• Adjusted1 operating profit flat, with solid trading performances and favourable foreign exchange offset by c.£6m impact of severe North American hurricanes, mainly on First Transit’s three contracts in Puerto Rico; in constant currency, adjusted1 operating profit (9.1)%

• Adjusted1 EPS +35.7% reflecting lower interest costs tempered by significantly higher tax rate as expected; adjusted1 EPS flat in constant currency

• Net cash inflow of £97.0m (H1 2016: outflow of £64.3m) in the period includes a cash flow improvement of £86.2m in addition to a £75.1m working capital inflow from the start of the SWR franchise 

• Net debt: EBITDA improved to 1.7 times at the half year, compared to 2.4 times a year ago

• Statutory operating profit decline of £20.5m, statutory loss before tax of £1.9m and statutory EPS reduction to 0.2p principally reflect a gain on disposal of property in the prior period which did not recur

Adjusted1	H1 2017 £m	H1 2016 £m	Change	Change in constant currency2	SWR-adjusted change in constant currency3
Revenue	2,771.3	2,564.7	+8.1%	+3.5%	+0.9%
Operating profit	89.4	89.0	+0.4%	(9.1)%
Operating profit margin	3.2%	3.5%	(30)bps	(50)bps
Profit before tax	30.5	21.9	+39.3%	+2.0%
EPS	1.9p	1.4p	+35.7%	flat
Net debt4	1,179.9	1,491.5	(20.9)%	(20.3)%
Statutory	H1 2017 £m	H1 2016 £m	Change
Revenue	2,771.3	2,564.7	+8.1%
Operating profit	57.4	77.9	(26.3)%
Operating profit margin	2.1%	3.0%	(90)bps
(Loss)/profit before tax	(1.9)	11.1	n/m5
EPS	0.2p	0.7p	(71.4)%

Divisional summary

• First Student delivered +5.3% average price increases and 83% retention through our ‘up or out’ bidding strategy, successfully managed school start up despite ongoing driver shortages, and completed an acquisition in the period

• First Transit growth and contract wins continued but margin affected by severe hurricane impact mainly on our Puerto Rico operations, and higher driver shortage costs due to strength of US employment market 

• Greyhound like-for-like6 revenue +1.2%, including +7.8% in Greyhound Express and other short haul growth while long haul declined; fuel and cost savings partially offset higher inflation and maintenance costs

• First Bus like-for-like6 passenger revenue +0.6% including +1.3% from commercial passengers; adjusted1 margin improved 50bps in period, driven by systematic programme of management actions 

• First Rail like-for-like6 passenger revenue +3.2% and cost efficiencies contributed to an increased margin; SWR franchise commenced towards end of period

Looking ahead

• Our overall trading and cash performance in first half, excluding the short term impact of the severe hurricanes, affirms our confidence that the Group will make further progress and deliver substantial cash generation for the full year

Commenting, Chief Executive Tim O'Toole said: "The overall trading performance and significantly increased free cash generation of the Group in the first half was consistent with the plans we outlined at the start of the financial year. Solid performances from most of our businesses are partially obscured by the impact of the recent severe hurricane on our operations in Puerto Rico. In the second half we will benefit from our normal seasonal bias, our ongoing focus on cost efficiencies and from additional business which commenced in the period, including the South Western Railway franchise. We expect to make further progress and deliver substantial free cash generation for the year as a whole."