Go-Ahead Group PLC (LON:GOG) said it has been granted a two-year contract extension to its contract to operate around 450 buses in the island’s Loyang region by the Land Transport Authority (LTA) of Singapore.
The extension will begin in September 2021 and will follow on from an original five-year contract that started in 2016, said the FTSE 250-listed bus and rail group.
Go-Ahead added that during its four years of running the contract so far, it had introduced a series of new services and improved both customer satisfaction and the efficiency of drivers and engineers.
In a statement, David Brown, Go-Ahead’s chief executive said: “Go-Ahead Singapore has been a great addition to the group and I am delighted that we will be running buses in Singapore until at least 2023.
“Our experienced management team has led the delivery of remarkable performance on behalf of the LTA in recent years and has played an important part in Singapore’s response to the COVID-19 crisis.”
In a trading update in May, Go-Ahead said coronavirus (COVID-19) pandemic issues had reduced services in Singapore to around 80% of normal contracted levels.
Peel Hunt noted the extension to the contract was awarded on the basis of strong operational performance and expects it to generate additional profits of £3mln a year from 2022.
The broker also expects more news on contracts shortly, including another in Singapore.
Buy with a 1,600p target price is its investment stance.
Shares rose 4% to 678.5p.
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