review and allow the group’s auditor, Deloitte, time to complete its audit, the company said.

Mobico continues to expect adjusted earnings before interest and tax for the financial year 2023 to be within the range of £175-185 million, as per October’s trading update.

Mobico said the German rail business is expected to represent less than 6% of 2023 group adjusted EBIT.

The company said its Spanish subsidiary, ALSA, has delivered another strong performance in 2023, and the group’s UK and North American businesses have performed in line with expectations.

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