focusing 
on our 
strategy 
annual report and accounts 2012 who we are
national express group is a leading transport 
provider delivering services in the uk  
north america spain and morocco 
our vision
is to earn the lifetime loyalty of our customers  
by consistently delivering frequent  
high performing public transport services  
which offer excellent value
our strategy
we are focused on the following
delivering operational excellence
read more on pages 1 1 and 16
driving organic growth
read more on pages 12 and 17
generating superior cash and returns
read more on pages 13 and 18
delivering new opportunities from  
capitallight markets
read more on pages 13 and 19
overview
an overview of national express group our key 
highlights and how we have performed this year
01 financial highlights 
02 where we are today 
04 national express group at a glance 
06 our business model  
08 chairman’s letter
delivering on our strategy 
this section provides an explanation of our 
strategy and vision
10 group chief executive’s strategic review 
14 strategic overview
business review
how we have performed at group and  
divisional levels
20 finance director’s review 
24 spain 
28 north america 
32 uk bus 
36 uk coach 
40 uk rail 
43 risk and risk management 
46 living our values
governance
our approach to corporate governance  
and how we have applied this in 2012
50 chairman’s overview 
52 board of directors 
54 corporate governance 
64 directors’ remuneration report 
76 directors’ report 
79 statutory information 
81  directors’ responsibilities statement
financial statements
the audited ﬁnancial statements of  
national express group for the year  
ended 31 december 2012
82 auditor’s report
83  group income statement
84  group statement of 
comprehensive income 
85 group balance sheet 
86 group statement of changes in equity 
87 group statement of cash flows 
88 notes to the consolidated accounts 
146 auditor’s report 
147 company balance sheet 
148 notes to the company accounts 
158 shareholder information 
159 dividends and ﬁnancial calendar 
160 corporate information 
161 glossary 
164 five year summary
unless otherwise stated all proﬁt margin and eps data refer to normalised results 
which can be found on the face of the group income statement in the ﬁrst column 
the deﬁnition of normalised proﬁt is as follows statutory result excluding proﬁt or 
loss on the sale of business exceptional proﬁt or loss on sale of noncurrent assets 
and charges for goodwill impairment intangible asset amortisation exceptional 
items and tax relief thereon the board believes that the normalised result gives  
a better indication of the underlying performance of the group
commercial revenue growth refers to revenue generated by passenger transport 
excluding concessionary and subsidy income 
operating margin is the ratio of normalised operating proﬁt to revenue  
for continuing businesses
operating cash ﬂow is intended to be the cash ﬂow equivalent of normalised 
operating proﬁt free cash ﬂow is intended to be the cashﬂow equivalent of 
normalised proﬁt after tax a reconciliation is set out in the table within the  
finance director’s review on page 21 
 net debt is deﬁned as cash and cash equivalents cash overnight deposits and 
other short term deposits and other debt receivables offset by borrowings  
loan notes bank loans and ﬁnance lease obligations and other debt payable 
excluding accrued interest
ebitda is ‘earnings before interest tax depreciation and amortisation’  
it is calculated by taking normalised operating proﬁt and adding depreciation  
ﬁxed asset grant amortisation normalised proﬁt on disposal of noncurrent  
assets and sharebased payments it is deﬁned in line with the group’s  
banking documentation
the eps generated by the rail business is calculated using the normalised 
operating proﬁt of the rail division taxed at the uk tax rate overview delivering on our strategy business review governance 
1 wwwnationalexpressgroupcom
financial statements 
overview
financial highlights
delivering ﬁnancial returns 
managing uncertainty
 third successive year of margin growth up 150 basis points to 1 16
 third year of growing nonrail proﬁt at £1852 million 201 1 £1818m
 delivered £34 million of cost savings in year
 improved operational performance with industryleading businesses
 delivered a group nonrail roce improvement of 14 over three years  
to 106
 generated £140 million of free cash ﬂow before rail franchise handover 
and funded over £125 million of organic capital investment
 won nearly £2 billion of new contracted revenue in the last 12 months
 successfully integrated petermann with annualised synergies of  
10 million delivered
 diversiﬁed our risk by broadening our product range and entering  
new markets
 strong balance sheet with long term funding maturity
 final proposed dividend of 66p total dividend for year 975p  
up 3 yearonyear
dividend per share
975
p
0
2
4
6
8
10
10 11 12
nonrail operating proﬁt 
£1 852
m
10 11 12
0
50
100
150
200
250
earnings per share
255
p
0
5
10
15
20
25
30
10 11 12
group revenue
£1 831 2
m
10 11 12
0
500
1000
1500
2000
2500
operating margin
11 6

0
2
4
6
8
10
12
10 11 12
group operating proﬁt
£21 19
m
0
50
100
150
200
250
10 11 12
overview  an integrated approach
below is a snapshot showing the foundations of our group and our progress during the year
how we create value 
our strategy
2012 has been another year of good progress 
in delivering on each part of this strategy
our business
a leading transport provider delivering services in the uk north america 
spain and morocco
national express group plc
bus 
spain
 alsa 
north america 
 durham school services
 stock transportation
 petermann
uk
 national express bus
our board of directors 
balance is considered a key requirement for the composition of 
the board not only in terms of the executives and nonexecutives 
but also with regard to the mix of skills experience knowledge 
independence and diversity
2012 saw the appointment of jackie hunt to the national express 
group plc board she was joined by sir john armitt at the start of 
the year who has since become our chairman additionally both 
miranda curtis and john devaney stepped down from the board 
52
read more
sir john armitt
chairman 
dean finch
group chief 
executive
jez maiden
group finance 
director 
how we manage our business
7 4
read more
delivering operational excellence
11
read more
16
driving organic growth
12
read more
17
generating superior cash and returns
13
read more
18
delivering new opportunities
13
read more
19
the journey so far 
jan feb mar apr may jun jul aug sep oct nov dec
£350m 7year sterling bond 
issue oversubscribed
jan feb mar apr may jun
two year extension 
granted to 
c2c franchise
201 0 201 1
three new directors appointed 
to the board
£225m 10year sterling 
bond issued 
rail 
uk
 c2c
coach 
uk
 national express 
 eurolines 
 the kings ferry 
spain
 alsa 
overview
where we are today
full biographies at
nationalexpressgroupcomaboutusourmanagementaspx
dean finch joins as new 
group chief executive
start of agadir bus service 
contract in morocco
2 national express group plc annual report and accounts 2012 risks
our risk management process
 provides a framework to identify assess and 
manage risks to the group’s overall strategy 
and the contribution of its individual divisions
 gives business unit management tools to 
identify and manage risks
 allows group management to identify and 
manage the risks that are likely to have a 
more signiﬁ cant impact on the ﬁ nancial 
results and strategy and share common 
issues and solutions and
 allows the board to fulﬁ l its governance 
responsibilities
43
read more
our markets 
spain
alsa has a leading position in a regulated 
and highly segmented market concessions 
exclusive to each operator 
24
read more
north america 
one third of school bus market outsourced 
public funding pressures are driving 
conversion to outsourcing new opportunities 
in transit and paratransit
28
read more
uk bus
largest ﬁ ve operators represent 70 of the 
uk market primarily a deregulated market 
32
read more
uk coach
the uk scheduled coach market leader 
operating in a highly deregulated market 
selective competition from other coach 
operators and rail
36
read more
uk rail
regluated environment and evolving 
franchise model 
40
read more
governance
national express is committed to operating its businesses in a responsible manner 
our corporate governance framework forms an integral part of this approach in order 
to safeguard shareholder value 
our companywide policies and procedures including risk management are considered 
as part of the overall governance of the business 
this report focuses on the group’s approach to corporate governance as provided in the 
uk corporate governance code 201 1 which is applicable to the company for the ﬁ nancial 
year being reported the group also has regard to developing corporate governance best 
practice including matters contained in various investor guidelines
50
read more
living our values
we share a common set of values across 
the business which help us deliver our 
strategy they are embedded in our 
daytoday operations and shape how 
we conduct our business
safety customer people community
46
read more
jul aug sep oct nov dec
201 2
jan feb mar apr may jun jul aug sep oct nov dec
prequaliﬁ cation for essex 
thameside and great 
western rail tenders
end of east anglia rail 
franchise
dividend reinstated 
with new payout policy
announcement of 
petermann acquisition 
– opens up transit
paratransit 
new coachcards launched after 
the uk government removes its 
concessionary travel scheme
fleet investment 
of £132m in bus 
coach and spain
national express 
foundation launched
sir john armitt named as 
new chairman
petermann deal completed 
– opens up transitpara
transit markets
guadalajara contract 
won in spain
delivering on our strategy business review governance 
3 wwwnationalexpressgroupcom
financial statements overview  overview
national express group at a glance
a leading global
transport provider 
delivering services in the uk north america spain and morocco every year more than 
800 million journeys are made on our buses trains light rail services and coaches
segment description
more information
financial highlights
north america bus uk bus spain bus and coach
 alsa
our spanish business 
alsa operates long distance 
regional and urban bus and 
coach services across spain 
and in morocco
alsa was acquired by 
national express in 2005 
and our position in spain 
was strengthened with the 
acquisition of continental 
auto in 2007  apart from its 
bus and coach services 
the business also operates 
service areas and other 
transportrelated businesses 
such as fuel distribution
 durham school services
 stock transportation
 petermann
the main focus of our business 
in north america is student 
transportation and operates 
in 32 us states and four 
canadian provinces
the business is the second 
largest private operator of 
school buses in north america 
we are also building the 
number of transit and 
paratransit contracts we 
operate in the us
 national express 
west midlands
 national express coventry
 national express dundee
 midland metro
national express is the market 
leader in the uk’s largest urban 
bus market outside of london 
we also run services in 
coventry and dundee 
in addition we operate 
the midland metro light rail 
service between birmingham 
and wolverhampton
revenue
£5350
m
operating proﬁ t
£838
m
revenue 
£5783
m
operating proﬁ t
£59 1
m
revenue
£2690
m
operating proﬁ t 
£34 1
m
24
read more
28
read more
32
read more
4 national express group plc annual report and accounts 2012 uk coach uk rail
 national express
 eurolines
 the kings ferry
national express is the 
largest operator of scheduled 
coach services in the uk 
the business operates high 
frequency services linking 
around 1000 destinations 
across the country
we are the uk partner in the 
eurolines network which serves 
over 500 destinations across 
europe and north africa
 c2c
national express operates the 
industryleading c2c franchise 
which serves london and 
south essex
it is an important commuter 
route serving 25 stations on 
the line out of fenchurch street 
station london
we ran national express east 
anglia until february 2012 
revenue 
£255 1
m
operating proﬁ t 
£206
m
revenue 
£1 95 1
m
operating proﬁ t
£267 
m
our global position
national express group
the group operates in the uk north america spain and morocco 
and at the end of the year we employed 42000 people and operated 
over 25000 vehicles passengers made more than 800 million 
journeys on our services in 2012 
the national express name ﬁ rst appeared on uk coaches in 1972 
and the company was listed on the london stock exchange in 1992
group revenue by market
 spain 29
 north america 32
 uk bus 15
 uk coach 14
 uk rail 10
group operating profi t by market
 spain 38
 north america 26
 uk bus 15
 uk coach 9
 uk rail 12
revenue and proﬁ t percentage in sterling
36
read more
40
read more
uk
 national express bus
north america
 durham school services
 stock transportation
 petermann
 c2c
 national express
 eurolines
 the kings ferry 
spain and morocco
 alsa 
delivering on our strategy business review governance 
5 wwwnationalexpressgroupcom
financial statements overview  how our business works
national express west midlands is the 
market leader in the largest single urban 
network in the uk deregulated market  
the deregulated model allows for total 
ﬂexibility in both fares and service the 
business has a high regional market share 
with strong competition from multiple 
operators on speciﬁc routes modal 
competition is principally from private cars 
how our business works
in north american school bus the group’s 
operations are carried out by our subsidiaries 
durham school services us petermann 
us and stock transportation canada 
the outsourced private operator market is 
only around one third of the total with the 
remainder being insourced that is owned 
and run by the school boards themselves 
contracts typically run from three to ﬁve 
years once secured contracts have low 
revenue risk over the contract life 
how our business works
alsa has a strong position in the 
outsourced urban bus market in spain 
operating city bus services on behalf of 
urban councils and transport consortia 
the outsourced market in spain represents 
smaller cities and suburban services 
the major cities are still run inhouse by 
municipalities or consortia contracts 
typically last from 10 to 20 years it also  
has a fastgrowing business in morocco 
running services in marrakech and agadir 
where alsa takes revenue risk
how we build long term value
revenue and proﬁtability are driven by  
the scale of operations delivering frequent 
reliable and affordable services across 
a broad network passenger growth is 
supported by sustainable investment  
in a high quality ﬂeet
how we build long term value
we are the second largest private operator 
in north america with high contract 
retention and a focus on customer service 
management of capital is key most new 
contracts require investment in new buses 
and asset utilisation is low due to the part 
time usage of these specialised vehicles 
scale is beneﬁcial but not overarching 
– economies can be achieved through 
procurement centralisation of administration 
and business development
how we build long term value
revenue is driven by contractual obligations 
over fares and kilometres operated we 
manage proﬁt by maintaining a tight control 
over costs alsa continues to target and 
win new city contracts in both mainland 
spain and morocco and is wellpositioned 
for further outsourcing opportunities
key risks to manage
 recovery of higher fuel cost
 economy still fragile
 annualisation of bsog cut
 pensions accounting impact
key risks to manage
 recovery of higher fuel cost 
 legislationregulatory change
 ancillarydiscretionary route reduction
key risks to manage
 recovery of higher fuel cost
32
read more
28
read more
bus 
north america uk spain 
24
read more
overview
our business model
driving value for shareholders
we have set out a strategy to drive further value from our core bus and coach operations and from 
our market opportunities 
6 national express group plc annual report and accounts 2012  how our business works
the intercity coach market in spain is 
regulated and supported by long term 
concession agreements provided to 
operators in exchange for public service 
obligations concessions typically run for  
10 to 15 years public transport is seen  
as an essential service in spain 
concessions are operated exclusively 
resulting in competition being primarily 
intermodal ie with rail low cost airlines  
and the car rather than other coach and  
bus operators where competition is at  
point of tender
how our business works
‘national express’ is the national coach 
network operator in the uk offering 
great value and accessible travel to all 
it operates the only scheduled national 
uk coach network and the largest in 
europe in a deregulated market where 
we have ﬂexibility over pricing and supply 
competition is modal against rail and 
private car national express runs 500 
coaches a day serving around 1000 
domestic destinations 
how we build long term value
alsa is the largest private operator of 
coaches in spain its portfolio provides  
a balance between long distance coach 
operations which receive no subsidy and 
take revenue risk in return for ﬂexibility over 
the number of services operated and a 
regulated maximum fare and regional coach 
operations which may be partly subsidised 
by the autonomous governments 
how we build long term value
national express has a ﬂexible outsourced 
business model where third party 
providers supply 80 of the coaches 
and responsibility for sales lies with the 
company with 90 brand recognition the 
national express coach business beneﬁts 
from its integrated network and scale 
offering breadth and interconnectivity 
where competitors  
offer only pointtopoint services with  
limited infrastructure
key risks to manage
 recovery of higher fuel cost
 threat from renfe rail
 weaker consumer demand
 transport law reform
key risks to manage
 competition – rail
 government policy – bsog elimination
24
read more
36
read more
40
read more
uk spain 
coach 
uk
rail 
how our business works
national express has a strong operational 
skills base in uk rail one of the few 
privatised systems in europe the uk rail 
industry comprises franchises awarded 
on an exclusive operation basis to private 
operators prices are predominantly 
regulated and costs are substantially ﬁxed 
around track access rolling stock and 
franchise payments franchisees therefore 
primarily target passenger volume growth 
whilst fulﬁlling their service obligations 
how we build long term value
the group ran two franchises in 2012 
operating national express east anglia until 
february 2012 and c2c throughout the year 
c2c is the uk’s best performing franchise 
the group is now starting to exploit its  
rail expertise in deregulating markets  
outside the uk particularly in germany 
where it has now been selected to run  
its ﬁrst two contracts
key risks to manage
 department for transport bid delays
 londoncity employment trends
our business model
national express operates principally in outsourced public transportation markets growth in these markets is driven 
by increasing social mobility gdp and the outsourcing of public provision of services the forecast trend is for ongoing 
deregulation in both developed and developing economies
the group uses its operational expertise experience and accumulated knowhow to provide best in class transport 
services which in turn drives revenue and proﬁt growth there are some economies of scale in procurement insurance 
overhead costs and ﬁnancing private transport operators can provide a higher standard of service and better value for 
money than public or state management national express can leverage this expertise across different modes of transport 
and in different geographies
the structurally cashgenerative nature of the business as many of our customers pay in advance enables us to combine 
sustainable investment in existing operations with the opportunity to add shareholder value either through highreturn 
growth or the return of capital
delivering on our strategy business review governance 
7 wwwnationalexpressgroupcom
overview financial statements  delivering shareholder value
i am pleased to report that national express has delivered a good revenue and proﬁt performance 
as part of another strong set of results for 2012 
overview
chairman’s letter
dear shareholder
i am delighted to have joined the group in january this year 
taking over as chairman from john devaney who has led 
the company with clarity of purpose through a challenging 
but successful period i look forward to building on the solid 
foundations that he has put in place 
national express continues to be one of the strongest 
performing providers of public transportation the strength 
and resilience of the group lies in our unique diversiﬁed 
portfolio of high quality businesses operating in bus  
coach and rail providing excellent geographic access 
to those markets transport trends over the last 20 years 
have been positive and national express beneﬁts from 
a combination of highly visible revenues from long term 
contracts and deregulated operations addressing  
a socially important need 
our uk bus uk coach and rail operations and the 
divisions in spain and north america are well managed and 
ﬂexible businesses with a track record of successive margin 
improvement delivered by completing a highly successful 
turnaround programme begun in 2010 our strength in 
delivering operational excellence has seen national express 
invest in new vehicles technology and people which have 
helped to drive underlying revenue and improve margins 
across the group we continue to focus on achieving 
greater cost efﬁciencies reducing variable costs by ﬂexing 
operational mileage and offering highly competitive  
prices with a quality service others ﬁnd difﬁcult to match 
driving organic growth 
in 2012 we acquired the petermann school bus business  
in north america a strategically signiﬁcant acquisition  
which has been successfully integrated into the group 
along with two other smaller acquisitions this has also 
provided a platform for us to establish and advance our 
north american transit business
sir john armitt
8 national express group plc annual report and accounts 2012  investment case 
2 well balanced portfolio with 
diversiﬁed exposure to modes 
of transport and geographies
1 a best in class public 
transport operator
 spain £535m
 north america £578m
 uk bus £269m
 uk coach £255m
 uk rail £195m
margin 

best in  
class 
spain 157 nx
n america 102 nx
uk bus 127 1 7
uk coach 8 1 nx
rail 137 nx
group 11 6 nx
3 credible strategy
delivering operational 
excellence
 margin at 1 16 – best in class 
in 4 out of 5 divisions
 record nonrail proﬁt at 
£185 million – third successive 
year of growth
driving organic growth
 revenue up 7
 new contracts secured –  
nearly £2 billion in revenue
generating superior  
cash and returns
 free cash ﬂow of £141 million  
– investing for growth 
 nonrail pretax roce  
stable at 106
delivering new  
opportunities
 delivery of 10 million 
annualised synergies from 
petermann school bus 
acquisition
 65 million revenue us transit 
business established
14
read more
 
4 stable ﬁnancial footing with a commitment to investment  
grade credit rating and medium term ﬁnancing
gearing ratios 2012 201 1 covenant
net debt ebitda 25x 19x 35x
interest cover 67x 7 2x 35x
ratings grade outlook
moodys baa3 postive
fitch bbb stable
strong debt maturity profile
5 dividend policy offering growth on a sustainable nonrail  
earnings basis
2012 p 201 1 p
basic eps nonrail 216 207
rail 39 63
group 255 270
dividend 975 95
national express continues to be an impressive  
cash generator our balance sheet is underpinned  
by an appropriate dividend and funding structure  
the group has strong liquidity and investment grade debt 
with a long maturity proﬁle the board is committed to a 
gearing policy which provides security but at the same time 
allows us to invest for the future public transport markets  
are growing and liberalising around the world this offers 
a range of market opportunities for national express in 
passenger transport contracts and concessions in selected 
target markets
dividend
the quality of our business and our chosen strategy enable 
us to generate an improving return on capital the board 
has an attractive and sustainable dividend policy which is 
appropriate for the current business environment where 
alongside our opportunities challenges will continue 
in a world of austerity our aim is to pay a dividend that 
is covered approximately twice by our bus and coach 
earnings the board is recommending that the ﬁnal 
dividend for 2012 is increased by 0 1 pence to 66 pence 
which when added to the interim dividend of 3 15 pence 
represents an increase of 3 for the year as a whole 
subject to approval by shareholders the ﬁnal dividend will be 
paid on 17 may to shareholders registered at 26 april 2013 
board
on behalf of the whole board i would like to thank our 
departing chairman john devaney for the fortitude and 
energy with which he has led national express since 2009 
we welcomed jackie hunt to the board during 2012 and 
she has quickly brought her strong ﬁnancial skills and listed 
company experience to our discussions
our values
during my initial visits around the business i have been 
impressed by the high level of commitment shown by the 
group’s management and employees to its core values  
our employees place great value on safety customer 
service their colleagues and the communities in which  
we operate doing their difﬁcult but often rewarding jobs  
our employees will ensure the long term sustainability  
of the group 
our future
with the right strategy and initiatives in place i am excited 
about the opportunities available for us and believe we will 
add to our pipeline of long term contracts and concessions 
within the coming months these have the potential to 
deliver further growth and returns to shareholders 
sir john armitt
chairman 
28 february 2013
59
24
493
42
20
65
21 20 19 18 17 16 15 14
drawn
13
24
388
230
available
delivering on our strategy business review governance 
9 wwwnationalexpressgroupcom
financial statements overview  building on our strengths 
national express enjoys leading positions in all of its principal markets  
which have attractive medium and long term growth characteristics
delivering on our strategy
group chief executive’s strategic review
introduction
the group ended 2012 having established itself in a number 
of new and growing markets in particular public transit in 
north america german rail and german coach we are 
convinced that our strategy of pursuing organic growth in 
our core markets deploying our expertise in new markets 
where we have an existing geographic presence and 
focused debt reduction will enable the group to deliver 
superior returns to its shareholders 
this has been a challenging year for the group we have 
overcome the loss of the national express east anglia 
franchise rising fuel costs economic recession and austerity 
in many of our markets group proﬁt before tax has reduced 
by £16 million yearonyear entirely reﬂecting the loss of one 
million senior citizen passengers due to the withdrawal of 
their concessionary scheme by the uk government 
in each of our markets we have taken considerable steps 
to improve the quality of our services to reduce costs and 
grow revenues group revenue increased by 7 beneﬁtting 
from acquisitions and after adjusting for rail franchises 
handed back at end of contract term group operating 
margin has improved by 150 basis points to a bestinclass 
1 16 operating proﬁt for the year was £21 19 million  
201 1 £2252m as we made substantial progress in 
mitigating almost £50 million of proﬁt headwinds  
proﬁt before tax was £164 1 million 201 1 £1802m
as many of the uk’s rail franchises reach the end of their 
current contract terms national express stands out as a 
diversiﬁed bus and coach operator our nonrail businesses 
generated a record operating proﬁt of £1852 million  
201 1 £1818m we remain the leading operator by margin in 
most of our businesses our core markets are sustained by 
long term positive trends such as outsourcing deregulation 
and the everincreasing cost of fuel and motoring for our 
customers we provide safe reliable and frequent public 
transport services at low prices in times of austerity  
dean finch
10 national express group plc annual report and accounts 2012  for our investors we are focused on driving our return  
on capital generating strong cash ﬂows and enhancing 
future earnings through leadership in our existing and 
developing markets
highlights
in 2012 we achieved some impressive results delivered  
by our high quality divisional management teams
 uk bus achieved revenue 2 proﬁt 4 and margin 
30 basis points growth we invested in over 200 new 
buses over the last 18 months carried out network 
reviews in two major locations and limited fare increases 
recognising the pressure on household budgets in doing 
so we have more than compensated for the £4 million 
bsog fuel duty rebate reduction passenger  
satisfaction increased by 4 in the passenger focus  
bus passenger survey
 in north america revenue grew by 19 overall through 
organic growth a strong bid season with 97 contract 
retention and 26 new contract wins and the successful 
acquisition and integration of the petermann school bus 
business operating proﬁt grew by 22 to 94 million 
including the delivery of inyear synergies of 7 million  
from petermann and a ﬁrst contribution from our small  
but fastgrowing transit division
 in spain alsa has shown a remarkable ability to continue 
to grow revenue and maintain proﬁt overall revenue 
growth of 4 was driven by strong urban bus operations 
and a resilient intercity coach business we delivered proﬁt 
unchanged at €103 million operating cash generation 
has been exceptional increasing by over €70 million to 
€125 million the quality and ﬂexibility of alsa’s business 
model gives us conﬁdence for the future
 rail once again delivered a very strong performance 
operating proﬁt of £27 million and a margin of 137 were 
generated by bestinclass operations c2c is the leading 
franchise in the uk for punctuality and customer service 
it also won rail operator of the year at the national 
transport awards and was voted the best commuter 
service in the uk by which magazine
 we put together two very strong bids for the essex 
thameside and great western rail franchises whilst  
we are disappointed that the uk government’s delay  
to the refranchising process and cancellation of the  
great western bid process has wasted signiﬁcant 
investment in the bids we hope to extend the existing 
c2c contract and look forward to restarting that franchise 
tender process later in 2013 our c2c credentials were 
also fundamental to being selected for our ﬁrst german 
regional rail contracts in february 2013 this is an  
exciting opportunity for us to develop our position  
in this large and liberalising market
 our uk coach result in 2012 was disappointing  
we overestimated our ability to mitigate the loss of the 
government’s senior citizen concession funding however 
we grew our nonconcession passenger volumes by 5 
and started to implement structural changes in revenue 
cost and organisation
alongside a record proﬁt performance from our nonrail 
businesses we have achieved strong results in our other  
key performance metrics
 we generated £141 million of free cash ﬂow before rail 
franchise handover we funded £125 million of organic 
capital investment delivering 1300 new vehicles into our 
ﬂeet to drive passenger and contract growth we invested 
nearly £160 million in new acquisitions to build scale and 
market presence we maintained our nonrail pretax 
return on capital at 106
 we are making excellent progress in improving our  
core safety performance through our investment in 
groupwide safety programmes responsible major 
injuries fell 67 and lost time injuries 23 on 201 1 
alongside our responsibility to be a safe operator  
this will reduce future costs
 we made good progress in developing new businesses 
with our us transit business achieving annual revenue 
of 65 million by the end of the year and the ﬁrst two 
contract wins under our ownership secured alongside  
our german rail success in february 2013
strategy
two years ago i set out a strategy to drive further value from 
our core bus and coach operations and from our market 
opportunities we have focused on improving proﬁtability 
by delivering operational excellence and driving organic 
growth across our divisions we have targeted strong cash 
generation we have sought to build on this platform and 
expand into new markets 2012 has been another year of 
good progress in delivering on each part of this strategy 
1 delivering operational excellence
delivering operational excellence across national  
express requires
 consistent service performance for our customers
 continuous cost efﬁciency improvement and 
 living our core values every day 
operational excellence is crucial to our goal of achieving  
bestinclass margins we outperformed our competitors  
in 2012 in north america school bus spain uk coach 
and rail in uk bus we have almost doubled the margin 
over three years and have plans to match the best industry 
performer our operational excellence initiatives create more 
sustainable efﬁcient businesses for the longer term
“ we have focused on improving 
proﬁtability by delivering operational 
excellence and driving organic 
growth across our divisions”
business review governance 
11 wwwnationalexpressgroupcom
financial statements delivering on our strategy overview  delivering on our strategy
group chief executive’s strategic review continued 
in 2012 we delivered a number of initiatives to ensure 
consistent service performance our c2c rail franchise 
achieved outstanding passenger service scoring a 
record 93 satisfaction in the national passenger survey 
and carrying two million passengers during the london 
olympics in morocco we extended the agadir bus  
network driving passenger revenue growth of over 50  
uk coach implemented new customer service standards 
and improved its passenger survey rating in every category 
as a result whilst uk bus implemented automatic vehicle 
location to enable better schedule management and provide 
realtime information to passengers
we are also relentlessly driving cost efﬁciencies to protect 
and grow margins across the group technology is helping 
us to drive savings in every division gps technology and 
vehicle telemetry are bringing fuel savings in spain north 
america uk bus and uk coach we are now able to 
achieve better route management monitor driving style 
and reduce the amount of engine idling as well as ensuring 
strong cost control where routes and schedules vary  
for example in school bus operations
our business models are ﬂexible allowing us to adjust 
mileage as appropriate in spain we reduced kilometres 
operated in the intercity coach business by 4 to match 
lower passenger demand by ﬂexing our outsourced supply 
in uk bus network optimisation reduced mileage by 1 
whilst better meeting passenger needs in the core uk 
coach business we increased mileage by 3 to support 
new routes
we continue to identify ways to make savings through 
structural change uk coach is consulting with employees 
to close its crawley base to reduce overhead cost without 
compromising network efﬁciency saving £05 million a year 
our global procurement team delivered over £12 million  
of annual savings by leveraging the group’s scale in ﬂeet  
it telecoms and engineering
we are also making progress in developing the group’s 
culture around our four core values that we believe will 
support a sustainable revenue and proﬁt stream in the 
long term – safety customer people and community 
our ‘driving out harm’ safety programme has brought a 
signiﬁcant reduction in injuries and is helping to reduce the 
number of vehicle accidents these have a direct ﬁnancial 
beneﬁt but importantly help create a better environment 
for our customers and employees our customer initiative 
seeks to earn the lifetime loyalty of our passengers in 
2012 we introduced global standards and monitoring 
improving customer satisfaction in all divisions amongst our 
people initiatives we have pooled contract management 
expertise to develop new opportunities and an international 
management scheme to reﬂect our business development 
in the uk we launched the national express foundation 
to provide support to community groups and students in 
the west midlands east london and south essex more 
information on our progress is set out in our corporate 
responsibility reporting
16
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2 driving organic growth
in 2012 we achieved commercial revenue growth in each  
of our divisions as we
 grew passenger volumes in uk coach  
c2c and morocco
 increased contracted volumes in spanish urban bus  
and north america school bus
 secured new bid wins in spain and north america and
 integrated bolton acquisitions with growth and  
margin potential
the group continues to build a strong pipeline of contracted 
revenues with £36 billion equivalent to 3 1 years of group 
revenues that are either contracted or operated on an 
exclusive concession basis we have added just under  
£2 billion of new revenue during the last 12 months in north 
america this included 26 new school bus contracts of 
which eight were conversion opportunities adding a total of 
1300 new buses we also won our ﬁrst two contracts in the 
recently launched transit business at alsa we have added 
eight new contracts including an extension to services in 
agadir and contracts in cadiz and guadalajara which were 
secured through competitive bids against existing operators 
in germany we have recently been selected to run our ﬁrst 
two rail contracts starting in late 2015 
average revenue yield increased by 2 in 2012 contract 
prices increased in school bus reﬂecting improving market 
conditions and customer recognition of the quality of service 
we offer in our urban contracts in spain we secured an 
average price increase of 3 in uk bus commercial 
revenue increased by 3 delivered through fare increases 
that remain affordable for our customers in uk coach  
we reduced average commercial yield by 4 driving  
a 5 increase in passenger journeys and supporting  
our value positioning
we operate in highly competitive markets and our customers 
are affected by austerity looking to the future therefore we 
must strive to improve further the value we offer the service 
we deliver and ensure we are always competitive we will 
continue to drive growth through investment in technology 
and through initiatives to better manage ﬂeet utilisation  
in uk coach the ﬁrst stage of an improved revenue 
management system will be implemented later in 2013  
with a more advanced package to follow this will 
allow better realtime management of fares promoting 
travel on less utilised services and ensuring fares are 
always competitive this in turn should deliver healthy 
organic growth supported by our initiatives to improve 
understanding targeting and marketing to key customer 
segments in uk bus we will pilot commercial smart cards 
from the second quarter of 2013 supported by investment 
this year in £25 million of new buses in the west midlands 
including 30 hybrid vehicles as we focus on increasing  
and sustaining the number of passenger journeys in spain 
as well as all of our uk operations we are developing mobile 
applications that will make ticket purchasing and realtime 
tracking of vehicles easier for our customers improving  
the quality of their journeys
17
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12 national express group plc annual report and accounts 2012  3 generating superior cash and returns
through successful implementation of our strategy  
national express
 continues to deliver excellent cash generation
 underpins its operations with a sound debt and dividend 
policy and
 is growing nonrail return on capital through disciplined 
capital deployment across the group
long term cash generation is a key tenet for us driving 
shareholder value creation and supporting future returns  
to shareholders
2012 has been another good year for the group in this 
regard as strong ebitda efﬁcient cash management and 
selective capital deployment have combined to increase 
operating cash ﬂow signiﬁcantly operating cash ﬂow 
increased by £50 million to £2096 million with operating 
cash conversion of 99 spain alone generated  
£101 million of cash this year of key importance we are 
being paid promptly by our municipal customers with 2012 
seeing a £20 million reduction in outstanding receivables 
balances our free cash ﬂow of £141 million and low debt 
position supported an investment of nearly £160 million  
in acquisitions – of petermann school bus and the creation  
of our us transit business as well as funding the handover 
of the east anglia franchise
the focus on cash generation will continue our target is 
to generate £125 million to £150 million per annum in free 
cash ﬂow over the next two years our gearing policy is to 
maintain net debt between 2 and 25 times ebitda in 2012 
our gearing was at the upper end of our range we plan to 
reduce this to 2 times by the end of 2014 enabling further 
choices over future investment and return of capital  
to shareholders
pretax return on capital employed roce from the  
nonrail business the rail business does not utilise capital 
was maintained at 106 in 2012 we will continue to target 
capital deployment carefully combining it with further 
improvement of margins to enhance roce and releasing 
capital where appropriate our ﬂeet is wellinvested across 
the group and we are committed to maintaining an 
appropriate level of investment in each business this will  
see us add 1 15 buses in uk bus in 2013 and 230 vehicles  
in alsa in north america we will continue to cascade 
existing ﬂeet improving utilisation as we consolidate the 
petermann ﬂeet into our operations in addition our range  
of new market opportunities are capitallight allowing  
roce to continue to improve over time a key measure  
of shareholder value creation for us
18
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4  delivering new opportunities from  
capitallight markets
our strategy is also to target geographies which have  
or are liberalising their public transport markets this is
 creating a pipeline of long term sustainable transport 
operations
 leveraging the group’s expertise running passenger 
transport services in adjacent markets operating in the 
same or similar modes of transport and building scale  
in selected geographies and
 representing primarily capitallight opportunities which  
will not require signiﬁcant asset investment 
national express is unique amongst its peers in owning  
a diversiﬁed portfolio of assets that provides a platform for 
growth in attractive markets alsa has a strong reputation 
outside spain in morocco we expect to bid for further urban 
contracts alongside our existing marrakech and agadir 
operations which have driven recent revenue and proﬁt 
growth as the largest scheduled european coach operator 
we are launching ‘city2city’ in april in germany’s newly 
liberalised coach market taking the best of the alsa  
and uk coach business models
within eight months of initial acquisition in 2012 we built  
a transit business in north america that had annual 
revenue of 65 million in addition we have a bid pipeline 
of 100 million of revenue opportunities with total capital 
requirements of only 7 million like urban contracts in spain 
and morocco these can be mobilised rapidly on award and 
are proﬁtable from the start
building on the strong credentials of our leading c2c 
franchise we invested in a bid team in german rail early 
in 2012 we are very pleased to have been selected for 
our ﬁrst rail contracts in germany which are due to start 
operations in late 2015 this will expand into a portfolio of low 
risk smaller rail contracts in regional rail franchises these 
contracts offer a similar proﬁle to a uk franchise in duration 
capital requirement and margin but with less revenue and 
guarantee risk
we will continue to expand the group’s capability to secure 
contracts to operate public transportation services as the 
leading public transport operator by proﬁtability in europe 
we are currently looking at a number of opportunities where 
we can use national express’ intellectual capital  
and reputation to explore new markets
19
read more
prospects for the future
in 2013 we expect to make good progress in growing  
our business in uk bus uk coach and north america  
in spain we have already submitted our ﬁrst intercity coach 
concession bid and are focused on protecting and growing 
our market share during the renewal process in rail we 
are in discussions to extend our c2c franchise and will 
participate in future franchise opportunities
looking to the future we believe we have the right strategy  
in place to deliver long term value for our shareholders 
firstly we will continue to drive organic growth and better 
margins by focusing on improving the quality and value 
offered by our operations attracting customers increasing 
revenue and creating a more efﬁcient cost base secondly 
we will drive cash generation reducing gearing to two  
times over the next two years and deploying capital in  
a cautious targeted way thirdly we will continue to add 
to the signiﬁcant pipeline of bid and market opportunities 
in north america europe and north africa where our 
expertise in operating bus coach and rail services is already 
proving successful
dean finch
group chief executive 
28 february 2013
business review governance 
13 wwwnationalexpressgroupcom
financial statements delivering on our strategy overview  our vision focused on our strategy 
our vision is to earn the 
lifetime loyalty of our 
customers by consistently 
delivering frequent high 
performing public transport 
services which offer 
excellent value
safety
more than anything else we value the 
safety of our customers employees 
and the public generally
customers
we will place customers at the heart 
of our business nobody will try 
harder for our customers than 
we do 
people
enabling all our people to reach their 
full potential and to give their best 
as individuals and in teams
community
we will advance the social 
environmental and economic 
conditions in the communities 
where we operate
our values
46
read more
read more
47
read more
47
read more
48
delivering on our strategy
strategic overview
strategic priorities performance in 2012
1
delivering 
operational 
excellence
 group operating margin improved by 
150 basis points to 1 16 best in class 
in four out of ﬁ ve divisions
 record nonrail proﬁ t of £185 million
 c2c is the top performing rail franchise 
in the uk
 groupwide safety programme delivering 
results – 67 drop in major injuries
2
driving organic 
growth 
 commercial revenue growth across 
the uk and north america
 school bus – 1300 school buses won 
in 26 new contracts including eight 
conversion opportunities
 new contracts secured in spain 
guadalajara granada bus station
 passenger revenue growth of 19 
in morocco
3
generating superior 
cash and returns
 operating cash ﬂ ow increased by £50 million 
to £2096 million
 operating cash conversion of 99
 free cash ﬂ ow of £141 million
4
delivering new 
opportunities from 
capitallight markets
 delivery of 10 million of annualised 
synergies from petermann acquisition
 within eight months we have built a transit 
business with annual revenue of 65 billion – 
target opportunties of 300 million
 prequaliﬁ ed for ﬁ ve german rail contracts 
and now selected for two of those 
due to start in late 2015
 set up german coach operations based 
on outsourced uk coach model 
launching in april 2013
 completed two high quality uk rail bids 
awaiting resumption of franchise 
tendering process
14 national express group plc annual report and accounts 2012  key performance indicators kpis
opportunities ahead 2013
continue to drive organic growth 
and better margins by focusing 
on improving the quality and 
value offered by our operations 
attracting customers increasing 
revenue and creating a more 
efficient cost base
targeting cash generation of 
£125£150 million in 2013 and 
2014 reducing gearing to two 
times over that period
continue to add to the significant 
pipeline of bid and market 
opportunities in north america 
europe and north africa  
where our expertise in bus  
coach and rail services is  
already proving successful
0
100
200
300
metric contract wins by value £m
spain
11 12 11 12 11 12
school
bus
transit
0
30
60
90
120
150
11 12 11 12 11 12 11 12 11 12
metric operating cash conversion 
spain north
america
uk
bus
uk
coach
uk
rail
0
2
4
6
8
11 12 11 12 11 12 11 12 11 12
metric underlying revenue growth 
 likeforlike commercial or continuing business
spain north
america
uk
bus
uk
coach
uk
rail
0
5
10
15
20
metric margin 
spain north
america
uk
bus
uk
coach
uk
rail
11 12 11 12 11 12 11 12 11 12
business review governance 
15 wwwnationalexpressgroupcom
financial statements delivering on our strategy overview  1
operational excellence
investing in technology is generating both operational 
efﬁ ciencies and passenger beneﬁ ts
in october we opened our new bus control centre 
in birmingham this allows us to monitor the location 
of buses while they’re in service and manage 
their frequency by december punctuality had 
improved by 7
our rail franchise c2c set a new uk record for 
annual train punctuality of 97 5 – more than 
6 better than the national average it also came 
top in the national passenger survey with 93 
overall passenger satisfaction
our new uk bus control centre helped 
punctuality improve by 7 in december
11
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delivering 
operational 
excellence
16 national express group plc annual report and accounts 2012  wwwnationalexpressgroupcom
organic growth 
we carried 15 more passengers in morocco last year 
and increased our revenue there by 19 on top of 
that we completed a highly effective network review 
in agadir and won a ﬁ veyear extension to the 
marrakech bus contract
meanwhile in spain we secured a new arrangement 
to operate granada’s bus station as well as a 12year 
contract for city bus services in guadalajara 
further cities in both countries are expected to look 
to outsource bus transportation
revenue growth in morocco in 2012
19

