Annual Report and Accounts 2008
Relationships and Resources
Discontinued operations
Following the decision by the Group in October 2008 to exit the business, Dot2Dot has been classified as a discontinued operation in 2008. The normalised pre-tax loss in the year was £8.3 million (2007: £4.8 million loss) and, after tax relief of £2.8 million and an exceptional write-off of £4.2 million, total after-tax loss was £9.7 million (2007: £3.4 million loss). The operation was sold on 9 January 2009. In addition, discontinued operations includes an exceptional charge of £3.7 million for additional tax liabilities arising from prior year disposals.
Stakeholder relationships
The Group has a broad range of stakeholders who are key to the achievement of our business objectives. External stakeholders include those who award us our contracts - the UK Department for Transport, local authorities, transport bodies and school boards; our customers, who use our services; our suppliers, trade unions and non-governmental organisations. Internal stakeholders focus around our employees, whose hard work and commitment enable us to deliver our services every day.
We have an active stakeholder engagement programme, through regular meetings and events, open forums, magazines and websites. Interaction occurs at a Group, divisional and local level, maintaining stakeholder plans to address needs and support the business. Internal stakeholders engage through management conferences, employee magazines, intranet sites, meetings and conference calls. Customer and employee views are solicited through regular surveys, and coach and East Coast rail customers can text comments about their journey.
Resources
The Group accesses a range of resources to deliver its objectives and service its stakeholders. These include:
Our people
In our service based business, the Group's most important resource is our people. Strong employee satisfaction helps deliver high customer satisfaction;
Our brand
National Express is the most recognised brand amongst UK transport groups, achieving number 130 in the Superbrand ranking for 2008/09. Integration of UK operations in early 2008 has helped develop the National Express master brand, with building recognition of the brand across rail and bus, beyond its traditional coach heartland. The brand is also used corporately in North America and Spain;
Our customers
We continue to develop our customer relationship management systems and databases, to optimise our service delivery to customers. During 2008, we have significantly grown the size of our contactable customer database and CRM activity over all business units;
Our reputation
The Group's reputation as a reliable, safe transport operator enables customers to award contracts to us knowing that we can deliver customers' expectations;
Our expertise
We are a first class operator, delivering excellent services safely and reliably, across different countries and cultures, and across rail, bus and coach;
Our contracts
Contract tenure provides a degree of certainty and risk management in delivering shareholder value.
Joint ventures and associates
The Group has a number of associates and joint ventures in Spain. It also holds a 40% investment in Inter-Capital and Regional Rail Limited ('ICRRL'). These investments made a profit of £nil in 2008 (2007: £0.4 million profit). The Group's Eurostar contract with ICRRL was designated an onerous contract in 2006 and the losses provided for to the end of the contract in 2010. Consequently, there is no charge to the income statement for this contract in 2008.