TRANSPORT giant FirstGroup has seen shares tumble after flagging doubts over its future amid the coronavirus pandemic as passenger numbers plunged and it slumped to a near-£300 million loss.

Shares in the Aberdeen-based bus and rail firm plummeted after it revealed “material uncertainty” over its ability to continue as a going concern.

It saw pre-tax losses widen to £299.6m for the year to March 31 from losses of £97.9m the previous year after booking a raft of charges, including a £21.5m hit for the Covid-19 crisis.

The group, which runs rail franchises including South Western Railway and Avanti West Coast, said passenger numbers across its UK and international services dropped by around 90 per cent in March as countries were placed into lockdown.

It said ongoing guidance to limit travel and social distancing measures will continue to have a “significant impact on our service capacity and financial performance”.

The firm has tapped into the UK’s Covid Corporate Financing Facility for £300m, with support also expected in the US for its Greyhound coach arm.

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The company also warned over its ability to continue as a going concern after swinging to the loss.

It said the directors “noted that the risks … indicate that a material uncertainty exists that may cast significant doubt on the group’s and the company’s ability to continue as a going concern and, therefore, that it may be unable to realise its assets and discharge its liabilities in the normal course of business”.

It warned over the risks surrounding state support schemes and a recovery in demand among cautious passengers, but stressed it had “adequate” resources to carry on operating for the next 12 months.

Matthew Gregory, FirstGroup chief executive, said: “We do not yet know the rate and extent of demand recovery, nor how long restrictions or social distancing will be in place.

“Nor do we know how government and customer support might taper, although it’s clear that governments and customers understand the key role that our services play.”

Mr Gregory also said: “The funding and support we have received from governments and our customers to sustain critical transport services is testament to their importance now and for the future.

“We took rapid action to protect our ability to deliver continuity of the transport services that are so essential to our economies.

“I am immensely proud of our people who are working so hard to support our communities during the crisis, by maintaining essential transport services and providing direct assistance to those who need it most.

“There is no way of predicting with any certainty how the coronavirus pandemic will continue to affect the public transportation sector and the impact it may have on customer trends longer-term."

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He said: “The importance of public transport to society has never been more clearly demonstrated, and we will continue to take all necessary measures to enable the Group to emerge from this unprecedented situation in a robust position.”

“However, as leading operators in each of our markets we are strongly positioned for a recovery in passenger demand and for the opportunities that may emerge from this exceptional period. This will become ever more pertinent as the focus and drive towards zero-carbon public transportation systems inevitably increases, helping to create a better connected and more sustainable world.

“Despite the near-term uncertainty, the long-term fundamentals of our businesses remain sound.”

Results showed FirstGroup’s bottom line was also hit by a £186.9m impairment charge for its Greyhound coach business in the US, which it has been looking to sell.

The firm has since put its entire North American business up for sale, including the First Student and First Transit businesses.

However, it admitted that the coronavirus crisis has slowed the sale process.

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Stuart Lamont, investment manager at Brewin Dolphin, Aberdeen, said: “Transport companies were among the hardest hit by the Covid-19 pandemic, with passenger numbers decreasing significantly. FirstGroup’s share price followed, dropping nearly 80% at the crisis’s peak before making a partial recovery.

“The business has undertaken a lot of self-help initiatives to mitigate the effects of Covid-19, raising money from lending schemes and implementing a substantial cost-cutting programme.

“There is, however, undoubtedly a lot more work to do and today’s results are only a glimpse into the effects the pandemic has had on the business – the year only covers a few weeks of lockdown. Nevertheless, FirstGroup has an important role to play in the UK’s economic recovery, providing much-needed local and national travel.”

Gerald Khoo, transport expert at Liberum, said the full-year results showed a bigger-than-expected impact from the pandemic.

He added: “Support from governments and customers has been crucial to allowing the group to remain cash-generative in the first quarter.

“We expect this support to continue, but any wavering of such support is a key risk.”

Shares closed at 37.84p, down 23.06%.