12
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driving organic 
growth 
2
financial statements delivering on our strategy overview business review governance financial statements 
17 generating superior returns
the £140 million of free cash ﬂ ow we generated last year 
helped fund investment of almost £160 million in new 
acquisitions to build scale and market presence 
we also funded £125 million of organic capital 
investment delivering 1300 new vehicles into 
our ﬂ eet to drive passenger and contract growth
our range of new market opportunities are capitallight 
which will allow return on capital to improve over time 
last year it was stable at 106
generating superior cash and returns 
gives us choices over future investment
free cashﬂ ow generation in 2012
£1 40
m
generating superior 
cash and returns
13
read more
3
18 national express group plc annual report and accounts 2012  delivering new 
opportunities from 
capitallight 
markets
new opportunities
building up from three small acquisitions 
our new north american transit division 
began operating its ﬁ rst competitively tendered 
contract in december across three cities 
in north carolina the twoyear contract 
worth 12 million will see us carrying 500000 
passengers a year the transit team has also 
won a second bid for paratransit in ohio 
and has a strong pipeline of bid opportunities
7 3 billion – annual value 
of american transit and 
paratransit markets
13
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4
19
financial statements delivering on our strategy overview business review governance financial statements overview delivering on our strategy overview business review governance financial statements overview 
wwwnationalexpressgroupcom driving strong results and cash
cash generation is core to the strategy at national express representing a key driver of shareholder 
value alongside the maximising of returns on capital employed
business review
finance director’s review
revenue
group revenue in 2012 was £18312 million 201 1 £22380m 
with the reduction reﬂ ecting the handover of the national 
express east anglia nxea franchise in february on a 
constant currency basis and adjusted for the rail handover 
total revenue grew by over 7 yield improvement has 
delivered organic growth in four out of the ﬁ ve divisions 
likeforlike volume growth was achieved in uk bus rail and 
north america in spain north america and germany we 
have now added £2 billion of total revenue from new contracts 
in the last 12 months
normalised results
group operating proﬁ t decreased to £21 19 million 201 1 
£2252m reﬂ ecting the loss of rail earnings from nxea 
strong performance in nonrail operating proﬁ t increasing 
to a record level of £1852 million from £1818 million in 201 1 
enabled the group to offset a number of other headwinds 
such as a reduction in fuel duty rebate in uk bus and uk 
coach £4 million an increase in the hedged price of fuel 
£10 million and adverse foreign exchange movements on 
translation of overseas earnings £5 million we were unable 
to mitigate the cut in senior citizen coach concessions 
£16 million
we have generated incremental proﬁ t in the following key 
areas during the year
 organic growth – £21 million driven by yield and 
passenger increases in uk bus core uk coach services 
uk rail and morocco as well as contract increases in 
urban spain north america and olympicrelated work
 acquisitions and synergies – the proﬁ t from the petermann 
and transit acquisitions along with efﬁ cient execution of 
synergies to secure £1 1 million in year
jez maiden
20 national express group plc annual report and accounts 2012  improvements in normalised nonrail operating proﬁ t 2012
efﬁ ciency and other cost savings have also been made 
as follows
 procurement savings of £12 million in communications 
it parts and outsourcing of support services 
 managing costs – £19 million from overhead efﬁ ciencies 
insurance and other savings
 fuel efﬁ ciency – volume savings of £3 million derived 
from adjustments to mileage in spain uk bus and 
north america as well as beneﬁ ts from vehicle telemetry 
improving consumption
group operating margin increased by 150 basis points 
to 1 16 from 10 1 four of our ﬁ ve divisions achieved 
industry leading margins
net ﬁ nance costs increased to £492 million 201 1 £464m 
reﬂ ecting the impact on debt from the acquisition of 
petermann and other businesses the tax charge was 
£327 million 201 1 £415m an effective tax rate of 199 
201 1 230 proﬁ t for the year was £1314 million 201 1 
£1387m giving a basic eps of 255 pence 201 1 27 0p
statutory results
total exceptional costs for the year were £426 million 
201 1 £nil items charged as exceptional reﬂ ect oneoff 
operating cost investments in the future we treat uk rail bid 
costs and business development costs for new businesses as 
exceptional costs uk rail bid costs for the essex thameside 
and great western tenders were £163 million bid costs in 
german rail were £13 million reﬂ ecting the simpler tendering 
approach and reduced risks involved and leading to our ﬁ rst 
contract success in february 2013 we spent £30 million 
in business development activity around our pipeline of new 
opportunities covering the development of a german coach 
model for launch in 2013 and new market opportunities 
elsewhere the acquisition and integration costs for the 
petermann and transit transactions were £134 million 
other restructuring and rationalisation costs of £86 million 
represent the oneoff impact of cost rationalisation for future 
savings such as closing a uk coach depot reducing future 
pension costs and risks ﬂ eet rationalisation to improve 
capital efﬁ ciency and signiﬁ cant headcount reductions 
across the group
intangible asset amortisation was £517 million 201 1 
£508m and relates principally to the value of the group’s 
concessions in spain and contracts in north america
group statutory proﬁ t after tax was £613 million 201 1 
£1026m diluted earnings per share were 1 17 pence 
201 1 198p
cash management
cash generation is core to the strategy at national express 
representing a key driver of shareholder value alongside the 
maximising of returns on capital employed this year the 
group increased operating cash generation by £50 million 
and operating cash ﬂ ow for 2012 was £2096 million 
201 1 £1598m as set out below representing a 99 
conversion rate 201 1 71
2012 
£m
201 1 
£m
normalised operating proﬁ t 2119 2252
depreciation 1098 1055
grant amortisation proﬁ t on 
disposal and sharebased payments 05 24
ebitda 3212 333 1
net replacement capital expenditure 1086 1 102
working capital movement 67 525
pension contributions above normal 
charge 97 106
operating cash ﬂ ow 2096 1598
2011
operating
 proﬁt
fx
rebase
operating proﬁt
concession 
rebate removal
masynergy
incremental
organic growth
fuel
managing
cost efﬁciency
inﬂation
other
2012
operating
proﬁt
£182m
£5m £22m
£155m
£11m
£21m
£34m
£10m £29m
£3m
£185m
overview 
21 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  working capital movement improved yearonyear  
by £592 million through improving receivables management 
in the contract businesses and including a €22 million 
reduction in receivables with spanish municipalities  
we continued to invest in the ﬂeet with replacement  
capital expenditure in line with depreciation the group  
is well invested in its ﬂeet and the average age has  
remained unchanged at six years
2012  
£m
201 1  
£m
operating cash ﬂow 2096 1598
payments to associates  
and minorities 82 84
net interest 473 446
taxation 133 84
free cash ﬂow 1408 984
uk rail franchise exit 870 58
cash ﬂow after  
rail handover 538 926
free cash ﬂow prior to rail franchise handover similarly grew 
by £424 million and reached £1408 million 201 1 £984m 
during the year we paid the last instalment of £9 million 
to close out our eurostar associate investment cash tax 
payments increased marginally due to timing differences 
in spain related to government austerity measures during 
the year the group paid out £87 0 million in rail franchise exit 
cash for the nxea franchise £800m and a ﬁnal residual 
payment for east coast £7 0m 
2012  
£m
201 1  
£m
free cash ﬂow 538 926
net growth capital expenditure 168 356
financial investments and shares 08 27
exceptional cash ﬂow 407 82
acquisitions and disposals 1578 7 6
cash ﬂow on the maturity of foreign 
exchange contracts 89 128
foreign exchange and other  
noncash movements 82 32
dividends 493 458
net funds ﬂow 1945 233
growth capital investment predominantly expenditure on 
school buses in north america has reduced with a greater 
focus on winning lower capital conversion contracts 
acquisition costs of £157 8 million related primarily to the 
petermann school bus business which completed in may 
other smaller acquisitions included the purchase of two 
businesses to complete our platform for growth in us  
transit operations the dividend grew in line with the 
increases in the 201 1 ﬁnal payment and the interim  
dividend paid in september
group net debt at 31 december 2012 was £8282 million 
201 1 £6337m 
capital returns
the group’s objective is to maximise long term shareholder 
returns through the disciplined deployment of the funds at 
its disposal our portfolio of assets has a mix of attributes 
that produce stable proﬁtability organic growth and exciting 
strategic opportunities in 2012 we selectively invested in the 
asset intensive uk bus spain and school bus businesses 
driving growth and concession renewal the main 
opportunities in the future in current and new markets  
are predominantly ‘capitallight’ including us transit 
german coach and german rail
we use pretax return on capital employed roce as a key 
performance indicator in the delivery of strategic investment 
internal capital allocation decisions are made with a 12 
pretax return on capital hurdle rate based on exceeding the 
estimated posttax weighted average cost of capital of 8
in 2012 group pretax roce was 122 201 1 14 1  
the change has been signiﬁcantly inﬂuenced by the 
handover of the nxea rail franchise which had a sizeable 
negative capital employed the group’s nonrail roce  
was stable at 106 in 2012
treasury management
funding sources
the group has a strong funding platform that underpins 
the delivery of its strategy its sources of ﬁnance have an 
attractive mix of long term public and private market debt 
ﬁxed term ﬁnance leases and a bank facility that remains 
substantially undrawn providing signiﬁcant committed 
headroom and liquidity for the group to fund its operations 
and growth requirements at 31 december 2012 headroom 
including cash was almost £500 million
national express has substantial long term nonbank  
debt comprising of two sterling denominated bonds  
a 2017dated £350 million bond at 625 and a 2020dated 
£225 million bond at 6625 both bonds are investment 
grade rated at bbb with fitch stable outlook and baa3 
from moodys who recently upgraded its outlook  
to positive during the year the group also completed  
a private placement note purchase agreement for €785 
million at 455 due in 2021 the group has ﬁnance leases 
of 207 million that provide low cost ﬁnancing to purchase 
vehicles primarily in north america 
the group had at 31 december 2012 drawn £81 million 
of the £500 million unsecured committed revolving credit 
facility arranged with a broad multinational banking group 
the facility itself is due to be reﬁnanced by august 2014
business review
finance directors review continued
22 national express group plc annual report and accounts 2012  covenant compliance
the group has a prudent approach to covenant compliance 
on its banking debt which is to maintain its debt gearing 
ratio at between 20 and 25 times ebitda at 31 december 
2012 its covenant ratios were as follows
 debt gearing ratio net debt to ebitda 25 times  
201 1 19 times covenant not to exceed 35 times
 interest cover ebitda to net interest 67 times  
201 1 7 2 times covenant not to be less than 35 times
interest rate and currency hedging
the group hedges its exposure to interest rate movements 
to maintain a balance between ﬁxed and ﬂoating interest 
rates on borrowings to achieve the desired ﬁxed to ﬂoating 
ratio the group has entered into a series of interest rate 
swaps that have the effect of converting ﬁxed rates into 
ﬂoating rate debt the net effect of these transactions  
was that at 31 december 2012 the proportion of group  
net debt at ﬁxed rates was 63 201 1 84
the group’s material exposure to foreign exchange is limited 
to translation of its earnings and assets as its overseas 
activities are naturally hedged by earning revenue and 
incurring costs in local currencies in order to hedge its 
exposure to currency ﬂuctuations with regards to its banking 
covenants the group held debt in euros €215 million and 
us dollars 207 million at 31 december 2012 this can 
include the use of foreign exchange contracts to create 
synthetic debt positions 
fuel risk management
the group consumes approximately 230 million litres of 
fuel each year for which it is at risk ie there is no direct fuel 
escalator in the contract or concession price mostly of ultra 
low sulphur diesel and gasoline which represented a total 
cost including delivery and taxes to the group in 2012 of 
£163 million 9 of group revenue at an average fuel cost 
of 43 pence per litre the group has adopted a forward fuel 
buying policy in order to secure a degree of certainty in its 
planning the board’s policy is to hedge fully a minimum 
of 15 months’ demand across all exposed businesses 
together with at least 50 of the next nine months’ 
consumption in contract businesses based on expected 
hedgable consumption a proportion of this is ﬁxed for the 
future currently the group is 100 ﬁxed for 2013 at an 
average price of 49 pencelitre excluding delivery and tax 
100 ﬁxed for 2014 at an average price of 50p and 10 
ﬁxed for 2015 at 49p
where businesses have freedom to price services this 
hedge provides sufﬁcient protection to recover fuel price 
increases through the fare basket in contract businesses 
where price escalation may be restricted by a formula 
independent of fuel costs extended cover up to the life of 
the contract may be taken subject to availability and liquidity 
in the hedging market the latter is rarely available beyond 
three years from the trading date
pensions
the group’s principal deﬁned beneﬁt pension schemes are 
all in the uk at 31 december 2012 these schemes had a 
combined deﬁcit under ias19 of £193 million an increase 
from a deﬁcit of £18 million at 31 december 201 1 due to 
lower asset return and liability discount rates the national 
express group staff pension plan uk coach plan is now 
closed to all future accrual a funding plan aimed at bringing 
the plan to self sufﬁciency over a six year period was agreed 
in 2010 national express contributes £42 million per 
annum to this scheme in 201 1 uk bus agreed a £55 million 
annual deﬁcit repayment plan with the trustees of the west 
midlands passenger transport authority pension fund  
wm plan to fund a £71 million scheme funding deﬁcit  
the plan remains open to accrual for existing active 
members only this scheme was further derisked during 
the year by securing future payments for existing pensioners 
in a £272 million insurance buyin to the scheme 
the ias19 valuations by division at 31 december 2012  
were as follows
 uk bus under the wm plan and the tayside  
transport superannuation fund £329 million deﬁcit 
201 1 £168m deﬁcit
 uk coach plan £166 million surplus  
201 1 £186m surplus
 uk rail £18 million deﬁcit 201 1 £22m deﬁcit  
the group’s rail business participates in the railways 
pension scheme this exposure transfers to an incoming 
operator in the event of a franchise termination  
as happened on the east anglia franchise
2013 will see the introduction of updated provisions under 
ias19 the overall increase in pension costs charged to the 
income statement is expected to be £2 million no cash 
change is involved in this accounting change
jez maiden
group finance director 
28 february 2013
overview 
23 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  kpis – measuring our progress 
business review
spain
resilient to austerity pressures
revenue for alsa in 2012 was £5350 million 201 1 £551 1m and normalised operating proﬁt £838 million 
201 1 £90 1m in local currency revenue was €659 1 million 201 1 €6354m and normalised operating proﬁt 
was €1033 million 201 1 €1039m
javier carbajo
chief executive alsa
why we measure
each national express division is targeting 
revenue growth as a core driver of value
2012 performance
underlying revenue growth in urban spain 
and morocco and new contracts and 
acquisitions such as bilbao have offset a 
decrease in underlying intercity revenue
 local currency
revenue growth
4

why we measure
normalised operating margin reﬂects 
operational efﬁciencies and cost control
2012 performance
flexibility in matching supply to demand 
protected divisional margins
margin
15 7

why we measure
passenger journeys are reﬂective  
of underlying demand for bus and  
coach travel national express is  
targeting increased passenger  
ridership as a long term driver  
of sustainable value
2012 performance
increase in total journeys from  
underlying growth in morocco  
plus new bilbao operations
passenger journeys
2423
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24 national express group plc annual report and accounts 2012  results
alsa’s performance was resilient in the face of a difﬁcult 
year growing revenue by 4 and holding proﬁt almost  
ﬂat at €1033 million set against the background of 
economic uncertainty and austerity measures in spain  
this highlights the quality of the division’s management  
and its mix of businesses 
total revenue at alsa grew by 4 in local currency a 3 
decrease in sterling terms to €659 1 million 201 1 €6354m 
the growth was generated by a strong performance in the 
urban bus business in spain and morocco whilst a decline 
in the intercity coach business was offset by new wins and 
acquisitions revenue in the noncore auxiliary operations 
declined by 15 in line with the wider economic situation 
but remains proﬁtable
operating proﬁt in local currency was €1033 million  
201 1 €1039m with the improved revenue and lower  
costs offsetting a €9 million impact from fuel a weaker  
euro reduced sterling proﬁt by 7 £6 million to  
£838 million 201 1 £90 1m the operating margin  
remains bestinclass for a bus and coach operation
why we measure
mileage is a both a key cost management 
tool and also an indicator of organic growth 
the alsa model allows for ﬂexibility in 
kilometres operated to match demand
2012 performance
total mileage increased as a result of new 
business such as in pamplona and bilbao 
underlying intercity mileage decreased 4 
and urban spain by 3
mileage
2926
km
why we measure
with a regulated maximum fare this 
measures the effectiveness of our fares 
strategy as we ﬂex mileage to meet demand
2012 performance
an increase delivered by cuts in underlying 
mileage and price increases of 2 in 
intercity and 3 in urban
why we measure
safety is a key national express value  
with a groupwide objective of reducing 
injuries to employees and making our 
customers feel secure this will support 
sustainable revenue growth and save  
costs maintenance insurance claims 
2012 performance
a 41 reduction as a result of  
major investment in the safety  
improvement programme
revenue per km
€1 84
lost time injuries per 1000 fte
23 1
cash generation was very strong increasing by €73 million 
yearonyear to €125 million much of this was from improved 
working capital mainly in cash collection from municipalities 
total revenue in the intercity coach business was ﬂat 
underlying revenue fell 2 reﬂecting lower passenger 
volumes in the third quarter as lower discretionary 
expenditure reduced summer travel a trend which has 
been maintained since a concession was secured serving 
routes around pamplona by contrast underlying urban 
bus revenue in spain grew by 4 and 21 overall with the 
acquisition of a major contract in bilbao whilst underlying 
bus revenue in morocco grew by 19 beneﬁtting from a 
new contract and network review
“ these results highlight the quality  
of the division’s management  
and its mix of businesses”
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overview 
25 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  market overview 
operational excellence
given the challenging economic backdrop and increased 
fuel costs alsa responded by carefully matching mileage 
operated to customer demand reducing overhead costs 
identifying new opportunities and delivering a quality service 
to maximise contract bonus potential
alsa’s ability to manage supply to meet ﬂ uctuating demand 
on a daily basis by adding or removing services in real time 
protected margins in the intercity business in particular 
where underlying mileage was reduced to match demand 
in urban bus in spain we reduced marginal services to 
accommodate customer budgetary requests in return 
future investment requirements have been reviewed and 
deferred improvements introduced by the government in 
labour ﬂ exibility have helped to restrain wages and efﬁ ciency 
beneﬁ ts have been achieved
major improvements have been made in safety during 
the year and lost time injuries in spain improved by 41 
signiﬁ cant progress has also been made in morocco
growth
growth opportunities are high on the agenda the urban 
business in morocco increased patronage by 15 securing 
a new contract and completing a highly effective network 
review in agadir over time we anticipate that further cities 
in both spain and morocco will look to outsource bus 
transportation and there will be opportunities as some 
competitors are unable to continue to fund services and 
capital requirements 
during the year we renewed the contract to operate 
granada bus station as well as competitively winning the 
guadalajara urban tender we obtained a ﬁ ve year extension 
to the marrakech bus contract we also acquired at low 
cost some bolton investments that are expected to 
add value over time such as a contract in bilbao
market composition
alsa has the leading position in a highly fragmented market
market trends
slight decline in bus and coach market passenger volumes since 
mid 2012 reﬂ ecting resilience in public transport trends compared 
to other modes of transport and wider austerity impact in spain 
passenger growth in morocco
market features
regulated and highly segmented market with three levels of 
government regulation national long distance coach regional 
regional coach and city urban bus each concession is exclusive 
to the operator based on compliance with the public service 
obligation flexibility required to meet changing demand
customers
urban all ages work and study multiple trips per week
intercity mostly young people few trips per year for leisure 
visiting family on regional services also work and study
competition
intercity competition from statebacked rail and low cost airlines 
cutting capacity in 2013 bus and coach concessions are awarded 
through competitive public tender typically every ten years
market size 
€35bn
regulated bus and intercity coach market
group revenue by market
 intercity coach concessions
 urban bus contracts
 other concessions
concessions
17 2
alsa has 141 intercity coach concessions 31 urban bus 
contracts and one other concession
business review
spain continued
labour
historically less ﬂ exible labour market reﬂ ecting domestic practices 
unionised austerity measures driving some reform
growth
new business growth from concession renewal urban contract 
wins in spain and morocco 
alsa revenue split
 passenger
 contract
 subsidy
 other
26 national express group plc annual report and accounts 2012  cash generation
in june we received €25 million through a central 
government scheme to clear overdue local authority debt 
in addition we have continued to maintain tight control over 
working capital total receivables at the year end were 
€35 million against a peak of €64 million in the ﬁ rst quarter 
and overdue amounts are now only €8 million against 
€21m at the end of 201 1 
future prospects
the bus and coach market in spain continues to be 
fundamentally attractive provision of public transport is a key 
social commitment by the government and a combination 
of alsa’s high level of investment in ﬂ eet and technology 
its reputation for quality of operations and its ﬁ nancial 
strength make it a bestinclass participant in that market
the government’s national intercity coach concession 
tendering process has also recently restarted after a delay 
of 12 months alsa will submit strong and competitive bids 
in order to retain our franchises the ﬁ rst tender has now 
been submitted and the result is likely to be announced in 
the coming months we expect the government to continue 
to adjust the national coach tendering process including the 
likely introduction of a fee equal to one percent of revenue on 
new concession awards as part of a proposed change 
to transport legislation
the spanish government is also considering further market 
liberalisation such as opening the market for rail passenger 
transportation or replacing lossmaking regional rail 
operations with coach services our reputation and record 
as spain’s highest quality road transport provider would put 
alsa in a good position to capitalise on any opportunities
we expect that the trends from the second half of 2012 will 
continue for the ﬁ rst six months of 2013 with lower intercity 
revenue but resilient urban revenue and growth in morocco 
further opportunities in spain and beyond will continue to 
develop to enhance alsa’s earnings
strategic focus
our key objective over the next two years is to renew the 
intercity concessions due for retendering in the intercity 
coach and urban bus operations will adjust supply to reﬂ ect 
recent market trends in order to protect proﬁ tability and 
improve return on capital by winning contracts in spain 
and morocco we can continue to deliver good growth 
whilst developing exciting opportunities in new territories
living our values
 safety
driving out harm is a ﬁ veyear groupwide safety improvement programme 
that is intended to deliver a 50 improvement in our safety performance by 2016 
each of our businesses has annual targets and the aim is to make our safety 
record the best in the transport sector
one of the key measures of performance is to cut the number of preventable 
vehicle accidents for which we are responsible progress last year in alsa saw 
the numbers of such accidents fall by 203 compared to 201 1 to 126 per million 
miles this means that during its ﬁ rst two years driving out harm has helped 
alsa reduce its accidents by 326
delivering improvements on the scale we are seeking requires changes in 
behaviour alsa for example has introduced scheduled safety brieﬁ ngs for 
drivers in its spanish and moroccan operations together with thorough driver 
competence assessments these involve managers travelling with each of the 
drivers for whom they are responsible observing and assessing their driving 
behaviour according to such criteria as speed proﬁ les anticipation and 
emotional control
feedback sessions inform the drivers of their strengths and where they need 
to make improvements 
in addition new maintenance and engineering staff assessments have led to 
improvements in compliance with safety instructions when working on vehicles
reviewing alsa’s initiatives the safety consultancy company arthur d little 
recently praised the good progress that is being made
overview 
27 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  beneﬁtting from greater scale 
revenue in 2012 was £5783 million 201 1 £4810m and normalised operating proﬁt was £59 1 million  
201 1 £47 9m in local currency revenue was 9194 million 201 1 7722m and normalised  
operating proﬁt was 940 million 201 1 769m
david duke
ceo national express corporation
business review
north america
kpis – measuring our progress 
why we measure
each national express division is targeting 
revenue growth as a core driver of value
2012 performance
underlying revenue growth of 3 was 
supplemented by the acquisition of 
petermann and the start up of the  
transit operations
 local currency
revenue growth
19

why we measure
normalised operating margin reﬂects 
operational efﬁciencies and cost control
2012 performance
we delivered robust underlying school 
bus margins executed the petermann 
transaction well and added good ﬁrstyear 
transit proﬁts
margin
102

why we measure
school bus operations have low asset 
utilisation compared to other bus and coach 
businesses our strategy is now focused on 
improvement in operating returns
2012 performance
we maintained a solid margin and continued 
to rationalise the ﬂeet selling 1600 buses
return on net tangible assets
17  7

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28 national express group plc annual report and accounts 2012  results
2012 has been a particularly good year for our operations 
in north america we have delivered underlying revenue 
growth participated in a successful bid season acquired 
and integrated the petermann school bus business and 
set up and developed our fastgrowing transit operations 
outperforming our competitors 
pricing levels in both contract renewals and new bid wins 
improved our retention rate was again high at 97 
reﬂecting a positive relationship with our customers and 
our increasing investment in account management with a 
school bus ﬂeet of over 20000 buses we have consolidated 
our bestinclass margin position
total revenue in north america in 2012 increased by 19 
to 9194 million 201 1 7722m underlying school bus 
revenue grew by 3 driven by a combination of price 
increases further progress in developing charter revenues 
and the annualised effect of the previous successful  
bid seasons
2012 operating proﬁt grew by over 17 million to 940 million 
201 1 769m we successfully responded to increased 
fuel costs higher labour rates and some reductions in 
discretionary revenue by adjusting routes and reducing 
overhead costs our newly established transit operation  
also generated a proﬁt as part of the overall divisional result
the integration of petermann has gone well we have 
achieved inyear synergies of 7 million representing back 
ofﬁce 4m insurance 2m and procurement 1m 
savings this represents annualised synergies of 10 million 
we are particularly pleased that we have retained all of the 
petermann customers with further beneﬁts to come from  
an expanded footprint that now includes ohio and 
minnesota as well as good paratransit contracts we are 
delighted by how quickly we have achieved and exceeded 
our goals from the transaction
operational excellence
our team in north america has made progress in driving 
efﬁciencies across the business our compass project links 
the oracle enterprise system to the gps locators recently 
installed on the vehicles bringing a greater degree of 
management control over ﬂeet operations in particular  
in matching payroll to customer billing by the end of 2012  
the system was live in 85 locations and has had a 
demonstrable effect when compared to noncompass 
depots on the 8000 routes audited so far 2000 schedules 
have been adjusted delivering an average of 800 hours a  
day in stafﬁng efﬁciency
why we measure
route buses are the revenue generating 
assets of school bus operations 
2012 performance
we won over 800 buses on a net basis  
in the contract bidding season as well  
as adding the petermann ﬂeet
route buses operated own fleet
17 87 0
why we measure
as a contracting business retention rate is a 
key measure of success in retaining contracts
2012 performance
97 is another excellent performance  
and above the target retention level
retention rate
97

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total injuries per 200000 hours
502
why we measure
safety is a key national express value  
with a groupwide objective of reducing 
injuries to employees and making our 
customers feel secure this will support 
sustainable revenue growth and save costs 
maintenance insurance claims
2012 performance
total injuries per 200000 hours  
decreased by 29
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overview 
29 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  business review
north america continued
market overview 
improved efﬁciency and ﬂeet utilisation saw return on net 
tangible assets in 2012 improve to 17 7 201 1 16 1  
fleet rationalisation and cascading of spare buses  
saved 28 million from our projected capital expenditure 
requirement and reduced the ﬂeet spare ratio to 1 17 
for the existing business we are now consolidating the 
petermann ﬂeet to achieve further savings
maintenance efﬁciency and procurement of spare parts  
are major areas of cost that we have targeted to improve  
in preparation during 2012 the existing bus ﬂeet was 
migrated onto a new asset management system we will  
use this tool to improve our standard operating procedures 
such as the way we schedule vehicle maintenance claim 
against warranties and improve our parts holding systems 
we continue to focus on safety our enhanced safety 
programme saw vehicle collision frequency decrease by 
10 during the year and a reduction in injuries by 29  
we are investing heavily in improving performance 
management processes and support for our ﬁeld  
managers at over 200 locations
market size 
24bn
total school bus market in north america represented  
by 531000 route buses
32 is outsourced 68 inhouse 
 outsourced
 inhouse
market share
1 1 of outsourced school bus market
 national express group
 others
national express operates 17 870 regular routes
north america revenue split
 
 passenger 
 contract 
 subsidy 
 other
market composition
top four players operate aproximately 90000 routes
40 companies operate 200 buses rest of outsourced market split 
between 4000 operators
market trends
growth traditionally inﬂation and population driven recent increase  
in outsource conversion due to public funding pressures
market features
local relationship and service delivery important
customers
local school boards funded largely by local property taxation
transport is a signiﬁcant part of local education spending
competition
bigger players have access to capital geographical reach  
and some scale advantages
potential for some market consolidation
labour
traditionally part time workforce
over 30 of national express staff unionised
growth
winning contracts in the school bidding season primarily  
through outsourcingconversion as well as market share shift  
new transit business has a pipeline of contracts being targeted
30 national express group plc annual report and accounts 2012  growth
in delivering organic growth the 2012 bidding season was 
again a successful one over 1300 buses were secured in 
contract wins and we retained 97 of our existing contract 
base conversion outsourcing contracts offer long term 
customer relationships and can deliver a better return 
on capital invested this year we won eight conversion 
contracts with 400 buses net of contract losses our overall 
organic volume growth was 800 buses for the 201213 
school year in charter revenue grew by 9 in our existing 
business we are now seeking to grow petermann’s 
charter share using the sales platform developed in 
the existing businesses 
within less than a year of acquisition the transit operation 
achieved annualised revenue of 65 million in its three core 
subsectors paratransit shuttle and ﬁ xed route contracts 
our platform is based on existing paratransit contracts in the 
petermann business as well as two other small acquisitions 
completed in 2012 since integrating these businesses 
we have won two further contracts in ohio and north 
carolina and our pipeline over the medium term has 
signiﬁ cant potential
cash generation
generating cash in this capital intensive market is closely 
aligned with optimising the return on that capital we have 
made further progress in generating cash in north america 
building on the improvement of 201 1 with operating cash 
conversion reaching 68 in 2012 up from 39 in 201 1 
this beneﬁ tted from our improvements in ﬂ eet efﬁ ciency 
and capital deployment
future prospects
in north america we will seek to sustain the progress 
made following the successful integration of petermann 
to deliver further cost efﬁ ciencies and careful capital 
deployment to drive greater returns and cash generation 
and to secure a favourable win rate on our pipeline 
of transit contracts we will focus on conversion 
opportunities in school bus working in prooutsourcing 
states and optimising our contracts
strategic focus
we have the following priorities in 2013 ﬁ rstly to continue our 
investment in safety and employee management secondly 
to develop a tailored account management structure so that 
our top class customer service is properly recognised and 
thirdly to drive efﬁ ciencies out of the compass technology 
and our maintenance programme
“ 2012 has been a 
particularly good year 
for our operations 
in north america”
living our values
 people
our school bus operation in north america is a disparate business with 22000 
employees working from more than 250 locations 
enjoy the ride is an overarching employee relations programme part of the 
purpose of which is to help unify widely separated colleagues but it is also 
intended to improve morale and staff retention as well as creating a sense 
of enjoyment about working for the company
enjoy the ride brings together several separate initiatives each linking to one 
of national express’ four key values safety people customer and community
under the heading of people for example smart ride provides employees with 
the opportunity to improve their skills some are studying for undergraduate 
degrees others taking language courses to allow them to communicate more 
easily with their child passengers or the children’s parents
healthy ride events include the 10000 step challenge which encourages 
employees to walk 10000 steps a day around three miles – for which 
pedometers have been provided the school bus slim down is a teambased 
weight loss competition run in march with prizes that include paid gym memberships 
in 2012 employees collectively lost over 8600 lbs almost four tonnes 
and for some people this event has proved to be a lifechanging experience
communitybased programmes under the heading share the ride have been 
particularly successful one of these adoptaschool has been taken up by 
98 of our facilities across north america and has seen employees reading with 
children landscaping schools and taking part in school events throughout the year
overview 
31 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  revenue and margin  
growth continues
revenue in 2012 was £2690 million 201 1 £2635m and normalised operating proﬁt  
£34 1 million 201 1 £327m 
peter coates
managing director uk bus
kpis – measuring our progress 
business review
uk bus
why we measure
each national express division is targeting 
revenue growth as a core driver of value
2012 performance
overall revenue growth of 2 as an 
increase in commercial income of 3  
was offset by a 1 decrease in 
concessionary revenue
revenue growth
22

why we measure
normalised operating margin reﬂects 
operational efﬁciencies and cost control
2012 performance
an increase of 30 basis points in margin 
provided by strong revenue growth and  
tight cost control
margin
12 7

why we measure
yield per passenger measures value 
generated by each passenger journey  
on our network
2012 performance
fare increases at the beginning of the year 
resulted in a net yield increase of over 3
passenger yield revenue per journey
£094
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32 national express group plc annual report and accounts 2012  results
the uk bus division performed well in 2012 combining 
revenue growth and cost reduction initiatives to deliver an 
increase in proﬁt despite a reduction in the bus service 
operators’ grant bsog fuel duty rebate by the uk 
government our strategy of ﬂeet investment encouraging 
increased patronage and improvements in cost efﬁciency  
will support sustainable revenue growth and move us closer 
to bestinclass operating margin
total uk bus revenue grew by over 2 to £2690 million 
201 1 £2635m commercial revenue increased 3 
supported by fare yield and a growth in college and 
corporate travelcard sales network reviews and ﬂeet 
improvements led to local growth in passenger demand 
with likeforlike volume slightly higher yearonyear 
concession income fell 1 but will see future inﬂation 
protection under a new agreement through to 2015
operating proﬁt continued to improve growing by over 
4 to £34 1 million 201 1 £327m operating margin 
increased by 30 basis points to 127 solid commercial 
revenue growth was supported by £9 million of cost and 
procurement efﬁciencies together these more than offset 
the impact of a £4 million reduction in bsog which was 
absorbed without a speciﬁc fare increase
why we measure
passenger journeys are reﬂective of 
underlying demand for bus travel national 
express is targeting increased passenger 
ridership as a long term driver of  
sustainable value
2012 performance
overall decrease in passengers primarily 
driven by senior citizens and mileage 
reductions good passenger growth 
following network reviews
passenger journeys
271 6
m
why we measure
mileage is both a key cost management tool 
and also an indicator of organic growth
2012 performance
a 1 decrease as a consequence of 
removing unproﬁtable frequencies and  
parts of the network
why we measure
safety is a key national express value with a 
groupwide objective of reducing injuries to 
employees and making our customers feel 
secure this will support sustainable revenue 
growth and save costs maintenance 
insurance claims
2012 performance
the ﬁrst full year of driving out harm has 
reduced long term injuries by 45
mileage
692
m
lost time injuries per 1000 fte
228
operational excellence
our priority in uk bus is to continue delivering consistent 
high quality customer service in 2012 we improved the 
frequency and quality of bus services increased cost 
efﬁciency and invested in technology on our bus ﬂeet
our focus on service quality was recognised in an 
improvement in customer satisfaction of four percentage 
points measured by the passenger focus bus passenger 
survey across the network investment in ﬂeet cleaning 
and presentation accompanied by an industryleading 
antisocial behaviour reduction programme and enhanced 
revenue protection helped customers feel safer and saw  
a reduction in recorded crime 
we worked closely with centro our local integrated 
transport authority to manage a major rerouting of buses 
as part of tram extension works in birmingham city centre 
without material impact on passenger volumes
investment in technology is generating both operational 
efﬁciencies and passenger beneﬁts in october we opened 
our new control centre utilising automatic vehicle location  
to monitor and direct buses in service improving punctuality 
by up to 7 in december nine of our depots now have 
‘green’ technology utilising photovoltaic electric cells  
to reduce power consumption and winning a gold  
carbon saver award 
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overview 
33 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  business review
uk bus continued
procurement savings were delivered in vehicle parts and 
lean engineering continues to be implemented across our 
bus operations onboard telemetry and monitoring of 
driving style is improving vehicle efﬁciency we have reached 
a driver wage agreement based on a 25 annual increase 
for the next two years
growth
commercial revenue growth of 3 beneﬁtted from a new 
programme which delivered a 50 increase in corporate 
and student travelcard sales the latter tapping strong local 
growth in college enrolment we also continue to innovate 
with our fares strategy encouraging differentiation and 
segmentation in the market the £1 inner city hop proved 
particularly popular alongside family and unlimited  
evening travel products
we are piloting the extension of smart cards from 
concession travellers to commercial passengers in dundee 
along with mobile internet and smartphone applications  
this is expected to stimulate patronage growth through  
more ﬂexible ticket offers
network reviews in coventry and sandwell improved  
service frequency and ensured customers were better 
served resulting in passenger numbers locally increasing by 
4 by the end of 2012 this built on sustained improvements 
from previous reviews in wolverhampton walsall and  
east birmingham which have delivered growth rates  
of 2 to 5 
market size 
£48bn
uk excluding london
97 is privatised
 privatised
 nonprivatised
market share
1660 buses operated in the ﬂeet
focused on the west midlands and dundee markets
market composition
largest ﬁve operators represent around 70 of the uk market
remainder made up of a large number of private operators
market trends
short term economic pressures from austerity and local 
unemployment
longer term economic regeneration and environmentallydriven  
public transport growth opportunities over the car
market features
primarily deregulated market vehicleregulatory oversight
low barriers to entry – ﬂexibility and scale of operations is key
customers
over 90 of west midlands network is commercial remainder mostly 
public service tenders
around 75 of revenue from passengers balance concessionary
 passenger fares
 concessions
competition
active competition from national and local operators as well  
as private car
labour
primarily unionised with strong industrial relations
growth
growth strategy is focused on increasing passenger volumes  
through investment in vehicles and technology as well as  
delivering high quality services 
uk bus revenue split
 passenger 
 contract 
 subsidy 
 other
market overview 
34 national express group plc annual report and accounts 2012  “ our priority in uk bus 
is to continue delivering 
consistent high quality 
customer service”
our investment in new vehicles saw 130 buses purchased 
for the network in 2012 with deployment focused on high 
volume high frequency corridors these have proved popular 
with passengers our average ﬂ eet age has decreased 
to less than nine years
building on our close working relationship with centro 
we are supporting enhancement of the integrated public 
transport system in the west midlands this partnership 
delivers modern environmentallyfriendly bus services 
from national express and investment in bus infrastructure 
and customer information from centro the threeyear 
agreement on concessions which protects funding for 
senior citizens and students is part of this partnership 
during the year we also agreed an extension to our 
operations on the midland metro tram system until 2018
cash generation
operating cash conversion was 61 in 2012 reﬂ ecting 
capital expenditure of £30 million more than twice 
depreciation annual investment in ﬂ eet is expected 
to continue at around £25 million delivering ﬂ eet 
upgrades and modernisation which in turn should 
lead to increased patronage
future prospects
the bus market continues to be attractive national express 
is the market leader in the uk’s biggest deregulated bus 
region where 90 of the population live within 250 metres 
of a bus stop 2013 will see national express continue to 
build on the progress made over the past three years we 
will build passenger volume growth we will continue to 
invest with over 100 buses to be introduced in 2013 as well 
as improve ﬂ eet turnout and punctuality the roll out of new 
technology will continue with smart cards and realtime 
passenger information delivered at bus stops and via mobile 
applications increased fuel costs will present a headwind 
but cost efﬁ ciency gains will help to mitigate this cash 
generation will improve this will continue to be a business 
that generates a strong return on capital for the group
strategic focus
we believe that we can grow revenue and passenger 
volumes in particular by getting the essential ‘hygiene 
factors’ right this means providing a reliable and ontime 
service with a well invested ﬂ eet we want to explore how 
technology is able to help us to do this through smart cards 
passenger information systems or mobile apps
 
community
national express is committed to improving the social and economic conditions 
of the local communities in which it operates 
this includes providing good quality jobs
we are already birmingham’s largest private sector employer – by some way 
– employing around 6000 people across the west midlands our digbeth 
headquarters are in the parliamentary constituency of ladywood which has 
the highest jobless beneﬁ t claimant count in the country yet it is home to 
1000 national express staff
in april we launched a new jobs initiative – routes to work – which commits 
us to providing 1700 new job opportunities in the bus business over three years 
by the end of 2012 we had already taken on 650 new people
as part of the programme we are working with local job centres to provide 
preinterview training for candidates who might need a conﬁ dence boost after 
a period of unemployment new entrants are helped to achieve nvqs in literacy 
and numeracy as well as all the training they need to obtain the driver certiﬁ cate 
of professional competence – which is now required by all professional bus and 
coach drivers this is a highly transferable qualiﬁ cation
many of the jobs under routes to work are as bus drivers replacing workers 
as they retire but at least 120 are completely new jobs we have for example 
doubled the size of our revenue protection team in the west midlands and have 
installed – and staffed – the largest gps tracking system in the country which 
will help to improve the service we provide our communities
living our values
overview 
35 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  returning to growth after 
subsidy challenge
revenue in 2012 was £255 1 million 201 1 £259 1m and normalised operating proﬁt  
£206 million 201 1 £349m
tom stables
managing director uk coach
kpis – measuring our progress 
business review
uk coach
why we measure
each national express division is targeting 
revenue growth as a core driver of value
2012 performance
total revenue decreased over the year as 
concession income was cut underlying 
revenue increased by over 2
revenue growth
2

why we measure
normalised operating margin reﬂects 
operational efﬁciencies and cost control
2012 performance
the drop in margin from the withdrawal  
of the concessionary income reﬂects a 
lower but sustainable level of proﬁtability 
which is not dependent on material 
government support 
margin
8 1

why we measure
passenger journeys are reﬂective of 
underlying demand for coach travel  
national express is targeting increased 
passenger ridership as a long term driver  
of sustainable value
2012 performance
as with revenue concessionary journeys 
decreased by over 30 offset by growth  
in the core business
 express network including concessionary journeys
passenger journeys
165
m
0
1
2
3
4
5
6
10 11 12
0
3
6
9
12
15
10 11 12
0
5
10
15
20
10 11 12
36 national express group plc annual report and accounts 2012  why we measure
mileage is both a key cost management tool 
and also an indicator of organic growth
2012 performance
mileage increased during the year as we 
invested in new routes and services to 
support revenue growth
why we measure
as a mainly discretionary form of transport 
uk coach is focused on delivering the 
highest levels of customer service
2012 performance
we have worked particularly hard to improve 
the quality of the service over the last two 
years reﬂected in a high overall result that 
has been sustained 
mileage
850
m
customer satisfaction 
84

results
2012 was a difﬁcult year for the uk coach division with the 
withdrawal of the government’s £16 million senior citizen 
concession scheme one million fewer concession journeys 
were made although we took action to grow commercial 
nonconcession revenue this was insufﬁcient to deliver  
a material mitigation of the loss of subsidy
uk coach revenue decreased to £255 1 million in 2012 
a 2 decline from £259 1 million within this the express 
coach business declined 7 driven by a 40 decline in 
revenue from our over60 customers apart from these 
concession passengers commercial revenue in the  
express business grew by 2 with increased volumes 
across each of our market segments alongside good 
growth in the kings ferry and eurolines operations
operating proﬁt fell £143 million to £206 million 201 1 
£349m and operating margin was 8 1 reﬂecting the loss 
of the concession subsidy an increase in fuel costs and 
additional mileage operated for new routes were offset by 
commercial passenger growth and good olympic contract 
volume at the kings ferry
operational excellence
operational excellence initiatives focused on improving 
customer service cost reduction and network efﬁciency  
in 2012 we increased our customer recommendation rate  
to 96 service improvements included using technology  
to improve driving behaviour and keep our customers 
informed we now track 100 of our coaches informing 
both travellers and customerfacing staff of changes to arrival 
and departure times as well as providing live telemetry to our 
control centre of vehicle operation data we also introduced 
over 100 new coaches to the network over half the ﬂeet 
is less than two years old our investment in employees 
through the ‘driving out harm’ safety programme saw  
a 63 improvement in employee injury rates 
in response to the signiﬁcant loss of concession revenue 
after the government subsidy withdrawal we identiﬁed 
opportunities to reduce structural costs in december we 
announced the closure of our crawley ownoperated depot 
saving £05 million per annum we also made overhead 
cost savings through headcount reduction during the year 
increasing use of the website to drive sales up to 55  
from 50 in 201 1 has reduced distribution costs 
lost time injuries per 1000 fte 
132
why we measure
safety is a key national express value  
with a groupwide objective of reducing 
injuries to employees and making our 
customers feel secure this will support 
sustainable revenue growth and save  
costs maintenance insurance claims
2012 performance
the ﬁrst full year of ‘driving out harm’ has had 
a signiﬁcant impact on safety in the business 
with a decrease of 63
0
20
40
60
80
100
10 11 12
0
20
40
60
80
100
10 11 12
0
10
20
30
40
50
10 11 12
overview 
37 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  business review
uk coach continued
market overview 
market size 
£300m
of contested revenues in the scheduled coach market  
almost all privatised
 national express
 other operators
market share
around 1000 destinations served
national express is the uk scheduled coach market leader
market composition
national express has the only nationwide network of services
other competitors tend to focus on speciﬁc regions or corridors
market trends
core revenue growth reﬂecting value and convenience of coach
price competition from rail through discounted fares
market features
highly deregulated market
customer safety and disability access supported by regulation
operators able to compete ﬂexibly on selected routes
customers
customer satisfaction important in driving longer term loyalty
attracted by fare discount to rail increasing cost of private motoring  
and environmental friendliness
“ in 2012 we increased our customer 
recommendation rate to 96”
competition
selective competition from large bus operators and localised services
labour
outsourced model 80 operated by thirdparty partners on  
long term contract
 thirdparty partners
 owned operations
consistent service and behaviour standards across all operators
growth
revenue growth through improved retailing systems and greater 
understanding of our customers and their needs
uk coach revenue split
 passenger
 contract 
 subsidy 
 other
with a change in passenger travelling patterns also driven 
by the concession subsidy withdrawal we restructured our 
express coach network to improve efﬁciency and match 
customer demand firstly we reduced some services 
that were made unproﬁtable by the concession removal 
secondly we consolidated and remapped overlapping 
routes such as the trans pennine services eliminating 
one million miles of annual schedule without impacting 
revenue thirdly we removed some low usage intermediate 
destinations such as in sussex or east anglia to reduce 
journey times and drive greater patronage 
38 national express group plc annual report and accounts 2012  living our values
 customer
customers have a choice they don’t have to travel with us but the better the 
service we provide the more likely they are to choose national express and we 
want to make sure they enjoy it so much that they keep coming back increasing 
customer satisfaction will increase our revenue
by the end of 2014 national express aims to be the customer service leader  
of the entire transport sector
our coach business took a step towards achieving this ambitious goal with the 
launch during national customer service week of the ﬁrst coach customer 
charter this told passengers what they could expect from us as a company –  
the priority we give to their safety the services we provide and the reliability  
they are entitled to
but we have also been training our staff about how to use the charter and how  
to put things right – there and then – when they go wrong 
staff are encouraged to put themselves in their customer’s shoes and if they 
believe a customer has been badly treated they are empowered to intervene and 
resolve the problem we have even introduced a new process that allows coach 
station staff to offer unhappy customers free journeys – if that’s what it takes 
we ask customers what they think of our service and in 2012 satisfaction 
increased in all but one of the 14 areas we measure compared to 201 1 
in addition the number of complaints fell by 26
growth
we grew our core commercial express revenue by 2 in 
2012 with austerity impacting our customers and strong 
competition from advance ticket prices on rail we reduced 
fare yield by 4 successfully driving a 5 increase in 
volume increasing seat utilisation is our key target we saw 
growth in all nonconcession market segments and a steady 
improvement through the second half of the year with 
underlying passenger volume growth of 8 in december 
we also introduced new routes including additional airport 
schedules beneﬁtting from underlying passenger trafﬁc 
recovery at heathrow and stansted also popular was the 
introduction of faster direct routes with greater frequencies 
such as from the south coast to london meeting demand 
from withdrawal of a competitor
by the end of the year we had sold over 210000 coach 
concession cards to replace the discounts available to 
seniors with good renewal rates and a higher average 
number of journeys by each holder we are also developing 
partnership arrangements to expand distribution channels 
for ticket sales in december we partnered with age uk  
to offer discounted products to their members 
outside the core coach operations both the kings ferry 
and eurolines performed well the kings ferry secured 
key contracts for the olympics and paralympics eurolines 
added further capacity to paris brussels and amsterdam 
during the year leading to an 1 1 increase in revenue 
despite a lull over the traditionally busy summer period  
due to the olympics
cash generation
cash generation was solid with 106 of operating proﬁt 
converted into cash ﬂow compared with 69 in 201 1 the 
outsourced business model ensures that return on capital 
employed remains high even with a lower operating margin
future prospects
as the only national coach network in the uk and a capital
light operating model our uk coach business is a unique 
asset in our portfolio offering great value for money to 
customers in challenging difﬁcult economic times it is well 
placed to improve its performance in the medium term 
in 2013 we are investing in improving our retailing systems 
and customer database to understand their needs better 
enabling us to offer tailored products which will support the 
growth of passenger volumes across our customer base 
we are also investing in improved revenue management 
with uptotheminute pricing to reﬂect booking levels 
and encourage travel supported by better demand 
management historic analysis and predictive scheduling  
of our services we will also extend our cost efﬁciency drive 
focusing on depot costs and helping to improve our partner 
cost base including reducing dead mileage in the absence 
of further austerity measures we believe we can grow both 
revenue and margin in this unique business
strategic focus
2013 is about targeting growth in the core network and 
making changes to the structure of the business our key 
priority is to develop and implement a revenue management 
system followed by getting to know our customers better 
and building a single customer view
overview 
39 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  continuing to outperform
revenue in 2012 was £195 1 million 201 1 £6883m and normalised operating proﬁt  
£267 million 201 1 £434m
andrew chivers
managing director uk rail
business review
uk rail
kpis – measuring our progress 
why we measure
each national express division is targeting 
revenue growth as a core driver of value
2012 performance
good underlying revenue growth on the  
c2c franchise increased by share of  
olympic trafﬁc
 c2c only
revenue growth
7

