National Express UK and Germany CEO Tom Stables and National Express West Midlands Managing Director David Bradford have departed the business, each after around 13 years’ service.
Mr Stables will be succeeded by former BP senior executive Alex Jensen in early September. UK Coach Managing Director Chris Hardy is acting as interim CEO in the meantime.
That change was announced by parent Mobico Group CEO Ignacio Garat at an investor conference following publication of Mobico’s results for the six months to 30 June, a period that saw a group loss after tax of £39.4 million on revenue of £1.57 billion. Mobico is the renamed National Express Group business, although the National Express brand is retained in the UK.
Mobico revenue was up significantly from the £1.32 billion of H1 2022, but Mr Garat notes that cost pressures and a reduction in government recovery funding led to a reversal of the £15.2 million group profit after tax for that earlier period. H2 2023 is expected to perform better than H1, the group says.
Combined National Express operations in the UK delivered H1 2023 revenues of £285.4 million and an adjusted operating loss of £10.8 million. Industrial action at NEWM cost up to £3 million, according to Mobico Chief Financial Officer James Stamp.
Mr Stables joined National Express in 2011 as Business Development Director. He progressed to become UK and Germany CEO in November 2018.
Ms Jensen has held multiple roles with BP. Mr Garat says that she will bring “an impressive record of delivering commercial and operational transformation” to Mobico.
LinkedIn was the forum for Mr Bradford to announce his departure on 27 July. His career with National Express began in 2010 as Group Commercial Manager before he moved to Director level. He was appointed NEWM MD in 2018.
Change at the top of the UK and Germany business follows earlier work to bring all of Mobico’s UK operations together under one management team. Such efforts will allow further efficiencies and growth to be leveraged, the group says.
While NEWM was affected by industrial action during H1, Mr Garat has praised performance of the UK scheduled coach business in the same period. Against H1 2022, it saw passenger volumes grow by 42% and average occupancy rise by three percentage points as additional journeys were added.
Mr Garat also notes that yield has lifted by 11% over the same timeframe, and by 20% since 2019. “While passenger growth is an important driver of our business, it has to be in combination with progress in pricing,” he says. Management of the UK coach business has balanced capacity, occupancy and yield “to drive the top line.”
Although some patronage growth came as a direct result of railway industrial action, Mr Stamp points out that 12% of such first-time customers have subsequently returned to use coach services. “That is real modal shift,” he believes.
Several National Express coach corridors are now above 100% of 2019 patronage.
Those linking London with Bristol, Liverpool, Manchester and Swansea are at 135-160% of pre-pandemic numbers and further network growth is planned, says Mr Stamp.
Meanwhile, NEWM has reached agreement with the West Midlands Combined Authority and the Department for Transport (DfT) on funding that, when combined with a recent fare increase, will enable preservation of the operator’s current network to the end of FY2024.
It it thought that this money is part of the Bus Service Improvement Plan (BSIP) allocation to the West Midlands. Such use was enabled by a recent DfT change of policy away from a previous approach of mandating that BSIP funds could not be used to support existing services. The West Midlands was not among areas in England to receive a first-year BSIP Plus allocation.
Commercial patronage on NEWM services is now above 97% of 2019 levels. Mobico expects that no further revenue support will be needed beyond the current agreement.
Full Mobico H1 results here.
