FIRSTGROUP PLC

PUblication of climate transition plan

FirstGroup plc (the `Group') is pleased to announce that it has today published its first Climate Transition Plan setting out our comprehensive strategy to meaningfully reduce emissions, manage climate-related risks, drive modal shift and contribute to growth and prosperity in the communities we serve.

 

Buses, coaches and trains contribute less than 5% of the UK's transport emissions, compared to over 50% for cars. As one of the UK's leading transport operators carrying around two million passengers a day, FirstGroup has a critical role to play in the climate transition. We have already received recognition of our commitments and progress to date, such as our inclusion in the most recent S&P Sustainability Yearbook and Clean200 1 report as well as receiving MSCI 2 's highest possible ESG rating of AAA.

 

In addition to the Group's commitment to reach net-zero emissions by 2050, we have a number of science-based Group emissions targets validated by the Science Based Targets initiative (`SBTi') including:

 

-           to reduce Scope 1 and 2 emissions by 63% by the end of FY 2035 from a FY 2020 base year;

-           to achieve a 20% reduction in absolute Scope 3 emissions from fuel and energy-related activities; and

-           to ensure 75% of our suppliers by emissions covering purchased goods and services and capital goods will have targets aligned to the science - based approach by the end of FY 2028.

 

The Plan also highlights the progress the Group has made to date and how we plan to build on this progress to achieve our goals. In First Bus these include:

 

-           more than £300m already invested in our commercial bus fleet and infrastructure decarbonisation, with more than 650 zero emission vehicles now in service in our regional operations, and more than 300 in London;

-           ten depots in the UK now electrified and electrification underway at a further five depots (c.30% of our depots) - we are the first UK bus operator to offer access to its electric vehicle charging infrastructure to other organisations that include DPD, Openreach, Centrica, eHGV and smaller bus operators;  

-           a commitment to continue our investment and use of innovative financing arrangements with an aim of achieving our target of a zero-emission fleet by 2035; and

-           a proactive approach to make use of our expertise to work with our local partners to tackle congestion, connect communities, enhance customer experience and promote the bus as reliable, affordable, digitised and accessible.

 

First Rail's two open access rail operations contributed just 1.3% of the Group's overall emissions footprint in FY 2024 thanks to Lumo's fully electric and Hull Trains' bi-mode fleet. The Plan also highlights how both operators are stimulating demand and driving modal shift:

 

-           Lumo has carried almost four million passengers and successfully helped grow demand for all rail operators on the East Coast Mainline since its launch in October 2021, reporting seat capacity utilisation of 75% in FY 2024; and

-           since its launch in 2000, Hull Trains has steadily increased capacity and thanks to a £60m investment in a new bi-mode fleet that entered service in 2019, emissions have been reduced by 65% and seat capacity utilisation grew to almost 70% in FY 2024, significantly above the industry average.

 

Looking ahead, the Group is actively growing its open access rail business by adding capacity, enhancing timetables and applying for new and complementary routes. Recent developments include:

 

-           the acquisition of track access rights for new services between London Paddington and Carmarthen and London Euston and Stirling; and

-           the placement of a £500m order for a fleet of UK manufactured Hitachi trains to deliver the Group's growth plan, with an option to invest a further £460m should the applications the Group submitted last year for new open access routes be successful.

 

For First Rail's Department for Transport contracted Train Operating Companies (`DfT TOCs') the Plan highlights:

 

-           high level decarbonisation goals set by the DfT TOCs including reaching net-zero emissions by 2050 and removing diesel-only traction by 2040, aligning with the UK Government's targets;

-           First Rail-led trials of battery train technologies, low-carbon fuels, and collaboration with Network Rail to improve energy efficiency and expand track electrification; and

-           initiatives to stimulate demand through enhanced customer service, flexible ticketing, the introduction of digital technologies, integrating routes with onward travel and improving accessibility  

 

The Climate Transition Plan is available on the Group's website: https://www.firstgroupplc.com/investors/reports-and-presentations.aspx

 

Commenting, FirstGroup Chief Executive Officer Graham Sutherland said:

"As a leading public transport operator, we have a critical role to play in the climate transition. Investing in decarbonisation, enhancing our operations and driving modal shift reduces our environmental impact and supports growth and prosperity in the communities we serve. It is also a key driver of our commercial success. The publication of our first Climate Transition Plan setting out our structured and ambitious approach to achieve this is an important step in our sustainability journey."