why we measure
normalised operating margin reﬂects 
operational efﬁciencies and cost control
2012 performance
proﬁt and margin boost from successful  
nxea handover
margin
13 7

why we measure
passenger journeys are reﬂective  
of underlying demand for travel  
national express is targeting increased 
passenger ridership as a long term driver  
of sustainable value
2012 performance
increase in passenger demand boosted  
by olympic visitors
 c2c only
passenger journeys
37 2
m
0
2
4
6
8
10 11 12
0
3
6
9
12
15
10 11 12
0
10
20
30
40
10 11 12
40 national express group plc annual report and accounts 2012  why we measure
spads are a railindustry speciﬁc  
safety measure
2012 performance
a total of 5 spads during the year was 
disappointing a comprehensive action  
plan is in place to remedy this
 c2c only
why we measure
this is the rail industry standard 
measurement of performance  
it also enables franchises to be 
benchmarked against each other
2012 performance
a further improvement in operational 
standards to record levels
 c2c only
why we measure
safety is a key national express value  
with a groupwide objective of reducing 
injuries to employees and making our 
customers feel secure this will support 
sustainable revenue growth and save  
costs maintenance insurance claims
2012 performance
slightly higher than in the previous year  
but should be seen in the context of  
eight years of reducing numbers of 
accidents plans in place to reduce  
incidents in 2013
 c2c only
signals passed at danger per million miles
1 1 7
public performance measure  
moving annual average
97 5

lost time injuries per 1000 fte
82
results
national express has once again demonstrated its ability 
to operate a successful rail business with outstanding 
performance at c2c a smoothly executed transition of 
national express east anglia nxea to the new franchisee 
and qualiﬁcation for two franchise bids in the uk and ﬁve  
in germany we are very pleased to have been selected  
for two of those rail contracts in germany which are due  
to start operations in late 2015
revenue in 2012 was £195 1 million 201 1 £6883m 
reﬂecting the end of the nxea franchise in february 
operating proﬁt was £267 million 201 1 £434m 
operational excellence
in c2c national express runs the most punctual rail 
franchise in the uk delivering the best customer service 
the franchise has recently set a new uk record for annual 
train punctuality of 97 5 – more than 6 better than the 
national average it also ranked as the best franchise in the 
country in the national passenger survey with 93 overall  
passenger satisfaction  
a number of major achievements were accomplished during 
the year c2c implemented a new quality system achieving 
four star efqm status in january a key step forward in the 
group’s operational and bidding credentials we have also 
invested to deliver an improved customer experience carrying 
out major refurbishment at shoeburyness and thorpe bay 
stations where we have introduced smart technology 
c2c won rail operator of the year at the national transport 
awards and was voted the best commuter service in the  
uk by which magazine
growth
the c2c franchise grew both passenger volume and yield 
in 2012 it carried over 2 million passengers as part of the 
successful delivery of travel during the london olympics 
during the year we completed two high quality uk 
franchise bids one to continue our current operation of 
the essex thameside franchise and the other for great 
western we were disappointed by the suspension of the 
procurement process by the department for transport and 
the subsequent cancellation of the great western tender 
wasting substantial bid costs however we welcome the 
recommendations of the brown report and the planned 
restart of the refranchising process
 public performance measure moving annual average
00
02
04
06
08
10
12
10 11 12
0
20
40
60
80
100
10 11 12
0
2
4
6
8
10
12
10 11 12
overview 
41 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  business review
uk rail continued
market overview 
cash generation
1 1 1 of operating proﬁt was converted into cash the rail 
businesses in both the uk and germany are asset light  
and provide a good route for future value creation
future prospects
c2c is the uk’s best performing rail franchise its credentials 
were a key factor in national express being successful 
in german regional and commuter rail bidding we are in 
negotiations to extend the franchise on an interim basis  
and will be resubmitting our long term bid in due course 
we are delighted to have been selected for our ﬁrst two 
contracts to operate in germany and will work towards their 
mobilisation in late 2015 we have prequaliﬁed for three 
further bids with a promising pipeline beyond germany 
offers smaller rail contracts generally with lower risk and 
bidding costs to the uk and we look forward to developing 
a portfolio of operations there in such an attractive and 
sizeable market 
strategic focus
we will continue to focus on delivering exceptional 
performance at c2c maintaining our position at the top 
of punctuality and customer satisfaction tables we have 
an excellent rail bid team in place and will use this ﬂagship 
operation as an example of our capabilities in winning further 
franchises both in the uk and abroad
market size 
£6bn
of uk franchise revenues over next ﬁve years  
based on estimated pipeline
€6bn currently accessible german regional rail market
market share
one franchise remaining after nxea handover in february 2012
c2c  essex thameside
market composition
top four players have around 70 of the market
 top four operators
 other operators
19 uk franchises in total
“ c2c carried over 2 million 
passengers during the  
london olympics”
market trends
growth over the past decade driven by passenger volumes
dependent on gdp and employment particularly central london 
employment for c2c
regulated fares will increase by 13 in real terms over next two years
liberalising german rail market
market features
regulated environment
current framework has 710 year franchises
highly regulated qualiﬁcation and operational processes
customers
steady growth in passenger volume over last 20 years
competition
increased international competition in uk franchise bidding
labour
relationships are managed within each franchise with high  
union representation
growth
successful bid to retain c2c and bidding for other uk franchises 
further bid wins in germany
42 national express group plc annual report and accounts 2012  business review
risk and risk management
the group has a well established governance structure  
with internal control and risk management systems  
the risk management process
 provides a framework to identify assess and manage 
risks both positive and negative to the group’s  
overall strategy and the contribution of its individual 
component divisions
 gives business unit management formal tools to identify 
and manage risks in their daytoday operations
 allows group executive management to identify and 
manage the risks that are likely to have a more signiﬁcant 
impact on the ﬁnancial results and strategy and share 
common issues and solutions across the group
 allows the board to fulﬁl its governance responsibilities  
by making a balanced and understandable assessment  
of the operation of the risk management process  
and its outputs
responsibilities and actions
the board
 has overall responsibility for the group’s system of internal 
control and for reviewing its effectiveness
 maintains full control and direction over appropriate 
strategic ﬁnancial operational and compliance issues
 has put in place an organisational structure with formally 
deﬁned lines of responsibility delegated authorities  
and clear operating processes
the audit committee 
 has speciﬁc responsibility for reviewing the  
effectiveness of the group’s internal control  
and risk management systems
 is responsible for the identiﬁcation assessment  
and management of risk including actions taken  
and processes adopted to do so
 reviews and approves all ﬁnancial information published  
by the group
 reviews the internal audit programme considers major 
ﬁndings of the internal audit investigations and reviews 
management’s ﬁnancial reporting and risk management
risk review process
each division plus the group function is required to make  
a formal review of risks to their business objectives assess 
the impact and likelihood of the risk occurring and put  
in place mitigating actions processes and systems to 
manage the risk
risks
identify risks to business objectives on a bottom up basis 
risks are described and categorised into operational 
strategic and financial risks in order to help deﬁne their 
precise nature and potential impact on the business
assessment 
assess and quantify the potential impact on business 
objectives and determine the likelihood of the risk occurring 
this is done on a ‘before’ and ‘after’ basis where the impact 
of management controls is assessed in relation to the 
probability and severity of a risk
management
take mitigating actions and implement systems to manage 
the likelihood and impact of the risk identify an individual 
with responsibility for each risk
monitoring and control
risks are considered on a monthly basis at divisional 
level and formally updated twice a year management is 
encouraged to review the risk registers from other divisions 
to identify common issues and potential solutions
each divisional register including the group function register 
is consolidated into a group risk register
the group executive committee reviews the group 
risk register twice a year followed by the group audit 
committee the audit committee reports in turn to  
the main board 
the internal audit function has responsibility for the 
monitoring of the risk management and internal control 
systems internal audit reports to management and the 
audit committee on the extent to which internal controls  
are adequately designed and implemented
risk assessment and review
3 mitigating action
ml m mh h 
ml m mh h
impact
probability
contractual
economic
conditions
    and austerity
currency
insurance
and claims
credit
risk
fuel
costs
mergers and 
acquisitions
political and 
regulatory
1 identify 2 assess
overview 
43 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  business review
principal risks of 2012 
risks
principal risks and uncertainties
outlined below are risks that have the potential to affect the group’s performance in a material way which are monitored through the risk  
management processes
risks assessment management
potential 
impact
during 2012 the group focused on the following key areas of risk
economic conditions and austerity
difﬁcult economic conditions currently 
exist in europe and north america whilst 
some of the group’s businesses have 
naturally defensive characteristics some 
of the more discretionary parts of the 
business may be adversely affected  
by reduced economic activity
revenues in the bus coach and rail 
businesses in the uk and spain may be 
affected by lower passenger demand 
there is also some positive risk that the 
group would beneﬁt from the prospect of 
modal shift towards its forms of transport 
in north america for example school 
boards may reduce their transportation 
budgets or look to shift provision to 
contractors like national express  
in spain the division may be affected by 
lower disposable income sustained high 
unemployment lower council budgets 
and low gdp growth however they  
too may beneﬁt from the outsourcing  
of further urban bus operations
the group seeks to mitigate these risks 
through proactive cost control revenue 
management systems the careful 
economic modelling of new and existing 
contracts including sensitivities around 
expected growth rates and through 
sharing risk with contracting parties
high
political and regulatory
the group’s businesses are subject to 
numerous laws in the jurisdictions in which 
they operate regulating the operation 
of concessions safety procedures 
equipment speciﬁcations employment 
requirements environmental procedures 
and other operating issues
changes in political and regulatory 
environments can have a signiﬁcant 
impact on regulated public transport 
operators from adding signiﬁcant cost  
to changing the fundamental nature  
of a market for example
changes in uk government policy have 
resulted in material decreases in subsidies 
paid in 2012 for senior citizen discounts 
and fuel rebates
the uk department for transport has 
suspended the rail franchising process
the spanish government is considering 
the imposition of a fee on new concessions 
and other regulatory changes
the risk is reduced by maintaining close 
relationships with key stakeholders and 
ensuring that the economic advantages  
of our business models are fully 
understood and considered
in the longer term the group can mitigate 
risk by diversifying its operations into  
other geographies
high
the following risks are key ongoing risks within the business
fuel cost
all of the group’s businesses are exposed 
to fuel costs – primarily ultra low sulphur 
diesel for buses and coaches fuel  
prices are subject to signiﬁcant  
volatility due to economic political  
and climate circumstances
fuel costs constitute approximately 9  
of the group’s costs and consequently  
to the extent that price increases cannot 
be passed on to customers increases  
in fuel costs will affect proﬁtability
the group seeks to mitigate risks of 
increases in fuel costs by entering into fuel 
swaps and forward purchase contracts 
in line with the group’s hedging strategy 
discussed on page 23
medium
insurance and claims
the group’s policy is to selfinsure  
a number of potential claims within  
its business
there is a risk that a successful claim or 
series of successful claims may result in 
substantial higher charges to proﬁt and 
cash outﬂow than expected
throughout the business a strong 
safety culture prevails led by the board 
safety and environmental committee 
where claims arise they are managed 
by experienced claims handlers and 
professional advice is obtained in order to 
evaluate and minimise costs to the group 
it has also reduced selfinsurance values 
and increased external market coverage
medium
44 national express group plc annual report and accounts 2012  risks assessment management
potential 
impact
credit risk
as contractual operations the north 
american and spanish businesses are 
exposed to the risk that customers are 
either late or unable to pay sums owed  
to the group
payment terms and cash collections in 
north america are extremely good 
in spain during 201 1 receivables balance 
increased as a result of issues related 
to local and federal elections as well as 
ﬁnancial constraints in june 2012 all long 
term outstanding amounts were settled 
through a federal government credit 
facility and the level of outstanding debt is 
back to normal levels and continues to fall
receivables in each business are closely 
monitored based on robust and thorough 
documentation provisions are then made 
where appropriate on a prudent basis for 
a certain level of noncollection additional 
contractual terms for interest accrual  
and repayment of outstanding balances 
have been agreed with major debtors 
where necessary 
medium
currency
the group’s exposure to overseas 
earnings through its spanish and north 
american operations creates a risk 
that movement in exchange rates may 
adversely impact translation of proﬁt and 
cash ﬂows together with group gearing 
foreign currency movements impact the 
proﬁt balance sheet and cash ﬂows of the 
group during 2012 the euro depreciated 
against sterling although the us dollar 
remained relatively stable the group 
swapped some of its debt during the  
year to access eurodenominated debt  
as well as maintaining sterling bonds  
and us dollar ﬁnance leases 
the group uses its overseas currency 
debt and currency swaps to reduce the 
impact and mitigate the risk in addition 
management has ﬂexibility to adjust  
its group capital allocation decisions  
to focus on its highly cash generative  
uk businesses 
the board has stress tested for the 
impact of a breakup of the eurozone  
or sovereign debt default on the  
group’s ability to fund and operate  
and has identiﬁed appropriate plans  
for such scenarios
low
acquisitions
risk of failing to execute and then  
realise the expected returns from the 
petermann acquisition
the group acquired petermann for 200 
million in may its return on that investment 
is dependent on properly integrating 
the operations retaining customers and 
employees and realising planned cost 
savings and synergies
thorough due diligence was carried out 
as well as dedicating resource for the 
transition and integration of petermann 
operations and customers operational 
and ﬁnancial metrics show the acquisition 
is on track to meet expected returns 
low
contractual
much of the group’s business is 
secured through winning contracts 
and concessions particularly in its 
north american school bus and transit 
business in spain and in uk rail
an inherent risk in contract bidding is 
that bid assumptions might prove to be 
incorrect if the group’s signiﬁcant bid 
assumptions prove to be incorrect this 
could have an adverse effect on results  
of the operations and the group’s  
ﬁnancial condition
the group seeks to mitigate the risk 
through careful economic modelling of 
new contracts and by sharing revenue 
risk with the awarding body for example 
with the dft in uk rail
high
overview 
45 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  our values underpin who 
we are as a business
our vision and values are fundamental to our identity as a business and ensure that  
we are a responsible corporate citizen
business review 
living our values
our approach 
our vision is to earn the lifetime loyalty of our customers 
by consistently delivering frequent high performing public 
transport services that offer excellent value 
this vision is supported by four values our business 
activities reﬂect our values we should always be safe in 
everything we do we will always try harder than anyone else 
for customers we will work to be an employer of choice 
we will play an active role in the local community and will 
respect the environment and meet the challenges presented 
by climate change in addition all our business should be 
conducted properly in line with legal regulatory and other 
stakeholder requirements 
all of our senior management team are tasked with ensuring 
that our vision and values business approach and policies 
are adhered to this section of our annual report highlights 
how we manage each of these areas further information 
about national express and corporate responsibility is 
published on the group website  
nationalexpressgroupcomourway
managing responsibly
safety
safety is a key value and is a fundamental priority for any 
public transport business ultimate responsibility for managing 
our performance rests with dean finch our group chief 
executive our group safety director alison forster and  
the divisional heads 
the group develops a health safety and environment plan 
every three years which includes input from each division 
such as setting objectives and quantiﬁed targets
in practice the distinctive nature of our divisional business 
activities means that health and safety presents a different 
set of challenges for each one consequently our health and 
safety management systems are developed and managed  
at this level compliance with our health and safety standards 
is enforced by a rigorous and continuous internal audit 
process and is an essential and prominent feature of our 
internal reporting throughout the business and at board level
our values 
safety
more than anything else we value the safety of our 
customers employees and the public generally
customers
we will place customers at the heart of our business 
nobody will try harder for our customers than we do
people
enabling all our people to reach their full potential and to 
give their best as individuals and in teams
community
we will advance the social environmental and economic 
conditions in the communities where we operate
driving out harm a groupwide safety initiative was 
developed in 2010 with the aim of embedding a global safety 
culture throughout our divisions features include regular 
safety training for our middle managers and supervisors 
safety is also viewed throughout the business as being  
the personal responsibility of every employee
additionally all of our divisions are in regular dialogue with peer 
group companies regulators and industry associations and 
conduct best practice health and safety knowledge sharing 
activities with them as a matter of course 
the group’s health and safety performance has seen material 
improvements in performance during 2012 signiﬁcant 
reductions in lost time injury instances were achieved at 
uk bus uk coach and in spain similar improvements in 
preventable accidents were recorded in spain morocco 
north america and at uk coach
46 national express group plc annual report and accounts 2012  measuring our progress
customers
operational excellence is a key element of our vision 
and values and we aim to earn the lifetime loyalty of our 
customers five golden rules have been introduced in 2012 
to provide a groupwide standard for customer service 
and we strive to ensure that every employee is aware of 
these requirements staff members are encouraged to 
be approachable communicate clearly be in possession 
of current information take personal responsibility for any 
actions they might take and treat customers courteously  
and with respect
this focus on excellence is reﬂected by c2c’s achievements 
our uk rail franchise holds both the industry’s punctuality 
records this industryleading performance was recently 
complemented by the national passenger survey published 
in october 2012 by passenger focus the independent 
watchdog for rail services in the survey c2c was named as 
the most popular franchise in the uk overall passengers 
rated c2c as the leading franchise in ﬁve key categories
passengers also rated c2c as the top london commuter rail 
franchise in 12 categories including overall satisfaction with 
the station service frequency and the speed of the journey 
similarly our uk bus business increased overall customer 
satisfaction during 2012 from 80 to 84 using the 
passenger focus survey methodology 
customers expect good communication and the internet 
and social media play an increasingly important part in 
ensuring that we keep them informed about our services 
an example is the launch in 2012 of coach tracker in the 
uk the service allows customers to track their coach in 
real time anytime and anywhere this enables them to see 
whether the coach is on time and when it is due to arrive at  
a station or stop the service also allows customers to check 
for information such as an earlier or later departure should 
journey plans change
people
underpinning the delivery of the people value are ﬁve people 
management standards which apply across all of our 
operations they are
 recruitment excellence to get the right person into the 
right job at any level in national express
 induction to ensure that every new employee is engaged 
with our vision and values and understands the business 
policies practices safety rules and standards of the area 
in which they work
 performance management to enable all our people to 
meet and exceed job requirements each year linked to 
core values
 talent management to ensure all our people reach their 
full potential in national express
 workplace rights to sustain an open fair and supportive 
environment for all those who work for our company
compliance with our policies and our people management 
standards is monitored at divisional level through employee 
feedback including the whistleblowing mechanism 
customer feedback and internal human resources 
measurement systems 
the views of our employees matter to gauge engagement 
in the business we conduct separate employee surveys  
in our divisions they examine employee opinion on a  
variety of aspects of our business including issues such  
as safety employee morale working environment and 
manager relations
the 2012 uk bus survey had a response rate of 55  
up 6 on 201 1 particularly positive scores were noted  
in the following areas
 understanding of personal obligations regarding  
safety 95
 role played in helping the business achieve its  
objectives 89
 safety is taken seriously by the business 87
c2c’s latest employee survey was conducted in december 
2012 and had a response rate of 75
uk coach targeted an increase in response rates to its own 
survey which is undertaken twice annually this led to an 
improvement in participation from 49 to 88 and overall 
employee satisfaction increased slightly during a challenging 
year to 75 
each area of the business has nominated one of their 
team as an engagement champion and this team of 25 
champions have been instrumental in raising the proﬁle  
of the survey encouraging responses communicating  
the results and holding focus groups to ensure the  
resulting action plans achieved the desired results  
local action plans are in place in all areas of the business  
as well as a businesswide action plan which addresses  
the key areas of communication and recognition
0
5
10
15
20
25
30
preventable accidents per million miles
uk
bus
uk
coach
spain morocco north
america
11 12 11 12 11 12 11 12 11 12
0
20
40
60
80
lost time employee injuries per 1000 fulltime equivalent employees
uk
bus
uk
coach
spain morocco north
america
uk
rail
11 12 11 12 11 12 11 12 11 12
11 12
overview 
47 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  business review 
living our values continued
key conclusions from the 2012 from our latest quarterly 
employee survey in north america included the following
 employees clearly understand what is expected 
of them at work 957
 feedback from employees to managers is acted 
upon 928
 employees understand the goals and priorities of the 
company 907
community 
we recognise the impact we have on the communities 
in which we operate responsibility for ensuring that our 
policies concerning the community including our impact 
on the environment are carried out is split between the 
group head ofﬁ ce and our divisions 
at group level a key development in 2012 in support of the 
community value was the launch of the national express 
foundation an independent charitable trust the foundation 
was created in response to the urban disturbances in the 
uk in 201 1 and the group has pledged to provide it with 
at least £500000 in funding over ﬁ ve years
the foundation provides support to students with 
challenging personal and ﬁ nancial circumstances to enable 
them to advance their further and higher education it also 
provides grants to community groups with social objectives 
that support children and young people and promote 
crosscommunity cohesion and understanding in 2012 
more than 750 young people beneﬁ tted as a result of the 
foundation making grants to community groups 
and awarding bursaries to students
in the uk national express is actively promoting payroll 
giving and we are aiming to achieve the gold quality mark 
for payroll giving this is awarded to organisations that 
achieve 10 employee participation in payroll giving to 
charities and demonstrate other support for the programme 
the group believes that it is also important that our divisions 
interpret our policies through designing activities which 
are relevant to our business and the communities in 
which they operate examples of this sort of activity 
during 2012 included
 our uk employee charity panel making awards to 
60 community groups which employees are involved 
with totalling £18000
 our routes to work scheme commits us to ﬁ lling the 
expected 1700 job opportunities in our west midlands 
bus business over the next three years in partnership 
with jobcentre plus
 our participation in national bullying prevention 
month in north america
 our support of national school bus safety week in 
north america
 our support of the john xxiii foundation in spain 
this organisation aims to encourage the personal 
development social inclusion and professional 
qualiﬁ cations of people with learning disabilities
across the group we made charitable donations totalling 
£373000 in 2012 other community activity included our 
continued association with transaid in 2012 four more 
west midlands driver trainers spent time at the national 
institute of transport in tanzania to help build skills and share 
techniques with local instructors this is part of the charity’s 
efforts to improve the road accident rate in tanzania 
in 2012 we continued to make good progress improving 
our environmental performance the health safety and 
environment plan requires divisions to prepare their own 
element and set objectives and quantiﬁ ed targets
national express’ group property and environment 
director stuart parker plays a key role in our management 
systems this responsibility includes maintaining an up to 
date corporate register of relevant legislation and standards 
which is circulated regularly to relevant environmental 
coordinators providing guidance on the implications of 
forthcoming legislation and providing input into the group 
health safety and environment plan 
the group property and environment director 
provides regular updates to the board’s health safety 
and environment committee which is responsible for 
reviewing and monitoring our environmental systems and 
performance it also reports periodically to the board and 
makes recommendations on any speciﬁ c environmental 
issues further information on its activities is recorded in 
the safety  environment overview on page 63
customer
97 5
punctuality ppmmaa
93
overall journey satisfaction
92
satisfaction with train
safety
all of our divisions are in regular dialogue 
with peer group companies regulators and 
industry associations and conduct best 
practice health and safety knowledge sharing 
activities with them as a matter of course     national passenger survey c2c rail
48 national express group plc annual report and accounts 2012  community
the group applies a ‘plandocheckreview’ model which 
is compatible with established environmental management 
systems such as iso14001 it is not a requirement to obtain 
this certiﬁ cation although a number of sites have achieved 
this the framework is also consistent with the principles 
of the european foundation quality model efqm
each national express division has assigned a director with 
speciﬁ c responsibility for this aspect of our business this 
role includes ensuring that our operations have a systematic 
approach to ensure for example compliance with the 
relevant legislation pollution prevention and continual 
improvement in our environmental performance additional 
responsibilities include ensuring that employees have the 
necessary training support and resources and requiring 
contractors and suppliers to manage environmental issues 
in line with our policies
in practice the nature of our divisional activities means that 
environmental and climate change matters present a different 
set of challenges to each of our businesses consequently 
they have developed approaches which are tailored to their 
areas of impact supported by groupwide and peer group 
knowledge sharing  an example is the requirement for each 
business to develop its own environmental policy this must 
comply with the policy of the group relevant environmental 
legislation and be reviewed every three years  
environmental performance highlights
 groupwide greenhouse gas emissions continue to fall 
and are now less than 50 of 2004 levels 
 key three year key performance indicator targets are 
being achieved ahead a year ahead of target end 2013 
these were a 5 reduction in ﬂ eet fuel consumption per 
vehicle a 10 reduction in site electricity gas and gas 
oil consumption and a 40 reduction in nonhazardous 
waste going to landﬁ ll
 zero prosecutions during 2012 for pollution incidents
 the introduction of electric and hybrid vehicles – ﬁ ve in 
spain and 18 on our west midlands routes with 30 more 
on order
business conduct
national express has established rigorous processes and 
procedures at divisional and corporate level to ensure that 
people
95
of our staff understand 
their personal obligations 
regarding safety
89
of our staff understand their 
role in helping the business 
achieve its objectives
its policies and the expectations of its stakeholders are met 
in this important area for example our relations with our 
suppliers are governed by locally constructed purchasing 
policies and procedures these include ensuring that 
operating companies only source goods and services from 
approved suppliers that have agreements with the company 
or appear on an approved list large projects above 
£100000 require the involvement of group procurement in 
the purchasing process and speciﬁ c group approval if they 
have a value in excess of £500000
group compliance with the requirements of the uk 
bribery act is supported by whistleblowing procedures 
which have been developed locally for example in the 
uk the company has developed a whistleblowing hotline 
procedure which is managed by an independent third party 
service callers to a free of charge number are addressed 
by a trained adviser who will maintain conﬁ dentiality if 
requested information obtained through this service is 
passed by group management to the appropriate manager 
for investigation
“the funding provided by the national 
express foundation has been invaluable 
in helping to expand our innovative faith 
schools linking programme”  stephen 
shashoua director three faiths forum     2012 uk bus employee survey
uk site usage mwh
10 11 12 10 11 12
electricity gas
source utilities database grantley lowe
0
5000
10000
15000
20000
25000
30000
uk greenhouse gas emissions tco
2
e
10 11 12
600000
500000
400000
300000
200000
100000
0
overview 
49 wwwnationalexpressgroupcom
financial statements business review delivering on our strategy governance  board committee overview
governance 
chairman’s overview 
governance 
chairman’s overview 
what does good governance 
mean to national express 
dear shareholder
the board believes that effective governance is essential to 
protecting shareholder value and the sustainable growth of 
the group we therefore seek to ensure that it is an integral 
part of the ‘way we do business’ and that it is fully embraced 
by all our employees
as you will know i have only recently joined the board and 
took over from john devaney as chairman of the company 
at the beginning of february this year i would like to thank 
john for the leadership and commitment he has shown 
in ensuring that good governance is in place across the 
whole group
this section of the report and accounts explains the 
various aspects of the governance of the company 
including reports on the work undertaken in 2012 by 
the board’s committees
the composition of the board has continued to evolve 
in addition to my appointment miranda curtis retired from 
the board and jackie hunt has joined it it is important that 
the board has the correct balance of skills and experience 
and that board members work together effectively 
i will endeavour to carry on the good work of your former 
chairman in this area
national express supports diversity throughout the group as 
well as the boardroom we work on the premise that talent 
has no age race or gender and is not ruled out by disability 
our goal is for our people to reach their full potential and to 
give of their best as individuals and in teams 
in 201 1 the review of the performance of the board was 
carried out by an external facilitator and in 2012 the review 
was carried out internally both reviews conﬁ rmed that the 
board continued to operate effectively further details of the 
recommendations that came out of these reviews are set 
out on page 57 
a description of the subjects considered by the board in 
2012 are set out on page 56 and it is likely we will have 
another busy year in 2013 as we wrestle with the ongoing 
difﬁ cult macroeconomic climate and continue to seek to 
grow the group
audit committee
tim score chairman
nomination committee
sir andrew foster committee member
■ nonexecutive director 
appointment 40
■ chairman’s appointment 40
■ succession planning 20
■ compliance 20
■ internal audit 35
■ external audit 40
■ other 5
60
read more
62
read more
50 national express group plc annual report and accounts 2012  we continue to monitor the developments in corporate 
governance practice and will aim to comply with the new 
uk corporate governance requirements that come into 
effect in 2013
i would like to encourage you to attend our annual general 
meeting at 2pm on 9 may 2013 at kings place 90 york way 
london n1 9ag and i look forward to meeting many of you 
that day
sir john armitt cbe
chairman
28 february 2013 
safety  environment committee
chris muntwyler chairman
remuneration committee
sir andrew foster chairman
■ board remuneration 40
■ compliance 20
■ share schemes 30
■ other 10
■ governance 30
■ environment 25
■ safety 45
63
read more
64
read more
overview delivering on our strategy business review governance 
51 wwwnationalexpressgroupcom
financial statements  governance 
board of directors 
an experienced and 
balanced board
the board is regularly reviewed to ensure that the mix of skills and experience is appropriate to meet the 
current needs of the group an overview of the directors’ experience is summarised below
board overview
name
position
committee 
membership
length of service 
as at 31 december 2012 independent
public board 
experience
operational 
experience
sir john armitt
67
chairman
nomination chair
safety  environment
na na ✔✔
joaquín ayuso
57
nomination
safety  environment
1 year 6 months ✔✔ ✔
jorge cosmen
44
deputy chairman
nomination
safety  environment
7 years 1 month na ✔✔
sir andrew foster
68
audit
nomination
remuneration chair
safety  environment
8 years 4 months ✔✔ ✔
jackie hunt
44
audit 
safety  environment
3 months ✔✔ ✔
chris muntwyler
60
audit 
safety  environment 
chair
 1 year 7 months ✔✔ ✔
lee sander
56
remuneration
safety  environment
1 year 6 months✔✔
tim score
52
senior independent 
director 
audit chair 
remuneration 
safety  environment
7 years 10 months ✔✔ ✔
dean finch
46
group chief executive 2 year 10 months na ✔✔
jez maiden
51
group finance director 4 years 1 month na ✔✔
52 national express group plc annual report and accounts 2012  the board consists of a balance of executive and  
nonexecutive directors who each bring a strong  
and indepth mix of knowledge business skills  
and experience to the board’s deliberations  
details of which are shown below
  for detailed biographies of our board of 
directors and company secretary please 
go to nationalexpressgroupcomaboutus
ourmanagement
international 
experience
legalma 
experience
finance 
experience
government   
regulatory 
experience commentary
✔✔✔✔ senior leadership experience in the public and private sectors
 signiﬁcant board experience at chief executive and chairman levels
 extensive knowledge of international construction civil engineering 
and transport industries
✔✔✔✔ signiﬁcant board experience at senior level
 extensive knowledge of the transportation industry in both continental 
europe and internationally
✔✔✔✔ expertise in the transportation industry
 key shareholder representative
✔✔✔✔ signiﬁcant public sector and infrastructure experience
✔ ✔ ✔ ✔ signiﬁcant ﬁnancial expertise
 senior board experience
 chartered accountant
✔✔ ✔ extensive senior management experience in transport and logistics 
industries both in the uk and international
 senior board experience both uk and international
✔✔ senior management and operational experience in  
the us transportation industry
 signiﬁcant experience at us government advisory level  
on transportation policy and management
✔✔✔ financial expertise from cfo positions
 has acted as interim chairman
✔✔✔✔ signiﬁcant transportation experience
 chartered accountant
✔✔✔✔ signiﬁcant ﬁnancial expertise
 chartered management accountant
the structure of the board
overview delivering on our strategy business review governance 
53 wwwnationalexpressgroupcom
financial statements  key matters reserved for board approval 
group strategy and risk management
 formulation and approval of long term objectives
 approval of changes to capital structure
 approval of major changes to management and control structure
 approval of extension of activities into new businesses or geographical areas
financial and internal controls
 oversight of risk management and internal control framework
 approval of ﬁnancial statements and results announcements
 approval of shareholder communications circulars and notices  
of meetings
 approval of the auditor’s remuneration and recommendations  
for their appointmentremoval
 recommendation and declaration of dividends
 monitoring group’s businesses against plan and budget
 approval of major capital expenditure projects
 approval of material contracts
board membership and committees
 appointment of directors
 approval of remuneration of the nonexecutive directors 
 setting of committee terms of reference
 approval of new share incentive plans
corporate governance
 undertaking formal performance reviews of board committee  
and individual directors
 determining the independence of directors
 receiving reports from the company’s major shareholders
policies
 review and approval of group policies for example 
 – health and safety
 – risk management strategy
 –environment
 – charitable and political donations
independence
the board considers all of the nonexecutive directors to 
be independent other than jorge cosmen and considered 
sir john armitt to be independent prior to his appointment 
as chairman jorge cosmen is not considered to be 
independent by the board due to his close links with the 
alsa business and signiﬁcant interests in the shares of 
the company which are held through european express 
enterprises limited despite his nonindependence the 
board feels that it beneﬁts greatly from jorge cosmen’s 
extensive local market knowledge and experience 
nonexecutive directors do not participate in any of the 
company’s share option or bonus schemes and their 
service is nonpensionable
the role of the board
the board’s role is to provide leadership of the group and 
direction for management it is collectively responsible 
and accountable to the company’s shareholders for the 
long term success of the group and for ensuring the 
appropriate management and operation of the group in 
pursuit of its objectives 
the board is responsible for setting the group’s strategic 
aims its values and standards and ensuring the necessary 
ﬁnancial and human resources are in place to achieve its 
goals to help discharge its responsibilities the board has  
a schedule of governance and business matters for which  
it is responsible these form the core of the board’s agenda
the board discharges its duties through an annual 
programme of board and other meetings in doing so  
the board ensures that all necessary matters are discussed 
the timeline on page 56 shows the main items of business 
addressed by the board during the year the nonexecutive 
directors also met several times during the year without the 
executive directors being present
 
governance 
corporate governance
54 national express group plc annual report and accounts 2012  the chairman and the group chief executive
the chairman is responsible for leading the board and 
ensuring its effectiveness the group chief executive is 
responsible for running the business of the group and 
implementation of the strategy and policies adopted by  
the board the roles of chairman and group chief executive 
are held separately and the division of responsibilities 
between these roles is clearly established as shown below
chairman’s responsibilities 
 chairing and managing the business of the board
 together with the group chief executive leading the 
board in developing the strategy of the business and 
ensuring its effective implementation by the executive 
management team
 ensuring effective dialogue with investors concerning 
mutual understanding of objectives
 in conjunction with the nomination committee taking 
responsibility for the composition and replenishment  
of the board
 periodically reviewing with the board its working practices 
and performance
 ensuring there is an effective contribution from the 
nonexecutive directors and a constructive relationship 
between executive and nonexecutive directors
group chief executive’s responsibilities
 communicating a shared purpose and the culture  
vision and values of the group
 the development and implementation  
of management strategy
 the daytoday management of the group
 managing the executive management team
 fostering relationships with key stakeholders
 leading the group executive committee
 in conjunction with the group finance director 
communicating the group’s ﬁnancial performance  
to investors and analysts
 liaising with the chairman to ensure effective dialogue 
with investors and stakeholders
the chairman’s other signiﬁcant commitments are detailed 
in his biography which accompanies the notice of the 2013 
annual general meeting
nonexecutive directors
the terms and conditions of appointment of the non
executive directors are available for inspection at each 
annual general meeting on the company’s website and 
at its registered ofﬁce during normal business hours the 
nonexecutive directors disclose to the board their other 
signiﬁcant commitments the procedure adopted by the 
company in relation to directors’ conﬂicts of interest are 
detailed on page 79
senior independent director
the board appoints one of the nonexecutive directors to 
act as senior independent director and this role has been 
held by tim score since april 2009 the role of the senior 
independent director is to provide a sounding board for 
the chairman and to serve as an intermediary for the other 
directors where necessary the senior independent director 
is also available to address shareholders’ concerns if they 
have been unable to resolve these through normal channels 
or when such channels would be inappropriate the senior 
independent director is also responsible for leading the 
annual appraisal of the chairman’s performance
executive directors
the executive directors are responsible for the daytoday 
management of the group’s businesses implementation 
of its strategy policies and budgets and its ﬁnancial 
performance executive management meetings comprise 
the executive directors and senior management from the 
divisions and are held regularly to discuss current issues
principal committees of the board
the main committees established by the board are the audit 
committee the remuneration committee the nomination 
committee and the safety  environment committee  
each committee operates within deﬁned terms of reference 
the full versions of which can be found on the company’s 
website at nationalexpressgroupcom each committee 
reports its proceedings to the board through the submission 
of reports and minutes as appropriate 
all board committees are authorised to obtain legal or other 
professional advice as necessary to secure the attendance 
of external advisors at their meetings and to seek information 
required from any employee of the group in order to perform 
their duties 
reports of each of the committees are provided on pages 
60 to 65 and include information on each committee’s 
membership duties and work throughout the year 
the chief executive heads the group executive committee 
which meets on a monthly basis and is tasked with 
approving operational business matters in addition the uk 
spain and north america executives meet on a monthly 
basis and matters dealt with at these meetings are reported 
to the group executive committee
the reporting framework of the board committees and  
of the group executive committee and its subcommittees 
is shown above
the table on page 56 sets out the number of meetings  
of the board and its committees during the year and 
individual attendance by the board and committee 
members at these meetings 
during the year the chairman met on several occasions with 
the nonexecutives without the executive directors present 
to allow informal discussions on a variety of issues
reporting framework
 board committee
 executive committee
group 
board 
remuneration
committee  
nomination
committee  
 
