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- FTSE 250 company benefits from scale as international ticket sales rise
Trainline shares rose sharply on Monday after the ticket booking platform raised its full-year forecast for the second time in less than two months.
The FTSE 250-listed group raised its guidance last month after a better-than-expected first half and has enjoyed a strong start to the second half of its financial year.
Trainline told shareholders on Monday that the group is “increasingly benefiting from operating leverage as it grows”.
Trainline’s expansion into continental markets such as Spain has helped boost sales
As well as efforts to expand its offering to include trains and coaches outside the UK, Trainline’s performance this year has been boosted by fewer strike days.
Italy and Spain have been key drivers of international net ticket sales, which grew 6 per cent to £583m in the first half to help total net ticket sales rise 15 per cent to £2 billion pounds sterling.
Trainline told shareholders it now expects to report full-year net ticket sales growth of 12 to 14 percent, up from previous guidance of “at the top end” growth of 8 to 12 percent.
It expects revenue growth of 11 to 13 percent, up from 7 to 11 percent.
Adjusted earnings before the unpleasantries are expected to come in at 2.6 percent of net ticket sales, an adjustment from previous guidance that the figure would “exceed 2.5 percent.”
The group will provide more information on first-half performance when it releases interim results next week.
Train line actions rose 11.6 percent to 376 pence, bringing earnings in 2024 to 19.2 percent.
The shares remain about 32 per cent below their February 2020 high of 547p.
In response to the upgrade, analysts at Shore Capital reiterated a buy rating on Trainline with a price target of 465p, 38 per cent above the group’s closing price on Friday.
The analysts said: “We are delighted to see this morning’s update and continue to see Trainline as a dominant player within the UK rail network, which will benefit from growing consumer demand for digitalisation.”
“Beyond this, we believe that the international opportunity, which is being built, is not taken into account in the current (valuation).”
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