 

Contacts at FirstGroup: Marianna Bowes, Head of Investor Relations Stuart Butchers, Group Head of Communications [email protected] Tel: +44 (0) 20 7725 3354

Contacts at Brunswick Group: Andrew Porter / Simone Selzer Tel: +44 (0) 20 7404 5959

 

Contacts at Panmure Liberum: Nicholas How / John More Tel: +44 (0) 20 3100 2000

Contacts at RBC Europe Limited: James Agnew / Jack Wood Tel: +44 (0) 20 7653 4000

 

Legal Entity Identifier (LEI): 549300DEJZCPWA4HKM93. Classification as per DTR 6 Annex 1R: 3.1.

 

Definitions

1 The Clean200 lists the 200 major companies from 35 countries that are at the forefront of the green energy transition. These are the companies that are leading the way by putting sustainability at the heart of their products, services, business models and investments, helping to move the world onto a more sustainable trajectory.

2 MSCI Inc. is a leading provider of research and ratings for the global investment community. They use a rules-based methodology to rate companies on a AAA (industry leaders) to CCC (industry laggards) scale according to their exposure to ESG risks and how well they manage those risks relative to peers.

Scope 1 (direct emissions) - emissions from activities owned or controlled by our organisation. Examples of Scope 1 emissions include emissions from combustion in owned or controlled vehicles, boilers and furnaces.

Scope 2 (energy indirect) - emissions associated with our consumption of purchased electricity, heat, steam and cooling.

These indirect emissions are a consequence of our energy use but occur at sources we do not own or control.

Scope 3 (other indirect) - also known as value chain emissions, they represent the carbon associated with our supply chain. They are emissions we do not own or control but have been generated through our business needs.

 

Forward-looking statements

Certain statements included or incorporated by reference within this document may constitute `forward-looking statements' with respect to the business, strategy and plans of the Group and our current goals, assumptions and expectations relating to our future financial condition, performance and results. By their nature, forward-looking statements involve known and unknown risks, assumptions, uncertainties and other factors that cause actual results, performance or achievements of the Group to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. No statement in this document should be construed as a profit forecast for any period. Shareholders are cautioned not to place undue reliance on the forward-looking statements. Except as required by the UK Listing Rules and applicable law, the Group does not undertake any obligation to update or change any forward-looking statements to reflect events occurring after the date of this document.

 

About FirstGroup

FirstGroup plc (LSE: FGP.L) is a leading private sector provider of public transport services. With £4.7 billion in revenue and around 30,000 employees, we transported almost 2m passengers a day in FY 2024. We create solutions that reduce complexity, making travel smoother and life easier. Our businesses are at the heart of our communities and the essential services we provide are critical to delivering wider economic, social and environmental goals. Each of our divisions is a leader in its field: First Bus is one of the largest bus operators in the UK, serving more than 25% of the population in the UK with a fleet of over 5,7500 buses, and carrying more than a million passengers a day. First Rail is one of the UK's largest rail operators, with many years of experience running long-distance, commuter, regional and sleeper rail services. We operate a fleet of c.3,700 locomotives and rail carriages through three DfT contracted train operating companies: WCP (incorporating Avanti West Coast and West Coast Partnership Development), GWR and SWR) and two open access routes (Hull Trains and Lumo). We are formally committed to operating a zero-emission First Bus fleet by 2035, and First Rail will help support the UK Government's goal to remove all diesel-only trains from service by 2040. During FY 2024 FirstGroup was named as one of the world's cleanest 200 public companies for the fifth consecutive year and achieved Industry Top-Rated status for the first time with Sustainalytics. We provide easy and convenient mobility, improving quality of life by connecting people and communities. Visit our website at www.firstgroupplc.com and follow us @firstgroupplc on X.