Go-Ahead admits rail division weakness Growth in bus passenger and revenue numbers will help Go-Ahead produce full-year results in line with expectations, despite some signs of weakness in its rail franchises, the company said. Full-year like-for-like passenger revenue is expected to rise by about 4 per cent in its deregulated bus division, 8.5 per cent for its Southern rail franchise, 10 per cent for Southeastern and 13.5 per cent for its London Midland train routes, the company said. It admitted, however, that it faced some challenges meeting targets on its Southern rail services since the economy is much weaker than the company had forecast in its 2009 bid for the franchise. David Brown, group chief executive, said: "In rail, we are pleased with the performance of our three franchises despite the challenging economic environment. Overall, we remain confident that we will deliver a full-year result in line with our expectations. The company said remained in a strong financial position with good cash generation and a "robust" balance sheet, "allowing flexibility to pursue further value-adding opportunities." Since its last update in April, Go-Ahead has acquired HC Chambers & Son, a small bus company operating on the border of Essex and Suffolk. This will help the company achieve a 7 per cent increase in full-year bus passenger revenues on routes outside London with a journey growth of 4.5 per cent, Go-Ahead said. In London, where bus services are still regulated, Go-Ahead acquired the Northumberland Park bus depot. It expects full-year passenger revenue and mileage growth in the capital to be about 7.5 per cent and 5.5 per cent respectively as a result of this and the bus contracts it has won, compared with like-for-like revenue and mileage growth of 6 per cent and 4 per cent respectively excluding the acquisition. Douglas McNeill at Charles Stanley Securities described the update as "satisfactory," noting that Go-Ahead had achieved another good quarter of growth in London. "We retain our positive stance on the stock, on the grounds that the market is giving no credence at all to Go-Ahead's prospects of winning future rail franchises, despite its presence on the Thameslink shortlist," he said.