Aberdeen-headquartered transport giant FirstGroup plc said on Friday that chairman David Martin “has decided that he intends to retire from the board of FirstGroup plc.”
The firm said the transition and appointment of a new chairman will be led by Peter Lynas, its senior independent director.
“David Martin was appointed Chairman of FirstGroup in August 2019, serving as Executive Chairman following the departure of Chief Executive Officer Matthew Gregory in September 2021, until the appointment of the current Chief Executive Officer Graham Sutherland in May 2022,” said the company.
FirstGroup said that during his tenure, Martin had undertaken “a refresh of the skills and experience on the board and successfully overseen a significant change of strategy amidst the challenging pandemic period” repositioning the group to a leading public transport business with a strong balance sheet and delivering significant realisation of value for shareholders, including:
- Sale of the North American First Transit, First Student and Greyhound businesses
- A subsequent £500 million tender offer to shareholders and a significant de-risking of the balance sheet and a reduction in pension liabilities including a £220 million contribution to the First Bus pension scheme
- Reinstatement of dividend payments from the end of FY 2023
- Returning £190 million to shareholders via two share buyback programmes
The company added: “In FY 2024, the Group delivered a material increase in profit driven by continued progress in both First Bus and First Rail, further underpinning the Group’s strong balance sheet and diversification in earnings.”
FirstGroup CEO Graham Sutherland said: “I thank David for his contribution to the Group and the strategic progress that he has overseen.
“I also thank David for his wise counsel in my first two years with the business and for helping to build a strong platform for the next stage.”
Martin said: “I am proud of the progress that we have made at FirstGroup over the last five years under my Chairmanship.
“I will enjoy continuing to work with the team until my retirement from the Board. I wish the team the very best for the future.”
FirstGroup also published a trading update for its AGM on Friday.
“Ahead of the AGM, the Group notes that its overall trading performance for the financial year-to-date has been in line with the expectations we outlined at our full year results on 11 June 2024 …” said the company.
“On 28 June 2024, the Group successfully took over the operation of the IFS Cloud London Cable Car on behalf of Transport for London (TfL).
“The contract has an initial core five-year term with the option to extend for a further three years, with anticipated revenues of c.£60m over the eight-year period.
“In addition to delivering a number of improvements to the service, we look forward to working together with TfL to apply our extensive experience and expertise to develop its customer proposition, promote it as a leader in London’s leisure market and place it at the heart of its local community …
“As at 25 July 2024, just under £2m of the Group’s £115m on-market share buyback programme launched in August 2023 remained outstanding. The Group’s strong balance sheet and cash generative businesses provide considerable optionality to invest in decarbonisation, to grow and diversify our portfolio and for potential further capital returns to shareholders, and the Board continues to keep this under review.
“On 16 July 2024, the Group agreed terms with an insurance company to buy out the remaining liabilities of the legacy Greyhound US pension plan, after which, the plan will be terminated.
“Following a Group contribution of $6m, gross liabilities valued at $155m (£123m) at the FY 2024 year-end are to be removed from the Group’s balance sheet and the Group expects to recognise a settlement gain of c.£5m in the Group’s income statement as an adjusting item.
“This transaction concludes the Group’s material liability discharge from the legacy Greyhound business with a more favourable outcome than initially forecast, and in the coming years, the Group anticipates a small cash surplus relating to the final exit.
“In June 2024, the Group was very pleased to be upgraded to the highest possible AAA rating for ESG by MSCI (from AA previously). The upgrade was primarily driven by improvements in greenhouse gas mitigation efforts including our accredited Science Based target to cut Scope 1 and 2 greenhouse gas emissions by 63% by 2035 (vs. 2020). MSCI also stated that the Group’s corporate governance practices now lead those of global peers.”