Performing strongly before the crisis
ALSA was performing very strongly with revenue up 23% in the first two months of the year driven by underlying growth of over 6% boosted by the new contracts in Rabat and Casablanca and acquisitions made in 2019. Our Spanish business was performing strongly across all segments but particularly in long haul where revenue was up 8%.
North America was performing strongly with revenue up 16% in the first two months of the year, largely driven by continued growth in our transit and shuttle businesses. The renewal and expansion of our two largest transit contracts in the fourth quarter of 2019 flowed through to the start of the year, while the acquisition of WeDriveU in April 2019 also boosted growth (and was itself growing revenue by over 20% in the first two months).
The UK was performing well, with revenue up over 5% in the first two months of the year. Broad-based underlying growth in both our bus and coach businesses was augmented by the acquisition of National Express Accessible Transport (NEAT) in August 2019.
Doing the right things through the crisis
An unprecedented 80% drop in passenger demand following lockdown was mitigated by proactive customer engagement to limit revenue loss to 50% and swift action to significantly reduce service to save variable costs.
The safety and welfare of our customers and colleagues remained our priority with enhanced cleaning regimes and reconfigured vehicle layouts quickly established; personal protective equipment (PPE) promptly distributed and employee welfare programmes enhanced.
Across the Group services were repurposed to meet community needs such as food parcel delivery, health worker shuttles; and medical transport.
Swift and decisive action was taken to protect the financial position of the Group with liquidity boosted by a £230 million share placing, £1.3 billion of new facilities and lending covenants renegotiated out to December 2021.
Decisive management action to cut costs across the Group: at peak, 40,000 employees were furloughed or temporarily laid off; over £100 million was cut from planned capital expenditure; over £300 million of operating costs removed from the business in Q2; and the Board and senior management accepted salary sacrifices.
Ready to emerge strongly from the crisis
We remain excited by the long-term opportunity. The global recovery must be powered by a more efficient economy that is cleaner and greener. High quality mass transit will be a necessity, and the financial strains caused by the pandemic will create opportunities for operators that are able to adapt and survive. Public transport has always played a key role in social mobility and in these unprecedented times it is ever more important in enabling economic recovery by providing safe access to work, education, retail and leisure. Where restrictions have been removed, we have seen a rapid recovery in demand. We are confident that our strong reputation for service and safety, close relationships with customers and improved Balance Sheet mean we will be well placed to prosper post pandemic. During this period we have won or retained nearly £900 million of total contracted revenue, including our first contracts in Portugal, as well as completing the mobilisation of our new German Rail franchise.