 
 
audit 
committee
safety  environment
committee 
group executive committee 
uk  
executive 
spain 
executive 
north america 
executive 
overview delivering on our strategy business review governance 
55 wwwnationalexpressgroupcom
financial statements  governance 
corporate governance continued
number of board meetings
board meetings
the board  
of directors
audit 
committee
nomination 
committee
remuneration 
committee
safety  
environment 
committee
total meetings in 2012 83543
executive directors
dean finch group chief executive 8 – – – –
jez maiden group finance director 8 – – – –
nonexecutive directors
john devaney
3
 8–5–3
joaquín ayuso
4
7 – – – 3
jorge cosmen 8 –5 –3
miranda curtis
1
3 3 – – 1 1 1 1
sir andrew foster
5 
735 3 33
jackie hunt
2
3 3 – – – 1 1
chris muntwyler 8 3 – – 3
lee sander 8 – – 4 3
tim score 8 3 –43
company secretary michael hampson also acts as secretary to the board committees
1
 resigned from the board on 10 may 2012 maximum possible meetings shown in brackets
2
 appointed to the board on 13 september 2012 maximum possible meetings shown in brackets
3
 resigned from the board on 31 january 2013
4
 joaquín ayuso was unable to attend the board meeting held on 24 january 2012 due to a pror engagement scheduled before his appointment to the board
5
 sir andrew foster was unable to attend the unscheduled board meeting held on 13 september 2012 due to a prior engagement
  strategy
  governance
 investor relations 
  financial and risk 
management 
 group policy 
  commercial and 
business 
board activity throughout the year excluding standing items
january 2012 group strategic review 20122015
february 2012 consideration of board external evaluation results and recommendations
review of market perceptions of share price performance
review of  prequaliﬁcation questionnaire for rail bid
review of stakeholder strategyrail bidding
capital investment
approval of potential additional nonbank funding
approval of preliminary announcement and annual report and accounts for year to 31 december 2011
recommendation of ﬁnal dividend for ﬁnancial year 2011
may 2012 update report on uk coach business
review of progress on rail bids
discussion of key information and ﬁnancial risks re german rail tender
approval of communications and investor relations strategy
approval of induction programme for new nonexecutive directors
june 2012 discussion of board succession and potential candidates to fulﬁl role of nonexecutive director
rail bids update approval of german rail bid 
update on north american school bus and transit businesses
july 2012 rail bids update
review of due diligence and risks and approval of contract for acquisition of two transit businesses in the us
approval of half year results and interim dividend
review of bis proposals on uk directors’ remuneration
september 2012 appointment of jackie hunt as a nonexecutive director
october 2012 spanish division review
approval of hr strategy proposals for north america
consideration of appointment of new chairman
november 2012 approval of purchasing strategy for replacement coaches for spanish ﬂeet in 2013
approval of 2013 budget
presentation on uk coach business
approval of appointment of new chairman
56 national express group plc annual report and accounts 2012  information and support
reports from the executive directors which include  
indepth ﬁnancial information are circulated to board 
members prior to every board meeting senior management 
and advisers make presentations to the board on signiﬁcant 
matters during the year every effort is made to ensure 
that information reported to the group board is of high 
quality in terms of accuracy quality appropriateness 
comprehensiveness and currency directors are able  
to seek clariﬁcation or ampliﬁcation from management 
where necessary 
under the direction of the chairman the company secretary 
is responsible for ensuring board procedures are followed 
and applicable rules and regulations are complied with  
and advises the board on governance matters all directors 
have access to the advice and services of the company 
secretary and the appointment or removal of the company 
secretary is a matter for the board as a whole as well as 
the support of the company secretary there is a procedure 
in place for any director to take independent professional 
advice where considered necessary
induction of new directors
on appointment directors are offered training as 
appropriate and are thereafter encouraged to keep abreast 
of matters affecting their duties as a director and to attend 
training courses relevant to their role 
an induction process is in place for new directors the aim  
of which is to
 build an understanding of the nature of the company  
its business and the markets in which it operates
 establish a link with the group’s employees
 build an understanding of the group’s main relationships 
including stakeholders and customers
the following information is provided as part of the induction 
and ongoing training and development of board directors
on appointment 
 governance information in relation to the group including 
the terms of reference of the board and its committees
 guidance for directors of british public companies 
generally including under the law the uk corporate 
governance code and the rules of the uk listing authority
 board minutes covering the previous year
 information on key group policies
following appointment 
 business brieﬁng meetings with the chairman the group 
chief executive and the group finance director
 meetings with the company secretary to discuss the 
group structure the company’s constitution and board 
procedures and terms of reference of the board and  
its committees
 meetings with the group’s main stakeholders including 
major shareholders and fund managers
 meetings with senior management in the ﬁve divisions
 meeting with the director of safety for an overview  
of the group’s health and safety policy and safety record
 meetings with the group’s auditors
performance evaluation
an evaluation of the effectiveness of the board and its 
committees is conducted annually in late 201 1 an external 
evaluation of board performance was led by geoffrey 
shepheard of icsa board evaluation the full results of  
the board evaluation were discussed at the board meeting 
in february 2012 the board concluded that following 
this comprehensive review the board and its committees 
continue to operate effectively actions implemented from 
the 201 1 performance review include
2011 recommendations actions 
 remove pressure from the 
board schedule and allow 
time for nonexecutives 
to meet on their own 
in advance of board 
meetings
nonexecutive directors are 
scheduling their personal 
commitments to allow time  
to meet on their own
 ensure a more regular 
pattern of meetings 
with a closer link to the 
company’s reporting and 
events calendar
following a review the 
meetings schedule was 
adjusted
 circulate board papers at 
least four days including 
two working days before 
the board meeting
there has been a clear 
improvement in the despatch 
of board papers and the 
use of ipads and electronic 
dissemination of board 
papers via a secure board 
portal is considered a real 
advantage
 strengthen the breadth 
of skills and experience 
around the board table
the composition of the 
board has been signiﬁcantly 
strengthened and contains  
a balance of four uk and four 
international nonexecutives
board oversight and benchmarking
 the board regularly and rigorously reviews and 
benchmarks operational and functional performance
 at each board meeting the board receives a report 
from the group chief executive on operational 
performance and from the group finance director  
on the ﬁnancial performance of the group as a whole 
and each of the group’s businesses individually
 the board receives a presentation at each of its 
meetings from either a business managing director  
or a functional head
overview delivering on our strategy business review governance 
57 wwwnationalexpressgroupcom
financial statements  governance 
corporate governance continued
in september 2012 an internal evaluation of board 
effectiveness was conducted by stephen connock 
group hr director via a questionnaire circulated to all the 
directors the results of the internal review were discussed 
at the november board meeting the board’s discussions 
highlighted a number of areas of strength and it was felt that 
the board continued to work well areas identiﬁed for action 
from the 2012 evaluation include the following 
2012 performance review – areas for action 
 post implementation 
audits
increase focus on action 
plans arising from board 
decisions with clear 
responsibilities and 
timescales for 
resulting actions
 succession planning further development of 
board succession planning 
including an analysis of  
the future composition  
of the board
outcomes arising from this evaluation process will be further 
reported on in next year’s annual report
relations with shareholders
the board recognises the importance of maintaining good 
communications with the company’s shareholders to ensure 
mutual understanding of the group’s strategy objectives 
governance and performance
during the year shareholders are kept informed of 
the progress of the group through regular corporate 
communications the preliminary announcement  
the notice of annual general meeting interim management 
statements and press releases regarding any other 
signiﬁcant developments as well as the dissemination 
of regulated information such communications are 
made available to the london stock exchange and are 
simultaneously available on the company’s website 
nationalexpressgroupcom 
the company’s website houses wideranging information 
about the group including the annual report and accounts 
press releases share price data and links to subsidiary 
company websites
from time to time the company invites research analysts 
and institutional investors to presentations and site visits  
that are designed to provide more understanding of the 
strengths and capabilities of its business operations and 
strategy in 2012 the company hosted a visit to meet the 
local management team and tour the spanish operations  
in madrid
shareholders receive documentation such as the annual 
report and accounts electronically and also are able to cast 
their votes by proxy electronically the company also has an 
electronic proxy appointment service for crest members
institutional shareholders
the chairman group chief executive and group finance 
director have held a number of meetings with existing and 
prospective institutional shareholders during the year as 
well as given presentations following the fullyear and half
year results they have also met and given presentations 
to research analysts and stockbrokers’ sales teams the 
company’s appointed brokers and investor relations 
advisors in turn have provided regular conﬁdential feedback 
to the company on the views of the major institutions  
the chairman senior independent director and other 
nonexecutive directors are also given the opportunity to 
meet institutional shareholders and are available by contact 
through the normal channels during 2012 the chairman 
and senior independent director have both met with major 
shareholders to discuss the governance and direction  
of the company
the board is provided with regular updates on the views 
and issues raised by the company’s investors during the 
year the board received external presentations from advisors 
on shareholder and market perception of the group’s 
performance and strategy formal written responses are 
given to correspondence received from shareholders 
as well as bilateral engagement through the group chief 
executive group finance director and the company’s 
investor relations function
analyst coverage
the company is aware of 19 analysts who have published 
equity research notes covering national express group plc 
during 2012 and we provide names and contact numbers  
of their ﬁrms on our website
private shareholders
we welcome contact from our private shareholders  
and are pleased to answer their queries we encourage 
our shareholders to make use of our website to access 
company reports notices of meeting and general 
shareholder and dividend information the website also 
provides a direct link to shareview shareviewcouk which 
enables shareholders to view and manage their shareholder 
account online
annual general meeting
notice of the annual general meeting and related papers  
are sent to shareholders at least 20 working days before  
the meeting last year’s annual general meeting included  
a presentation by the group chief executive on the progress 
of the business and an opportunity for shareholders to ask 
questions all our directors were available formally to answer 
questions during the meeting and many circulated and 
talked to shareholders informally afterwards voting on the 
resolutions was conducted by poll some 86 of the shares 
in issue were voted and the resolutions were passed  
the results were published on the group’s website shortly 
after the meeting
we look forward to welcoming shareholders to our 2013 
annual general meeting and updating them on the progress 
of the business this year
58 national express group plc annual report and accounts 2012  major shareholdings
as at 25 february 2013 the company had been notiﬁed of the following interests in its shares which represent 3 or more of the voting rights  
in the company
ordinary 
shares
percentage of 
share capital
nature 
of holding
elliott international lp  the liverpool limited partnership 1 127 41469 2203 direct 
european express enterprises ltd 87 095062 17 02 direct 
prudential plc 66764762 1304 direct 
the holdings for european express enterprises ltd are included in jorge cosmen’s holdings which are shown in the directors’ remuneration report 
on page 7 4
analysis of ordinary shareholdings at 25 february 2013
number of 
accounts
percentage of 
total number  
of accounts
number of 
shares 
percentage of 
ordinary capital
by size of holding
1500 64914808925943018
5011000 169812571333721026
10015000 363726948471914166
500150000 1459108117475833341
500011000000 16312140233243786
over 1000000 53 039 443291949 8663
13501 10000 511732603 10000
by investor type
individuals 12697940425408067492
institutional investors 699 5 18 481699629 9168
other corporate investors 105 078 4624907 340
13501 10000 511732603 10000
overview delivering on our strategy business review governance 
59 wwwnationalexpressgroupcom
financial statements  governance 
corporate governance continued
audit committee overview
dear shareholder
the audit committee plays an important role in the governance of the 
company and i am pleased to report to you on the work undertaken 
by the committee during 2012
as usual we have reviewed the integrity of the ﬁ nancial statements 
prepared for shareholders by management and the principal accounting 
matters and ﬁ nancial reporting judgements contained in them examples 
include reviewing the accounting implications of the north american 
acquisitions made in 2012 and considering the group’s annual goodwill 
and intangible asset impairment review deloitte llp  our external auditor 
conﬁ rmed they are satisﬁ ed with the treatment in the accounts of the 
signiﬁ cant areas of judgement
deloitte llp were appointed as the company’s auditor on 14 june 
201 1 following a tender process and we took the opportunity to review 
their performance in 2012 we believe the auditors have performed 
satisfactorily since taking on the role and that the audit process they 
implemented was effective we continue to consider deloitte llp 
to be independent and we were happy to recommend to the board 
that they be put forward to be reappointed at the forthcoming 
annual general meeting
the committee continued to monitor the group’s internal ﬁ nancial 
controls and risk management systems business continuity planning 
it systems and treasury policies were all speciﬁ c topics which we 
considered in 2012
the performance of the internal audit function itself continues to be 
assessed on an ongoing basis and we believe it is effective in the role 
it carries out
towards the end of 2012 the uk corporate governance code was 
updated and we will be ensuring that we take account of the new 
requirements in 2013
finally jackie hunt joined our board in september 2012 and is now 
a member of the committee i believe her signiﬁ cant ﬁ nancial and 
uk public company experience will be of great value to the committee 
in the coming years
tim score 
audit committee chairman
28 february 2013
60 national express group plc annual report and accounts 2012  during the year the committee 
considered the following
 review of compliance with the uk 
corporate governance code
 review and approval of internal audit 
plan for 2012
 review of the group risk register
 update on business continuity planning
 review of it strategy
 approval of updated treasury policy
 review and update of policy
on provision of audit and
nonaudit services
 consideration of the results of internal 
audit compliance testing of ﬁ nancial 
controls annual fitness checks
within the subsidiaries 
 review of the external auditor’s fees
 review of ﬁ nancial statements and 
accounting policies
main activities during the year 
the role of the audit committee
the terms of reference of the audit committee 
comprise the duties and tasks delegated to 
it by the board and include the following
 overseeing the process for selecting the 
external auditor assessing the continuing 
independence of the external auditor and 
recommending approval of the audit fee 
to the board
 responsibility for ensuring that provision 
of nonaudit services does not impair 
the external auditor’s independence or 
objectivity
 liaising with the external auditor on matters 
relating to the nature and scope of the audit 
and any issues or concerns arising from 
the audit process
 reviewing effectiveness of the company’s 
internal control and risk management 
systems including the internal audit 
programme and major ﬁ ndings identiﬁ ed from 
internal audit investigations and reviews and
 reviewing the halfyear and annual ﬁ nancial 
statements including accounting judgements 
and policies
the audit committee routinely considers a 
number of standing items during the year such 
as consideration of the internal and external 
audit reports review of the annual report 
and accounts review of the preliminary and 
halfyear announcements and review of the 
corporate governance report
the committee met three times in 2012 details 
of attendance at these meetings can be found 
on page 56 outside of the meeting process 
the committee chairman has regular contact 
with the executive directors other committee 
members and the auditors on a variety of 
topics the committee itself meets with the 
external auditor at least once a year without 
executive directors being present
at the invitation of the committee and as 
appropriate to the matters under discussion 
meetings may be attended by the executive 
directors and internal and external auditors 
full minutes are kept by the secretary of the 
matters considered and decisions taken 
by the committee
tendering frequency 
of external auditor
the committee currently has no set policy 
on the tendering frequency of their external 
auditor or of the tenure of their external auditor 
the committee will monitor developments 
in uk and european union best practice 
regarding audit tendering with a view to 
ensuring compliance with any requirements 
going forward notwithstanding the above the 
committee regularly considers the marketplace 
benchmarking the current level of audit services 
the company receives along with the fees 
it pays and the value being delivered the 
company last put its external audit contract out 
to tender in 201 1 following which deloitte llp 
were appointed as the company’s auditor
reappointment of auditor
as a result of its work with deloitte llp during 
the year the committee has concluded that 
it is satisﬁ ed with their performance and has 
recommended to the board that deloitte llp 
be reappointed
review of independence 
of external auditor
the audit committee assesses and reviews on 
a regular basis the independence of the external 
auditor as part of their determination the audit 
committee considers a report by the external 
auditor on the ﬁ rm’s independence which is 
required in order to carry out their professional 
duties and responsibilities as auditor 
policy on auditor providing 
nonaudit work
the committee has an approved policy on the 
provision of nonaudit services by its auditor for 
the following types of service
 services that are considered to have ‘general 
preapproval’ by the audit committee by 
virtue of the approval of the policy
 services that require ‘speciﬁ c preapproval’ 
on a casebycase basis before any work 
can commence and
 services that cannot be supplied by the 
external auditor prohibited services
the services that have general preapproval are 
tax transaction investigation and advisory and 
corporate ﬁ nance services the fees for these 
services are preapproved up to £50000 for 
each nonaudit assignment undertaken and 
subject to an overall limit of 75 of the total 
fees paid to the external auditor for services 
exceeding this limit speciﬁ c preapproval 
is required
in deciding whether or not to grant approval for 
the provision of speciﬁ c services by the external 
auditor the audit committee includes in its 
consideration the following factors
i whether the external auditor is best placed 
to provide an effective and efﬁ cient service 
given its familiarity with the company’s 
processes systems and people and
audit committee members
name of director position
tim score chairman senior 
independent director
sir andrew foster nonexecutive director
jackie hunt nonexecutive director 
appointed 13 september 
2012
chris muntwyler nonexecutive director 
ii the level of nonaudit fees paid to the 
external auditor in the year as a proportion 
of the annual external audit fee
the majority of nonaudit work undertaken 
by the external auditor during the year relates 
to advice in respect of tax advisory and 
other regulatory services these items the 
committee believes would be impractical 
and costly to provide through another party
the split between audit and nonaudit fees 
for the year ended 31 december 2012 appear 
in note 6 to the consolidated accounts
overview delivering on our strategy business review governance 
61 wwwnationalexpressgroupcom
financial statements  governance 
corporate governance continued
nomination committee overview
during the year the committee
 evaluated the balance of skills 
experience independence diversity 
and knowledge on the board and then 
prepared a description of the role and 
capabilities required for the role of 
nonexecutive director
 appointed search consultants to 
identify a shortlist of candidates for 
the role of nonexecutive director and 
interviewed candidates following which 
the appointment of jackie hunt was 
recommended to the board
 evaluated the experience and attributes 
required of a new nonexecutive 
chairman and then prepared a 
description of the role and capabilities 
sought for the role speciﬁ cation of 
nonexecutive chairman
 appointed search consultants to 
identify a shortlist of candidates for the 
role of nonexecutive chairman and 
interviewed candidates following which 
the appointment of sir john armitt was 
recommended to the board
 reviewed succession plans across 
the group
main activities during the year 
dear shareholder
i have been asked by sir john armitt to address you on the work 
undertaken in 2012 by the nomination committee as he did not join 
the board until 1 january 2013
two signiﬁ cant areas of work undertaken during the year by the 
committee were in respect of the appointment of jackie hunt to 
the board as a nonexecutive director and the appointment of sir 
john armitt as our new chairman the search process for our new 
chairman was led by tim score the senior independent director 
john devaney did not chair the nomination committee discussion 
that recommended to the board the appointment of sir john armitt 
external search consultants were retained to help the committee in the 
search processes kornferry whitehead mann were retained on the 
nonexecutive director search and spencer stuart were used for the 
chairman search neither of these consultants has any connection with 
the company as part of the process in both cases draft speciﬁ cations 
were drawn up for these roles and the members of the committee 
interviewed the shortlisted candidates for both appointments the 
committee was pleased with the quality of candidates that emerged 
through the selection processes and from which jackie hunt and 
sir john armitt stood out the board subsequently accepted 
recommendations by the committee for the appointment of both 
jackie hunt and sir john armitt and i am pleased to welcome both 
to the board of national express group plc
i am also pleased to announce that joaquín ayuso joined the 
nomination committee on 26 february 2013 the committee now 
comprises a majority of independent nonexecutive directors as 
prescribed by the uk corporate governance code
in addition the committee also reviewed the succession plans for 
the senior executive positions across the group 
further details about the role of the committee its activities and 
membership are set out below
 
sir andrew foster 
nomination committee member
28 february 2013
nomination committee members
name of director position
sir john armit chairman appointed 1 
january 2013 and as company 
chairman on 1 february 2013
joaquín ayuso nonexecutive director 
appointed 26 february 2013
jorge cosmen nonexecutive director
john devaney chairman resigned 31 january 
2013
sir andrew foster nonexecutive director
the role of the nomination committee
the key responsibilities of the nomination 
committee are summarised below
 responsibility for identifying and nominating 
for the approval of the board candidates to 
ﬁ ll board vacancies as and when they arise
 giving full consideration to succession 
planning and keeping under review the 
leadership needs of the organisation both 
executive and nonexecutive
 reviewing the time required from and spent 
by a nonexecutive director on fulﬁ lling his or 
her duties and
 leading the process for board appointments 
and making recommendations to the board 
and preparing a description of the role and 
requirements for any particular appointment 
based on its evaluation of the board as 
a whole
succession planning
the nomination committee carried out a 
detailed review of talent management and 
succession planning across the group 
facilitated by the group hr director at a 
meeting in november 2012
diversity
our goal at national express is for our people 
to reach their full potential and to give of their 
best as individuals and in teams in this context 
we are committed to never discriminating on 
the grounds of race veteran status colour 
creed disability religion ethnic origin sex 
sexual orientation or age while maintaining 
our existing policy of selecting the best available 
candidate for any position national express 
is content to set the aspirational target that by 
2015 30 of the board will be women in line 
with the recommendations of the davies report 
on boardroom diversity
62 national express group plc annual report and accounts 2012  safety  environment committee overview
during the year the committee
 monitored progress of implementation 
of the group’s global safety standards
 assessed progress of the group’s 
‘driving out harm’ safety programmes
 reviewed the ﬁ ndings of the external 
audit of corporate governance of safety
 visited group locations to review safety 
practices and procedures
 reviewed environmental management 
across the group
 approved safety and environmental 
targets for the group
main activities during the year 
dear shareholder
i am pleased to report that in 2012 we continued to make good progress 
in our safety performance and in the management of the company’s 
environmental responsibilities
during the year miranda curtis retired from the board and i would like 
to thank her for the contribution she made to this committee especially 
during her time as chairman of the committee both jackie hunt and 
sir john armitt have joined the committee and i look forward to their 
ongoing involvement
the committee oversaw the roll out of the next stages of our ‘driving out 
harm’ safety programme twelve global safety standards have now been 
adopted and we are seeing evidence of the beneﬁ cial impact these are 
having across the group in improving our safety performance
the ‘driving out harm’ programme was externally audited by arthur d 
little and they reported that signiﬁ cant improvements had been made 
in safety leadership and systems they also reported that effective 
governance of safety was being provided
a groupwide review of the management of environmental matters was 
undertaken which resulted in the adoption of a new strategic plan and 
new targets being set
it is likely that it will be mandatory for uk public companies to report 
on greenhouse gas emissions in all of their businesses from 2014 and 
we have therefore started work to put in place the processes to collect 
the required data
the safety of our employees and customers is of critical importance 
to the board as is the responsible management of our environmental 
obligations i would like to thank dean finch and his team for the 
leadership they show in these areas
chris muntwyler
safety  environment committee chairman
28 february 2013
safety  environment committee 
members
name of director position
sir john armitt company chairman appointed 
to the board and committee 
on 1 january 2013 and as 
chairman on 1 february 2013
joaquín ayuso nonexecutive director
jorge cosmen nonexecutive director
miranda curtis nonexecutive director 
resigned 10 may 2012
john devaney company chairman
resigned 31 january 2013
sir andrew foster nonexecutive director
jackie hunt nonexecutive director 
appointed 13 september 2012
chris muntwyler chairman
lee sander nonexecutive director
tim score independent director
the role of the safety  environment 
committee
the key responsibilities of the committee are 
as below
 responsibility for reviewing and challenging 
constructively the structure content and 
operation of the safety management 
arrangements put in place by members of 
the executive management of the group’s 
operating companies
 reporting periodically to the board on its 
observations on the safety management 
arrangements in place and reviewing and 
making recommendations to the board 
on any speciﬁ c safety management issues 
relating to the company or any subsidiary 
company and
 reviewing and monitoring the company’s 
environmental performance and targets
overview delivering on our strategy business review governance 
63 wwwnationalexpressgroupcom
financial statements  governance 
directors’ remuneration report
remuneration committee overview
dear shareholder
this is my ﬁ rst letter to you as chairman of the remuneration committee 
a role i took over when miranda curtis left the board during 2012 i would 
like to thank miranda for her contribution during her time as chair of 
the committee
2012 has been another year of progress in many areas at national 
express despite the continuing challenging economic conditions the 
successful integration of the petermann and transit businesses in north 
america allied to a continuation of our drive to reduce costs and make 
improvements to our operational efﬁ ciency leave the group well placed 
to generate future value for shareholders
i believe that it is the key responsibility of the remuneration committee 
to create remuneration policies and practices that achieve the best value 
for shareholders pay and incentives have to be set at a level that will 
attract and retain quality management and fully incentivise them to deliver 
outstanding performance 
the board and remuneration committee are aware that there has 
always been a strong and competitive market for successful senior 
executives against this backdrop concerns relating to the retention 
of the company’s executive directors emerged during 2012 more 
speciﬁ cally in regard to the chief executive the board ﬁ rmly believes 
that the strong and effective leadership provided by the chief executive 
and his team has provided the group with a clear and robust platform for 
the delivery of future growth with this in mind and following consultation 
with the company’s major shareholders the remuneration committee 
and board deemed it necessary to develop its previously stated 
remuneration policy for 2012 key changes to the 2012 remuneration 
policy for the chief executive included 
 an increase in annual bonus opportunity from 125 of salary to 150 
of salary with 50 of the additional bonus being compulsorily deferred
 introduction of supplementary ﬁ ve year long term incentive awards of 
100 of salary pa granted subject to targets linked to the company’s 
ﬁ ve year plan and
 introduction of an additional pension promise that is focused on the 
retention of the chief executive for the next ten year period
in line with the above changes the board considered it appropriate to 
amend the finance director’s remuneration policy with effect from 2012 
accordingly the finance director’s bonus opportunity was increased 
from 1 125 to 150 with 50 of the additional bonus being subject 
to deferral 
following the above changes to the 2012 remuneration policy bonuses 
were earned at 1 17  15 and 1 17 of base salary respectively for the 
chief executive and finance director the remuneration committee 
was comfortable with the level of bonus earned based on the 
performance against ﬁ nancial targets and the achievement of speciﬁ c 
personal objectives set at the start of the year 
whilst full details of the revised remuneration policy are provided 
in the remuneration report i take this opportunity to highlight the 
remuneration committee’s continued aim to incentivise and reward 
performance over the long term accordingly the remuneration 
committee resolved not to increase the base salaries of executive 
directors this year and to make greater use of the company’s long 
term incentive plan in determining the remuneration of executive 
directors going forward 
with regard to future remuneration policy the committee believes that 
the amended remuneration policy operated in 2012 is appropriate for 
future years and looks to our shareholders to approve both this year’s 
remuneration report and the amendment to the current long term 
incentive plan described in the notice of agm
sir andrew foster
remuneration committee chairman
28 february 2013
64 national express group plc annual report and accounts 2012  during the year the committee 
considered the following items 
of business
 review of executive directors’ and 
senior executives’ salary levels
 annual bonus scheme terms for 2012
 review of the chairman’s fee
 performance targets to apply to the 
2012 long term incentive plan awards 
including the total shareholder return 
comparator group used and the range 
of earnings per share targets set
 2012 award levels under the 
company’s share plans
 approval of a new remuneration 
arrangement for the chief executive 
and finance director
 recruitment packages for new senior 
executives
 testing of performance conditions and 
vesting of long term incentive plan 
awards granted in 2009
 outline of the group’s 2012 bonus 
scheme
 long term incentive plan entitlements 
upon redundancy
main activities during the year 
remuneration committee
name of director position
sir andrew foster chairman appointed 
10 may 2012
miranda curtis chairman resigned 
10 may 2012
lee sander nonexecutive director 
tim score senior independent director
management attendees
dean finch group chief executive
stephen connock mbe group hr director
michael hampson general counsel and 
company secretary
role of the remuneration committee
the key responsibilities of the committee are to
 determine the fees of the chairman
 determine the remuneration and conditions 
of employment including any termination 
arrangements of the executive directors
 approve the remuneration and conditions 
of employment of the divisional heads and 
company secretary
 review the remuneration and conditions 
of employment of the senior management 
team and
 select and appoint any remuneration 
consultants who advise the committee
the full terms of reference of the committee 
are available on the company’s website at 
nationalexpressgroupcom 
the members of the committee who served 
during the year were all independent directors 
the committee met four times in 2012 details 
of attendance at these meetings can be found 
on page 56
the committee members and management 
attendees did not participate in any discussions 
directly relating to their own remuneration or 
performance during the year 
advisors to the committee
the committee has appointed independent 
remuneration consultants new bridge street 
nbs to advise on all aspects of senior 
executive remuneration nbs has no other 
connection with the group other than in the 
provision of advice on executive and employee 
remuneration and nor does its ultimate parent 
aon plc nbs is a signatory of the remuneration 
consultants’ code of conduct which speciﬁ es 
the professional standards of conduct for 
consultants to remuneration committees of 
uk listed companies from time to time the 
company submits the remuneration consultant 
function to tender 
overview delivering on our strategy business review governance 
65 wwwnationalexpressgroupcom
financial statements  governance 
directors’ remuneration report continued
information not subject to audit
remuneration policy for executive directors
remuneration policy is based on the following broad 
principles set by the committee
 to provide a competitive remuneration package  
to attract and retain quality individuals
 to align remuneration to drive the overall objectives  
of the business
 to align the interests of management with the interests  
of shareholders and
 to provide the foundation for overall reward and 
remuneration beyond the speciﬁc roles falling within  
the direct remit of the remuneration committee
in implementing its policy the committee gives full 
consideration to the principles set out in the uk corporate 
governance code with regard to directors’ remuneration 
and due regard is given to the guidance issued by investor 
protection bodies and institutional investors more generally
remuneration policy is reviewed on an ongoing basis 
against the committee’s broad principles and in light of 
emerging best practice in corporate governance 
during the year as a result of the continuing strong 
performance of the executive directors and in response to 
speciﬁc retention concerns in respect of the chief executive 
that were brought to the attention of the remuneration 
committee a number of changes were made to the 
remuneration policy to apply for 2012 this suite of changes 
was considered appropriate to retain and motivate the 
executive directors with the remuneration committee 
introducing the changes after appropriate consultation 
with the company’s major shareholders the changes 
were considered to ﬁnely balance performance and non
performance related elements of in particular the chief 
executive’s package with a view to ensuring his retention 
over the long term but linking a substantial proportion of 
his remuneration to a successful implementation of the 
company’s growth strategy they included
 an increase in the annual bonus opportunity for both 
executive directors to 150 of salary but with 50 of the 
additional bonus being compulsorily deferred in addition 
to 25 deferral of the previous bonus potential
 a supplementary ﬁve year long term incentive award was 
granted to the chief executive subject to targets linked to 
the company’s ﬁve year plan the principal terms of which 
are set out on pages 69 and 70 and
 the introduction of an additional pension promise for the 
chief executive that will accrue over the next ten years
the higher annual bonus opportunity coupled with greater 
deferral for both executive directors is considered to provide 
a more market consistent annual bonus opportunity and 
structure taking into account the size and complexity of  
the company
the remuneration committee recognises that the changes 
made during the year developed the policy disclosed in 
respect of 2012 in last year’s directors’ remuneration report 
however it considered it necessary to take this action given 
the retention issues noted earlier
the company is seeking shareholder approval to amend 
its existing ltip to enable supplementary ﬁve year long 
term incentive awards to be granted on an annual basis 
to the chief executive from 2013 this approach is being 
taken as a result of the remuneration committee wishing 
to provide a clear alignment with both our medium three 
year and long term ﬁve year objectives in future years 
further details in respect of the ﬁve year long term incentive 
awards to be granted on an ongoing basis are set out in the 
accompanying notice of agm
the committee believes that it continues to take into 
account the principles of sound risk management when 
setting pay the above changes are considered to have 
mitigated the retention issues perceived at the start of 2012 
the revised remuneration policy provides for a substantial 
proportion of the current remuneration packages of the 
executive directors to be weighted towards long term 
performance with the annual bonus also the subject 
of part deferral into the company’s shares clawback 
provisions also apply in the event of a misstatement of the 
company’s results and a broad range of ﬁnancial and non
ﬁnancial targets are included in our incentive programmes 
appropriate liaison takes place between the remuneration 
and audit committees as part of an effective remuneration 
risk assessment process in line with the association of 
british insurers’ abi’s guidelines on responsible investment 
disclosure the committee ensures that the incentive 
structure for executive directors and senior management 
will not raise environmental social or governance esg risks 
by inadvertently motivating irresponsible behaviour more 
generally with regard to the overall remuneration structure 
there is no restriction on the committee which prevents it 
from taking into account corporate governance on esg 
matters and it takes due account of issues of general 
operational risk when structuring incentives the committee 
takes due account of remuneration structures elsewhere in 
the group when setting pay for the executive directors for 
example consideration is given to the overall salary increase 
budget and the incentive structures that operate across 
the group 
the group operates a leadership and development 
programme which includes an appraisal system for directors 
and senior management in 2012 the appraisal system used 
balanced scorecards to assess performance against safety 
customer people and community objectives the results 
of the annual appraisal system are taken into consideration 
when setting remuneration levels
66 national express group plc annual report and accounts 2012  summary of executive directors’ remuneration
element objective performance period policy
basic salary to position at a competitive  
level for similar roles within  
comparable markets
annually individual pay levels using comparable midmarket  
data for guidance as appropriate are determined by 
reference to the individual’s performance experience  
in post and potential
performance  
related bonus
to incentivise delivery  
of performance objectives
1 year bonus payments are based on the achievement  
of speciﬁed corporate ﬁnancial and nonﬁnancial objectives 
a proportion of the bonus is subject to mandatory deferral 
into shares for one year from award 
pension to provide competitive beneﬁts  
in line with market practice and  
to act as a retention mechanism 
and reward long service
ongoing executive directors do not participate in the pension scheme 
the chief executive receives a cash supplement in lieu of 
pension at 35 of salary plus an additional 25 of salary 
notional pension contribution as part of an unfunded  
pension promise that is revalued each year at 5 pa  
from 1 april 2013
the finance director receives a cash supplement in lieu of 
pension at 25 of salary only basic salary is pensionable
long term incentive 
plan
to drive performance aid 
retention and align the interests 
of executive directors with 
shareholders
3 and 5 years
if applicable
half of any award is subject to eps growth the remaining 
half is subject to the relative total shareholder return tsr  
of the company compared against a bespoke peer group 
other beneﬁts to provide competitive beneﬁts in 
line with market practice
ongoing executive directors receive private health and long term 
sickness insurance and a cash alternative to a fully  
expensed car 
share ownership 
guidelines
to align executive directors  
with shareholders
na a shareholding of 100 of current salary should be achieved 
within ﬁve years 
elements of remuneration
i fixed versus variable remuneration
a substantial proportion of the executive directors’ pay is 
performance related the charts below show the balance 
between ﬁxed and performance related pay at target and 
maximum performance levels based on the elements of 
national express’s remuneration package set out above 
maximum performance assumes achievement of maximum 
bonus and full vesting of shares under the ltip 
ii basic salary
the salary of individual executive directors is reviewed at 
1 january each year account is taken of the performance 
of the individual concerned together with any change in 
responsibilities that may have occurred and the rates for 
similar roles in two comparator groups of companies the 
comparator groups for the 2012 ﬁnancial year were i a 
group of transportleisure sector companies and ii a group 
of companies from the ftse mid 250 drawn from across 
all sectors the constituents of each group were selected 
to be broadly reﬂective of the size market capitalisation and 
turnover and complexity of national express at the time 
of completing the review for 2013 the comparator groups 
will be based on similar groups of transportleisure and 
general sector companies drawn from the ftse 250 when 
considering pay increases for 2014 
no increases were awarded to base salary for the executive 
directors for 2012 or for 2013
iii performance related bonus
the maximum potential bonus payable to executive 
directors in 2012 was 150 of salary for both executive 
directors this reﬂected a change of policy that was 
discussed with the company’s largest shareholders 
following the publication of the 201 1 directors’ remuneration 
report in light of this change of policy the company’s 
policy on deferral was also revised in addition to the existing 
requirement for 25 of the bonus to be deferred following 
the decision to increase the maximum bonus entitlement  
to 150 the executive directors are required to defer 50 
of the additional bonus 
2013 fixed and variable pay 
group chief executive at target 
and maximum performance levels
target
maximum
2013 fixed and variable pay 
group finance director at target 
and maximum performance levels
target
maximum
base salary
annual bonus
ltip performance and matching
0
20 40 60 80 100
0
20 40 60 80 100
overview delivering on our strategy business review governance 
67 wwwnationalexpressgroupcom
financial statements  governance 
directors’ remuneration report continued
in respect of the targets applying to the annual bonus 
for 2012 for the chief executive and finance director a 
maximum of 105 of salary and 90 of salary respectively 
was payable based on achievement against a sliding scale 
of challenging normalised proﬁt targets the deﬁnition of 
normalised proﬁt is set out in the glossary on page 162 
a maximum of 45 and 60 of salary respectively was 
payable based on nonﬁnancial targets that encompassed 
customer operational excellence and people objectives
in relation to the proportion of the bonus determined by 
performance against normalised proﬁt targets no bonus 
is payable unless the company achieves at least 95 of 
budget and the maximum amount is only payable on the 
achievement of a stretch target of 1 10 of budget
the targets set in relation to nonﬁnancial performance 
are key strategic group objectives that are tailored to the 
responsibilities of each individual executive director and in 
aggregate are considered to be similarly challenging to the 
range of ﬁnancial targets set in addition no bonus in respect 
of nonﬁnancial performance is payable unless 95 of the 
group’s normalised proﬁt budget is achieved 
the committee has full discretion in the payment of bonuses 
and in particular it is a precondition to the award of any 
bonus that the committee has determined that there 
has been a material improvement in safety processes 
procedures and outcomes during the year in the relevant 
business unit before any bonus is paid
the amounts deferred under the bonus plan are deferred 
into shares awarded under the executive deferred bonus 
plan edbp receipt of the deferred shares is subject to 
continued service and the same ‘good leaver’ provisions and 
other terms as noted for the long term incentive plan below 
the 2012 bonus also includes clawback provisions that 
require the deferred shares to be forfeited or repaid should it 
be necessary for the company to restate materially its 2012 
results within a two year period following the deferred bonus 
being awarded the proportion of the bonus that would 
be the subject to a clawback would depend on the extent 
to which the original bonus payment turned out to be false 
following the publication of corrected results 
in terms of an overview of the 2012 bonus plan and the 
extent to which targets were met this is set out in the table 
below bonuses were payable at 1 17  15 of salary for the 
group chief executive and 1 17 of salary for the finance 
director in calculating these bonuses the committee 
considered the safety performance of the company 
and concluded that a continued improvement in safety 
processes procedures and outcomes during the year had 
been achieved
the deferred bonuses awarded to both executive directors 
in 2012 based on performance to 31 december 201 1 are 
due to vest on 2 march 2013
bonus scheme 2012
 of salary details achievement
maximum bonus potential 150 proportion of bonus subject to 
mandatory deferral into company 
shares for one year from award
group chief executive
1
 1 17  15 and 
group finance director
2
 117
bonus potential at 95 of  
budgeted normalised proﬁt  
before tax pbt
2625 for group chief executive
225 for group finance director
on target bonus potential  
at 100 of budgeted normalised 
pbt
525 for group chief executive
45 for group finance director
awarded on achieving budget
stretch bonus for 1 10 of  
budgeted normalised pbt 
105 for group chief executive
90 for group finance director
awarded on achieving a stretch 
target of 1 10 of normalised pbt
nonﬁnancial targets underpinned 
by achievement of 95 of  
budgeted normalised pbt
45 for group chief executive
60 for group finance director
awarded on meeting key strategic 
group objectives tailored to each 
executive director’s responsibilities 
notes 
1
  the group chief executive achieved 7215 of salary in respect of the ﬁnancial performance condition and 45 in respect of his achievement of his nonﬁnancial targets
2
  the group finance director achieved 6262 of salary in respect of the ﬁnancial performance condition and 5438 in respect of the nonﬁnancial targets
it is a precondition to the award of any bonus that the remuneration committee has determined that there has been a material improvement in safety processes procedures and 
outcomes during the year in the relevant business unit before any bonus is paid  
in addition to the bonus payments described above the finance director received a cash payment of £25567301 to compensate him for a shortfall in the amount of 2009 ltip 
vesting the shortfall was as a result of a delay in the grant of awards due to the company being in a close period at the time the 2009 awards would normally have been granted 
after having reﬂected on the exceptional circumstances the committee decided that whilst they could not amend the terms of the plan they felt it unfair for the finance director to 
be penalised as a result of the late granting of the award the cash payment was thus calculated as the difference between the value of the ltip vesting on 30 june 2012 and the 
value had it vested on 31 march 2012 ie the vesting date had there been no delay in the 2009 grant
68 national express group plc annual report and accounts 2012  iv pensions
under the terms of their service agreements executive 
directors are not entitled to become members of one of the 
group pension schemes the chief executive receives a 
35 of salary supplement in lieu of pension contributions 
in addition from 2012 as part of a revised remuneration 
structure intended to facilitate his retention described above 
the chief executive will also accrue rights under a pension 
promise that will take place over ten years from 1 april 2013 
the promise provides that a pension beneﬁt will be eligible to 
be drawn based on a notional company contribution of 25 
of salary over the ten year period revalued at a rate of 5 
pa which is broadly comparable to the assumed investment 
return used to value pension liabilities across the group
jez maiden receives a 25 salary supplement in lieu of 
pension contributions 
v incentive scheme and share options 
long term incentive arrangements
the national express group long term incentive plan 
ltip was approved by shareholders at the 2005 agm and 
operates as the company’s sole type of executive long term 
incentive arrangement the ltip consists of annual awards 
of performance and matching shares a proportion of the 
award is made as approved share options under a hmrc 
approved option plan structure this does not increase the 
gross beneﬁt to the participant or the costs to the company 
or shareholders
performance shares
executive directors are eligible to receive a conditional 
award of shares up to an equivalent of 100 of basic salary 
the vesting of the award is conditional on meeting the 
performance conditions set out below
matching shares
executive directors are also eligible to receive awards of 
matching shares that are based on a personal investment 
in national express group plc shares funded either 
through using an annual bonus award to purchase shares 
or through pledging of shares held not already allocated to 
the ltip  matching awards are made on the basis of up to 
two matching shares being awarded based on the gross 
tax value of the investment for each national express share 
pledged or purchased the maximum value of investment  
in any year is 30 of basic salary matching share awards 
are also conditional on the performance conditions set  
out overleaf 
if a participant ceases employment before vesting for a 
‘compassionate’ reason eg redundancy retirement death 
in service sale of business out of the company’s group his
her awards will ordinarily vest the extent of vesting will be 
determined by applying the relevant performance conditions 
to the date of cessation and scaling back the number of 
shares awarded on a pro rata basis rounded up to the next 
complete six month period from the date of grant unless  
the committee determines that it would be inappropriate  
to apply a pro rata reduction awards lapse on cessation  
of employment for any other reason
ltip performance conditions
there are normally two distinct performance conditions 
applying to awards of both performance shares and 
matching shares made 
first the performance condition attached to onehalf  
of an award part ‘a’ is based on the group’s normalised 
earnings per share eps growth performance in excess  
of inﬂation over a ﬁxed threeyear period three ﬁnancial  
years commencing with the ﬁnancial year in which the  
award is made
the performance condition attached to the other half 
of an award part ‘b’ is based on the company’s total 
shareholder return tsr performance over the same  
ﬁxed threeyear period relative to the tsr performance of  
a bespoke comparator group of transport companies taken 
predominantly from the ftse industrial transportation and 
ftse travel  leisure sectors the companies comprising 
the comparator group have been chosen on the basis of 
their comparability to national express group plc based 
on their size and scope of business operations the 
committee has retained the power in respect of this  
element of an award to apply an earnings underpin
there is no ability to retest either performance condition 
eps and tsr have generally been chosen for the ltip  
as the most appropriate measures of the group’s long  
term performance since eps is an important growth 
measure considered within the company and a driver of 
shareholder value and tsr improves shareholder alignment 
and is consistent with the company objective of providing 
superior long term returns to shareholders the 2014 eps 
targets have been based on nonrail 201 1 earnings as  
the company’s rail franchise is subject to a government 
tender process
for awards granted in 2012 the eps performance conditions 
applying to part a of the awards and the tsr performance 
conditions applying to part b of the awards are set out in the 
table overleaf
to determine vesting of ltip awards the committee retains 
independent consultants to test the proportion of an award 
vesting under the relative tsr test and then reviews the 
conclusion of this analysis before shares formally vest 
the national express group executive deferred bonus plan executive deferred bonus plan
deferred bonuses awarded in 2012 based on performance to 31 december 201 1 will vest on 1 march 2013 as set out in the table below
as at 1 
january 2012
during year
at 31 
december 
2012
market price 
at date of 
vesting
date of  
grant
date of 
vesting granted vested lapsed
dean finch 201 1 49427 – 49427 – – 2210p 2502 1 1 2502 12
2012 – 75417 – – 75417 0203 12 –
jez maiden 201 1 39541 – 39541 – – 2210p 2502 1 1 2502 12
2012 – 51832 – – 51832 0203 12 –
the market price per share on the date of award was calculated on basis of the average market price share in the 5 days preceding the date of the grant
deferred shares would be required to be forfeited or repaid should it be necessary to restate materially the company’s 2012 results within a two year period following the award of the 
bonus the proportion of the bonus subject to clawback would depend on the extent to which the original bonus turned out to be false following the publication of corrected results
overview delivering on our strategy business review governance 
69 wwwnationalexpressgroupcom
financial statements  governance 
directors’ remuneration report continued
with regard to the eps targets vesting is based on  
the company’s audited results with liaison as required 
between the audit and remuneration committees 
performance conditions for ltip awards 
granted in 2012
part a of award – eps conditions
eps for the ﬁnancial year  
ending 31 december 2014
percentage of part a of 
the award that vests
less than 237 pence 0
237 pence 30
264 pence 100
between 237 pence  
and 264 pence 30–100 pro rata
part b of award – tsr conditions
rank of the company’s 
tsr as noted above
percentage of part b  
of the award that vests
below median 0
median 30
20th percentile 100
between median  
and 20th percentile 30–100 pro rata
the table below sets out the percentage of each extant 
award that would have vested if the performance conditions 
had been tested at 31 december 2012 without making any 
allowance for pro rata reduction for any period of less than 
three years 
indicative percentage of ltip awards vesting 
based on performance to 31 december 2012
year of award
tsr 
element
eps 
element
total 
max 
100
2010 0 325 325
201 1 0 0 0
2012 0 4222 4222
chief executive ﬁve year award
as noted above in response to speciﬁc retention concerns 
in respect of the chief executive that were brought to the 
attention of the remuneration committee and to align him 
with the company’s ﬁve year business plan on 3 august 
2012 the chief executive was granted a retention award 
comprising a conditional award over 261407 ordinary shares 
in the capital of the company the retention award was 
granted pursuant to rule 9422 of the ukla listing rules
as with the 2012 ltip awards detailed above the eps 
targets have been based on nonrail earnings this is 
because the company’s rail franchise will soon be subject  
to a government tender process
the performance conditions applying to the award are 
set out below and the principal terms of the award are 
summarised on page 69
performance conditions for the chief 
executive’s ﬁve year award
part a of award – eps conditions relating to one half 
of the award
eps for the ﬁnancial year 
ending 31 december 2016
percentage of part a of 
the award that vests
less than 25 pence 0 
25 pence 30 
28 pence 100 
between 25 pence  
and 28 pence 30–100 pro rata 
part b of award – tsr conditions relating to one half 
of the award
rank of the company’s 
tsr as noted above
percentage of part b 
of the award that vests
below median 0
median 30
20th percentile 100
between median and 20th 
percentile 30–100 pro rata
performance criteria
the committee believes that budgeted proﬁt andor eps 
growth as performance measures for the discretionary 
bonus scheme and long term incentives in most normal 
circumstances provide a transparent and accessible 
method of gauging the ﬁnancial performance of the 
company the company calculates performance against 
these performance measures by reference to the proﬁt 
or earnings per share ﬁgures reported in the company’s 
audited accounts which the company believes to be the 
most transparent and objective measure of the company’s 
proﬁt or eps the committee also monitors the group’s tsr 
against the ftse allshare travel  leisure index as a broad 
measure of the company’s performance tsr measured 
against a more tailored group of comparators has been 
used by the company as a primary performance measure 
for awards made to executive directors under the ltip as 
outlined in this report
it is currently intended that the performance targets that will 
apply to awards granted in 2013 will again be an equal blend 
of eps and tsr if it were considered appropriate to make 
any fundamental changes to the performance targets in 
2013 it is anticipated that this would be accompanied by  
a consultation with major shareholders
the graphs on page 72 show a comparison of national 
express group plc total cumulative shareholder return 
against that achieved by the ftse allshare travel  leisure 
index and the ftse 250 index these indices have been 
selected because the company is a constituent of each 
index with the former including many members of the ltip 
tsr peer group and the committee therefore feels that 
these are the most appropriate indices to represent the 
company’s relative performance 
70 national express group plc annual report and accounts 2012  information subject to audit
long term incentive plan ltip awards
details of the ltip and the performance conditions that have applied to each award below are shown on page 69 and in the notes to the ltip awards 
table below
ltip awards to executive directors
ltip share 
awards
at 1  
january  
2012
during year
at 31 
december 
2012
market 
price  
on date of 
award
market 
price  
at date of 
exercise
date from 
which 
exercisable
expiry  
date granted exercised expired
dean finch
performance 
shares 227272––– 227272 2203p – 1503 13 1509 13
matching 
shares 227270––– 227270 2203p – 1503 13 1509 13
performance 
shares 222672 – – – 222672 247 0p – 2502 14 2508 14
matching 
shares 267204––– 267204 247 0p – 2502 14 2508 14
performance 
shares – 240069 – – 240069 2284p – 1204 15 12 10 15
matching 
shares – 288080 – – 288080 2284p – 1204 15 12 10 15
jez maiden
performance 
shares 176342 – 109191
3
67  151 – 2104p 2200p 0109 12 0103 13
matching 
shares 132637 – 82129
3
50508 – 2104p 2200p 0109 12 0103 13
performance 
shares 174672––– 174672 2300p – 0104 13 01 10 13
matching 
shares 174670––– 174670 2300p – 0104 13 01 10 13
performance 
shares 170040––– 170040 247 0p – 2502 14 2508 14
matching 
shares 204048––– 204048 247 0p – 2502 14 2508 14
performance 
shares – 183326 – – 183326 2284p – 1204 15 12 10 15
matching 
shares – 219988 – – 219988 2284p – 1204 15 12 10 15
notes
1
 details of the performance conditions applicable to the 2012 awards are shown on page 70
2
  the tsr performance conditions applicable to the 2010 and 2011 awards are the same as for the 2012 awards and the relevant maximum and minimum eps ﬁgures  
are 28 pence and 23 pence and 293 pence and 261 pence respectively
3
 the aggregate gain on the shares which were exercised in 2012 was £420000 
chief executive’s ﬁve year award
ltip share 
awards
at 1  
january  
2012
during year
at 31 
december 
2012
market 
price  
on date of 
award
market 
price  
at date of 
exercise
date from 
which 
exercisable
expiry  
date granted exercised expired
performance 
shares – 261407 – – 261407 2104p – 0308 17 0308 18
note
1
 details of the performance conditions applicable to the 2012 awards are shown on page 70
overview delivering on our strategy business review governance 
71 wwwnationalexpressgroupcom
financial statements  governance 
directors’ remuneration report continued
directors’ service contracts notice periods  
and termination payments
executive directors
the contract dates and notice periods for the executive 
directors are shown in the table on page 73
the service contracts of both the executive directors 
which are rolling contracts contain a provision exercisable 
at the option of the company to pay an amount on early 
termination of employment equal to one year’s salary or in 
the case of dean finch one year’s salary salary supplement 
in lieu of pension and car allowance the company will use 
the payment in lieu of notice provisions when the speed 
certainty and protection of restrictive covenants afforded by 
such clauses are thought to be in the best interests of the 
company and the circumstances surrounding the departure 
of the relevant director justify their use 
in any event the committee’s policy is that payments to 
directors on termination should reﬂect the circumstances 
that prevail at the time also taking account if applicable  
and appropriate the director’s duty to mitigate
the committee continuously reviews its policies on 
executive remuneration and severance in the best interests 
of shareholders guidance on best practice expectations is 
taken into account prior to agreeing directors’ contractual 
provisions 
conditional award of shares
on appointment as group chief executive in 2010 dean 
finch was granted a oneoff forfeitable share award as 
compensation for forfeited remuneration from his previous 
employer the share award comprised two parts an award 
of 28023 shares the first award which vested on 1 april 
201 1 and 18281 shares the second award which vested 
on 1 april 2012 the second award vested during the 
reporting period at a market price per share of 230 pence  
at which point the shares were no longer at risk of forfeiture 
executive directors’ external appointments
under the terms of their service agreements board approval 
is required before any external appointment may be 
accepted by an executive director the executive director  
is permitted to retain any fees paid for such services  
details of fees received by executive directors in 2012  
are shown below
director fee external appointment
jez maiden £50000
synthomer plc  
formerly yule catto  co plc
remuneration of nonexecutive directors 
the fees of the nonexecutive directors are set by the 
board as a whole and those of the chairman are set by the 
remuneration committee in both cases following an annual 
review the review takes account of fees paid for similar 
positions in the market the time commitment required 
from the director estimated to be 60 days per year for the 
chairman and 20 days per year for the other nonexecutive 
directors and any additional responsibilities undertaken 
such as acting as chairman to one of the board committees 
or fulﬁlling the role of senior independent director non
executive directors are not eligible to receive pension 
entitlements or bonuses and may not participate in share 
option schemes 
in line with the decision not to increase the basic salaries 
of the executive directors in 2013 it was agreed that there 
would be no increase in the fees paid to the nonexecutive 
directors in 2013 the fees payable to the chairman have 
also not been increased for 2013 increases to base 
salaries will be strictly monitored in line with our focus on 
cost control across the group and depending on the 
businesses involved and the locations we envisage 
salaries for employees generally being frozen or increased 
by up to 2
total shareholder return versus 
ftse allshare travel  leisure index 
source thomson reuters
national express group cumulative return
ftse allshare travel  leisure cumulative return
national express annual return
ftse allshare travel  leisure annual return
each point plotted on the above graph represents the total cumulative 
shareholder return on an investment made in national express group 
on 31 december 2006 compared with an investment in the ftse 
allshare travel  leisure index with the corresponding annual returns 
80
60
40
20
0
20
40
60
2012 2011 2010 2009 2008 2007
total shareholder return versus 
ftse 250 index 
source thomson reuters
national express group cumulative return
ftse 250 cumulative return
national express annual return
ftse 250 annual return
each point plotted on the above graph represents the total cumulative 
shareholder return on an investment made in national express group 
on 31 december 2006 compared with an investment in the ftse 250 
index with the corresponding annual returns 
80
60
40
20
0
20
40
60
2012 2011 2010 2009 2008 2007
72 national express group plc annual report and accounts 2012  executive directors’ service contracts and notice periods 
director contract date notice period from the company notice period from the director
jez maiden 17 november 2008 12 months 12 months
dean finch 16 december 2009 12 months 6 months
nonexecutive directors’ appointment dates
director date of appointment
sir john armitt 1 january 2013
joaquín ayuso 1 june 201 1
jorge cosmen 1 december 2005
sir andrew foster 1 august 2004
jackie hunt 13 september 2012
chris muntwyler 11 may 2011
lee sander 1 june 201 1
tim score 21 february 2005
directors’ minimum shareholding
in order to align the interests of the directors more closely with the shareholders the remuneration committee has also determined that the executive 
directors should build up a share fund equal to at least one year’s current salary over a period of ﬁve years 
2012  
£
201 1  
£
chairman’s fee 225000 225000
nonexecutive director basic fee 45500 45500
senior independent director 
additional fee 5000 5000
committee chairman additional fee 10000 10000
nonexecutive directors’ appointments
the nonexecutive directors do not have service contracts 
with the company but are appointed for an initial threeyear 
term nonexecutive directors are typically expected to 
serve for two threeyear terms although their appointment 
can be terminated either by them or the company on one 
month’s written notice it is open to the company to invite a 
nonexecutive to serve for a further period after the expiry 
of two threeyear terms all directors are required to stand 
for reelection by shareholders each year the original 
appointment dates of the chairman and nonexecutive 
directors are shown in the table below
senior executive remuneration
the remuneration committee reviews and notes the 
salaries of senior executives within the group the salaries of 
this group of employees by band are as shown to the right
salary band  
£000
number of executives  
2012
201–410 7
151–200 12
101–150 40
75–100 45
overview delivering on our strategy business review governance 
73 wwwnationalexpressgroupcom
financial statements  governance 
directors’ remuneration report continued 
directors’ shareholdings
directors’ interests and transactions
the beneﬁcial and nonbeneﬁcial interests of the directors in ofﬁce as at 31 december 2012 are shown below
at 31 december 2012
at 1 january 2012 or on 
appointment if later
change from 31 december 
2012 to 28 february 2013
executive directors
dean finch 138252 11 4579 –
jez maiden 168919 11 634 7 –
nonexecutive directors
joaquín ayuso – ––
jorge cosmen
1
 88860685 88860685 –
miranda curtis resigned 10 may 2012 – ––
john devaney resigned 31 january 2013 76666 76666 –
sir andrew foster 22893 22893 –
jackie hunt appointed 13 september 2012 – ––
chris muntwyler – ––
lee sander – ––
tim score – ––
1
  jorge cosmen’s holding includes shares held by european express enterprises ltd which are shown on page 59 in the list of major shareholdings in the company
the register of directors’ interests maintained by the company contains full details of the directors’ holdings of shares and options over shares in the company the midmarket price 
of the company’s ordinary shares at 31 december 2012 was 204 pence 201 1 223 pence and the range during the year ended 31 december 2012 was 1645 pence to 252 pence
directors’ emoluments
salaryfees 
£000
performance 
related bonus
£000
beneﬁts
1
£000
beneﬁts in lieu 
of pension 
£000
total  
2012 
£000
total  
201 1 
£000
executive directors
dean finch 550 644 26 192 1412 1454
jez maiden 420 491
2
24 105 1040 1021
nonexecutive directors
joaquín ayuso 49
4
––– 49 30
jorge cosmen deputy chairman 45 – – – 45 45 
john devaney chairman  
resigned 31 january 2013 225 – – – 225 225
sir andrew foster 51 – – – 51 44 
jackie hunt appointed 13 september 2012 13 – – – 13 –
chris muntwyler 59
4
––– 59 37
lee sander 69
4
––– 69 30
tim score senior independent director 60 – – – 60 60
former nonexecutive directors
miranda curtis resigned 10 may 2012 23 – – – 23 55
1
 beneﬁts in kind include a cash alternative to a fully expensed car life assurance and health insurance
2
    jez maiden sacriﬁced £20000 of his cash bonus entitlement before its award pension contributions equal to this amount were made into pension plans  
for the beneﬁt of his dependants the amount shown in the bonus column reﬂects the full bonus earned
3
  as explained on page 68 jez maiden received an additional oneoff bonus of £255673 to compensate him for a shortfall in the amount of the 2009 ltip vesting
 4
  an additional fee of £4000 is paid for attendance at board meetings held outside the continent in which the nonexecutive director is resident
by order of the board
sir andrew foster
director and chairman of the remuneration committee 
28 february 2013
 
