(Adds CEO, analyst comment, share price)
By Sarah Young
LONDON, Sept 4 British transport company
Go-Ahead lifted its dividend for the first time since
2008 after making progress towards a profit target and winning a
new rail contract, prompting hopes of further dividend
Fresh from winning Britain's biggest rail franchise, the
Thameslink contract around London, Go-Ahead said on Thursday it
would raise its full-year dividend by 4.3 percent to 84.5 pence
a share after operating profit jumped 19 percent in the twelve
months to June 28.
"Profit's up, good revenue growth and being on target and
winning tenders so that's given us the confidence to do it. We
hope there will be more to come," Chief Executive David Brown
said in an interview.
Go-Ahead shares climbed 3.2 percent to 2,345 pence, making
the company one of the biggest risers on Britain's midcap index.
The stock is up 34 percent since the beginning of the year,
helped by the Thameslink win.
"We expect that the dividend per share will be increased
progressively from now on," said Investec analyst John Lawson,
who has a "buy" rating on Go-Ahead shares.
Lawson raised his estimate for the dividend for the next
financial year to 89 pence from 81 pence.
Go-Ahead reported operating profit of 103.2 million pounds
($170 million) for its financial year, compared with the 86.7
million pounds a year earlier, after carrying record numbers of
passengers on buses and trains in Britain.
Brown said Go-Ahead had attracted more passengers by
investing in smart, new and more fuel-efficient vehicles
equipped with wifi and smart card technology to make paying
The company said it was on track to meet its target of
generating 100 million pounds of operating profit from its bus
business by the 2015/16 financial year. The company runs buses
in London as well as in other parts of eastern and southern
(1 US dollar = 0.6079 British pound)
(Reporting by Sarah Young; editing by Mark Potter and Tom