LONDON (Reuters) - Transport company FirstGroup (L:FGP) guided towards a stronger second half of the year and said it did not expect its medium term targets to be hindered by the loss of a contract to run a rail service in Scotland.
The company, which operates bus services in the U.S. and rail and bus services in Britain, on Wednesday said it remained confident that its financial performance would improve over the six months to the end of March after "variable" conditions over the last six months.
Stronger second-half profits would be driven by the seasonal nature of its First Student business, which runs yellow school buses in the United States.
The loss of the Scottish rail contract, ScotRail, which it has operated since 2004, would not affect the company's medium term targets, FirstGroup said.
FirstGroup also lost out on a contract to run rail services on the Thameslink network in England in May, a line it had been operating.
It said it remained in talks with the British government's transport department about a potential direct award, that is one without a competitive process, to continue to operate First Great Western, another rail line in England.
FirstGroup is due to announce its half-year results on Nov. 5.
(Reporting by Sarah Young; editing by Kate Holton)