Aberdeen-based bus and rail giant FirstGroup said revenue in the year to March 31 rose 8.3% to £5.65 billion and profit before tax rose 23% to £207 million, helped by progress at the firm’s First Student and First Transit businesses in North America and by favourable currency translation.

But FirstGroup gave a cautious trading outlook and did not reinstate its dividend, sending its shares down almost 6%.

In its outlook, FirstGroup said: “In the year ahead, the group faces a mixed trading environment with opportunities for steady progress in the North American divisions but continued economic uncertainty in the UK.

“We expect to make further progress from the road divisions, with First Rail’s margin reducing, and to continue to generate free cash after disciplined investment to support our customers’ and communities’ needs across the group.”

Hargreaves Lansdown analyst George Salmon told Reuters: “It’s been a long journey for FirstGroup, but it finally looks like some progress is being made, in parts of the business at least.

“Nonetheless, cost inflation is hanging over the group and there is still no sign of a resumption in dividend payments.

“Some analysts had been, perhaps wishfully, pencilling in a payout for this year.”

FirstGroup shares fell almost 6% to around 141p, giving it a stock market value of around £1.7 billion.

FirstGroup CEO Tim O’Toole said: “We are encouraged by this year’s improved financial results, with our largest division First Student delivering a significant margin improvement despite continued driver recruitment challenges, while our First Bus and First Rail operations have faced more challenging market conditions this year.

“Through rigorous focus on sustainable operational and capital efficiencies, we were also able to generate substantially improved net cash inflow of £147 million.

“In the year we have maintained our consistent and disciplined approach to bidding for future business throughout the group, with the recent award of the South Western rail franchise being a good example of our focus on the service quality improvements our customers and communities tell us they want …”