74 national express group plc annual report and accounts 2012  in accordance with listing rule 9422 the principal terms 
of the retention award are summarised below
structure of award
the award is structured as a conditional award of shares 
no payment was required for the grant of the award  
the award is not transferable except on death  
the award is not pensionable
vesting of award
the award will normally vest on the ﬁfth anniversary  
of the grant date of the award to the extent that the 
performance conditions are satisﬁed and subject to  
the terms of the award
leaving employment
the award will ordinarily lapse in the event of the chief 
executive’s cessation of service within the group prior  
to the vesting of the award 
however if the chief executive ceases employment 
for certain ‘compassionate’ reasons eg redundancy 
retirement ill health sale of business out of the group 
or for any other reason determined by the committee 
the award shall either continue on its terms and vest on 
normal timetable or vest early at the discretion of the 
committee in such circumstances the extent to which 
the award would vest would be dependent on the extent 
to which the performance conditions were met over the 
full period or curtailed period as relevant furthermore in 
such circumstances the size of the award would be scaled 
back by reference to the time elapsed since date of grant 
rounding up to the nearest half year unless the committee 
determined that it would be inappropriate to apply such 
time proration in the relevant circumstances
corporate events
in the event of a takeover scheme of arrangement or 
winding up of the company not being a corporate 
reorganisation the award would vest early to the extent 
that the committee considers that the performance 
conditions had been satisﬁed at the time of such event 
with a prorata reduction in the size of the award based  
on the time elapsed between the date of the award and 
the date of the relevant event rounded up to the nearest 
half year unless the committee determines that it would 
be inappropriate to apply a pro rata reduction in the 
relevant circumstances 
in the event of a corporate reorganisation the award would 
be replaced by an equivalent new award
variation of share capital
in the event of any variation of the share capital of the 
company a demerger special dividend or other similar 
event which affects the market price of the group’s shares 
to a material extent the committee may make such 
adjustments to the award as it considers appropriate
no shareholder rights until vesting 
the award does not confer any shareholder rights for 
example the right to vote the shares until the award has 
vested and shares delivered under the award 
at the discretion of the committee the chief executive  
will be entitled to receive a payment in cash andor shares 
on or shortly following the vesting the award of an amount 
equivalent to the dividends that would have been paid on 
the vested shares between the time when the award was 
granted and the time when it vests 
source of shares
the award may only be satisﬁed with existing shares  
no newly issued or treasury shares will be used in 
connection with the award 
extenuating events
in exceptional circumstances the committee may 
defer the vesting of the award to such later date as it 
so determines or cancel such award if it considers 
acting fairly and reasonably that there is any sufﬁciently 
extenuating event or events in the 12 months prior to the 
vesting of the award that warrants such determination
amendment
the terms of the award may be amended in such 
manner as the committee may determine provided that 
amendments to the award to the chief executive’s beneﬁt 
may only be made with prior consent of shareholders  
and any to his detriment subject to his consent
chief executive’s 5 year retention award
overview delivering on our strategy business review governance 
75 wwwnationalexpressgroupcom
financial statements  governance 
directors’ report
the directors present their report and audited ﬁnancial 
statements for the year ended 31 december 2012
principal activities
national express group plc is the holding company of 
the national express group of companies its subsidiary 
companies provide mass passenger transport services  
in the uk and overseas
business review
reviews of the business likely future developments and 
details of principal risks and uncertainties can be found  
in the following pages and are incorporated by reference  
into this report
 group chief executive’s review on pages 10 to 13
 finance director’s review on pages 20 to 23 and
 governance report on pages 50 to 81
branches outside the uk
the company has branches in spain 
results and dividends
the proﬁt on ordinary activities before tax from continuing 
operations for the year ended 31 december 2012 was  
£698 million 201 1 £1294m and a proﬁt attributable to 
equity shareholders of £600 million 201 1 £1012m was 
transferred to reserves
the directors recommend a ﬁnal dividend for the year of 
66 pence per ordinary share 201 1 65p which together 
with the interim dividend of 3 15 pence per ordinary share 
201 1 3p paid on 21 september 2012 gives a total dividend 
for the year of 975 pence per share 201 1 95p subject 
to shareholder approval the ﬁnal dividend will be paid on 
17 may 2013 to ordinary shareholders on the register of 
members at the close of business on 26 april 2013
directors
the directors of the company who served during the  
year were
jorge cosmen 
miranda curtis resigned 10 may 2012
john devaney resigned 31 january 2013
dean finch
sir andrew foster 
jackie hunt appointed 13 september 2012
jez maiden 
chris muntwyler
lee sander
tim score
sir john armitt joined the board on 1 january 2013 he was 
appointed as chairman of the board on 1 february 2013 
following the resignation of john devaney 
the appointment and replacement of directors of the 
company is governed by its articles of association the 
uk corporate governance code the companies act and 
related legislation in accordance with the uk corporate 
governance code all the directors will retire at the 
upcoming agm and offer themselves for reelection the 
board is satisﬁed that each director is qualiﬁed for reelection 
by virtue of their skills experience and contribution to the 
board details of the remuneration of the directors their 
interests in shares of the company and service contracts  
are contained in the directors’ remuneration report on pages 
64 to 75
corporate governance
a full report on corporate governance can be found in the 
governance section of this document and the company’s 
corporate governance statement is on page 79 both are 
incorporated by reference into this report
directors’ interests in contracts
except as stated in note 36 on page 143 no contract existed 
during the year in relation to the company’s business in 
which any director was materially interested
post balance sheet events
as at the date of this report there were no post balance 
sheet events to report
employment policies
the group strives to meet its business objectives by 
motivating and encouraging its employees to be responsive 
to the needs of its customers and continually improve 
operational performance the group is committed to 
providing equality of opportunity to employees and potential 
employees this applies to appropriate training career 
development and promotion for all employees regardless  
of physical ability gender sexual orientation religion  
age or ethnic origin all businesses in the group report 
diversity data
full and fair consideration is given to applications for 
employment received from disabled persons according 
to their skills and capabilities the services of any existing 
employee disabled during their period of employment are 
retained wherever possible
employee involvement
the group encourages employee involvement in its 
affairs subsidiary companies produce a range of internal 
newsletters and circulars which keep employees abreast of 
developments senior management within the group meet 
regularly to review strategic developments and management 
conferences are held at group and business levels to bring 
our senior managers together to share ideas and develop 
policy dialogue takes place regularly with trade unions and 
other employee representatives on a wide range of issues 
employees are able to share in the group’s results through 
various employee share schemes
employee views are also sought through regular employee 
satisfaction questionnaires both within business units and 
across the group following such surveys results are shared 
with employees and action plans are put in place to deal 
with issues arising the group encourages innovation from 
all levels of employees and has a structured programme in 
place known as ‘make a difference’ to develop ideas and 
track them through to implementation innovation sponsors 
agents and champions are appointed in the business and 
their work is coordinated by an innovations council at group 
level for national express innovation is a way of life that 
involves and engages our people
the group also has a welldeveloped succession planning 
process in place and succession plans are reviewed by 
the plc board annually as a key part of this process the 
company focuses on emerging talent to ensure the group 
has the right people being developed to meet our future 
business needs talent management remains an important 
priority for the group
76 national express group plc annual report and accounts 2012  environmental policy
information on the group’s environmental initiatives can  
be found in the corporate responsibility review on page 
46 and in the corporate responsibility section of the 
company’s website nationalexpressgroupcom where  
you will ﬁnd corporate responsibility reports policies and 
other information
charitable and political contributions
charitable donations made during the year totalled  
£373000 201 1 £228000 it is the group’s policy not to 
make political donations and accordingly none were made 
in the year however the company did attend party political 
conferences during the year for which total expenditure was 
£6750 201 1 £6000
creditors’ payment policy and practice
it is the company’s policy to agree terms of payment prior 
to commencing trade with any supplier and to abide by 
those terms based on the timely submission of satisfactory 
invoices 
trade creditor days of the company for the year ended  
31 december 2012 were 17 days 201 1 17 days based on 
the ratio of company trade creditors at the end of the year  
to the amounts invoiced during the year by trade creditors
financial instruments
details of the use by the company and its subsidiaries of 
ﬁnancial instruments and any related risk management 
objectives and policies including hedging policy and 
exposure including price credit liquidity or cash ﬂow risk  
of the company in connection with such ﬁnancial 
instruments can be found in the notes to the consolidated 
accounts on pages 88 to 145 and are incorporated by 
reference into this report
major shareholdings
disclosures of major shareholdings notiﬁed to the  
company are shown on page 59 and these disclosures  
are incorporated by reference into this report
share capital and rights attaching to the 
company’s shares
under the company’s articles of association any share in 
the company may be issued with such rights or restrictions 
whether in regard to dividend voting return of capital 
or otherwise as the company may from time to time by 
ordinary resolution determine or in the absence of any 
such determination as the directors may determine 
at 31 december 2012 the company’s issued share 
capital consisted of a single class of ordinary shares with 
a nominal value of 5 pence at a general meeting of the 
company every member has one vote on a show of hands 
and on a poll one vote for each share held the notice of 
agm accompanying this document speciﬁes deadlines for 
exercising voting rights either by proxy or by being present 
in person in relation to resolutions to be passed at a general 
meeting details of the authorised and issued share capital 
of the company and details of shares issued during the year 
can be found in note 32 on page 133 
on 6 march 2012 the company sold its entire holding of 
treasury shares which amounted to a total of 1668688 
ordinary 5 pence shares nominal value £83434 in treasury 
equal to 032 of the issued share capital
no shareholder is unless the board decides otherwise 
entitled to attend or vote either personally or by proxy at 
a general meeting or to exercise any other right conferred 
by being a shareholder if he or she or any person with an 
interest in his or her shares has been sent a notice under 
section 793 of the companies act 2006 which confers 
upon public companies the power to require information 
with respect to interests in their voting shares and he or 
she or any interested person failed to supply the company 
with the information requested within 14 days after delivery 
of that notice the board may also decide that no dividend 
is payable in respect of those default shares and that no 
transfer of any default shares shall be registered these 
restrictions end seven days after receipt by the company 
of a notice of an approved transfer of the shares or all the 
information required by the relevant section 793 notice 
whichever is earlier
the directors may refuse to register any transfer of any share 
which is not a fullypaid share although such discretion 
may not be exercised in a way which the financial services 
authority regards as preventing dealings in shares of that 
class from taking place on an open or proper basis the 
directors may likewise refuse any transfer of a share in favour 
of more than four persons jointly
the company is not aware of any other restrictions on the 
transfer of ordinary shares in the company other than
 certain restrictions that may from time to time be imposed 
by laws and regulations for example insider trading laws 
and
 pursuant to the listing rules of the financial services 
authority whereby certain employees of the company 
require approval of the company to deal in the company’s 
shares
the company is not aware of any agreements between 
shareholders that may result in restrictions on the transfer  
of securities or voting rights
resolutions will be proposed at the 2013 agm to authorise 
the directors to exercise all powers to allot shares or grant 
rights for or to convert any security into shares and approve 
a limited disapplication of statutory preemption rights 
details are set out in the notice of agm accompanying  
this document
the company was granted authority at the agm in 2012 
to purchase its own shares up to an aggregate value of 
10 of the issued nominal capital the authority was not 
used during the year the authority is renewed annually 
and approval will be sought at the agm in 2013 for its 
renewal further details are set out in the notice of agm 
accompanying this document
share schemes
first names jersey limited formerly ifg trust jersey 
limited as trustee of the national express group employee 
beneﬁt trust as at 25 february 2013 held 339070 shares 
006 of the share capital of the company for employee 
share schemes further details of the company’s employee 
share schemes can be found in note 7 on page 102 and are 
incorporated by reference into this report the trustee may 
vote the shares held by the trust at its discretion
the current association of british insurers abi guidance on 
dilution limits provide the overall dilution under all share plans 
operated by a company should not exceed 10 over a  
ten year period in relation to the company’s share capital 
with a further limitation of 5 in any ten year period on 
executive plans national express share plans operate  
within abi recommended guidelines on dilution limits
overview delivering on our strategy business review governance 
77 wwwnationalexpressgroupcom
financial statements  governance 
directors’ report continued
articles of association
any amendments to the company’s articles of association 
may be made in accordance with the provisions of the 
companies act 2006
annual general meeting
the annual general meeting agm will be held at 200pm 
on 9 may 2013 at kings place 90 york way london 
n1 9ag at the meeting special resolutions will be proposed 
to authorise the directors to issue shares without applying 
statutory preemption rights to authorise the company to 
make market purchases of its own shares and to authorise 
the calling of general meetings other than annual general 
meetings on 14 clear days’ notice full details are provided 
in the notice of meeting if you would like to register any 
question you may have in advance of the agm you can 
do so at agmnationalexpresscom or you can write to 
the company secretary at national express group plc 
national express house birmingham coach station mill 
lane digbeth birmingham b5 6dd
powers of the directors
subject to its articles of association and relevant statutory 
law and to any direction that may be given by the company 
in general meeting by special resolution the business of 
the company shall be managed by the directors who may 
exercise all powers of the company which are not required 
to be exercised by the company in general meeting
material contracts and change of control 
agreements
the company is party to a number of banking agreements 
which allow for notiﬁcation of change of control within 
ﬁve days of becoming aware of the event following which 
repayment of outstanding commitments is to be made within 
30 days
under the terms of the £1000000000 euro medium term 
note programme under which the company issued medium 
term notes mtns to various institutions on 13 january 
2010 as updated on 19 november 2012 there is a change 
of control put option such that upon a change of control 
event any holder of any mtn may require the company 
to redeem or purchase that mtn 
the company entered into a private placement note 
purchase agreement on 30 july 2012 relating to the issue 
by the company of €78500000 455 senior notes due 
16 august 2021 under the terms of the agreement the 
company is required to offer to note holders to repay to 
them the entire unpaid principal amount and interest thereon 
upon a change of control
the group currently runs one dft franchise c2c the rail 
franchise agreement with dft contains termination rights 
for the beneﬁt of dft which would be triggered by a change 
of control in national express group plc
the group’s rail franchisee c2c leases its rolling stock 
and its leases with porterbrook leasing company limited 
contain termination rights for the beneﬁt of the lessor which 
would be triggered by a change of control in national 
express group plc
the group’s north american business operates school 
bus services under contracts with school boards those 
contracts invariably contain a change of control clause 
for the beneﬁt of the board which would be triggered by 
a change of control in national express group plc while 
no one single school bus contract could be considered 
signiﬁcant in the context of the group turnover the impact 
on that turnover in the event that each school board 
exercised its termination right on a change of control would 
be signiﬁcant
directors’ and employees’ service contracts
there are no agreements between the company and its 
directors or employees providing for compensation for 
loss of ofﬁce or employment whether through resignation 
purported redundancy or otherwise that occurs because  
of a takeover bid
auditor
resolutions to reappoint deloitte llp as auditor of 
the company and to authorise the directors to ﬁx their 
remuneration will be proposed at the 2013 agm
disclosure of information to auditor
the directors conﬁrm that so far as they are aware there 
is no relevant audit information of which the company’s 
auditor is unaware and that each director has taken all the 
steps that they ought to have taken as a director in order 
to make themselves aware of any relevant audit information 
and to establish that the company’s auditor is aware of 
that information this conﬁrmation is given and should be 
interpreted in accordance with the provisions of section 418 
of the companies act 2006
risks
a summary of the company’s risk management framework 
and an overview of its principal risks are detailed on pages 
43 to 45 and are incorporated by reference into this report
going concern
the group’s business activities together with the factors 
likely to affect its future development performance and 
position are set out in the business review the ﬁnancial 
position of the group its cash ﬂows liquidity position 
and borrowing facilities are described in the group chief 
executive’s review on pages 10 to 13 and the finance 
director’s review on pages 20 to 23 in addition note 30  
to the ﬁnancial statements includes the group’s objectives 
policies and processes for managing its capital its 
ﬁnancial risk management objectives details of its ﬁnancial 
instruments and hedging activities and its exposure to credit 
risk and liquidity risk
the group has a formalised process of budgeting reporting 
and review which provides information to the directors 
which is used to ensure the adequacy of resources available 
for the group to meet its business objectives
the directors have a reasonable expectation that the 
company and the group have adequate resources to 
continue in operational existence for a period of at least  
12 months from the date of signing the accounts 
accordingly they continue to adopt the going concern basis 
of accounting in preparing the annual ﬁnancial statements
78 national express group plc annual report and accounts 2012  governance 
statutory information
statement of compliance with  
the uk corporate governance code 
in the opinion of the directors the company has complied 
with the provisions of the uk corporate governance code 
code issued by the financial reporting council in 2010 
save in respect of the following provisions
b21 the composition of the nomination committee
jorge cosmen who is a member of the nomination 
committee is not considered to be independent however 
as deputy chairman and the representative of one of the 
company’s largest shareholders the board considers  
mr cosmen should be a member of the nomination 
committee in order to be involved in the recruitment  
process for board appointments
joaquín ayuso was appointed as a member of the 
nomination committee on 26 february 2013 accordingly 
the majority of the nomination committee are now 
independent nonexecutive directors in accordance  
with provision b2 1 of the code
the governance section of this annual report has applied 
the principles of the uk corporate governance code and 
complied with its provisions during 2012 a copy of the uk 
corporate governance code is available at frcorguk
reelection of directors
in accordance with the company’s articles of association 
and the principles of the uk corporate governance code 
all directors of the company will offer themselves for either 
election or reelection at this year’s agm nonexecutive 
directors are appointed for speciﬁc terms subject to re
election nonexecutive directors will only be put forward for 
reelection if following performance evaluation the board 
believes the director’s performance continues to be effective 
and demonstrates commitment to the role 
remuneration and service contracts 
of directors
the directors’ remuneration report including details of 
remuneration policy and service contracts is set out on 
pages 64 to 75
directors’ conﬂicts of interest
the board has a procedure in place to deal with a situation 
where a director has a conﬂict of interest as required by the 
companies act 2006 as part of this process the members 
of the board prepare a list of other positions held and all 
other conﬂict situations that may need authorising either 
in relation to the director concerned or hisher connected 
persons the board considers each director’s situation 
and decides whether to approve any conﬂict situations 
taking into consideration what is in the best interests of 
the company and whether the director’s ability to act in 
accordance with his or her wider duties is affected each 
director is required to notify the company secretary of any 
potential or actual conﬂict situations that will need authorising 
by the board authorisations given by the board are 
reviewed annually
accountability and audit
statements of the respective responsibilities of the directors 
and auditors are set out on pages 81 and 82
directors’ and ofﬁcers’ liability insurance
the company maintains directors’ and ofﬁcers’ liability 
insurance in respect of legal action that might be brought 
against its directors pursuant to the company’s articles 
of association the company has indemniﬁed its directors 
and ofﬁcers in accordance with the provisions of section 
233 of the companies act 2006 a copy of the articles of 
association is available for inspection at the company’s 
registered ofﬁce 
internal control statement
the board’s responsibilities
the board has overall responsibility for the group’s system 
of internal control and for reviewing its effectiveness the 
board maintains full control and direction over appropriate 
strategic ﬁnancial operational and compliance issues and 
has put in place an organisational structure with formally 
deﬁned lines of responsibility delegated authorities and 
clear operating processes the systems that the board 
has established are designed to safeguard both the 
shareholders’ investment and the assets of the group  
and are described as follows 
key elements of the control framework
financial reporting process – management and 
specialists within the finance department are responsible 
for ensuring the appropriate maintenance of ﬁnancial records 
and processes to ensure that all information is relevant 
reliable and in accordance with the applicable laws and 
regulations and distributed both internally and externally in 
a timely manner a review of the consolidation and ﬁnancial 
statements is completed by management to ensure that the 
ﬁnancial position and results of the group are appropriately 
reﬂected all ﬁnancial information published by the group is 
subject to the approval of the audit committee
performance management – the performance of each 
division and operating company against its plan is closely 
monitored by a formal monthly reporting process and by the 
attendance of the relevant executive directors at monthly 
divisional executive meetings
annual ﬁtness check process – internal audit undertake 
an annual review at each operating company to assess 
the integrity of the balance sheet and to check the effective 
operation of key ﬁnancial reporting and information systems 
controls the results of the reviews are presented to both 
divisional and group ﬁnance with any required actions 
agreed with the relevant divisional finance director
strategic and ﬁnancial planning – an annual  
budgeting and strategic planning process has been 
established whereby each division and constituent  
operating company assesses its competitive position 
and goals taking account of the strategic risks faced 
this strategy is translated into a ﬁnancial plan with clear 
milestones and performance indicators
capital investment – a clear process is in place for the 
approval of capital expenditure which includes detailed 
appraisal of the beneﬁts of the proposed investment and  
any associated key risks material capital expenditure 
requires board approval
health and safety – health and safety standards and 
benchmarks have been established in all our businesses 
and the performance of operating companies in meeting 
these standards is closely monitored
overview delivering on our strategy business review governance 
79 wwwnationalexpressgroupcom
financial statements  governance 
statutory information continued
risk management reporting process – each division 
and operating company evaluates its internal control 
environment and key risks and the results are reviewed 
at management level and passed to the audit committee 
before being presented to the board this process is 
reviewed on a regular basis to ensure the validity and 
relevance of the key risks included in reports the review 
covers strategic ﬁnancial compliance and risk management 
controls these procedures are mandated and designed 
to manage the risk in order to ensure that the operations 
achieve their business objectives
internal audit – the internal control system is 
independently monitored and supported by a group 
internal audit function the internal audit function reports 
to management and the audit committee on the group’s 
ﬁnancial and operational controls and monitors and  
reviews the extent to which its recommendations have  
been implemented
boardlevel reporting on internal control – during the 
year the audit committee reviews regular reports from the 
internal audit function the external auditors and executive 
management on matters relating to internal control ﬁnancial 
reporting and risk management the audit committee 
provides the board with an independent assessment of the 
group’s ﬁnancial position accounting affairs and control 
systems in addition the board receives regular reports on 
how speciﬁc risks that are assessed as material to the group 
are being managed
review of internal control effectiveness
the system of internal control and risk management 
described above has been in place for the year under 
review and up to the date of approval of this annual report 
and accounts such a system is designed to manage 
rather than to eliminate the risks inherent in achieving the 
group’s business objectives and can therefore provide only 
reasonable and not absolute assurance against material 
misstatement or loss the effectiveness of this system has 
been regularly reviewed by the directors in line with the 
guidance on audit committees published by the financial 
reporting council in december 2010 where signiﬁcant 
control failings or weaknesses have been identiﬁed 
appropriate corrective action has been taken
whistleblowing policy
‘whistleblowing’ policies are in place in each of the 
group’s businesses and are also available on the group’s 
websitenationalexpressgroupcom the board supports 
the highest standards of corporate governance and ethical 
practices within all its operations and continues to review 
its policies on an ongoing basis the board has endorsed 
a set of principles which establish the framework for how 
its businesses operate key to these is working in an open 
and honest manner the group is committed to the highest 
standards of quality honesty openness and accountability 
employees are encouraged to raise genuine concerns 
under the policy either by contacting their line manager or 
telephoning a dedicated external helpline any concerns 
raised are investigated carefully and thoroughly to assess 
what action if any should be taken and conﬁdential records 
are maintained the company secretary reports any matters 
of signiﬁcance to the appropriate committee in 2012 no 
issues of signiﬁcance were raised
antibribery policy
a group antibribery policy has been established and 
issued to all group companies and is also available on the 
group’s website at nationalexpressgroupcom the policy 
prohibits any inducement which results in a personal gain or 
advantage to the recipient or any person or body associated 
with them and which is intended to inﬂuence them to take 
action which may not be solely in the interests of the group 
or of the person or body employing them or which they 
represent the prevention detection and reporting of bribery 
is the responsibility of all employees throughout the group 
employees can report conﬁdentially any suspicion of bribery 
via an externally facilitated whistleblower hotline
michael hampson
company secretary
28 february 2013
80 national express group plc annual report and accounts 2012  the directors are responsible for preparing the annual 
report and the ﬁnancial statements in accordance with 
applicable law and regulations
company law requires the directors to prepare ﬁnancial 
statements for each ﬁnancial year under that law the 
directors are required to prepare the group ﬁnancial 
statements in accordance with international financial 
reporting standards ifrss as adopted by the european 
union and article 4 of the ias regulation and have elected 
to prepare the parent company ﬁnancial statements in 
accordance with united kingdom generally accepted 
accounting practice united kingdom accounting standards 
and applicable law under company law the directors must 
not approve the accounts unless they are satisﬁed that they 
give a true and fair view of the state of affairs of the company 
and of the proﬁt or loss of the company for that period 
in preparing the parent company ﬁnancial statements  
the directors are required to
 select suitable accounting policies and then apply them 
consistently
 make judgements and accounting estimates that are 
reasonable and prudent
 state whether applicable uk accounting standards 
have been followed subject to any material departures 
disclosed and explained in the ﬁnancial statements and
 prepare the ﬁnancial statements on the going concern 
basis unless it is inappropriate to presume that the 
company will continue in business
in preparing the group ﬁnancial statements international 
accounting standard 1 requires that directors
 properly select and apply accounting policies
 present information including accounting policies in a 
manner that provides relevant reliable comparable and 
understandable information 
 provide additional disclosures when compliance with the 
speciﬁc requirements in ifrss is insufﬁcient to enable 
users to understand the impact of particular transactions 
other events and conditions on the entity’s ﬁnancial 
position and ﬁnancial performance and
 make an assessment of the company’s ability to continue 
as a going concern
the directors are responsible for keeping adequate 
accounting records that are sufﬁcient to show and explain 
the company’s transactions and disclose with reasonable 
accuracy at any time the ﬁnancial position of the company 
and enable them to ensure that the ﬁnancial statements 
comply with the companies act 2006 they are also 
responsible for safeguarding the assets of the company and 
hence for taking reasonable steps for the prevention and 
detection of fraud and other irregularities
the directors are responsible for the maintenance and 
integrity of the corporate and ﬁnancial information included 
on the company’s website legislation in the united 
kingdom governing the preparation and dissemination  
of ﬁnancial statements may differ from legislation in  
other jurisdictions
governance
directors’ responsibilities statement
responsibility statement 
we conﬁrm that to the best of our knowledge
 the ﬁnancial statements prepared in accordance with the 
relevant ﬁnancial reporting framework give a true and fair 
view of the assets liabilities ﬁnancial position and proﬁt or 
loss of the company and the undertakings included in the 
consolidation taken as a whole and
 the business review which is incorporated into the 
directors’ report includes a fair review of the development 
and performance of the business and the position 
of the company and the undertakings included in 
the consolidation taken as a whole together with a 
description of the principal risks and uncertainties that 
they face
by order of the board
dean finch
chief executive ofﬁcer
28 february 2013
jez maiden
group finance director
28 february 2013
overview delivering on our strategy business review governance 
81 wwwnationalexpressgroupcom
financial statements  financial statements 
independent auditor’s report to the members of 
national express group plc
we have audited the group ﬁnancial statements of national express group plc for the year ended 31 december 2012 
which comprise the group income statement the group statement of comprehensive income the group balance sheet 
the group statement of changes in equity the group statement of cash flows and the related notes 1 to 38 the ﬁnancial 
reporting framework that has been applied in their preparation is applicable law and international financial reporting 
standards ifrss as adopted by the european union
this report is made solely to the company’s members as a body in accordance with chapter 3 of part 16 of the 
companies act 2006 our audit work has been undertaken so that we might state to the company’s members those 
matters we are required to state to them in an auditor’s report and for no other purpose to the fullest extent permitted by 
law we do not accept or assume responsibility to anyone other than the company and the company’s members as a body 
for our audit work for this report or for the opinions we have formed
respective responsibilities of directors and auditor
as explained more fully in the directors’ responsibilities statement the directors are responsible for the preparation of the 
group ﬁnancial statements and for being satisﬁed that they give a true and fair view our responsibility is to audit and express 
an opinion on the group ﬁnancial statements in accordance with applicable law and international standards on auditing uk 
and ireland those standards require us to comply with the auditing practices board’s ethical standards for auditors
scope of the audit of the ﬁnancial statements
an audit involves obtaining evidence about the amounts and disclosures in the ﬁnancial statements sufﬁcient to give 
reasonable assurance that the ﬁnancial statements are free from material misstatement whether caused by fraud or error 
this includes an assessment of whether the accounting policies are appropriate to the group’s circumstances and have 
been consistently applied and adequately disclosed the reasonableness of signiﬁcant accounting estimates made by the 
directors and the overall presentation of the ﬁnancial statements in addition we read all the ﬁnancial and nonﬁnancial 
information in the annual report to identify material inconsistencies with the audited ﬁnancial statements if we become aware 
of any apparent material misstatements or inconsistencies we consider the implications for our report
opinion on ﬁnancial statements
in our opinion the group ﬁnancial statements
 give a true and fair view of the state of the group’s affairs as at 31 december 2012 and of its proﬁt for the year then ended
 have been properly prepared in accordance with ifrss as adopted by the european union and
 have been prepared in accordance with the requirements of the companies act 2006 and article 4 of the ias regulation
opinion on other matter prescribed by the companies act 2006
in our opinion the information given in the directors’ report for the ﬁnancial year for which the group ﬁnancial statements are 
prepared is consistent with the group ﬁnancial statements
matters on which we are required to report by exception
we have nothing to report in respect of the following
under the companies act 2006 we are required to report to you if in our opinion
 certain disclosures of directors’ remuneration speciﬁed by law are not made or
 we have not received all the information and explanations we require for our audit
under the listing rules we are required to review
 the directors’ statement set out in the directors’ report in relation to going concern 
 the part of the corporate governance statement as set out within the statutory information relating to the company’s 
compliance with the nine provisions of the uk corporate governance code speciﬁed for our review and
 certain elements of the report to shareholders by the board on directors’ remuneration
other matter
we have reported separately on the parent company ﬁnancial statements of national express group plc for the year ended 
31 december 2012 and on the information in the directors’ remuneration report that is described as having been audited 
nigel mercer senior statutory auditor
for and on behalf of deloitte llp
chartered accountants and statutory auditor
birmingham uk
28 february 2013
national express group annual report and accounts 2012 82 overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
financial statements 
group income statement  
for the year ended 31 december 2012 
 83 
 
 note 
total before 
intangible 
amortisation 
and 
exceptional 
items 
2012 
£m 
intangible 
amortisation 
and 
exceptional 
items 
2012 
£m 
total 
2012 
£m 
total before 
intangible 
amortisation  
and 
exceptional 
items  
2011  
£m 
intangible 
amortisation 
and 
exceptional 
items 
2011 
£m 
total 
2011
£m 
c continuing operations        
revenue 4  18312 – 18312 22380 – 22380 
operating costs before intangible 
amortisation and exceptional items   16193 – 16193 20128 – 20128
intangible amortisation  514  – 517 517 – 508 508
exceptional items  5  – 426 426 – – – 
total operating costs  6  16193 943 17136 20128 508 20636
group operating profit  2119 943 1176 2252 508 1744 
share of posttax results from 
associates and joint ventures 
accounted for using the equity method  18  14 – 14 14 – 14 
finance income  49  44 – 44 67 – 67 
finance costs  9  536 – 536 531 – 531
profit before tax   1641 943 698 1802 508 1294 
tax charge 10  327 242 85 415 147 268
 
profit for the year  1314 701 613 1387 361 1026 
profit attributable to  
equity shareholders   1301 701 600 1373 361 1012 
profit attributable to  
noncontrolling interests   13 – 13 14 – 14 
  1314 701 613 1387 361 1026 
earnings per share        
– basic earnings per share  13    118p   199p 
– diluted earnings per share  13   117p   198p 
normalised earnings per share        
– basic earnings per share  13 255p   270p   
– diluted earnings per share  13 254p   269p    national express group plc annual report and accounts 2012 
financial statements 
group statement of comprehensive income  
for the year ended 31 december 2012 
84 
 
