FirstGroup sees lower profit, higher cash flow after £48m Mistral Data disposal

(Sharecast News) - FirstGroup said adjusted operating profit for 2027 would fall by £4m after agreeing to sell its Mistral Data unit to Tracsis for £48m but added the disposal would strengthen the group's medium‑term cash generation outlook.

The transport operator expects to book a £46m profit on disposal, which will be treated as an adjusting item.

Despite the profit hit, FirstGroup upgraded its free‑cash guidance, saying the disposal accelerates and enhances inflows previously expected from Department for Transport‑contracted rail operations. The group now forecasts around £435m of free cash generation over the next three years, well above the earlier £90m estimate tied to rail‑services cashflows.

Mistral Data, part of the First Rail division, provides real‑time data‑integration software for train operators. Revenues have grown from roughly £7m in FY 2022 to £13m in FY 2026, generating operating profit of about £4m.

Chief executive Graham Sutherland said the sale demonstrated FirstGroup's ability to "create and realise value" as the UK transport sector evolves. He added that proceeds would strengthen the balance sheet and support investment in UK bus and rail markets, as well as shareholder returns.

Completion is expected by October 31, subject to clearance from the Competition and Markets Authority.

Reporting by Frank Prenesti for Sharecast.com