National Express hints at further rail job cuts
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Your support makes all the difference.The transport group National Express yesterday hinted at significant job cuts in its passenger rail businesses as it announced that it made a pounds 2.1m profit last year from the first two train franchises it took over.
The group also disclosed that 4,000 employees of the bus company West Midlands Travel, which it acquired in 1995, will share in a pounds 31m shares bonanza worth an average of pounds 7,800 each through a loyalty bonus to be paid in May.
National Express is now Britain's biggest rail operator after winning five of the 25 passenger franchises. It will receive a total of pounds 2.8bn in subsidies over the next seven to 15 years.
Midland Mainline, the InterCity service from London's St Pancras, made a pounds 1.6m operating profit in the last eight months of 1996 after receiving pounds 11m of taxpayers' support. The underlying operating loss, excluding pounds 1.8m of exceptional charges to cover redundancies, was pounds 7.6m. In its last full year in public ownership, the line made a loss of pounds 11.8m.
The Gatwick Express line, also taken over last April, made a pounds 500,000 profit after a pounds 3m payment to the Government and pounds 900,000 exceptional charges.
National Express has cut about 300 jobs from the two franchises - equivalent to an 18 per cent staff reduction. If it imposes the same level of job cuts at its three new franchises - ScotRail, Central Trains and North London Trains -it could mean a further 1,400 job losses.
Phil White, chief executive, would not be drawn on the precise level of job losses but he said there was significant scope for cost savings.
He was speaking as the group announced a 45 per cent rise in pre-tax profits last year to pounds 60.1m.
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