FirstGroup freezes dividend after west coast rail fiasco Transport operator FirstGroup froze its dividend today following the west coast rail franchise fiasco, but said it remained "committed" to UK rail. The Aberdeen-based company, whose appointment to take over the line from Virgin Rail was cancelled due to a flawed bidding process, is holding its interim dividend at last year's level and will review the full-year payment once its rail prospects are clearer in the wake of government reviews. FirstGroup paid £12.3 million in total UK rail bidding costs, including for the west coast franchise. The Department for Transport (DfT) has already said it will repay bidding costs to the four groups involved in the botched bid process and FirstGroup said it was in discussions with the UK government over the bill it incurred. Tim O'Toole, chief executive of FirstGroup, said "no one is a winner" after the west coast blunder, which has led to two separate inquiries into the bid process and wider franchise arrangements in the UK. FirstGroup - which runs First Capital Connect, First Great Western, Scotrail and TransPennine Express services - was also shortlisted for three franchises, which have all now been put on hold after an inquiry discovered flaws in the DfT's bidding process. FirstGroup said it was "extremely disappointed and frustrated at this extraordinary series of events." But it added: "We remain committed to maintaining our leading position in the rail market and are actively engaging with the ongoing reviews to help shape the future of franchising." In half-year results also announced today, FirstGroup reported a 42 per cent fall in underlying pre-tax profits to £48.7m, but said it was on track with its turnaround plan and remained focused on reviving its UK bus business. Shares in FirstGroup fell 4 per cent in early trading before recovering some lost ground. The group had been due to take over the west coast line, which links Glasgow and London, from Sir Richard Branson's Virgin Rail next month. But the process was suspended after Branson - whose rail business had operated the line since 1997 - launched a legal challenge, while an independent inquiry found significant errors by the DfT resulted in a "flawed" bidding process. Transport secretary Patrick McLoughlin cancelled the current franchise bid in October and three civil servants were suspended after the embarrassing U-turn. Taxpayers will now face an estimated £40m bill as the UK government will be paying back the money the four companies spent on their franchise bids. FirstGroup said it was urging the UK government to restore the wider franchising process "without further delay."