Rotala PLC Contract Wins (6203Z)

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RNS Number : 6203Z

Rotala PLC

16 March 2017

Embargo for 07.00 on 16 March 2017:

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Rotala plc

("Rotala" or "the Company" or "the Group")

Contract wins - further expansion in West Midlands

Rotala is pleased to announce a series of new contract wins with Transport for the West Midlands ("TfWM").

These contracts were won following TfWM's latest tender round for its supported bus contracts, which are due to commence operations on 23 April 2017. These contracts will attract a subsidy from TfWM of approximately GBP866,000 a year. The passenger revenue associated with these contracts (based on usage statistics provided by TfWM at the time of the tender) is estimated to be a further GBP740,000 per annum. Therefore in a full year the total revenue derived from these contracts will be approximately GBP1,606,000.

The contracts are for periods of between one and five years, with the vast majority of them concentrated in the three to five year range. The contracts will require the equivalent of a further 12 buses to be put on the road which are stipulated by the contracts to be at the Euro 5 emission standard at a minimum. However the mix of vehicles in the Group's current fleet is sufficient to meet these new requirements and no new vehicles will be acquired to service this additional business. The services will also be operated from the existing Tividale and Redditch depots of the Company. Therefore, by using existing depots and vehicles, increased operational efficiency will be attained.

In anticipation of this expansion the Company has secured from the West Midlands Traffic Commissioner authorisation to increase its operating fleet in the West Midlands area from 228 to 275 vehicles. This increase places the Company in a position where it can take immediate advantage of any further growth opportunities arising from the Buses Bill which is expected to receive the Royal Assent this summer.

For further information please contact:

 
 Rotala Plc                                  0121 322 2222 
 John Gunn, Chairman 
 Simon Dunn, Chief Executive Officer 
 Kim Taylor, Group Finance Director 
 
 Nominated Adviser & Broker: 
  Cenkos Securities plc                        020 7397 8900 
 Stephen Keys/Callum Davidson (Corporate 
  Finance) 
  Michael Johnson/Julian Morse (Corporate 
  Broking) 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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March 16, 2017 03:00 ET (07:00 GMT)