 note 
2012  
£m 
2011 
£m 
profit for the year  613 1026 
    
other comprehensive income and expenditure    
exchange differences on retranslation of foreign operations net of hedging  442 264
exchange differences on retranslation of noncontrolling interests   02 02
actuarial losses on defined benefit pension plans  34  311 86
gain on cash flow hedges   22 242 
transfers to the income statement on cash flow hedges  202 253
tax on exchange differences   16 29 
deferred tax on actuarial losses  72 04 
deferred tax on cash flow hedges   49 06
other comprehensive income and expenditure for the year net of tax  798 336
    
total comprehensive expenditureincome for the year   185 690 
    
total comprehensive expenditureincome attributable to    
equity shareholders   196 679 
noncontrolling interests   11 11 
  185 690 
  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
financial statements 
group balance sheet 
at 31 december 2012 
 85 
d finch group chief executive 
j k maiden group finance director  
28 february 2013 
 note 
2012
£m 
2011 
£m 
n noncurrent assets    
intangible assets  14 12629 12125 
property plant and equipment  15  7874 7545 
available for sale investments  17  71 76 
derivative financial instruments  17  311 310 
investments accounted for using the equity method  18  44 66 
trade and other receivables  20  56 59 
defined benefit pension asset 34 166 186 
  21151 20367 
current assets    
inventories  21  193 188 
trade and other receivables  22  1948 2481 
derivative financial instruments  17  47 211 
deferred tax assets 27 78 – 
current tax assets   08 09 
cash and cash equivalents  23  728 925 
  3002 3814 
total assets   24153 24181 
noncurrent liabilities   
borrowings  28  7868 7184
derivative financial instruments  28  22 24
deferred tax liability  27  848 952
other noncurrent liabilities  25  59 49
noncurrent tax liabilities  – 54
defined benefit pension liability  34  359 204
provisions  26  283 240
  9439 8707
current liabilities  
trade and other payables  24  3484 4664
borrowings  28  1690 548
derivative financial instruments  28  30 02
current tax liabilities   199 197
provisions  26  287 409
  5690 5820
total liabilities   15129 14527
net assets   9024 9654 
shareholders’ equity    
called up share capital  32  256 256 
share premium account   5327 5327 
capital redemption reserve   02 02 
own shares   05 140
other reserves  33  442 999 
retained earnings   2907 3131 
total shareholders’ equity   8929 9575 
noncontrolling interest in equity   95 79 
total equity   9024 9654  national express group plc annual report and accounts 2012 
financial statements 
group statement of changes in equity  
for the year ended 31 december 2012 
86 
 
 
share  
capital  
£m 
share 
premium 
account 
£m 
capital 
redemption 
reserve
 £m 
own 
shares 
note 32
£m 
other 
reserves 
note 33 
£m 
retained 
earnings  
£m 
total  
£m 
non
controlling 
interests
 £m 
total 
equity 
£m 
at 1 january 2012  256 5327 02 140 999 3131 9575 79 9654 
shares purchased  – – – 48 – – 48 – 48
own shares released to satisfy 
employee share schemes  – – – 45 – 45 – – – 
disposal of own shares – – – 138 – 98 40 – 40 
total comprehensive income  
and expenditure  – – – – 557 361 196 11 185
sharebased payments  – – – – – 52 52 – 52 
tax on sharebased payments  – – – – – 01 01 – 01
dividends – – – – – 493 493 – 493
adjustment from changes in  
noncontrolling interests – – – – – – – 05 05 
at 31 december 2012  256 5327 02 05 442 2907 8929 95 9024 
 
 
share  
capital  
£m 
share 
premium 
account 
£m 
capital 
redemption 
reserve
 £m 
own 
shares 
note 32
£m 
other 
reserves 
note 33 
£m 
retained 
earnings  
£m 
total  
£m 
non
controlling 
interests
 £m 
total 
equity 
£m 
at 1 january 2011  256 5327 02 141 1251 2637 9332 66 9398 
shares purchased  – – – 27 – – 27 – 27
own shares released to satisfy 
employee share schemes  – – – 28 – 28 – – – 
total comprehensive income  
and expenditure – – – – 252 931 679 11 690 
sharebased payments  – – – – – 50 50 – 50 
tax on sharebased payments  – – – – – 01 01 – 01
dividends – – – – – 458 458 – 458
dividends paid to noncontrolling 
interest – – – – – – – 03 03
adjustment from changes in  
noncontrolling interests – – – – – – – 05 05 
at 31 december 2011  256 5327 02 140 999 3131 9575 79 9654 
  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
financial statements 
group statement of cash flows  
for the year ended 31 december 2012 
 87 
 
 note 
2012 
£m 
2011 
£m 
c cash generated from operations  37  1696 2470 
tax paid  134 84
net cash from operating activities   1562 2386 
cash flows from investing activities    
payments to acquire businesses net of cash acquired  19a 1569 04
deferred consideration for businesses acquired and disposed 19ab 06 57
purchase of property plant and equipment   1038 1045
proceeds from disposal of property plant and equipment   167 63 
payments to acquire intangible assets   29 39
payments to acquire associates  05 – 
proceeds from disposal of associates  16 – 
dividends received from associates  09 10 
interest received   37 56 
net cash used in investing activities   2418 1016
cash flows from financing activities    
proceeds from the sale of treasury shares  40 – 
purchase of own shares   48 27
interest paid   488 502
finance lease principal payments   180 249
net loans drawn downrepaid  1745 356
receiptspayments for the maturity of foreign currency contracts  89 128
dividends paid to noncontrolling interests   01 04
payments for equity in noncontrolling interests  – 05
dividends paid to shareholders of the company   493 458
net cash fromused in financing activities   664 1729
decrease in cash and cash equivalents   192 359
opening cash and cash equivalents   925 1288 
decrease in cash and cash equivalents   192 359
foreign exchange   05 04
closing cash and cash equivalents  23  728 925 
  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts  
for the year ended 31 december 2012 
88 
1 corporate information  
the consolidated accounts of national express group plc and its subsidiaries ‘the group’ for the year ended 31 december 2012 were 
authorised for issue in accordance with a resolution of the directors on 28 february 2013 national express group plc is a public limited 
company incorporated in england and wales whose shares are publicly traded on the london stock exchange  
the principal activities of the group are described in the business review that accompanies these accounts  
2 accounting policies  
statement of compliance  
these accounts have been prepared in accordance with international financial reporting standards ifrs and interpretations of the 
international financial reporting interpretations committee ifric as adopted by the european union eu and with those parts of the 
companies acts 2006 applicable to companies reporting under ifrs  
basis of preparation  
the financial statements have been prepared on the going concern basis see directors’ report on page 76 under the historical cost 
convention except for the recognition of derivative financial instruments and available for sale investments  
the consolidated accounts are presented in pounds sterling and all values are rounded to the nearest one hundred thousand pounds 
£01m except where otherwise indicated  
a summary of the group’s accounting policies applied in preparing the accounts for the year ended 31 december 2012 is set out below 
significant accounting judgements and key sources of estimation uncertainty 
the preparation of accounts in conformity with generally accepted accounting principles requires the use of estimates and assumptions 
that affect the reported amounts of assets and liabilities at the date of the accounts and the reported amounts of revenues and expenses 
during the reporting period although these estimates are based on management’s best knowledge actual results may ultimately differ 
from those estimates  
the key accounting estimates and judgements are 
goodwill and impairment 
determining whether goodwill is impaired requires an estimation of the value in use of the cashgenerating units to which goodwill has 
been allocated the value in use calculation requires the entity to estimate the future cash flows expected to arise from the cashgenerating 
unit and a suitable discount rate in order to calculate present value details of the assumptions used and key sensitivities are set out in note 
14 to the accounts 
retirement benefit obligations 
determining the amount of the group’s retirement benefit obligations and the net costs of providing such benefits requires assumptions  
to be made concerning long term interest rates inflation salary and pension increases investment returns and longevity of current and 
future pensioners changes in these assumptions could significantly impact the amount of the obligations or the cost of providing such 
benefits the group makes assumptions concerning these matters with the assistance of advice from independent qualified actuaries 
details of the assumptions made are set out in note 34 
insurance  
the estimation of the insurance provisions is based on an assessment of the expected settlement on known claims together with an 
estimate of settlements that will be made in respect of incidents occurring prior to the balance sheet date but for which claims have  
not been reported to the group the group makes assumptions concerning these matters with the assistance of advice from independent 
qualified actuaries 
tax provisions 
assessing the outcome of uncertain tax positions requires judgements to be made regarding the result of negotiations with and enquires 
from tax authorities in a number of jurisdictions the assessments made are based on advice from independent tax advisors and the status 
of ongoing discussions with the relevant tax authorities  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 89 
2 accounting policies continued  
basis of consolidation  
the consolidated accounts comprise the accounts of national express group plc and all its subsidiaries drawn up to 31 december  
each year adjustments are made to bring any dissimilar accounting policies that may exist into line with the group’s accounting policies  
on acquisition of a business the purchase method of accounting is adopted and the group income statement includes the results of 
subsidiaries and businesses purchased during the year from the date control is assumed the purchase consideration is allocated to 
assets and liabilities on the basis of fair value at the date of acquisition on the sale of a business the group income statement includes 
the results of that business to the date of disposal  
intragroup transactions balances and unrealised gains and losses on transactions between group companies are eliminated  
noncontrolling interests represent the portion of comprehensive income and equity in subsidiaries that is not attributable to the parent 
company shareholders and is presented separately from parent shareholders’ equity in the consolidated balance sheet  
interests in joint ventures  
the group has a number of contractual arrangements with other parties to share control of other entities which represent joint ventures  
the group recognises its interest in the entity’s assets and liabilities using the equity method of accounting the group balance sheet 
includes the appropriate share of these joint ventures’ net assets or liabilities and the income statement includes the appropriate share  
of their results after tax  
accounts of jointly controlled entities are prepared for the same reporting period as the group adjustments are made in the group’s 
accounts to eliminate the group’s share of unrealised gains and losses on transactions between the group and its jointly controlled 
entities the group ceases to use the equity method from the date it no longer has joint control over the entity  
interests in associates  
companies other than subsidiaries and joint ventures in which the group has an investment representing not less than 20 of the  
voting rights and over which it exerts significant influence are treated as associates the consolidated accounts include the appropriate 
share of these associates’ results and net assets based on their latest accounts under the equity method  
changes in accounting policies  
the accounting policies adopted are consistent with those of the previous financial year and there have been no changes in accounting 
standards during the year that have had a material effect on the group 
income statement presentation  
the income statement has been presented in a columnar format to enable users of the financial statements to view the normalised results 
of the group normalised results are defined as the statutory results before the following as appropriate profit or loss on the sale of 
businesses exceptional profit or loss on the sale of noncurrent assets and charges for goodwill impairment amortisation of intangible 
assets exceptional items and tax relief on qualifying exceptional items and intangibles  
exceptional items  
exceptional items are material items of income or expenditure which in the opinion of the directors due to their nature and infrequency 
require separate identification on the face of the income statement to allow a better understanding of the financial performance in the year 
in comparison to prior years   national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
90 
2 accounting policies continued 
revenue recognition  
rendering of services  
revenue comprises income from road passenger transport train passenger services and related activities in the uk north america  
and europe where appropriate amounts are shown net of rebates and sales tax  
revenue is recognised by reference to the stage of completion of the customer’s travel or services provided under contractual 
arrangements as a proportion of total services to be provided  
rail revenue includes amounts attributed to the train operating companies tocs based principally on agreed models of route usage  
by railway settlement plan limited which administers the income allocation system within the uk rail industry in respect of passenger 
receipts in addition net franchise agreement receipts from the department for transport rail division dft rail and local passenger 
transport executives ptes are treated as revenue net franchise agreement payments to dft rail are recognised in operating costs  
uk coach revenue comprises amounts receivable generated from ticket sales uk bus and european coach  bus revenue comprises 
amounts receivable generated from ticket sales and revenue generated from services provided on behalf of local transport authorities 
which is recognised as the services are provided for all the divisions noted above the relevant share of season ticket or travelcard income 
is deferred within liabilities and released to the income statement over the life of the relevant season ticket or travelcard north american 
bus revenue from school boards and similar contracts is recognised as the services are provided  
rental income  
rental income is accounted for on a straightline basis over the lease term  
finance income  
revenue is recognised using the effective interest method  
government grants  
government grants relating to property plant and equipment are included in liabilities as deferred income and are credited to the income 
statement over the expected useful economic life of the assets concerned other grants are credited to the income statement as the 
related expenditure is expensed  
segmental reporting  
each of the group’s business and geographical segments provides services that are subject to risks and returns that are different from 
those of the other business segments due to the nature of the group’s operations the distinct business segments align directly with 
geographical segments which are operating in separate economic environments  
the group’s segments comprise uk bus uk coach rail north american bus european coach  bus and central functions  
these segments are described in more detail in the business review accompanying these accounts  
leases  
leases of property plant and equipment where substantially all the risks and rewards of ownership of the asset have passed to the group 
are capitalised in the balance sheet as property plant and equipment finance leases are capitalised at the lower of the fair value of the 
leased property and the present value of the minimum lease payments the capital element of future obligations under hire purchase 
contracts and finance leases is included as a liability in the balance sheet the interest element of rental obligations is charged to the 
income statement over the period of the lease and represents a constant proportion of the balance of capital repayments outstanding 
property plant and equipment acquired under finance leases are depreciated over the shorter of the useful life of the asset or the lease 
term  
leases of property plant and equipment where a significant portion of the risks and rewards of ownership are retained by the lessor are 
classified as operating leases rentals paid under operating leases are charged to the income statement on a straightline basis over the 
term of the lease incentives received under operating leases and initial direct costs in negotiating the lease are amortised to the income 
statement on a straightline basis over the term of the lease  
all material arrangements and transactions entered into by the group are reviewed to check whether they contain elements that meet 
the accounting definition of a lease although they may not follow the legal form of a lease  
borrowing costs  
borrowing costs are recognised as an expense when incurred except where they are directly attributable to the acquisition construction 
or production of a qualifying asset in which case they are capitalised as part of the cost of that asset  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 91 
2 accounting policies continued  
current tax and deferred tax  
current tax is provided on taxable profits earned according to the local tax rates applicable where the profits are earned income taxes are 
recognised in the income statement unless they relate to an item accounted for in other comprehensive income or equity in which case 
the tax is recognised directly in other comprehensive income or equity the tax rates and tax laws used to compute the current tax are 
those that are enacted or substantively enacted by the balance sheet date  
deferred tax is provided in full in respect of all material temporary differences at the balance sheet date between the tax bases of assets 
and liabilities and their carrying amounts for financial reporting purposes apart from the following exceptions  
• where the temporary difference arises from the initial recognition of goodwill  
• where an asset or liability is recognised in a transaction that is not a business combination and that at the time of the transaction 
affects neither accounting nor taxable profit or loss and  
• in respect of investment in subsidiaries associates and joint ventures where the group is able to control the reversal of the temporary 
difference and it is probable that the temporary difference will not reverse in the foreseeable future  
deferred tax is measured on a nondiscounted basis at tax rates that are expected to apply in the periods in which the temporary 
differences reverse based on tax rates and laws enacted or substantively enacted at the balance sheet date  
deferred tax assets are recognised to the extent that it is considered more likely than not that future taxable profits will be available  
against which the underlying temporary differences can be deducted their carrying amount is reviewed at each balance sheet date  
on the same basis 
deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and when the group 
intends to settle its current tax assets and liabilities on a net basis  
intangible assets  
intangible assets acquired separately that meet the recognition criteria of ias 38 ‘intangible assets’ are capitalised at cost and when 
acquired in a business combination are capitalised at fair value at the date of acquisition following initial recognition finite life assets are 
amortised on a straightline basis and indefinite life assets are not amortised the amortisation expense is taken to the income statement 
through operating expenses  
the existing finite life intangible assets have a residual value of nil and are amortised over their estimated useful lives as follows  
intangible assets with indefinite lives are tested annually for impairment the useful lives of finite life intangible assets are examined on an 
annual basis and adjustments where applicable are made on a prospective basis finite life assets are reviewed for impairment where 
indicators of impairment exist 
the group’s only indefinite life intangible asset is goodwill  
software  
computer software that is not integral to an item of property plant and equipment is recognised separately as an intangible asset and  
is carried at cost less accumulated amortisation and accumulated impairment losses costs include software licences consulting costs 
attributable to the development design and implementation of the computer software and internal costs directly attributable to the 
development design and implementation of the computer software costs in respect of training are expensed as incurred amortisation  
is calculated using the straightline method so as to charge the cost of the computer software to the income statement over its estimated 
useful life 3 to 7 years  
the carrying value of intangibles is reviewed for impairment if events or changes in circumstances indicate that the carrying value may not 
be recoverable  
 
customer contracts  – over the life of the contract between 1 and 33 years  
right to operate toc franchises  – over the life of the franchise between 1 and 7 years  
contractual relationships – over the life of the relationship between 8 – 20 years 
brands – over the life of the brand 5 years  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
92 
2 accounting policies continued  
goodwill  
goodwill on acquisition is initially measured at cost being the excess of the cost of the business combination over the group’s interest  
in the net fair value of the identifiable assets liabilities and contingent liabilities following initial recognition goodwill is stated at historic 
cost less any accumulated impairment if an acquisition gives rise to an excess of the acquirer’s interest in the net fair value of the 
acquiree’s identifiable assets liabilities and contingent liabilities over cost previously referred to as negative goodwill this is credited 
immediately to the income statement  
in accordance with ifrs 3 goodwill is not amortised all goodwill is subject to an annual test of impairment and an impairment charge 
recognised as required  
fair value accounting adjustments are made in respect of acquisitions fair value adjustments based on provisional estimates are amended 
within one year of the acquisition if required with a corresponding adjustment to goodwill in order to refine adjustments to reflect further 
evidence gained postacquisition  
where goodwill forms part of a cashgenerating unit and all or part of that unit is disposed of the associated goodwill is included in the 
carrying amount of the operation when determining the gain or loss on the disposal of the operation  
property plant and equipment  
all property plant and equipment is stated at historic cost less accumulated depreciation and accumulated impairment losses under  
the transitional arrangements of ifrs 1 the group elected to deem the fair value of certain revalued assets to be equivalent to cost  
land and buildings comprise mainly vehicle depots and garages and offices freehold land is not depreciated other property plant 
and equipment are depreciated on a straightline basis over their estimated useful lives as follows  
useful lives and residual values are reviewed annually and adjustments where applicable are made on a prospective basis repairs and 
maintenance are charged to the income statement during the financial period in which they are incurred  
an item of property plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from 
the continued use of the asset any gain or loss arising on the derecognition of the asset is included in the income statement in the period 
of derecognition  
impairment of nonfinancial assets  
all noncurrent assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may 
not be recoverable except for indefinite life intangible assets and goodwill which are reviewed annually an impairment loss is recognised 
for the amount by which the carrying amount of the asset exceeds its recoverable amount which is the higher of an asset’s fair value less 
costs to sell and its value in use for the purposes of assessing impairment assets are grouped at the lowest level for which there are 
separately identifiable cash inflows  
in assessing value in use the estimated risk adjusted future cash flows are discounted to their present value using a pretax discount rate 
that reflects current market assessments of the time value of money impairment losses are recognised in the income statement in expense 
categories consistent with the function of the impaired asset  
except for goodwill impairments a review is made at each reporting date of any previous impairment losses to assess whether they  
no longer exist or may have decreased if such indication exists the asset’s recoverable amount is estimated and any previously 
recognised impairment loss is reversed only if there has been a change in the estimates used to assess the recoverable amount since  
the last impairment loss was recognised if that is the case the carrying amount of the asset is increased subject to a limit of the asset’s 
net book value had no previous impairment loss been recognised such reversal is recognised in the income statement future 
depreciation or amortisation is then adjusted to allocate the asset’s revised carrying amount over its remaining useful economic life 
impairments to goodwill cannot be reversed  
 
freehold buildings  – 30 to 50 years  
long leasehold property improvements  – 15 to 40 years  
public service vehicles  – 8 to 15 years  
plant and equipment fixtures and fittings  – 3 to 15 years   overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 93 
2 accounting policies continued  
financial instruments  
the group determines the classification of its financial instruments at initial recognition the group classifies its financial assets in the 
following categories at fair value through profit or loss loans and receivables and availableforsale the classification depends on the 
purpose for which the financial assets were acquired  
financial assets at fair value through profit or loss  
financial assets at fair value through profit or loss are financial assets held for trading a financial asset is classified in this category  
if acquired principally for the purpose of selling in the short term derivatives are also categorised as held for trading unless they are 
designated as hedges assets in this category are classified as current assets  
financial assets carried at fair value through profit or loss are initially recognised at fair value and transaction costs are expensed in the 
income statement gains or losses arising from changes in the fair value of the ‘financial assets at fair value through profit or loss’ category 
are presented in the income statement within finance costs in the period in which they arise  
loans and receivables  
loans and receivables are nonderivative financial assets with fixed or determinable payments that are not quoted in an active market 
they are included in current assets except for maturities greater than 12 months after the balance sheet date which are classified as  
noncurrent assets the group’s loans and receivables comprise ‘trade and other receivables’ and ‘cash and cash equivalents’ in the 
balance sheet  
availableforsale financial assets  
availableforsale financial assets are nonderivatives that are either designated in this category or not classified in any of the other 
categories they are included in noncurrent assets unless management intends to dispose of the investment within 12 months of the 
balance sheet date  
the group’s investments in entities that are not subsidiaries associates or joint ventures are classified as availableforsale financial assets 
after initial recognition these assets are measured at fair value with gains or losses being recognised as a separate component of equity 
until the investment is derecognised or the investment is determined to be impaired at which time the previously reported cumulative gain 
or loss is included in the income statement where there is no active market for the group’s investments fair value is determined using 
valuation techniques including recent commercial transactions and discounted cash flow analyses in the absence of any other reliable 
external information assets are carried at cost or amortised cost as appropriate  
the group assesses at each balance sheet date whether there is objective evidence that a financial asset or a group of financial assets  
is impaired in the case of equity securities classified as available for sale a significant or prolonged decline in the fair value of the security 
below its cost is considered as an indicator that the securities are impaired if any such evidence exists for availableforsale financial 
assets the cumulative loss – measured as the difference between the acquisition cost and the current fair value less any impairment loss 
on that financial asset previously recognised in profit or loss – is removed from equity and recognised in the income statement impairment 
losses recognised in the income statement on equity instruments are not reversed through the income statement 
financial liabilities 
when a financial liability is recognised initially the group measures it at its fair value financial liabilities include trade payables accruals 
other payables borrowings and derivative financial instruments in the case of a financial liability not at fair value through profit or loss  
an adjustment is made for transaction costs that are directly attributable to the issue of the financial liability subsequent measurement 
depends on its classification as follows 
financial liabilities at fair value through profit or loss 
financial liabilities classified as held for trading and derivative liabilities that are not designated as effective hedging instruments are 
classified as financial liabilities at fair value through profit or loss these liabilities are carried on the balance sheet at fair value with gains  
or losses being recognised in the income statement 
other 
all other financial liabilities not classified as fair value through profit or loss are measured at amortised cost using the effective  
interest method 
 
  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
94 
2 accounting policies continued  
derivative financial instruments  
the group uses derivative financial instruments such as foreign currency forward exchange contracts fuel derivatives and interest rate 
derivatives to hedge its risks associated with foreign currency fuel price and interest rate fluctuations such derivative financial instruments 
are initially recognised at fair value and subsequently remeasured to fair value for the reported balance sheet the fair value of foreign 
currency forward exchange contracts interest rate and fuel derivatives is calculated by reference to market exchange rates interest rates 
and fuel prices at the period end  
the group’s fuel derivatives are designated as cash flow hedges the portion of the gain or loss on the hedging instrument that is 
determined to be an effective hedge is recognised in equity and the ineffective portion in the income statement the gains or losses 
deferred in equity in this way are recycled through the income statement in the same period in which the hedged underlying transaction  
or firm commitment is recognised in the income statement  
the group’s interest rate derivatives are designated as fair value hedges the gain or loss on the hedging instrument is recognised 
immediately in the income statement the carrying amount of the hedged item is adjusted through the income statement for the gain  
or loss on the hedged item attributable to the hedged risk in this case movements in the risk free interest rate 
foreign currency derivatives are used to hedge the group’s net investment in foreign currency denominated operations and to the extent 
they are designated and effective as net investment hedges are matched in equity against foreign exchange exposure in the related assets 
and liabilities gains and losses accumulated in equity are included in the income statement when the foreign operation is partially disposed 
of or sold foreign currency forward contracts are also used to hedge transactional exposures these contacts are not hedge accounted 
and all gains and losses are taken directly to the income statement 
for derivatives that do not qualify for hedge accounting gains or losses are taken directly to the income statement in the period  
hedge accounting is discontinued when the hedging instrument expires is sold terminated exercised or no longer qualifies for 
hedge accounting  
inventories  
inventories are valued at the lower of cost and net realisable value on a fifo basis after making due allowance for obsolete or slow 
moving items 
precontract costs  
precontract costs associated with securing new rail franchises are expensed as incurred up to the point when a franchise is awarded 
from this point in time they are recognised as an asset and are expensed to the income statement over the life of the franchise costs 
associated with the commencement of all new contracts other than rail franchises are expensed as incurred  
trade and other receivables  
trade and other receivables are recognised and carried at original invoice amount less an allowance for any uncollectable amounts 
doubtful debts are provided for when collection of the full amount is no longer probable whilst bad debts are written off when identified  
cash and cash equivalents  
cash and cash equivalents as defined for the cash flow statement comprise cash in hand cash held at bank with immediate access other 
short term investments and bank deposits with maturities of three months or less from the date of inception and bank overdrafts in the 
consolidated balance sheet cash includes cash and cash equivalents excluding bank overdrafts bank overdrafts that have no legal right 
of setoff against cash and cash equivalents are included within borrowings in current liabilities  
trade and other payables  
trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method  
interestbearing borrowings  
all loans and borrowings are initially recognised at cost being the net fair value of the consideration received plus transaction costs that are 
directly attributable to the issue of the financial asset or liability after initial recognition interestbearing loans and borrowings are 
subsequently measured at amortised cost using the effective interest method   overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 95 
2 accounting policies continued  
insurance  
the group’s policy is to selfinsure high frequency claims within the businesses to provide protection above these types of losses the 
group purchases insurance cover from a selection of proven and financially strong insurers the insurance provision is based on estimated 
exposures at the year end principally for claims arising in the uk and north america prior to the yearend date subject to the overall stop 
loss within the group’s insurance arrangements the majority of provisions will be utilised within 5 years and the provision has been 
discounted to take account of the expected timing of future cash settlements  
pensions and other postemployment benefits  
the group has a number of pension schemes both of a defined benefit and defined contribution nature full details are provided in 
note 34  
the balance sheet position in respect of defined benefit schemes comprises the net value for each scheme of the present value of the 
relevant defined benefit obligation at the balance sheet date less the fair value of plan assets the trustees complete a full actuarial 
valuation triennially separately for each plan but the obligation is updated annually for financial reporting purposes by independent 
actuaries using the projected unit credit method the present value of the obligation is determined by the estimated future cash outflows 
discounted using interest rates of high quality corporate bonds which have terms to maturity equivalent to the terms of the related liability  
the current service cost and gains and losses on settlements and curtailments are recognised in staff pension costs within operating costs 
in the income statement past service costs are included in operating costs where the benefits have vested otherwise they are amortised 
on a straightline basis over the vesting period the finance elements of the pension cost comprising the expected return on assets of 
funded defined benefit schemes and the interest on pension scheme liabilities are also included in operating costs actuarial gains and 
losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to other comprehensive income 
in the period in which they arise  
our tocs participate in the rps a defined benefit scheme which covers the whole of the uk rail industry this is partitioned into sections 
and the group is responsible for the funding of these sections whilst it operates the relevant franchise in contrast to the pension schemes 
operated by most businesses the rps is a shared cost scheme which means that costs are formally shared 60 by the employer and 
40 by the employee a liability is recognised in line with other defined benefit schemes in the group although this is offset by a franchise 
adjustment so that the net liability represents the deficit that the group expects to fund during the franchise term  
the charges in respect of defined contribution schemes are recognised when they are due the group has no legal or constructive 
obligation to pay further contributions into a defined contribution scheme if the fund has insufficient assets to pay all employees benefits 
relating to employee service in the current and prior periods  
sharebased payment  
the group awards equitysettled sharebased payments to certain employees under which the group receives services from employees 
as consideration for equity instruments options of the group the fair value of the employee services received in exchange for the grant  
of the options is recognised as an expense the total amount to be expensed is determined by reference to the fair value of the options 
granted excluding the impact of any nonmarket service and performance vesting conditions for example profitability sales growth 
targets and remaining an employee of the entity over a specified time period nonmarket vesting conditions are included in assumptions 
about the number of options that are expected to vest the total amount expensed is recognised over the vesting period which is the 
period over which all of the specified vesting conditions are to be satisfied at each balance sheet date the entity revises its estimates  
of the number of options that are expected to vest based on the nonmarket vesting conditions it recognises the impact of the revision  
to original estimates if any in the income statement with a corresponding adjustment to equity  
provisions  
provisions are recognised when the group has a present legal or constructive obligation as a result of past events it is probable that an 
outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be made provisions are measured 
at the directors’ best estimate of the expenditure required to settle the obligation at the balance sheet date and are discounted to present 
value where the effect is material using a pretax discount rate the amortisation of the discount is recognised as a finance cost  
contingent liabilities are obligations that arise from past events that are dependent on future events they are disclosed in the notes to the 
accounts where the expected future outflow is not probable   national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
96 
2 accounting policies continued  
share capital share premium and dividends  
where either the company or employee share trusts purchase the company’s equity share capital the consideration paid including any 
transaction costs is deducted from total shareholders’ equity as own shares until they are cancelled or reissued any consideration 
subsequently received on sale or reissue is included in shareholders’ equity  
dividend distributions to the company’s shareholders are recognised as a liability in the group’s accounts on the date when dividends  
are approved by the company’s shareholders interim dividends are recognised in the period they are paid  
noncurrent assets held for sale and discontinued operations  
noncurrent assets or disposal groups are classified as assets held for sale when their carrying amount is to be recovered principally 
through a sale transaction and a sale is considered highly probable they are stated at the lower of carrying amount and fair value less 
costs to sell if their carrying amount is to be recovered principally through a sale transaction rather than through continuing use  
a discontinued operation is a component of the group that has been disposed of or is classified as held for sale and it either represents  
a separate major line of business or geographical area is part of a plan to dispose of a separate major line of business or geographical 
area or was an acquired subsidiary intended for resale the resulting profit or loss from discontinued operations is reported separately  
in the income statement  
property plant and equipment and intangible assets once classified as held for sale are not depreciated or amortised  
foreign currencies  
the trading results of foreign currency denominated subsidiaries joint ventures and associates are translated into sterling the presentation 
currency of the group and functional currency of the parent using average rates of exchange for the year as a reasonable approximation 
to actual exchange rates at the dates of transactions  
the balance sheets of foreign currency denominated subsidiaries joint ventures and associates are translated into sterling at the rates  
of exchange ruling at the year end and exchange differences arising are taken directly to the translation reserve in equity on disposal of  
a foreign currency denominated subsidiary the deferred cumulative amount recognised in the translation reserve since 1 january 2004 
under the transitional rules of ifrs 1 relating to that entity is recognised in the income statement all other translation differences are taken 
to the income statement with the exception of differences on foreign currency borrowings and forward foreign currency contracts which 
are used to provide a hedge against the group net investments in foreign enterprises these are taken directly to equity until the disposal 
of the net investment at which time they are recognised in the income statement  
new standards and interpretations not applied  
the iasb and ifric have issued the following standards interpretations and amendments with an effective date after the date of these 
financial statements 
ifrs 10 consolidated financial statements effective for annual periods beginning on or after 1 january 2013 – the standard establishes 
the principles for the presentation of consolidated accounts when an entity controls one or more other entities 
ifrs 11 joint arrangements effective for annual periods beginning on or after 1 january 2013 – the standard determines the type of joint 
arrangement by assessing the rights and obligations and accounts for those rights and obligations in accordance with that type of joint 
arrangement 
ifrs 12 disclosure of interests in other entities effective for annual periods beginning on or after 1 january 2013 – the standard sets  
out the requirements to disclose information that enables users of accounts to evaluate the nature of and risks associated with its 
interests in other entities and the effects of these interests on its financial position financial performance and cash flows  
ifrs 13 fair value measurement effective for annual periods beginning on or after 1 january 2013 – the standard defines fair value  
and a framework for measuring fair value 
ias 19 revised employee benefits effective for annual periods beginning on or after 1 january 2013 – the standard will impact the 
measurement of the various components representing movements in the defined benefit pension obligation and associated disclosures 
but not the group’s total obligation it is likely that following the replacement of expected returns on plan assets with a net finance cost  
in the income statement the operating profit for the period will be reduced and accordingly other comprehensive income increased  
ifrs 9 financial instruments effective for annual periods beginning on or after 1 january 2015 – the standard deals with the classification 
recognition and measurement of financial assets and liabilities but has yet to be adopted by the eu  
the directors assess that the standards and interpretations issued but not yet effective are not likely to have a significant impact on future 
financial statements 
  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 97 
3 exchange rates 
the most significant exchange rates to uk sterling for the group are as follows 
if the results for the year to 31 december 2011 had been retranslated at the average exchange rates for the year to 31 december 2012 
north american bus would have achieved normalised operating profit of £482m on revenue of £4845m compared to normalised 
operating profit of £479m on revenue of £4810m as reported and european bus  coach would have achieved a normalised operating 
profit of £844m on revenue of £5158m compared to normalised operating profit of £901m on revenue of £5511m as reported 
4 revenue 
5 segmental analysis 
the operating businesses are organised and managed separately according to the nature of the public transport services they provide 
and the geographical market they operate in commentary on the segments is included in the business review 
analysis by class and geography of business 
intersegment sales represent rail replacement services provided to rail by uk bus and uk coach intersegment trading is undertaken  
on standard arm’s length commercial terms due to the nature of the group’s businesses the origin and destination of revenue is the 
same no single external customer amounts to 10 or more of the total revenue 
 
2012 
closing rate 
2012 
average rate 
2011 
closing rate 
2011
average rate 
us dollar  163 159 155 161 
canadian dollar  161 159 158 158 
euro  123 123 120 115 
 
2012
 £m 
2011
 £m 
rendering of services  18280 22313 
rental income  32 67 
revenue  18312 22380 
finance income  44 67 
total revenue from continuing operations  18356 22447 
 
external 
revenue 
2012 
£m 
inter
segment 
sales 
2012 
£m 
segment 
revenue 
2012 
£m 
external  
revenue  
2011  
£m 
inter
segment 
sales 
2011
 £m 
segment 
revenue 
2011 
£m 
uk bus  2688 02 2690 2631 04 2635 
uk coach  2540 11 2551 2545 46 2591 
rail  1951 – 1951 6883 – 6883 
north american bus  5783 – 5783 4810 – 4810 
european coach  bus  5350 – 5350 5511 – 5511 
intersegment sales elimination  – 13 13 – 50 50
total revenue  18312 – 18312 22380 – 22380  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
98 
5 segmental analysis continued  
 
normalised 
operating 
profit 
2012 
£m 
intangible 
amortisation 
and 
exceptional 
items 
2012
£m 
segment 
result 
2012
£m 
normalised 
operating 
profit 
2011 
£m 
intangible 
amortisation  
and  
exceptional  
items  
2011 
£m 
segment 
result 
2011
£m 
uk bus  341 37 304 327 – 327 
uk coach  206 25 181 349 – 349 
rail  267 177 90 434 17 417 
north american bus  591 259 332 479 33 446 
european coach  bus  838 418 420 901 458 443 
central functions 124 27 151 146 – 146
project costs – – – 92 – 92
operating profit from continuing operations  2119 943 1176 2252 508 1744 
share of posttax results from associates and 
joint ventures  14   14 
net finance costs   492  464
profit before tax    698   1294 
tax charge    85  268
profit for the year    613   1026 
 
during 2011 oneoff project related costs of £92m were charged within operating costs £52m related to the settlement and associated 
legal expenses of a working time claim in north america the remainder related to external fees in response to the competition commission 
enquiry into the uk bus industry costs associated with the acquisition of petermann and professional fees relating to the strategic and 
board debate ahead of the 2011 annual general meeting  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 99 
5 segmental analysis continued  
intangible asset amortisation and operating exceptional items can be analysed by class and location of business as follows 
 
intangible 
asset 
amortisation  
2012 
£m 
operating 
exceptional 
items 
2012 
£m 
total 
2012 
£m 
uk bus  – 37 37 
uk coach  – 25 25 
rail  01 176 177 
north american bus  111 148 259 
european coach  bus  404 14 418 
central functions  01 26 27 
total  517 426 943 
 
in the year to 31 december 2012 exceptional costs of £163m were incurred in relation to uk rail bids this includes the costs of bidding 
for the great western and essex thameside rail franchises in addition £13m was incurred in bidding for a number of regional rail 
opportunities in germany 
exceptional costs of £134m were incurred in relation to the acquisition and integration of school bus and transit businesses in north 
america this includes the acquisitions of petermann partners inc the thompson transit joint venture and forsythe transportation inc 
further details of these acquisitions are disclosed in note 19 in addition £30m of business development costs have been incurred across 
the group as part of a major investment to create other new contract and passenger business pipelines 
exceptional restructuring and rationalisation costs of £86m have been incurred primarily within uk bus uk coach and spain 
there were no exceptional costs incurred during 2011 
 
 
 
 
intangible asset 
amortisation  
2011  
£m 
operating 
exceptional 
items 
2011 
£m 
total 
2011 
£m 
uk bus  – – – 
uk coach  – – – 
rail  17 – 17 
north american bus  33 – 33 
european coach  bus  458 – 458 
central functions  – – – 
total continued operations  508 – 508 
discontinued operations note 11  – – – 
total  508 – 508  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
100 
5 segmental analysis continued  
assets liabilities and capital expenditure can be analysed by class and geography of business as follows 
   noncurrent assets only include intangible assets property plant and equipment 
 the net capital expenditure after allowing for the movements in capital creditors disposal of fixed assets and payments to acquire intangibles  
was £1254m 2011 £1458m 
capital expenditure comprises property plant and equipment additions as disclosed above and in note 15 in 2012 software intangible 
assets of £66m 2011 £13m were acquired as disclosed in note 14 
unallocated assets and liabilities comprise the following items 
 
unallocated 
assets 
2012 
£m 
unallocated 
liabilities  
2012 
£m 
unallocated 
assets  
2011  
£m 
unallocated 
liabilities 
2011 
£m 
cash and cash equivalents  728 – 925 – 
other debt receivables 10 – 07 – 
current tax  08 199 09 197
noncurrent tax – – – 54
available for sale investments  71 – 76 – 
derivative financial assetsliabilities  358 52 521 26
borrowings excluding finance leases  – 8011 – 6219
dividend payable  – 06 – 05
deferred tax  78 848 – 952
total  1253 9116 1538 7453
 
 
assets  
2012  
£m 
of which 
noncurrent 
assets 
2012
£m 
liabilities 
2012 
£m 
capital
expenditure 
2012 
£m 
assets 
2011 
£m 
of which  
noncurrent 
assets  
2011 
£m 
liabilities 
2011
£m 
capital
 expenditure 
2011
£m 
uk bus  1429 1245 1151 247 1377 1173 1056 240 
uk coach  667 530 365 66 721 531 434 128 
rail  147 24 476 02 716 113 1864 23 
north american bus  8780 7894 2039 589 7201 6569 1686 631 
european coach  bus  11725 10763 1597 431 12444 11283 1504 545 
central functions  340 47 573 03 331 01 677 01 
unallocated  1253 – 9116 – 1538 – 7453 – 
intercompany elimination  188 – 188 – 147 – 147 – 
total  24153 20503 15129 1338 24181 19670 14527 1568  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 101 
6 operating costs 
the tocs have fixed track access contracts with network rail infrastructure limited for access to the railway infrastructure tracks 
stations and depots the tocs also have contracts under which rolling stock is leased the capital element of the rolling stock lease 
charge is based on the purchase price capital funded refurbishments and modifications the noncapital element of the lease charge 
includes heavy maintenance charges and charges based on mileage 
an analysis of fees paid to the group’s auditors is provided below 
 
2012
£m 
2011 
£m 
cost of inventories recognised in expense 670 660 
staff costs including exceptional cost of £58m 2011 £nil  7655 8167 
depreciation – owned assets including exceptional costs of £26m 2011 £nil 900 928 
 – leased assets  198 127 
amortisation of fixed asset grants  12 15
operating lease charges  rolling stock capital element 310 1012 
 rolling stock noncapital element  50 456 
 public service vehicles  40 43 
 other  60 76 
 – plant and equipment  460 1587 
 fixed track access  149 573 
 other  244 333 
 – land and buildings  393 906 
foreign exchange differences 04 09
other charges including exceptional expense of £342m 2011 £nil  6359 7777 
operating costs before intangible asset amortisation  16619 20128 
intangible asset amortisation  517 508 
total operating costs  17136 20636 
 
2012 
£m 
2011
£m 
fees payable to the company’s auditors for the audit of the consolidated and parent company accounts  03 03 
fees payable to the company’s auditors and its associates for other services   
the audit of the company’s subsidiaries  06 06 
other services  03 – 
 12 09  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
102 
7 employee benefit costs 
a staff costs 
the average number of employees including executive directors during the year was as follows 
included in the above costs are the following costs related to the group’s key management personnel who comprise the directors of the 
parent company 
b share schemes 
details of options or awards outstanding as at 31 december 2012 under the group’s share schemes are as follows 
 
 
2012  
£m 
2011 
£m 
wages and salaries  6573 7044 
social security costs  961 956 
pension costs note 34  69 117 
sharebased payment note 8  52 50 
 7655 8167 
 2012  2011 
managerial and administrative  3697 3318 
operational  35937 35603 
 39634 38921 
 
