Most brokers accept that the Aberdeen group will announce a drop in first-half profits on Wednesday – JP Morgan analysts predict an 11% decline in the core operating figure to around £160 million – but believe Lockhead will indicate that it is now back on track to become one of the few transport operators to achieve higher returns over the full year.

Importantly, they expect directors to demonstrate their ability to pay down debt after their massive acquisition of the US Laidlaw business and to squeeze bigger-than-anticipated cost savings from their merger along with fresh operating efficiencies.

The announcement is due only days after National Express spurned ­takeover approaches from Stagecoach and is now set to ask shareholders to bump up its balance sheet by subscribing up to £350m for new shares.

“The cash raising could play into FirstGroup’s hands as it has depressed the National Express share price while reducing the need for bidders to raise extra funds to accompany any fresh approach in the new year,” commented one analyst.

The fall in the National Express share price means that the company has a current stock-market value of less than £500m, compared with the £765m on offer in a share-exchange deal with Stagecoach.

Any move by FirstGroup would allow Stagecoach to return to the fray with its own offer – it is currently barred from making a fresh move for six months after indicating that it was only interested in an agreed merger.

The odds on National Express coming back into takeover play shortened dramatically this weekend after its major shareholders in the Spanish Cosmen family – with more than 18% of the company – criticised the abrupt dismissal of the Stagecoach offer and pressed directors to take fresh independent advice on future strategy.

Brian Souter at Stagecoach is certain to vent his own anger when he produces a trading update on Tuesday after working on plans for increased efficiencies from the merger of the bus and train operations together with moves to increase returns from National Express operations in the US.

Analysts believe he will indicate that the group is in a robust financial position with headroom for close to £500m extra borrowings, although there are concerns that the group’s rail operations may have recently gone into reverse after a strong opening half to the year.

Brokers at Collins Stewart point out that this side of the business is suffering from reduced revenue protection and has no subsidies under franchise agreements and may do no more than break even this year after contributing some £56m profits previously.

They believe that this could leave total pre-tax profits down from £171m to below £100m, although they have a buy rating on the shares at current levels as the group squeezes out ­

efficiency gains.

In contrast, FirstGroup’s rail businesses enjoy some revenue protection and Bank of America Merrill Lynch believes they could still ship in as much as £81m profits this year despite a switch by canny travellers to cheaper fares.

But the group’s UK bus operations are suffering from a 5% drop in passenger numbers, while the iconic Greyhound bus operations in the US saw a 20% slump in demand over the important summer season.

Even so, most brokers believe the group will at least match last year’s £200m profits thanks to tough action which has seen the workforce cut by more than 3,500 since the start of

the year.

Directors have said they will cut costs by up to £200m this year and some believe that Lockhead could be ready to increase this target with another round of savings.