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UK limits rail operator Go-Ahead's profits on troubled franchise

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By Reuters
UK limits rail operator Go-Ahead's profits on troubled franchise
FILE PHOTO: A Thameslink train passes through Harpenden in the snow, Harpenden, Britain, March 2, 2018. REUTERS/Peter Cziborra   -   Copyright  PETER CZIBORRA(Reuters)

LONDON (Reuters) – Britain said it had capped the amount of profit UK transport company Go-Ahead <GOG.L> and its French partner will make from a rail franchise in southern England after a new timetable caused widespread disruption earlier this year.

The government said that the current operators would continue to run the GTR franchise, which includes Thameslink and Southern services between London and the south coast, until 2021.

But under the new agreement, Go-Ahead and its partner France’s Keolis will not make any profit this year and the margin available for the rest of the contract will reduce to 0.75 to 1 percent from a previous 0.75 percent to 1.5 percent level. The operators will also pay 15 million pounds towards making improvements for customers.

Go-Ahead said in a statement on Tuesday that its financial expectations for the current year were not affected.

(Reporting by Sarah Young, editing by James Davey)