2012  
£m 
2011 
£m 
basic salaries 10 10 
benefits  03 03 
performancerelated bonuses  11 12 
sharebased payment  15 10 
 39 35 
 
number of 
share options 
2012 
number of 
share options 
2011 
exercise  
price  
future 
exercise 
periods 
executive share option plan  35508 57042 207p–354p 20132014 
long term incentive plan  6986836 5093870 nil 20132018 
share matching plan  1089251 1026550 nil 20132015 
deferred annual share bonus plan  1325234 1075762 nil 20132015 
wmt long service option scheme  283628 296361 129p–604p 20132020 
sharesave scheme  – 923603 na na 
executive deferred bonus plan 127249 88968 nil 2013 
 9847706 8562156    overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 103 
7 employee benefit costs continued  
b share schemes continued  
i executive share option plan  
the company operates tax approved and unapproved executive share option schemes open to group employees in senior management 
positions options granted by this plan have a maximum term of 10 years the options vest after three years subject to the satisfaction  
of certain performance criteria
 
based on the achievement of a target growth in earnings per share if the performance criteria are not met 
when initially tested in some instances they may be reassessed during the term of the option from 2005 executive share option grants 
have been replaced by awards made under the long term incentive plan as described in ii there are no cash settlement alternatives  
ii long term incentive plan ltip  
the ltip was introduced in 2005 on the recommendation of the remuneration committee to replace the annual award under the 
executive share option plan to executive directors and to certain senior employees under the ltip a performance award to acquire a 
specified number of free shares may be made to the employee or director in addition a matching award may be made as described in 
iii performance conditions are attached to the vesting of performance and matching awards based on both the achievement of target 
growth in earnings per share and the relative total shareholder return tsr of the company against a comparator group of companies  
if the performance conditions are met performance and matching awards vest on the third anniversary of the grant date and remain 
exercisable for a period of up to six months following the vesting date there are no cash settlement alternatives at present  
in 2011 and 2012 hmrc approved share option plans were added as an appendix to the ltip ‘approved plan’ a participant can only 
hold an option under the approved plan over shares with a market value of up to £30000 at the grant date options under the approved 
plan are granted in tandem with the usual options under the ltip the options are structured such that on exercise the proportion of the 
gain in respect of the first £30000 worth of shares as measured at the date of grant will be delivered under the approved option and the 
ltip option shall be scaled back to deliver the remaining gross gain that would have been delivered had the option been granted alone 
the excess shares under the ltip will be forfeited such that both awards will never become fully vested 
during 2012 a supplementary five year long term incentive award was granted to the chief executive subject to targets linked to the 
group’s five year plan this comprised a performance award with no matching element if performance conditions are met the 
performance award will vest on the fifth anniversary of the grant date and remain exercisable for a period of up to twelve months following 
the vesting date there are no cash settlement alternatives at present 
iii share matching plan the ‘plan’  
the share matching plan was introduced in 2005 as part of the new long term incentive plan arrangements described in ii under the 
plan a matching award to acquire a specified number of shares for free may be made if the employee pledges a number of shares as 
investment shares which are then matched by the company on up to a 21 basis with the number of shares that could have been 
purchased with the grosstax equivalent of the amount invested the matching awards vest on the third anniversary of the grant date  
and remain exercisable for a period of up to six months following the vesting date there are no cash settlement alternatives at present  
iv deferred annual share bonus plan  
the deferred annual share bonus plan is a discretionary scheme which forms part of the bonus arrangements for certain senior 
employees under the scheme part of any bonus may be received in cash whilst the remainder is used to make an award of nil cost 
options which vest three years after the award date the options must be exercised within six months of vesting there are no cash 
settlement alternatives at present  
v west midlands travel ltd wmt long service option scheme  
the wmt long service option scheme utilises a fixed amount of shares set aside for this purpose following the acquisition of wmt in 
1995 and is open to all wmt employees who have been in service for more than 25 years the options are exercisable between three  
and ten years following the grant date there are no cash settlement alternatives  
vi twm share incentive plan the ‘sip’  
the twm sip exists for the benefit of wmt employees at the end of the year 965 2011 908 national express group plc shares  
were held for the benefit of the trustee dividends on shares held in the sip forfeited shares account are waived there are no cash 
settlement alternatives   national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
104 
7 employee benefit costs continued   
b share schemes continued  
vii savings related share option scheme sharesave scheme 
the national express group approved sharesave scheme enabled eligible uk employees including executive directors to acquire shares 
in the company through monthly savings over a threeyear period at the end of which they also received a tax free bonus the savings 
and bonus could be used to purchase shares at a discounted option price set at the beginning of the savings contract the options 
matured three years after the grant date and could be exercised for a period of up to six months after this date there are no cash 
settlement alternatives  
viii executive deferred bonus plan 
as detailed in the directors’ remuneration report the committee considered it appropriate for bonuses awarded in respect of the calendar 
year to be deferred for a period of one year and that these would vest subject to the terms of the award and the relevant director’s 
continuing employment the deferred forfeitable ordinary shares are awarded under the terms of the national express group executive 
deferred bonus plan which was adopted by the board of the company on 10 march 2009  
the principal terms of awards under the executive deferred bonus plan are summarised below 
• awards under the plan may be cash awards conditional awards or forfeitable shares awards 
• awards normally vest one year from the date of grant subject to the relevant director’s continued employment with the company 
• the committee may decide that participants shall be entitled to receive a benefit determined by reference to the value of the dividends 
that would have been paid on the vested shares in respect of dividend record dates occurring during the period between the grant 
date and the date of vesting and 
• the awards will normally lapse on cessation of employment save in certain compassionate ‘good leaver’ circumstances eg death or 
disability 
in the event of a variation of the share capital of the company the committee may make such adjustments to the awards as it considers 
appropriate  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 105 
8 sharebased payment 
the charge in respect of sharebased payment transactions included in the group’s income statement for the year is as follows 
there were exceptional costs included within the charge during the year of £01m 2011 £nil 
during the year ended 31 december 2012 the group had eight sharebased payment arrangements which are described in note 7b  
for the following disclosure share options with a nil exercise price have been disclosed separately to avoid distorting the weighted average 
exercise prices the number of share options in existence during the year was as follows 
1
 there are no options 2011 21342 for which no expense has been recognised in accordance with the transitional provisions of ifrs 2 as the options 
were granted before 7 november 2002 although there has been subsequent modification to the options no ifrs 2 charge has been recognised as the 
amounts are not material  
the options outstanding at 31 december 2012 had exercise prices that were between 129p and 604p 2011 between 129p and 604p 
excluding options with a nil exercise price the range of exercise prices for options was as follows 
the options have a weighted average contractual life of one year 2011 one year options were exercised regularly throughout the year 
and the weighted average share price at exercise was 225p 2011 241p 
 
2012 
£m 
2011 
£m 
expense arising from share and share option plans – continuing operations  52 50 
  2012   2011 
 
number 
of share 
options 
weighted 
average 
exercise  
price  
p 
number 
of share 
options 
weighted 
average 
exercise
price
p 
options without a nil exercise price     
at 1 january  1277006 445 1460728 442 
granted during the year  26660 252 14140 242 
forfeited during the year  9708 424 133551 410 
exercised during the year 29877 146 2735 143 
expired during the year 944945 475 61576 434 
outstanding at 31 december
1
 319136 368 1277006 445 
exercisable at 31 december  211343 430 247755 241 
options with a nil exercise price     
at 1 january  7285150 nil 6116309 nil 
granted during the year  4754977 nil 4143972 nil 
forfeited during the year  333117 nil 1245344 nil 
exercised during the year  1954978 nil 1172720 nil 
expired during the year 223462 nil 557067 nil 
outstanding at 31 december  9528570 nil 7285150 nil 
exercisable at 31 december  197069  444461  
total outstanding at 31 december  9847706  8562156  
total exercisable at 31 december  408412  692216  
exercise price p  2012 2011 
0300  123278 127710 
300350 12141 33483 
350650 183717 1115813 
 319136 1277006  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
106 
8 sharebased payment continued  
the weighted average fair value of the share options granted during the year was calculated using a stochastic model with the following 
assumptions and inputs 
experience to date has shown that approximately 24 2011 24 of options are exercised early principally due to leavers this has been 
incorporated into the calculation of the expected option life for the share options without nil exercise price 
expected volatility in the table above was determined from historical volatility over the last eight years adjusted for oneoff events that were 
not considered to be reflective of the volatility of the share price going forward the expected dividend yield represents the dividends 
declared in the 12 months preceding the date of the grant divided by the average share price in the month preceding the date of the grant 
for share options granted during the year under the ltip the tsr targets have been reflected in the calculation of the fair value of the 
options above 
9 net finance costs 
 share options without nil exercise price share options with nil exercise price 
 2012 2011 2012  2011 
risk free interest rate  050116 270 050055 130144 
expected volatility  368400 364 400445 515516 
peer group volatility  – – 385455 551570 
expected option life in years  36 years 8 years 35 years 3 years 
expected dividend yield  397416 360 416456 347364 
weighted average share price at grant date 239p 242p 225p 242p 
weighted average exercise price at grant date 252p 242p nil nil 
weighted average fair value of options at grant date 49p 56p 171p 153p 
 
2012 
 £m 
2011
£m 
bond and bank interest payable  474 462
finance lease interest payable  47 50
other interest payable  02 02
unwind of provision discounting  13 17
finance costs  536 531
other financial income 44 67 
net finance costs  492 464
of which from financial instruments  
cash and cash equivalents  16 01
financial liabilities measured at amortised cost  469 402
derivatives used for hedging  40 38 
loan fee amortisation  24 22 overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 107 
10 taxation 
a analysis of taxation charge in the year 
b tax on items recognised in other comprehensive income or equity 
 
2012
 £m 
2011
 £m 
current taxation 
 
 
credit on exchange movements offset in reserves  – 70 
 – 70 
deferred taxation   
deferred tax chargecredit on sharebased payment  01 01 
deferred tax credit on actuarial losses  72 04 
deferred tax creditcharge on cash flow hedges  49 06
deferred tax creditcharge on exchange 16 41
 136 42
 
 
2012
 £m 
2011
 £m 
current taxation 
 
 
uk corporation tax  16 132 
overseas taxation  70 79 
current income tax charge  86 211 
adjustments with respect to prior years – uk and overseas 05 11
total current income tax charge 81 200 
deferred taxation note 27   
origination and reversal of temporary differences – continuing operations  03 68 
adjustments with respect to prior years – uk and overseas 07 – 
deferred tax charge 04 68 
total tax charge 85 268 
   
the tax charge is disclosed as follows   
tax charge on profit before intangible asset amortisation and exceptional items  327 415 
tax credit on intangible asset amortisation and exceptional items  242 147
 85 268 
   
tax credit on intangible asset amortisation and exceptional items is analysed as follows   
tax credit on intangible asset amortisation 151 147
tax credit on exceptional items 91 – 
 242 147 national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
108 
10 taxation continued  
c reconciliation of the total tax charge 
d temporary differences associated with group investments 
no deferred tax 2011 £nil is recognised on the unremitted earnings of subsidiaries associates and joint ventures as the group has 
determined that these undistributed profits will not be distributed in the near future as a result of changes to tax legislation in 2009 
overseas dividends received on or after 1 july 2009 are generally exempt from uk corporation tax but may be subject to withholding tax 
there are no temporary differences 2011 £nil associated with investments in subsidiaries associates and joint ventures for which a 
deferred tax liability has not been recognised but for which a tax liability may arise 
e unrecognised tax losses 
deferred income tax assets are recognised for tax loss carryforwards to the extent that the realisation of the related tax benefit against 
future taxable profits is probable uk and overseas deferred tax assets that the group has not recognised in the accounts amount to 
£94m 2011 £403m which arise in tax jurisdictions where the group does not expect to generate sufficient suitable future profits  
in addition there are capital losses of £59m 2011 £71m which have not been recognised recoverability of which is dependent  
on capital gains arising  
the £59m of unrecognised capital losses will expire at various dates from 2013 through to 2016 as follows 
f deferred tax included in the income statement 
details on the balance sheet position of deferred tax are included in note 27 
g factors that may affect future tax charges 
on 21 march 2012 the uk chancellor of the exchequer announced a 1 reduction in the uk corporation tax rate to 24 effective from  
1 april 2012 along with two subsequent reductions to 23 from 1 april 2013 and 22 from 1 april 2014 on 5 december 2012 in the 
chancellor’s autumn statement a further reduction to 21 on 1 april 2014 was announced 
at the balance sheet date a rate of 23 2011 25 was substantively enacted the change in rate from 25 to 23 has resulted in a 
tax credit of £01m to the income statement 
the proposed changes to reduce the uk corporation tax rate from 23 to 21 on 1 april 2014 will have a similar effect in future years 
 
2012  
£m 
2011 
£m 
accounting profit before income tax  698 1294 
notional charge at uk corporation tax rate of 245 2011 265  171 343 
nondeductible goodwill impairment and intangible amortisation  07 05 
recognition of a deferred tax asset for previously unrecognised tax losses  39 12
effect of reduction in uk tax rates note 10g 01 04
prior year adjustments within current and deferred tax  02 11
spanish reinvestment relief and other tax credits 16 09
effect of overseas tax rates  68 57 
tax on spanish goodwill and intangibles  58 62
overseas financing deductions 91 58
nondeductible expenditure  42 19 
total tax charge reported in the income statement note 10a  85 268 
  
2012 
£m 
2013  01 
2014  35 
2015  13 
2016  10 
  59 
 
2012  
£m 
2011 
£m 
accelerated capital allowances  72 68 
other short term temporary differences 12 36
utilisation of losses  56 36 
deferred tax charge 04 68  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 109 
11 discontinued operations 
in 2012 and 2011 there were no material movements arising from discontinued operations 
12 dividends paid and proposed 
13 earnings per share 
basic earnings per share is calculated by dividing the earnings attributable to equity shareholders of £600m 2011 £1012m by the 
weighted average number of ordinary shares in issue during the year excluding those held by employee share ownership trusts and those 
held as treasury shares which are both treated as cancelled 
for diluted earnings per share the weighted average number of ordinary shares in issue during the year is adjusted to include the weighted 
average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares 
the reconciliation of basic and diluted weighted average number of ordinary shares is as follows 
the normalised basic and normalised diluted earnings per share have been calculated in addition to the basic and diluted earnings per 
share required by ias 33 since in the opinion of the directors they reflect the underlying performance of the business’ operations more 
appropriately 
 
2012
£m 
2011 
£m 
declared and paid during the year   
ordinary final dividend for 2011 paid of 65p per share  332 305 
ordinary interim dividend for 2012 of 315p per share  161 153 
 493 458 
proposed for approval not recognised as a liability at 31 december 
 
 
ordinary final dividend for 2012 of 66p per share 2011 65p per share  337 333 
 2012 2011 
basic earnings per share 118p 199p 
normalised basic earnings per share  255p 270p 
diluted earnings per share  117p 198p 
normalised diluted earnings per share  254p 269p 
 2012 2011 
basic weighted average shares  510552927 509388824 
adjustment for dilutive potential ordinary shares  1626921 1556324 
diluted weighted average shares  512179848 510945148  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
110 
13 earnings per share continued  
the reconciliation of the earnings and earnings per share to their normalised equivalent is as follows 
 
14 intangible assets  
during the year the directors revised their estimate of the useful economic life of the group’s contractual relationships to 820 years 
   2012   2011 
 £m 
basic eps 
p 
diluted eps 
p £m 
basic eps  
p 
diluted eps 
p 
profit attributable to equity shareholders  600 118 117 1012 199 198 
intangible asset amortisation  517 101 101 508 100 100 
exceptional items  426 83 83 – – – 
tax relief on goodwill and exceptional items  242 47 47 147 29 29
normalised profit from continuing operations 
and attributable to equity shareholders 1301 255 254 1373 270 269 
 
customer 
contracts  
£m 
rail  
franchise  
£m 
 
brand 
£m 
software 
£m 
contractual 
relationships 
£m 
finite life 
assets  
£m 
goodwill 
£m 
total 
£m 
cost         
at 1 january 2012  4179 99 – 230 570 5078 10829 15907 
acquisitions 543 – 23 34 – 600 656 1256 
additions – – – 32 32 64 31 95 
transfer from property plant 
and equipment – – 
 
– 30 – 30 – 30 
disposal – 99 – – – 99 – 99
foreign exchange  121 – – 07 15 143 303 446
at 31 december 2012  4601 – 23 319 587 5530 11213 16743 
amortisation and 
impairment   
 
     
at 1 january 2012  2723 97 – 118 – 2938 844 3782 
charge for year  436 02 03 43 33 517 – 517 
disposals – 99 – – – 99 – 99
foreign exchange  71 – – 04 01 76 10 86
at 31 december 2012  3088 – 03 157 32 3280 834 4114 
net book value         
at 31 december 2012  1513 – 20 162 555 2250 10379 12629 
at 1 january 2012  1456 02 – 112 570 2140 9985 12125  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 111 
14 intangible assets continued  
during 2011 and prior years contractual relationships were deemed to have an indefinite life and together with goodwill were allocated to 
individual cashgenerating units for annual impairment testing on the basis of the group’s business operations the carrying value of these 
assets by cashgenerating unit is as follows 
in 2011 and prior years the useful economic lives of contractual relationships in north american bus and european coach  bus were 
deemed to be indefinite where historical experience had shown that these contracts were consistently renewed during 2012 the directors 
revised their estimate of the useful economic life of the group’s contractual relationships to 820 years reflecting changes in legislation in 
the contract tendering process the customer contract and rail franchise intangible assets are amortised over the finite duration of the 
contract or franchise as appropriate all amortisation charges in the year have been charged to operating costs 
the recoverable amount of indefinite life intangible assets has been determined based on a value in use calculation using cash flow 
projections based on financial budgets and forecasts approved by senior management covering a five year period the assumptions 
including growth rates and operating margins are based on historical experience detailed budget plans as well as management’s 
assessment of current market and economic conditions growth has then been extrapolated forward from the end of the forecasts 
 
customer 
contracts  
£m 
rail  
franchise  
£m 
software 
£m 
finite life 
assets 
£m 
contractual 
relationships 
£m 
goodwill  
£m 
indefinite 
life assets 
£m 
total 
£m 
cost         
at 1 january 2011  4263 99 220 4582 578 11044 11622 16204 
additions 26 – 13 39 – 04 04 43 
foreign exchange  110 – 03 113 08 219 227 340
at 31 december 2011  4179 99 230 4508 570 10829 11399 15907 
amortisation and 
impairment         
at 1 january 2011  2334 80 93 2507 – 855 855 3362 
charge for year  466 17 25 508 – – – 508 
foreign exchange  77 – – 77 – 11 11 88
at 31 december 2011  2723 97 118 2938 – 844 844 3782 
net book value         
at 31 december 2011  1456 02 112 1570 570 9985 10555 12125 
at 1 january 2011  1929 19 127 2075 578 10189 10767 12842 
 
2012 
contractual 
relationships 
£m 
2012
goodwill 
£m 
total 
£m 
2011 
contractual 
relationships  
£m 
2011
goodwill 
£m 
total 
£m 
uk coach – 132 132 – 132 132 
north american bus  355 3305 3660 397 2761 3158 
european coach  bus 200 6942 7142 173 7092 7265 
 555 10379 10934 570 9985 10555  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
112 
14 intangible assets continued  
the calculation of value in use for each group of cashgenerating units is most sensitive to the assumptions over discount rates and the 
growth rate used to extrapolate cash flows beyond the five year period of the management plan  
the key assumptions used for the cashgenerating units are as follows 
the value in use of the north american bus division exceeds its carrying amount by £554m 2011 £315m sensitivity analysis has been 
completed on each key assumption in isolation and this indicates that the value in use of the division will be equal to its carrying amount 
following an increase in the discount rate of 40 basis points 2011 30 basis points or a reduction in the growth rates used to extrapolate 
cash flows beyond the five year period of the management plan of 150 basis points 2011 100 basis points  
the value in use of the european coach  bus division exceeds its carrying amount by £474m 2011 £1768m sensitivity analysis has 
been completed on each key assumption in isolation and this indicates that the value in use of the division will be equal to its carrying 
amount following an increase in the discount rate of 30 basis points 2011 90 basis points or a reduction in growth rates used to 
extrapolate cash flows beyond five year period of management plan of 130 basis points 2011 410 basis points the decrease in 
headroom and increased sensitivity reflects the spanish macroeconomic risks which have been incorporated into the future cash flow 
assumptions see principal risk and uncertainties section for further details regarding how group management recognises prioritises and 
puts in place measures to mitigate these risks 
it is believed that any reasonably possible movement on key assumptions will not lead to an impairment of goodwill allocated to uk coach 
sensitivities to other assumptions 
in north american bus a reduction in operating profit margin in perpetuity of 60 basis points 2011 50 basis points will result in the value 
in use of the division being equal to its carrying amount in european coach  bus a reduction in operating profit margin in perpetuity of 80 
basis points 2011 260 basis points will also result in the value in use of the division being equal to its carrying amount 
the directors consider the assumptions used to be consistent with the historical performance of each cashgenerating unit and to be 
realistically achievable in light of economic and industry measures and forecasts 
 
pretax discount 
 rate applied to  
cash flow projections 
growth rate used to 
extrapolate cash flows 
beyond five year period of 
management plan 
 2012  2011  2012  2011 
uk coach  119 98 20 20 
north american bus  115 113 25 20 
european coach  bus 90 90 20 20  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 113 
15 property plant and equipment 
 
freehold land 
and buildings 
£m 
long leasehold 
property 
improvements 
£m 
public 
service 
vehicles  
£m 
plant and 
equipment 
fixtures 
and fittings 
£m 
total 
£m 
cost      
at 1 january 2012  951 42 10255 1736 12984 
additions  37 02 1176 123 1338 
acquisitions of businesses 12 – 573 11 596 
transfer to intangible assets – – – 30 30
disposals  05 01 301 178 485
foreign exchange  10 02 304 19 335
at 31 december 2012  985 41 11399 1643 14068 
depreciation      
at 1 january 2012 130 20 4013 1276 5439 
charge for the year  21 05 950 122 1098 
disposals 02 – 104 105 211
foreign exchange  05 02 123 12 132
at 31 december 2012  154 23 4736 1281 6194 
net book value      
at 31 december 2012  831 18 6663 362 7874 
at 1 january 2012 821 22 6242 460 7545 
cost of disposals includes £125m of divested assets relating to the acquisition of petermann as described in note 19  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
114 
15 property plant and equipment continued  
property plant and equipment held under finance lease agreements are analysed as follows 
finance leased assets and assets under hire purchase contracts are pledged as security for the related finance lease and hire purchase 
liabilities 
 
freehold land 
and buildings 
£m 
long leasehold 
property 
improvements 
£m 
public service 
vehicles  
£m 
plant and 
equipment 
fixtures  
and fittings  
£m 
total 
£m 
cost      
at 1 january 2011  952 37 9068 1657 11714 
additions  19 05 1397 147 1568 
acquisitions of businesses – – 15 – 15 
disposals  – – 152 54 206 
foreign exchange  20 – 73 14 107
at 31 december 2011  951 42 10255 1736 12984 
depreciation      
at 1 january 2011  112 16 3279 1166 4573 
charge for the year  19 05 867 164 1055 
disposals – – 107 47 154
foreign exchange  01 01 26 07 35
at 31 december 2011  130 20 4013 1276 5439 
net book value      
at 31 december 2011  821 22 6242 460 7545 
at 1 january 2011  840 21 5789 491 7141 
  
2012  
£m 
2011
£m 
land and buildings  – cost  13 14 
 – depreciation  01 01
net land and buildings   12 13 
public service vehicles  – cost  2554 2456 
 – depreciation 751 615
net public service vehicles   1803 1841 
plant and equipment  – cost  02 09 
 – depreciation  02 08
net plant and equipment   – 01 
total net book value   1815 1855  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 115 
16 subsidiaries 
the companies listed below include all those which principally affect the results and net assets of the group a full list of subsidiaries joint 
ventures and associates will be annexed to the next annual return to companies house the principal country of operation in respect of 
the companies below is the country in which they are incorporated 
national express group plc is the beneficial owner of all the equity share capital either itself or through subsidiaries of the companies 
the group’s train passenger services in the uk are operated through franchises awarded by dft rail as delegated by the uk 
government 
incorporated in england and wales  
national express limited  administration and marketing of express coach services in great britain
eurolines uk limited  administration and marketing of express coach services to europe 
airlinks airport services limited  operation of coach services 
national express rail replacement limited  operation of coach services 
the kings ferry limited operation of coach services 
west midlands travel limited  operation of bus services 
c2c rail limited operation of train passenger services 
 
incorporated in scotland  
tayside public transport co limited trading as travel dundee operation of bus services 
 
incorporated in the us  
durham school services lp  operation of school bus services 
petermann llc operation of school bus services 
ycn transportation llc operation of school bus services 
the joint venture of thompson transit inc and ycn transportation llc operation of transit bus services 
national express transit services corporation operation of transit bus services 
 
incorporated in canada  
stock transportation limited  operation of school bus services 
 
 
 the main holding companies of the alsa group 
incorporated in spain  
nex continental holdings sl holding company for operating companies 
tury express sa  holding company for operating companies 
general tecnica industrial slu  holding company for operating companies 
incorporated in morocco  
gat groupe alsa transport sa marrakesh operation of bus services 
tvam transport de voyageurs en autocar maroc sa marrakesh operation of bus services 
aca alsa city agadir sa  operation of bus services  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
116 
17 derivative financial assets and available for sale investments 
further information on the group’s use of fuel interest rate and foreign exchange derivatives is included in note 31 
available for sale investments 
the principal available for sale investments are as follows 
 
2012  
£m 
2011 
£m 
available for sale investments – unlisted ordinary shares  71 76 
derivative financial instruments – interest rate derivatives 310 237 
derivative financial instruments – fuel derivatives 01 73 
derivative financial instruments included in noncurrent assets  311 310 
derivative financial instruments – fuel derivatives  46 131 
derivative financial instruments – foreign exchange derivatives 01 80 
derivative financial instruments included in current assets  47 211 
 
2012 
 £m 
2011
 £m 
cost or valuation and net book value   
at 1 january  76 78 
disposals 03 – 
foreign exchange 02 02
at 31 december  71 76 
   2012 2011 
name  country of registration class of share 
proportion 
held  
 
proportion 
held 
 
metros ligeros de madrid sa mlm  spain ordinary shares  15 15 
various investments within alsa and continental auto  spain ordinary shares  116 116  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 117 
18 investments accounted for using the equity method 
investments accounted for using the equity method are as follows 
the group’s share of posttax results from associates and joint ventures accounted for using the equity method is as follows 
a investments in joint ventures 
the group’s interests in joint ventures are as follows 
the financial information of this joint venture is summarised below 
the carrying amount of the investment in joint ventures matches the group’s share of the net assets 
 
2012 
£m 
2011 
£m 
joint ventures  22 20 
associates  22 46 
total investments accounted for under the equity method  44 66 
 
2012 
£m 
2011
£m 
share of joint venture’s profit 01 01 
share of associates’ profit 13 13 
total share of results from associates and joint ventures 14 14 
name  country of registration activity 
proportion held 
 
iberoeurosur sl  spain holding company of deutsche touring 20 
  ibero 
share of joint venture’s balance sheet and results 
2012 
£m 
2011 
£m 
noncurrent assets  35 35 
current assets  – – 
share of gross assets 35 35 
noncurrent liabilities  09 12
current liabilities  04 03
share of gross liabilities  13 15
share of net assets  22 20 
revenue 02 01 
share of profit 01 01  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
118 
18 investments accounted for using the equity method continued  
b investments in associates 
the group’s interests in associates are as follows 
name   
country of 
 registration  
proportion held 
 
european coach  bus associates  spain  2050 
european coach  bus’s associates are generally involved in the operation of coach and bus services management of bus stations and 
similar operations 
the aggregate amounts related to associates are summarised below 
 
share of associates’ balance sheets and results 
2012  
£m 
2011 
£m 
noncurrent assets  31 47 
current assets  39 59 
share of gross assets  70 106 
noncurrent liabilities  22 24
current liabilities  26 36
share of gross liabilities  48 60
share of net assets  22 46 
total revenue 127 156 
share of profit 13 13  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 119 
19 business combinations 
a acquisitions 
 
2012 acquisitions 
i petermann partners inc 
on the 1 may 2012 in the united states the group acquired the entire share capital of mgop petermann holdings 2 llc and directly 
and indirectly the entire share capital of petermann partners inc ‘petermann’ the business operates transportation for students 
including transportation for special needs students 
the acquisition balance sheet has been adjusted to reflect fair value adjustments the intangible asset adjustment recognises customer 
contracts and relationships acquired with petermann £393m trademarks £23m and the value of noncompete agreements £07m 
the customer contracts are amortised over the life of the contracts which is on average 15 years the trademarks are amortised over 5 
years being the length of expected continued use of the trademarks and the noncompete agreements over 3 years  
the tangible fixed asset adjustment largely comprises a fair value write down of the carrying value of buses acquired along with a write 
down of certain software assets and leasehold improvements the trade and other payables adjustment comprises provisions for 
insurance and environmental claims 
the net consideration paid including adjustments was £1385m within this amount was a £39m receipt for the sale of certain assets in 
texas and washington that were required to be divested by the department of justice as a prerequisite for completing the purchase of 
petermann in addition a cash outflow of £47m arose from hedging the acquisition using us dollar foreign exchange derivatives cash 
acquired in the business was £76m therefore the net cash outflow for the group was £1356m 
in addition £53m of acquisition costs were incurred and have been expensed of which £06m was expensed in 2011 
from the date of acquisition the acquired business contributed £87m to operating profit if the combination had taken place at the 
beginning of 2012 the group operating profit in 2012 would have increased by £52m and revenue from continuing operations in 2012 
would have increased by £396m 
included in the goodwill recognised above are certain intangible assets that cannot be separately identified and measured due to their nature 
this includes control over the acquired business and increased scale in our north american school bus operations management believes that 
goodwill represents value to the group for which the recognition of a discrete intangible asset is not permitted the majority of the value was 
assessed to comprise of synergy benefits expected to be achieved by merging the business into the group’s north american operations 
  
book value 
 £m 
fair value 
adjustments
£m 
fair value 
total 
£m 
intangible assets   – 423 423 
property plant and equipment  474 83 391 
inventory  09 – 09 
trade and other receivables 137 – 137 
cash and cash equivalents 76 – 76 
trade and other payables 105 76 181
deferred tax asset   130 116 14 
net assets acquired   721 148 869 
goodwill on acquisition    5 552 
total    1421 
     
represented by     
consideration     1230 
payment for cash acquired in the business    76 
working capital adjustment    39 
capital expenditure adjustment    79 
proceeds from asset sale    39
related loss on cash flow hedges net of tax    36 
    1421 
add back tax on loss on cash flow hedges    11 
less net cash acquired    76
net cash outflow    1356  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
120 
19 business combinations continued  
ii other acquisitions 
on the 23 march 2012 in the united states the group acquired the entire share capital of the joint venture of thompson transit inc and 
ycn transportation llc ‘jv’ the jv operates part of the ride service for the massachusetts bay transit authority which provides 
transportation services under the americans for disability act the fair value of net assets acquired was £112m consideration was 
£167m resulting in goodwill of £55m there was £02m of cash acquired in the business and £26m of deferred consideration therefore 
the net cash outflow was £139m 
on the 23 march 2012 in the united states the group acquired the entire share capital of ycn transportation llc ‘ycn’ which 
operates special education school transportation services in the city of boston the fair value of net assets acquired was £26m 
consideration was £47m resulting in goodwill of £21m there was £02m of cash acquired in the business therefore the net cash 
outflow was £45m 
on the 24 july 2012 in the united states the group acquired the trade and assets of forsythe transportation inc which operates fixed
route transit contracts for arlington county virginia and the westmoreland county transit authority pennsylvania consideration was 
£31m resulting in goodwill of £10m 
a number of small controlling interests were acquired within the group’s spanish division including compañía navarra de autobuses sa 
pamplona biobide bilbao urban transport automóviles casado and alsa city sightseeing in morocco the combined cash paid for 
these businesses was £08m included in the acquired balance sheets was cash of £10m therefore the net cash inflow was £02m  
in addition there were bank borrowings and lease obligations in the acquired businesses of £14m 
£06m of deferred consideration was paid relating to the 2010 acquisition of school bus operator vogel bus company inc 
2011 acquisitions 
during the year the group paid £04m to acquire a controlling interest in dainco sa a company that operates coach services in spain 
goodwill arising on the acquisition was £04m included in the acquired balance sheet was £10m of bank borrowings 
b disposals 
2012 disposals 
there were no business disposals in the group in 2012 
2011 disposals 
there were no business disposals in the group in 2011 however during the year £09m of deferred consideration was received in relation 
to the 2008 disposal of the group’s portuguese transport business 
20 noncurrent assets – trade and other receivables 
21 inventories 
the movement on the provision for slow moving and obsolete inventory is immaterial 
 
2012  
£m 
2011
£m 
trade receivables 11 47 
prepayments and accrued income  10 – 
other receivables 35 12 
 56 59 
 
2012  
£m 
2011
£m 
raw materials and consumables  193 188  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 121 
22 current assets – trade and other receivables 
an analysis of the provision for impairment of receivables is provided below 
included within trade receivables are balances with a carrying value of £138m 2011 £276m which are past due at the reporting date 
the directors believe that based on the ongoing contractual relationships with predominantly government bodies that these amounts will 
be collected 
23 cash and cash equivalents 
 
2012 
£m 
2011 
£m 
cash at bank and in hand  417 648 
overnight deposits  286 250 
other short term deposits  25 27 
cash and cash equivalents  728 925 
cash and cash equivalents include restricted balances of £67m 2011 140m held by the rail subsidiaries tocs under the terms of the 
train franchise agreements cash can only be distributed by the tocs either up to the value of retained profits or the amount determined by 
prescribed liquidity ratios the restricted cash represents the balance that is either not available for distribution or the amount required to 
satisfy the liquidity ratio at the balance sheet date 
cash at bank and in hand earns interest at floating rates based on daily bank deposit rates short term deposits are made for varying 
periods of between one day and three months depending on the immediate cash requirements of the group and earn interest at the 
agreed short term floating deposit rate the fair value of cash and cash equivalents is equal to the carrying value 
24 current liabilities – trade and other payables 
trade payables are noninterest bearing and are normally settled on 30 day terms and other payables are noninterest bearing and have  
an average term of two months included within other payables are deferred fixed asset grants from government or other public bodies  
of £14m 2011 £26m 
 
2012 
£m 
2011 
£m 
trade receivables  1304 1558 
less provision for impairment of receivables  101 102
trade receivables – net  1203 1456 
amounts due from associates and joint ventures note 36 09 10 
amounts due from other related parties note 36 09 10 
other receivables  382 472 
prepayments and accrued income  345 533 
 1948 2481 
 
2012 
£m 
2011 
£m 
at 1 january  102 143
utilised in the year  01 41 
at 31 december 101 102
 
2012
£m 
2011 
£m 
trade payables  1331 1686 
amounts owed to associates and joint ventures note 36 08 10 
amounts owed to other related parties note 36 36 07 
other tax and social security payable  238 172 
accruals and deferred income  923 1828 
other payables  948 961 
 3484 4664  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
122 
25 other noncurrent liabilities 
26 provisions 
1
 the claims provision arises from estimated exposures at the year end for auto and general liability workers compensation and environmental claims 
the majority of which will be utilised in the next five years it comprises provisions for claims arising in the uk and north america 
2
 a provision was recognised in 2006 for the group’s onerous contract for eurostar with icrrl this was settled in 2012 with a final payment of £90m 
3
 other includes amounts provided for restructuring activities across the group and dilapidation provisions in rail 
when the effect is material the provisions are discounted to their net present value 
 
27 deferred tax 
based on current capital investment plans the group expects to be able to claim capital allowances in excess of depreciation  
in future years at a similar level to the current year 
deferred tax assets and liabilities within the same jurisdiction have been offset 
 
2012 
£m 
2011
£m 
deferred fixed asset grants 30 37 
other liabilities 29 12 
 59 49 
 
claims 
provision
1
 £m
eurostar 
 onerous  
contract  
provision
2
 
 £m 
other
3
 
£m 
total 
£m 
at 1 january 2012  442 90 117 649 
charged to the income statement  215 – 17 232 
utilised in the year  252 90 79 421
amortisation of discount  13 – – 13 
acquired in business combinations 99 – 10 109 
exchange difference  11 – 01 12
at 31 december 2012  506 – 64 570 
current 31 december 2012  223 – 64 287 
noncurrent 31 december 2012  283 – – 283 
 506 – 64 570 
current 31 december 2011  214 90 105 409 
noncurrent 31 december 2011 228 – 12 240 
 442 90 117 649 
 
2012  
£m 
2011 
£m 
net deferred tax liability at 1 january 952 841
charge to income statement  04 68
creditcharge to other comprehensive income or equity 136 42
exchange differences  30 14 
acquired in business combinations 20 15
net deferred tax liability at 31 december 770 952 overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 123 
27 deferred tax continued  
deferred tax assets 
2012 
£m 
2011
£m 
accelerated tax depreciation 61 – 
losses carried forward  103 – 
other short term temporary differences  36 – 
total  78 – 
 
28 borrowings and derivative financial liabilities 
an analysis of interestbearing loans and borrowings is provided in note 29 further information on derivative financial instruments is 
provided in note 31 
deferred tax liabilities 
2012 
£m 
2011
£m 
accelerated tax depreciation  1583 1517
losses carried forward  421 301 
other short term temporary differences 314 264 
total 848 952
 
2012 
£m 
2011 
£m 
noncurrent 
 
 
bank loans  37 55 
bonds 5900 5834 
finance lease obligations 1271 1292 
other debt payable  660 03 
noncurrent borrowings  7868 7184 
fuel derivatives  22 24 
noncurrent derivative financial instruments  22 24 
noncurrent borrowing and derivative financial liabilities  7890 7208 
current   
bank loans  1109 24 
bonds – accrued interest 292 299 
finance lease obligations  276 221 
other debt payable  13 04 
current borrowings  1690 548 
fuel derivatives 25 – 
foreign exchange derivatives  05 02 
current derivative financial instruments  30 02 
current borrowings and derivative financial liabilities  1720 550  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
124 
29 interestbearing borrowings 
the effective interest rates on loans and borrowings at the balance sheet date were as follows 
1
 this date is the ultimate maturity date of the syndicated credit facility 
during 2012 the group issued a €785m private placement repayable in august 2021 at a fixed rate of 455 
under the terms of the £1bn emtn programme there is a change in control put option such that upon a change of control event  
any holder of any mtn may require the company to redeem or purchase that mtn 
details of the group’s interest rate risk management strategy and associated interest rate derivatives are included in notes 30 and 31 
the group is subject to a number of financial covenants in relation to its syndicated credit facilities which if contravened could result  
in its borrowings under the facility becoming immediately repayable these covenants specify maximum net debt to ebitda and minimum 
ebitda to net interest payable 
 
2012  
£m  maturity 
effective
 interest rate 
2011 
£m maturity  
effective 
interest rate 
7 year sterling bond 3601 january 2017 654 3516 january 2017 654 
10 year sterling bond 2299 june 2020 685 2318 june 2020 685 
bonds 5900   5834   
accrued interest – bonds 292   299   
european bank loans 794 august 2014
1
libor  145 –   
european bank loans 284 february 2013 12 –   
european bank loans  58 20132017 502 63 20122016 495 
european bank loans 10 20132017 euribor  285 16 20122016 474 
bank loans  1146   79   
us dollar finance leases at fixed 
rate  1275 20132019 234 1173 20122018 267 
european finance leases  
at fixed rate 60 20132019 588 81 20122017 609 
european finance leases  
at floating rate  45 20132019 euribor  121 58 20122017 euribor  107 
sterling finance leases  
at fixed rate  167 20132019 476 201 20122018 476 
finance leases  1547   1513   
euro private placement 652 august 2021 455 –   
accrued interest – private 
placement 12   –   
euro loans  09 20132016  07 20122014  
other debt payable  673   07   
total  9558   7732    overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 125 
29 interestbearing borrowings continued 
the following table sets out the carrying amount by maturity of the group’s interest bearing borrowings 
as at 31 december 2012 
 1 year  
£m 
12 years 
£m 
23 years 
£m 
34 years 
£m 
45 years  
£m 
 5 years 
£m 
total 
£m 
fixed rate 
       
bank loans 310 14 12 06 – – 342
bonds – – – – 3601 2299 5900
finance leases  261 321 209 186 282 243 1502
other debt payable 13 03 05 – – 652 673
floating rate   
cash assets  728 – – – – – 728 
bank loans 799 03 02 – – – 804
finance leases 15 12 11 05 02 – 45
 
