Trainline Expects Weaker Ticket Sales in 2027 After UK Policy Changes
Trainline's 2027 Forecast and Market Impact
May 6 (Reuters) - Rail-ticketing group Trainline forecast on Wednesday net ticket sales of 6.2 billion-6.45 billion pounds ($8.42 billion-$8.76 billion) for 2027, largely below expectations, as it warned of pressure from policy changes and the Iran war.
UK Policy Changes Affecting Ticket Sales
The UK government has expanded contactless payment methods at railway stations to simplify the process of paying fares, which the company expects to deliver a 150-million-pound hit to its UK net ticket sales.
Expansion of Contactless Payments
The company's outlook is impacted by the government's push for more direct payment methods, reducing reliance on third-party platforms like Trainline.
Tap-In and Tap-Out Ticketing
The UK's Department for Transport has expanded options for 'tap-in and tap-out ticketing', where commuters can pay their ticket fees at the train station.
International Sales and Geopolitical Factors
The company, which operates across more than 40 countries in Europe, also warned that a decline in passengers travelling to the region amid the Middle East tension would impact its international sales.
Impact of Middle East Tensions
Travel disruptions and reduced passenger numbers are expected to affect Trainline's international ticket sales.
Financial Highlights and Analyst Expectations
Here are some details:
• The company expects revenue between 440 million and 455 million pounds in 2027, compared with a company-compiled analyst estimate of 453 million pounds on ticket sales of 6.42 billion pounds.
• The company makes commission from commuters booking tickets on its website and app, and expects a major hit from the UK government pushing for payments without third-party assistance.
• Trainline reported net ticket sales of 6.3 billion pounds for the year ended February 28, with adjusted core profit of 177 million pounds.
• Shares of the company fell 7.4% to 221.8 pence.
($1 = 0.7361 pounds)
(Reporting by Simone Lobo in Bengaluru; Editing by Subhranshu Sahu)
