Monday, 23 March 2009

First Bus and Rail to axe hundreds of jobs

The Western Daily Press reports on major job cuts within First:

"Some 1,100 bus jobs will have gone by March next year in the UK and a further 600 jobs will go in the rail division, which includes the South West-serving First Great Western, which operates out of London Paddington"

Is First imploding, we have to ask? Is its management in panic mode? Our local service cuts are just part of a national programme to slash services and reduce costs. The same day as our cuts were announced, more services were axed from Ipswich to East Lothian.

First's share price halved over the last 6 months - like many others - falling from £5.50 to £2.00. Was management action a reaction to this?

News of the cuts has meant that the shares have gone back up to £2.50. The volume of shares traded has shot up - someone is buying First. Their management must be pleased.

Last Thursday First gave a major briefing to financial institutions. There are 21 pages of statement and questions and answers. And what did they say about our buses? Just "Outside London it’s a flexible business. We can closely match services to demand in a pretty short time if we need to"

But what will the share price do when the loss of public goodwill becomes obvious? And shareholders realise that First's market share is contracting?

If we owned shares in First, we would be very worried.

No comments:

Post a Comment