First Group profits from virus
First Group is the company that operates most bus services in Somerset on behalf of Somerset County Council.
On 11th March, FirstGroup Chairman David Martin told investors that, “At the moment, in my experience, this is one of the most exciting times, with potentially real deliverables there and money standing behind it.”
Today RMT General Secretary Mick Cash suggested “FirstGroup executives are crowing over shareholders’ payouts for this year, all ultimately courtesy of the tax payer.” This following the announcement that the company “is set to benefit from millions in taxpayers’ cash to prop up its bus business on top of being bailed out by the government on its rail operations, including a new direct award contract for the Great Western Route.”
We should note that this is a matter for First Group not Somerset County Council who have no direct input into how the company operates and rewards its shareholders.
While banks have deferred dividend payments the RMT assert that current plans for First Group appear to be different. As the First Group Chairman put it “maximising shareholder value and providing the ability to create substantial returns to shareholders in the short term, or within the second half of this year.”
Of course a lot has happened since March 11.
When we checked the First Group “financial calendar” this morning no dividend dates had been set for the next 12 months. The company, which last paid a dividend in 2013, may yet decide it is politic not to pay dividends even if it finds it can afford to.