30 financial risk management objectives and policies 
financial risk factors and management 
the group’s multinational operations and debt levels expose it to a variety of financial risks of which the most material are market risks 
relating to fuel prices foreign currency exchange rates interest rates and the availability of funding at reasonable margins the group has 
in place a risk management programme that seeks to manage the impact of these risks on the financial performance of the group by using 
financial instruments including borrowings committed facilities and forward foreign exchange fuel and interest rate derivatives 
the board of directors has delegated the responsibility for implementing the financial risk management policies laid down by the board  
to the group finance director and group treasurer the policies are implemented by the group treasury department with regular 
reporting to the group finance director on its activities 
as at 31 december 2011 
 1 year  
£m 
12 years 
£m 
23 years 
£m 
34 years 
£m 
45 years  
£m 
 5 years 
£m 
total 
£m 
fixed rate 
       
bank loans 15 14 15 13 06 – 63
bonds – – – – – 6133 6133
finance leases  203 218 348 149 127 410 1455
other debt payable 04 02 01 – – – 07
floating rate   
cash assets  925 – – – – – 925 
bank loans  09 03 03 01 – – 16
finance leases 18 12 10 11 05 02 58 national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
126 
30 financial risk management objectives and policies continued  
foreign currency 
the group has major foreign operations in the us canada and spain and as a result is exposed to the movements in foreign currency 
exchange rates on the translation of these foreign currency denominated net assets and earnings these movements can have a significant 
impact on the group’s reported results the group seeks to manage this foreign currency exchange movements risk by aligning its foreign 
currency denominated liabilities with the ebit generated in each currency such that some protection is afforded to the net debt ebitda 
covenant within the group’s core borrowing facility this is achieved by a combination of foreign currency borrowings and finance leases 
and entering into derivative financial instruments such as cross currency interest rate swaps and foreign exchange swaps at the year end 
the group had outstanding foreign exchange derivatives of €500m and us500m swaps of us605m €50m c233m and finance 
leases of us2072m and €130m 
derivative financial instruments are designated as net investment hedges of foreign currency assets the effective portion of the gain or 
loss on the hedge is recognised in the statement of comprehensive income and recycled to the income statement at the same time as the 
underlying hedged net assets affect the income statement any ineffectiveness is taken to the income statement 
the table below demonstrates the sensitivity of the group’s financial instruments to a reasonably possible change in foreign exchange 
rates with all other variables held constant this would affect the group’s profit before tax and translation reserve the effect on the 
translation reserve represents the movement in the translated value of the foreign currency denominated loans and change in fair value  
of crosscurrency swap contracts these movements would be offset by an opposite movement in the translated value of the group’s 
overseas net investments it is estimated that a 10 change in the corresponding exchange rates would result in an exchange gain or 
loss in the translation reserve of £191m 
interest rate risk 
the group is exposed to movements in interest rates on both interestbearing assets and liabilities it is the group’s policy to maintain an 
appropriate balance between fixed and floating interest rates on borrowings in order to provide a level of certainty to interest expense in the 
short term and to reduce the year on year impact of interest rate fluctuations over the medium term to achieve the desired fixedfloating 
ratio the group has entered into a series of interest rate swaps that have the effect of converting fixed rate debt to floating rate debt the 
net effect of these transactions was that as at 31 december 2012 the proportion of group net debt at floating rates was 37 2011 16  
the table below demonstrates the sensitivity of the group’s financial instruments to a reasonably possible change in interest rates with all 
other variables held constant on the group’s profit before tax and on the group’s hedging reserve  
the sensitivity analysis covers all floating rate financial instruments including the interest rate swaps if the interest rates applicable to 
floating rate instruments denominated in sterling were increased by 100bps it is estimated that the group’s profit before taxation would 
decrease by approximately £16m if the interest rates applicable to floating rate instruments denominated in us were increased by 
50bps it is estimated that the group’s profit before taxation would increase by approximately £01m if the interest rates applicable to 
floating rate instruments denominated in euro were increased by 75bps it is estimated that the group’s profit before taxation would 
reduced by £05m the analysis assumes that the amount and mix of floating rate debt including finance leases remains unchanged from 
that in place at 31 december 2012 
   2012   2011 
as at 31 december 
strengthening
weakening
 in currency 
effect 
on profit
 before tax 
£m 
effect on 
translation  
reserve  
£m 
effect  
on profit  
before tax  
£m 
effect on 
translation 
reserve 
£m 
us dollar  10 – 80 – 15 
euro  10 – 116 – 196
canadian dollar  10 – 05 – 09 
us dollar 10 – 80 – 15
euro  10 – 116 – 196 
canadian dollar  10 – 05 – 09 overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 127 
30 financial risk management objectives and policies continued  
commodity prices 
the group is exposed to movements in commodity prices as a result of its fuel usage it is the group’s policy to hedge this exposure  
in order to provide a level of certainty as to its cost in the short term and to reduce the year on year impact of price fluctuations over the 
medium term this is achieved by entering into fuel derivatives at 31 december 2012 the group had hedged approximately 100 of its 
2013 expected usage and 91 of its expected usage in 2014 see the finance director’s review for further details  
the table below demonstrates the effect of a reasonably possible variation in fuel prices with all other variables held constant on the fair 
value of the group’s financial instruments and accordingly on the group’s profit before tax and on the group’s hedging reserve 
the sensitivity analysis includes all fuel derivatives the effect on the hedging reserve arises through movements on the fair value of the 
group’s fuel derivatives for these derivative contracts the sensitivity of the net fair value to an immediate 20 increase or decrease  
in all prices would have been £409m at 31 december 2012 the figure does not include any corresponding economic advantage or 
disadvantage that would arise from the natural business exposure which would be expected to offset the gain or loss on the derivatives 
credit risk 
the maximum credit risk exposure of the group is the gross carrying value of each of its financial assets this risk is mitigated by a number 
of factors many of the group’s principal customers suppliers and financial institutions with which it conducts business are public or 
quasipublic bodies both national dft rail and network rail in the uk and local school boards in north america municipal authorities  
in spain and morocco transport for london and centro in the uk the group does not consider these counterparties to pose a 
significant credit risk outside of this the group does not consider it has significant concentrations of credit risk the group has 
implemented policies that require appropriate credit checks on potential customers before sales commence 
the only elements of the group’s financial assets which are not impaired but are past due are certain trade receivable items an ageing  
of the assets which are past due is included in the table below in terms of trade receivables that are neither impaired nor past due there 
are no indications as at the yearend reporting date that the debtors will not meet their payment obligations see risk and risk management 
section for details of how management manages this process 
   2012  2011 
as at 31 december 
increase
decrease 
in basis
points 
effect on 
profit 
before tax
 £m 
effect on 
hedging  
reserve 
 £m 
effect on 
profit 
before tax
 £m 
effect on 
hedging 
reserve 
£m 
sterling  100 16 – 13 – 
us dollar 50 01 – – – 
euro  75 05 – – – 
sterling  100 16 – 13 – 
us dollar  50 01 – – – 
euro  75 05 – – – 
   2012  2011 
as at 31 december 
increase
decrease
 in price 
effect on 
profit 
before tax 
£m 
effect on  
hedging  
reserve  
£m 
effect on 
profit 
before tax 
£m 
effect on 
hedging 
reserve 
£m 
sterling denominated ulsd  20 – 149 – 116 
us dollar denominated heating oildiesel  20 – 96 – 121 
euro denominated ulsd  20 – 164 – 134 
sterling denominated ulsd  20 – 149 – 116
us dollar denominated heating oildiesel  20 – 96 – 121
euro denominated ulsd  20 – 164 – 134 national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
128 
30 financial risk management objectives and policies continued  
liquidity risk 
the group’s liquidity risk is managed centrally by the group treasury department with operating units forecasting their cash requirements 
the group actively maintains a mixture of long term and medium term committed facilities that are designed to ensure the group has 
sufficient available funds to meet current and forecast funding requirements in managing the liquidity risk the group has access to a range 
of funding sources through the banking and capital markets  
at 31 december 2012 the group had committed bank borrowing and finance lease facilities of £6162m 2011 £6205m the group has 
a £500m committed unsecured revolving bank facility maturing in august 2014 of which £4193m was unused at 31 december 2012 
2011 £500m letters of credit issued to support insurance retentions were £385m 2011 £308m  
the table below summarises the maturity profile of the group’s financial liabilities at 31 december 2012 based on the contractual 
undiscounted cash flows including interest cash flows as such the amounts in this table will not agree to the carrying amounts disclosed  
in the balance sheet or other notes the table includes cash flows associated with derivative hedging instruments their amounts reflect 
the maturity profile of the fair value liability where the instrument will be settled net and the gross settlement amount where the pay leg  
of a derivative will be settled separately to the receive leg 
year ended 31 december 2012 
on demand 
£m 
less than 
1 year 
£m 
15 years  
£m 
 5 years  
£m 
total 
£m 
bank loans  – 1126 38 – 1164 
bonds – 368 4971 2697 8036 
finance lease obligations  – 297 1353 127 1777 
other debt payable – 38 116 768 922 
trade and other payables  – 3470 29 – 3499 
 – 5299 6507 3592 15398 
foreign exchange derivatives – 04 – – 04 
interest rate derivatives – 56 214 47 317
fuel derivatives – 19 14 – 05
 – 71 200 47 318
 
year ended 31 december 2011 
on demand 
£m 
less than 
1 year 
£m 
15 years  
£m 
 5 years  
£m 
total 
£m 
bank loans  – 24 55 – 79 
bonds – 368 1471 6565 8404 
finance lease obligations  – 312 929 450 1691 
other debt payable – 04 01 02 07 
trade and other payables  – 4638 12 – 4650 
icrrl onerous contract obligation  – 90 – – 90 
 – 5436 2468 7017 14921 
foreign exchange derivatives – 80 – – 80
interest rate derivatives – 40 123 85 248
fuel derivatives – 165 57 – 222
 – 285180 85 550
   of which not impaired and past due in the following periods 
 
carrying 
amount 
£m 
of which 
neither 
impaired 
nor past due 
£m 
less than 
30 days 
£m 
between  
30 and 60 days  
£m 
between  
61 and 90 days 
 £m 
over 90 days
 £m 
trade receivables at 31 december 2012  1214 967 94 47 17 89 
trade receivables at 31 december 2011  1503 908 265 102 48 180  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 129 
30 financial risk management objectives and policies continued  
capital risk management 
the group seeks to adopt efficient financing structures that enable it to use its balance sheet strength to achieve the group’s objectives 
without putting shareholder value at risk the group’s capital structure comprises its equity refer to the group statement of changes  
in equity and its net debt refer to note 37  
the increase in the group’s net debt from £6337m to £8282m excluding accrued interest is explained in the finance director’s review 
information about the financial covenants in relation to the group’s borrowing facilities is included in note 29  
31 financial instruments including cash trade receivables and payables 
fair values 
the table below illustrates the fair values of all financial assets and liabilities held by the group at 31 december 2012 
loans and receivables are non derivative financial assets with fixed or determinable payments that are not quoted in an active market they 
are measured at amortised cost using the effective interest rate method and the carrying value in all cases approximates to the fair value  
available for sale investments are nonderivative assets that are either designated as available for sale or are not classified as loans and 
receivables or held to maturity investments the group’s available for sale investments have no active market and in the absence of any 
other reliable external information are carried at cost or amortised cost which approximates to the fair value 
the fair value of derivatives is either determined by the thirdparty financial institution with which the group holds the instrument in line  
with the market value of similar financial instruments or by use of valuation techniques using market data derivatives other than those 
designated as effective hedging instruments are classified as fair value through profit or loss and are carried on the balance sheet at their 
fair value with gains or losses recognised in the income statement derivatives designated as hedging instruments in an effective hedge  
are carried on the balance sheet at their fair value for cash flow hedges and hedges of net investments in foreign operations the effective 
portion of the gain or loss on the hedging instrument is recognised directly in other comprehensive income while the ineffective portion  
is recognised in the income statement amounts taken to other comprehensive income are transferred to the income statement when the 
hedged transaction affects profit or loss or when the foreign operation is sold or partially disposed for fair value hedges all gains or losses 
are recognised in the income statement 
derivatives are the only instrument which the group holds at fair value the fair value measurement of these instruments is categorised 
within the level 2 ie the fair values are derived based on observable market inputs in accordance with ifrs 7 
the group’s bonds are held at a hybrid amortised cost with a fair value adjustment after initial recognition at fair value the bonds are 
measured at amortised cost using the effective interest rate method a portion of the bonds are designated as the hedged item in an 
effective fair value hedging relationship as such the carrying value of this portion is adjusted for changes in fair value attributable to the risk 
being hedged this net carrying value will differ to the fair value depending on movements in the group’s credit risk movements in interest 
rates on the unhedged portion and unamortised fees 
all other liabilities including finance leases banks loans trade and other payables and other debt payable are held at amortised cost  
after initial fair value recognition these instruments are measured at amortised cost using the effective interest rate method the carrying 
value of these liabilities approximates to the fair value  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
130 
31 financial instruments including cash trade receivables and payables continued  
 
other receivables and other payables are to be settled in cash in the currency they are held in 
in accordance with ias 39 ‘financial instruments recognition and measurement’ the group has reviewed all contracts for embedded 
derivatives that are required to be separately accounted for no embedded derivatives have been identified 
classification of financial instruments  
as at 31 december 2012 
loans and 
receivables 
£m 
available
forsale 
assets 
£m 
derivatives 
used for 
hedging 
£m 
liabilities 
measured at 
amortised 
cost  
£m 
at fair value 
through  
profit or loss  
£m 
total 
£m 
assets 
      
investments  – 71 – – – 71 
fuel derivatives  – – 47 – – 47 
foreign exchange derivatives – – 01 – – 01 
interest rate derivatives – – 310 – – 310 
cash and cash equivalents  728 – – – – 728 
trade and other receivables  1651 – – – – 1651 
 2379 71 358 – – 2808 
liabilities       
bank loans  – – – 1146 – 1146
bonds including accrued interest – – – 6192 – 6192
finance lease obligations  – – – 1547 – 1547
other debt payable  – – – 673 – 673
fuel derivatives – – 47 – – 47
foreign exchange derivatives – – 05 – – 05
trade and other payables  – – – 3499 – 3499
 – – 5213057 – 13109
classification of financial instruments  
as at 31 december 2011 
loans and 
receivables 
£m 
available
forsale 
assets 
£m 
derivatives 
used for 
hedging 
£m 
liabilities 
measured at 
amortised cost  
£m 
at fair value 
through  
profit or loss  
£m 
total 
£m 
assets 
      
investments  – 76 – – – 76 
fuel derivatives  – – 204 – – 204 
foreign exchange derivatives – – 80 – – 80 
interest rate derivatives – – 237 – – 237 
cash and cash equivalents  925 – – – – 925 
trade and other receivables  2007 – – – – 2007 
 2932 76 521 – – 3529 
liabilities       
bank loans  – – – 79 – 79
bonds including accrued interest – – – 6133 – 6133
finance lease obligations  – – – 1513 – 1513
other debt payable  – – – 07 – 07
fuel derivatives – – 24 – – 24
foreign exchange derivatives – – 02 – – 02
trade and other payables  – – – 4650 – 4650
icrrl onerous contract obligation  – – – 90 – 90
 – – 2612472 – 12498 overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 131 
31 financial instruments including cash trade receivables and payables continued  
the group assesses at each yearend reporting date whether a financial asset or group of financial assets is impaired in the financial year 
2012 there was no objective evidence that would have necessitated the impairment of loans and receivables or availableforsale assets 
except the provision for impairment of receivables see note 22 
hedging activities 
the group uses derivative financial instruments to manage exposures to market risk such as movements in foreign exchange rates  
fuel prices and interest rates such derivative financial instruments are initially recognised at fair value and are subsequently remeasured  
at fair value in line with ias 39 the group classifies hedges as a fair value hedges used to hedge exposure to changes in the fair value  
of a recognised asset or liability b cash flow hedges used to hedge exposure to variability in cash flows associated with a recognised 
asset or liability or a highly probable forecast transaction and c hedges of a net investment in a foreign operation  
in 2012 the group applied cash flow hedge accounting for hedging floating fuel price risks in highly probable forecast purchase 
transactions and for hedging net investments in us dollar and euro foreign operations the group applied fair value hedge accounting  
for the fair value interest rate risk on £200m of the group’s fixed rate bonds and €785m private placement 
the movement on derivative financial instruments is detailed below 
 
the movement on the hedging reserve is detailed below 
 
interest rate 
swaps
 £m 
foreign  
exchange 
forward  
contracts  
£m 
fuel swaps 
£m 
total 
£m 
net asset at 1 january 2012 237 78 180 495 
transfers to the income statement on cash flow hedges – – 202 202
cash settlementsaccrual 03 42 – 39
revaluation through income statement  70 – – 70 
revaluation through other comprehensive income – – 22 22 
exchange differences – 40 – 40
net assetliability at 31 december 2012  310 04 – 306 
 
interest rate 
swaps
 £m 
foreign  
exchange 
forward  
contracts  
£m 
fuel swaps 
£m 
total 
£m 
net liabilityasset at 1 january 2011 13 100 193 80 
transfers to the income statement on cash flow hedges – – 253 253
cash settlementsaccrual 75 128 – 203 
revaluation through income statement  175 – – 175 
revaluation through other comprehensive income – – 242 242 
exchange differences – 50 02 48 
net asset at 31 december 2011  237 78 180 495 
 
2012 
£m 
2011 
£m 
at 1 january  159 176 
transferred to income statement – operating costs 202 253
revaluation through other comprehensive income 22 242 
tax on revaluation 49 06
at 31 december  28 159  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
132 
31 financial instruments including cash trade receivables and payables continued  
hedge of net investments in foreign entities 
the group uses foreign currency borrowings and derivative financial instruments to hedge the net investment in material foreign currency 
net assets of the group and are used to reduce the exposure to foreign exchange rate movements at 31 december 2012 the group had 
designated €50m of synthetic debt in the form of foreign exchange derivatives €100m of revolving credit facility drawings €785m private 
placement and €35m of other loans as net investment hedges of the net assets of its spanish subsidiaries similarly 50m of synthetic 
debt in the form of foreign exchange derivatives were designated as a hedge of the net assets of the group’s us subsidiaries  
no ineffectiveness was recognised in relation to these hedges 
fuel derivatives 
the group has a number of fuel derivatives in place to hedge the different types of fuel used in each division ultra low sulphur diesel  
is used in the uk bus uk coach and european coach  bus divisions and is hedged by swaps in the same type of fuel diesel used  
in the north american division is hedged using the heating oil and diesel market the timing of the swap cash flows match underlying  
fuel purchases from 2013 through to 2015 there was no significant element of hedge ineffectiveness requiring recognition in the income 
statement  
during the year £22m of fair value losses 2011 £242m gains have been transferred to the hedging reserve due to movements in market 
fuel prices fair value movements of £202m 2011 £253m have been transferred from the hedging reserve to the income statement 
following settlement of fuel trades of which £207m was recognised in the hedging reserve at 1 january 2012 and the remainder was 
generated during the year due to the movement in market fuel prices 
fuel derivatives can be analysed as follows 
 
31 december 
2012 
fair value 
£m 
31 december 
2011 
 fair value  
£m 
31 december 
2012 
volume  
million litres 
31 december 
2011
volume 
million litres 
hedge fuel derivatives     
sterling denominated – uk bus uk coach and rail  02 34 769 806 
us dollar denominated – north american bus  01 32 669 745 
euro denominated – european coach  bus  22 65 930 900 
fuel derivatives included in current assets 21 131 2368 2451 
sterling denominated – uk bus uk coach and rail  11 28 790 360 
us dollar denominated – north american bus 05 06 620 397 
euro denominated – european coach  bus  05 27 770 450 
fuel derivatives included in noncurrent assetsliabilities 21 49 2180 1207 
total hedge fuel derivatives  – 180 4548 3658  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 133 
31 financial instruments including cash trade receivables and payables continued  
interest rate swaps at fair value through profit or loss 
in july 2010 the group entered into four £50m denominated interest rate swaps on a total of £200m of the group’s sterling bonds these 
interest rate swaps all pay floating interest libor  a margin semiannually receive fixed interest annually with maturities matching the 
group’s sterling bonds two swaps with total notional value £100m mature in january 2017 two swaps with notional value £100m mature 
june 2020 and are designated as a fair value hedge of the interest rate risk on £200m of these bonds these swaps are measured at fair 
value through profit or loss with any gains or losses being taken immediately to the income statement to offset any fair value gains or 
losses due to changes in the risk free interest rate on the swapped portion of the bonds as at 31 december 2012 a total fair value gain  
of £54m was recognised in the income statement in relation to these swaps this is offset by a fair value loss of £54m on the underlying 
hedged item in this case changes in fair value on the £200m of the group’s bonds due to changes in the risk free interest rate 
in september 2012 the group entered into two €3925m denominated interest rate swaps equal in value to the euro private placement 
these interest rate swaps all pay floating interest euribor a margin semiannually receive fixed interest annually with maturities 
matching the euro private placement and are designated as a fair value hedge of the interest rate risk on the private placement these 
swaps are measured at fair value through profit and loss with any gains or losses being taken immediately to the income statement to 
offset any fair value gains or losses due to changes in the risk free rate on the euro private placement as at 31 december 2012 a total fair 
value gain of £17m was recognised in the income statement in relation to these swaps this is offset by a fair value loss of £17m on the 
underlying hedged item in this case changes in fair value of the euro private placement due to changes in the risk free interest rate 
 
32 calledup share capital 
 
2012 
£m 
2011 
£m 
at 31 december   
authorised 
 
 
800000000 2011 800000000 ordinary shares of 5p each 400 400 
issued calledup and fully paid   
511732603 2011 511726026 ordinary shares of 5p each  256 256 
the total number of share options exercised in the year by employees of the group was 1984855 2011 1175455 of which nil 
exercises were satisfied by newly issued shares 2011 nil and 1919772 2011 1175455 exercises were satisfied by transferring  
shares from the national express employee benefit trust the remaining exercises were settled via a direct purchase of shares from  
the open market 
own shares 
own shares comprises 535658 2011 380430 ordinary shares in the company that have been purchased by the trustees of the 
national express employee benefit trust the ‘trust’ during the year the trust purchased 2075000 2011 991615 shares and 
1919772 20111175455 shares were used to satisfy options granted under a number of the company’s share schemes the market 
value of these shares at 31 december 2012 was £11m 2011 £09m the dividends payable on these shares have been waived 
the group’s treasury shares were sold during the year and therefore are nil 2011 1668688 no shares were added or cancelled  
during the year 2011 nil  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
134 
33 other reserves 
 
merger
 reserve 
£m 
hedging  
reserve  
£m 
translation  
reserve 
£m 
total 
£m 
at 1 january 2012  154 159 686 999 
hedge movements net of tax – 131 – 131
exchange differences net of tax  – – 426 426
at 31 december 2012 154 28 260 442 
 
the nature and purpose of the other reserves are as follows 
• the merger reserve includes the premium on shares issued to satisfy the purchase of prism rail plc in 2000  
• the hedging reserve records the movements on designated hedging items offset by any movements recognised in equity on 
underlying hedged items and 
• the translation reserve records exchange differences arising from the translation of the accounts of foreign currency denominated 
subsidiaries offset by the movements on loans and derivatives used to hedge the net investment in foreign subsidiaries 
34 pensions and other postemployment benefits 
a summary of pension benefits and assumptions 
the uk bus and uk coach divisions operate both funded defined benefit schemes and a defined contribution scheme the majority of 
employees of the rail companies are members of the appropriate sharedcost section of the railways pension scheme rps a funded 
defined benefit scheme the assets of all schemes are held separately from those of the group contributions to the schemes are 
determined by independent professionally qualified actuaries 
subsidiaries in north america contribute to a number of defined contribution plans the group also provides certain additional unfunded 
postemployment benefits to employees in north america and spain which are disclosed in section c in the ‘other’ category 
during the period certain liabilities of the travel west midlands pension fund relating to current and deferred pensioners valued at £238m 
on an accounting basis were insured at a cost of £272m at the transaction date this insurance policy is a qualifying insurance policy  
and therefore the value of the policy and the value of the liabilities have been recognised within actuarial losses in the group statement  
of comprehensive income this buyin has reduced risk and volatility and brought greater stability to the group’s pension contribution 
commitments as a result of this transaction further assets due to the travel west midlands pension fund were identified and recovered 
which substantially offset these losses 
 
the total pension cost for the year was £69m 2011 £117m of which £35m 2011 £35m relates to the defined contribution schemes 
the uk coach plan is now closed to all future accrual a funding plan aimed at bringing the plan to self sufficiency over a six year period 
was agreed in 2010 national express contributes £42m annually to this scheme in 2011 uk bus agreed a £55m annual deficit 
repayment plan with the trustees of the west midlands passenger transport authority pension fund to fund a £71m scheme funding 
deficit over 12 years the plan remains open to accrual for existing members only 
the defined benefit pension liabilityasset included in the balance sheet is as follows 
 
merger
 reserve 
£m 
hedging  
reserve  
£m 
translation  
reserve 
£m 
total 
£m 
at 1 january 2011  154 176 921 1251 
hedge movements net of tax – 17 – 17
exchange differences net of tax  – – 235 235
at 31 december 2011  154 159 686 999 
 
2012  
£m 
2011 
£m 
uk bus  329 168
uk coach  166 186 
rail  18 22
other 12 14
total  193 18 overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 135 
34 pensions and other postemployment benefits continued  
a summary of pension benefits and assumptions continued 
the valuations conducted for financial reporting purposes are based on the triennial actuarial valuations a summary of the latest triennial 
actuarial valuations and assumptions made is as follows  
 amounts included in the income statement other comprehensive income and the balance sheet are calculated using the projected unit method 
the range of funding levels and scheme assets for rail reflects the range of funding levels and assets in the various sections of the rps 
relating to the franchises which the group operated at 31 december 2012 the plans do not provide medical benefits 
the most recent triennial valuations are then updated by independent professionally qualified actuaries for financial reporting purposes  
in accordance with ias 19 the main actuarial assumptions underlying the ias 19 valuations are 
  uk bus  uk coach rail 
date of actuarial valuation 
tayside 
31 march 
2011 
travel west 
midlands  
31 march  
2010 
5 april 
2010 
31 december 
2010 
actuarial method used  attained age attained age  projected unit projected unit 
rate of investment returns per annum  4369 5070  41 5576 
increase in earnings per annum  50 45  – 42 
scheme assets taken at market value  £455m £3820m  £548m £668m 
funding level  97 84  68 9599 
   2012   2011 
 uk bus uk coach rail uk bus  uk coach rail 
rate of increase in salaries  25 25 30 30 30 30 
rate of increase of pensions  20 28 20 20 30 20 
discount rate  44 44 44 50 50 50 
inflation assumption rpi 28 28 28 30 30 30 
inflation assumption cpi 20 20 20 20 20 20 
expected rates of return on scheme assets       
equities  77 77 77 77 77 77 
bonds  30 30 30 30 30 30 
other  125 125 125 125 125 125 
postretirement mortality in years       
current pensioners at 65 – male  210 247  209 245  
current pensioners at 65 – male pension under  
£9300 pa or pensionable pay under £35000 pa   206   205 
current pensioners at 65 – male – others    228   226 
current pensioners at 65 – female  237 276  236 275  
current pensioners at 65 – female pension under  
£3300 pa or pensionable pay under £35000 pa    225   224 
current pensioners at 65 – female – others    249   248 
future pensioners at 65 – male  224 267  223 266  
future pensioners at 65 – male pension under £9300 pa 
or pensionable pay under £35000 pa    230   228 
future pensioners at 65 – male – others    250   249 
future pensioners at 65 – female  253 296  252 295  
future pensioners at 65 – female pension under  
£3300 pa or pensionable pay under £35000 pa    250   249 
future pensioners at 65 – female – others    273   271  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
136 
34 pensions and other postemployment benefits continued 
a summary of pension benefits and assumptions continued 
the demographic assumptions reflect those adopted in the most recent triennial actuarial valuation for the rail scheme mortality 
assumptions have been set by reference to the recent experience of the scheme mortality is assumed to improve in the future in line  
with the ‘core projection’ model published by the actuarial profession’s continuous mortality investigation incorporating a long term 
improvement rate of 15 pa 
the directors regard the assumption around the discount rate to be the key assumption in the ias 19 valuation and the following table 
provides an approximate sensitivity analysis of the impact of a 01 change in the discount rate assumption 
scheme assets are stated at their market values at the respective balance sheet dates the expected rate of return on scheme assets is 
determined based on market returns on each category of scheme assets 
b accounting for the railways pension scheme  
the majority of employees of the rail companies are members of the appropriate section of the rps a funded defined benefit scheme 
the rps is a shared cost scheme which means that costs are formally shared 60 employer and 40 employee to date the group  
has experienced eleven changes of rail franchise ownership where the current owner has funded the scheme during the franchise term 
and the pension deficit at franchise exit has transferred to the new owner without cash settlement by entering into the franchise contract 
the toc becomes the designated employer for the term of the contract and under the rules of the rps must fund its share of the pension 
liability in accordance with the schedule of contributions agreed with the scheme trustees and actuaries  
in determining the appropriate accounting policy for the rps to ensure that the group’s accounts present fairly its financial position 
financial performance and cash flows management has consulted with toc industry peers and has concluded that the group’s 
constructive obligations should be accounted for in accordance with ias 19 this accounting policy which in all other respects is 
consistent with that set out in this note for the group’s other defined benefit schemes means that the group’s accounts reflect that 
element of the deficits anticipated to be settled by the group during the franchise term and will prevent gains arising on transfer of the 
existing rps deficits to a new owner at franchise exit  
in calculating the group’s constructive obligations in respect of the rps the group has calculated the total pension deficits in each of the 
rps sections in accordance with ias 19 and the assumptions set out above these deficits are reduced by a ‘franchise adjustment’ which 
is that portion of the deficit projected to exist at the end of the franchise and which the group will not be required to fund the franchise 
adjustment which has been calculated by the group’s actuaries is offset against the present value of the rps liabilities so as to fairly 
present the financial performance position and cash flows of the group’s obligations  
the franchise adjustment decreased from £596m at 31 december 2011 to £181m at 31 december 2012 the principal reason for the 
decrease was the handback of the east anglia franchise reducing the franchise adjustment by £490m in addition the adjustment 
increased due to interest on the franchise adjustment of £07m and other net actuarial movements of £68m in the prior year the franchise 
adjustment decreased from £724m at 31 december 2010 to £596m at 31 december 2011 the decrease was caused by interest on the 
franchise adjustment of £39m and net actuarial movements of £167m  
 
uk bus  
£m 
uk coach  
£m 
rail
 £m 
defined benefit pension liabilityasset at 31 december 2012 329 166 18
effect of a 01 increase in the discount rate  76 13 – 
current service cost for the year ended 31 december 2012 33 – 30
effect of a 01 increase in the discount rate  01 – –  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 137 
34 pensions and other postemployment benefits continued  
c financial results for pension benefits 
the amounts charged to the group income statement and group statement of comprehensive income for the years ended 31 december 
2012 and 2011 are set out in the following tables  
group income statement 
uk bus 
2012 
£m 
uk coach  
2012 
£m 
rail 
2012
£m 
total 
2012
£m 
amounts chargedcredited to group operating profitloss 
    
current service cost  33 – 30 63
expected return on pension scheme assets  239 22 39 300 
interest on pension liabilities  219 24 35 278
interest on franchise adjustment – – 07 07 
total charge to income statement  13 02 19 34
actual return on plan assets 325 27 119 471 
 
group statement of comprehensive income 
uk bus 
2012
 £m 
uk coach  
2012 
£m 
rail 
2012
£m 
total 
2012
£m 
actual return less expected return on pension scheme assets  86 03 78 167 
other actuarial gains and losses  331 63 84 478
actuarial losses  245 60 06 311
 
group income statement 
uk bus 
2011 
£m 
uk coach  
2011 
£m 
rail 
2011
£m 
total 
2011
£m 
amounts chargedcredited to group operating profitloss 
    
current service cost  41 01 103 145
expected return on pension scheme assets  251 35 144 430 
interest on pension liabilities  229 29 148 406
interest on franchise adjustment – – 39 39 
total chargecredit to income statement  19 05 68 82
actual return on plan assets 178 132 10 320 
 
group statement of comprehensive income 
uk bus 
2011
 £m 
uk coach  
2011 
£m 
rail 
2011
£m 
total 
2011
£m 
actual return less expected return on pension scheme assets  73 97 134 110
other actuarial gains and losses  124 25 123 24 
actuarial lossesgains  197 122 11 86
  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
138 
34 pensions and other postemployment benefits continued  
c financial results for pension benefits continued  
the amounts recognised in the balance sheet at 31 december are 
as at 31 december 2012 
uk bus 
2012
 £m 
uk coach 
2012
£m 
rail  
2012 
£m 
other  
2012 
£m 
total 
2012
£m 
equities  856 – 629 – 1485 
bonds  588 658 35 – 1281 
property  37 – – – 37 
insurance policy 2426 – – – 2426 
diversified growth fund 533 – – – 533 
other  40 73 07 – 120 
fair value of scheme assets  4480 731 671 – 5882 
present value of scheme liabilities  4809 565 993 12 6379
franchise adjustment  – – 181 – 181 
defined benefit obligation  4809 565 812 12 6198
members’ share of deficit  – – 123 – 123 
defined benefit pension deficitsurplus 329 166 18 12 193
 
the movement in the present value of the defined benefit obligation in the year is as stated below for rail the rps is a shared cost 
scheme which means that costs are formally shared 60 employer and 40 employee 
the group’s defined benefit obligation comprises £6186m 2011 £8617m including the members’ share of the deficit arising from plans 
that are wholly or partly funded and £12m 2011 £14m from unfunded plans 
 
as at 31 december 2011 
uk bus 
2011
 £m 
uk coach 
2011
£m 
rail  
2011 
£m 
other  
2011 
£m 
total 
2011
£m 
equities  1917 – 3037 – 4954 
bonds  2342 636 151 – 3129 
property  36 – – – 36 
other  24 43 22 – 89 
fair value of scheme assets  4319 679 3210 – 8208 
present value of scheme liabilities  4487 493 4233 14 9227
franchise adjustment  – – 596 – 596 
defined benefit obligation  4487 493 3637 14 8631
members’ share of deficit  – – 405 – 405 
defined benefit pension deficitsurplus 168 186 22 14 18
 
uk bus 
 £m 
uk coach 
£m 
rail  
£m 
other  
£m 
total 
£m 
defined benefit obligation at 1 january 2012 4487 493 3637 14 8631
current service cost  33 – 30 – 63
benefits paid  274 15 34 02 325 
contributions by employees 13 – 17 – 30
finance charge 219 24 35 – 278
interest on franchise adjustment  – – 07 – 07 
franchise exit – – 3073 – 3073 
members’ share of movement on liabilities – – 123 – 123
actuarial loss recognised in statement  
of comprehensive income 331 63 84 – 478
defined benefit obligation at 31 december 2012 4809 565 812 12 6198 overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 139 
34 pensions and other postemployment benefits continued  
c financial results for pension benefits continued 
the movement in the fair value of scheme assets is as follows 
 
uk bus 
£m 
uk coach  
£m 
rail 
£m 
total 
£m 
fair value of scheme assets at 1 january 2012 4319 679 3210 8208 
expected return on plan assets  239 22 39 300 
cash contributions – employer  97 42 29 168 
cash contributions – employee  13 – 17 30 
benefits paid  274 15 34 323
members’ share of return on assets  – – 78 78 
franchise exit – – 2746 2746
actuarial gain recognised in statement  
of comprehensive income 86 03 78 167
fair value of scheme assets at 31 december 2012 4480 731 671 5882 
 
 
uk bus 
£m 
uk coach  
£m 
rail 
£m 
total 
£m 
fair value of scheme assets at 1 january 2011  4295 596 3183 8074 
expected return on plan assets  251 35 144 430 
cash contributions – employer  100 60 95 255 
cash contributions – employee  14 – 61 75 
benefits paid  268 15 145 428
members’ share of return on assets  – – 06 06 
actuarial lossgain recognised in statement  
of comprehensive income 73 97 134 110
settlement – 94 – 94
fair value of scheme assets at 31 december 2011 4319 679 3210 8208 
 
 
uk bus 
 £m 
uk coach 
£m 
rail  
£m 
other 
£m 
total 
£m 
defined benefit obligation at 1 january 2011 4348 596 3728 14 8686
current service cost  41 01 103 – 145
benefits paid  268 15 145 – 428 
contributions by employees 13 – 61 – 74
finance charge 229 29 148 – 406
interest on franchise adjustment  – – 39 – 39 
settlement – 93 – – 93 
members’ share of movement on liabilities – – 96 – 96 
actuarial lossgain recognised in statement  
of comprehensive income 124 25 123 – 24 
defined benefit obligation at 31 december 2011 4487 493 3637 14 8631 national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
140 
34 pensions and other postemployment benefits continued  
c financial results for pension benefits continued 
the group expects to contribute £154m to its defined benefit pension plans in 2013  
the cumulative amount of actuarial gains and losses recognised in the statement of comprehensive income since 1 january 2004 is 
£503m loss 2011 £192m loss the directors are unable to determine how much of the pension scheme deficit recognised on transition 
to ifrss and taken directly to equity of £519m is attributable to actuarial gains and losses since inception of those pension schemes 
consequently the directors are unable to determine the amount of actuarial gains and losses that would have been recognised in the 
statement of comprehensive income before 1 january 2004 
history of experience gains and losses 
2012 
£m 
2011 
£m 
2010 
 £m 
2009 
 £m 
2008 
£m 
uk bus      
fair value of scheme assets  4480 4319 4295 3999 3628 
present value of defined benefit obligation 4809 4487 4348 4463 3574
restriction on surplus  – – – – 90 
deficit in the scheme 329 168 53 464  36 
experience adjustments arising on liabilities  50 233 01 02 33
experience adjustments arising on assets  86 73 213 313 628
uk coach      
fair value of scheme assets  731 679 596 516 421 
present value of defined benefit obligation  565 493 596 568 433 
surplusdeficit in the scheme  166 186 – 52 12
experience adjustments arising on liabilities  – 01 27 – – 
experience adjustments arising on assets 05 97 23 38  78
rail      
fair value of scheme assets  671 3210 3183 2844 4447 
present value of defined benefit obligation  812 3637 3728 3420 5267
members’ share of deficit  123 405 508 557 433 
deficit in the scheme 18 22 37 19  387
experience adjustments arising on liabilities  27 85 122 11 169 
experience adjustments arising on assets  80 134 61 232 1214 
other      
fair value of scheme assets  – – – – – 
present value of defined benefit obligation 12 14 14 14  15
deficit in the scheme 12 14 14 14 15
experience adjustments arising on liabilities – – – – –  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 141 
35 commitments and contingencies 
operating lease commitments 
the group’s total operating lease commitments are as follows 
operating lease commitments  
the majority of the group’s commitments arise in the rail division rail division companies have contracts with network rail infrastructure 
limited for access to the railway infrastructure tracks stations and depots they also have contracts under which rolling stock is leased 
the tocs’ obligations to fulfil these commitments exist only as part of their franchise agreement the table below reflects the 
commitments up to the current franchise end dates unless an extension or new franchise agreement has been signed the commitments 
are based on charges advised by the rail regulator for the period starting on 1 april 2010 commitments for future minimum rental 
payments under these contracts are shown below 
fixed track access agreements have an average remaining life of 04 years 2011 10 years other land and buildings have an average 
duration of 04 years 2011 10 years rolling stock agreements have an average life of 04 years 2011 09 years and other plant and 
equipment 04 years 2011 12 years 
  
2012
£m 
2011 
£m 
future minimum rentals payable under noncancellable operating leases   
within one year  land and buildings  233 366 
 plant and equipment  195 464 
  428 830 
after one year but not more than five years  land and buildings  329 312 
 plant and equipment  234 435 
  563 747 
more than five years  land and buildings  510 320 
 plant and equipment  – 09 
  510 329 
  1501 1906 
   
land and 
buildings   
plant and 
equipment 
rail division commitments   
2012 
£m 
2011  
£m 
2012 
£m 
2011 
£m 
future minimum rentals payable under noncancellable operating leases     
within one year  fixed track access 54 148 – – 
 rolling stock  – – 95 362 
 other  19 74 03 08 
  73 222 98 370 
after one year but not more than five years  fixed track access – 41 – – 
 rolling stock – – – 94 
 other – 22 – 03 
  – 63 – 97 
  73 285 98 467  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
142 
35 commitments and contingencies continued  
outside of the rail division the group has entered into operating leases on certain properties public service vehicles and various items  
of plant and equipment commitments for future minimum rental payments under cancellable operating leases are shown below 
the average remaining life of operating lease commitments in the other divisions is 62 years 2011 40 years for land and buildings  
34 years 2011 35 years for public service vehicles and 20 years 2011 24 years for other plant and equipment 
operating lease agreements where the group is the lessor 
the group receives rent on properties as follows 
the leases have an average unexpired duration of 03 years 2011 13 years  
finance lease commitments 
the group has finance leases for public service vehicles and various items of plant and equipment these leases have terms of renewal but 
no purchase options and escalation clauses renewals are at the option of the specific entity that holds the lease 
capital commitments 
the group is committed to vehicle purchases and various land and buildings improvements 
contingent liabilities 
bonds and letters of credit 
in the ordinary course of business the group is required to issue counterindemnities in support of its operations as at 31 december 
2012 there were rail performance bonds of £40m 2011 £258m and rail season ticket bonds of £211m 2011 £923m the group 
has other performance bonds which include the £nil 2011 £90m performance bond in respect of intercapital and regional rail limited 
a performance bond with birmingham city council relating to the building of the new coach station of £02m 2011 £02m performance 
bonds in respect of businesses in the us of £1047m 2011 £1081m and the rest of europe of £235m 2011 £233m letters of credit 
have been issued to support insurance retentions of £361m 2011 £308m 
 land and buildings public service vehicles  other 
other divisions’ commitments 
2012 
£m 
2011 
£m 
2012 
£m 
2011  
£m 
2012  
£m 
2011
£m 
within one year  160 144 93 92 04 02 
after one year but not more than five years  329 249 230 335 04 03 
more than five years 510 320 – 09 – – 
 999 713 323 436 08 05 
 
2012 
£m 
2011
£m 
future minimum rentals receivable under noncancellable operating leases   
within one year  04 14 
after one year but not more than five years – 04 
 04 18 
  2012   2011 
 
minimum 
payments 
£m 
present value  
of payments  
£m 
minimum 
payments  
£m 
present value 
of payments 
£m 
within one year  282 275 226 221 
after one year but not more than five years  1134 1028 954 859 
more than five years  275 244 514 433 
total minimum lease payments  1691 1547 1694 1513 
less future financing charges 144 – 181 – 
present value of minimum lease payments  1547 1547 1513 1513 
 
2012  
£m 
2011
£m 
contracted  463 437  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 143 
36 related party transactions 
a provision of £02m 2011 £02m has been booked against amounts due from european coach  bus associates which are 
presented net 
during the year the group made a number of acquisitions as part of the acquisition certain personnel signed three year noncompete 
agreements 
a number of spanish companies have leased properties from companies related to the cosmen family jorge cosmen is a nonexecutive 
director of the group and was appointed as deputy chairman in october 2008 these leases were in place before the group’s acquisition 
of alsa and are for appropriate market rates  
the details of the postemployment benefit plans operated for the benefit of employees of the group are disclosed in note 34 
compensation of key management personnel of the group 
 amount of transactions 
 amounts due from  
related parties  amounts due to related parties 
 
2012 
£m 
2011
£m 
2012
 £m 
2011 
 £m 
2012
 £m 
2011
 £m 
associates       
icrrl  90 90 – – – 90
spain associates  23 26 09 10 08 10
total associates  113 116 09 10 08 100
trade investments     
spain trade investments  44 43 05 06 05 05
property transactions     
north america 27 – – – 26 – 
spain  37 50 04 04 05 02
total other related parties  108 93 09 10 36 07
total  221 209 18 20 44 107
 
2012 
£m 
2011 
£m 
total compensation paid to key management personnel note 7 39 35  national express group plc annual report and accounts 2012 
financial statements 
notes to the consolidated accounts continued 
144 
37 cash flow statement 
the net cash inflows from operating activities include outflows of £407m 2011 £82m from continuing operations which are related  
to exceptional costs 
a reconciliation of group profit before tax to cash generated from operations 
b analysis of changes in net debt 
 excludes accrued interest on long term borrowings 
short term deposits included within liquid resources relate to term deposits repayable within three months 
borrowings include noncurrent interest bearing borrowings of £7868m 2011 £7184m as disclosed in note 28 
other noncash movements in net debt represent finance lease additions of £262m 2011 £437m and a £07m net positive movement  
in loan and bond arrangement fees 2011 £22m net negative movement the £70m increase to the fair value of the hedging derivative  
is offset by equal and opposite movements in the fair value of the related hedged borrowings this comprises a £54m fair value movement 
in bonds and a £16m fair value movement in other loans 
total operations 
2012  
£m 
2011 
£m 
net cash inflow from operating activities   
profit before tax from continuing operations  698 1294 
net finance costs  492 464 
share of posttax results under the equity method 14 14
depreciation of property plant and equipment  1098 1055 
intangible asset amortisation  517 508 
amortisation of fixed asset grants  12 15
profit on disposal of property plant and equipment 45 11
sharebased payments 52 50 
decreaseincrease in inventories  04 14
decreaseincrease in receivables  684 188
decrease in payables  1455 289
decrease in provisions – continuing operations 323 370
cash generated from operations  1696 2470 
 
at 
1 january 
2012
£m 
cash flow 
£m 
acquisitions
disposals 
£m 
exchange 
differences  
£m 
other 
movements  
£m 
at 
31 december 
2012
£m 
cash  648 316 90 05 – 417 
overnight deposits  250 36 – – – 286 
other short term deposits  27 02 – – – 25 
cash and cash equivalents  925 282 90 05 – 728 
other debt receivables  07 03 – – – 10 
borrowings      
 
 bank and other loans 79 1096 03 29 03 1146
 bonds 5834 – – – 66 5900
 fair value of hedging derivatives 164 – – – 70 234 
 finance lease obligations  1513 181 11 58 262 1547
 other debt payable  07 654 – – – 661
total borrowings 7269 1569 14 87 255 9020
net debt 6337 1848 76 82 255 8282 overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 
 145 
37 cash flow statement continued  
b analysis of changes in net debt continued 
 excludes accrued interest on long term borrowings 
c reconciliation of net cash flow to movement in net debt 
38 post balance sheet events 
there are no post balance sheet events
 
at 
1 january 
2011 
£m 
cash flow 
£m 
acquisitions
disposals 
£m 
exchange 
differences  
£m 
other 
movements 
£m 
at 
31 december 
2011 
£m 
cash  815 163 – 04 – 648 
overnight deposits  368 118 – – – 250 
other short term deposits  105 78 – – – 27 
cash and cash equivalents  1288 359 – 04 – 925 
other debt receivables  07 – – – – 07 
borrowings      
 
 bank loans 398 345 10 03 19 79
 bonds 5656 – – – 178 5834
 fair value of bond hedging derivatives 11 – – – 175 164 
 finance lease obligations  1316 249 – 09 437 1513
 other debt payable  18 11 – – – 07
total borrowings 7399 605 10 06 459 7269
net debt 6104 246 10 10 459 6337
 
2012
£m 
2011 
£m 
decrease in cash and cash equivalents in the year  282 359
cash inflow from movement in other debt receivables  03 – 
cash inflowoutflow from movement in debt and finance leases  1569 605 
change in net debt resulting from cash flows  1848 246 
change in net debt resulting from acquisitions and disposals  76 10
change in net debt resulting from noncash movements 173 469
movement in net debt in the year  1945 233
opening net debt 6337 6104
net debt  8282 6337 national express group plc annual report and accounts 2012 
financial statements 
independent auditor’s report 
to the members of national express group plc 
146 
we have audited the parent company financial statements of national express group plc for the year ended 31 december 2012 which 
comprise the parent company balance sheet and the related notes 1 to 21 the financial reporting framework that has been applied in 
their preparation is applicable law and united kingdom accounting standards united kingdom generally accepted accounting practice 
this report is made solely to the company’s members as a body in accordance with chapter 3 of part 16 of the companies act 2006 
our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them  
in an auditor’s report and for no other purpose to the fullest extent permitted by law we do not accept or assume responsibility to anyone 
other than the company and the company’s members as a body for our audit work for this report or for the opinions we have formed 
respective responsibilities of directors and auditor 
as explained more fully in the directors’ responsibilities statement the directors are responsible for the preparation of the parent 
company financial statements and for being satisfied that they give a true and fair view our responsibility is to audit and express an 
opinion on the parent company financial statements in accordance with applicable law and international standards on auditing uk and 
ireland those standards require us to comply with the auditing practices board’s ethical standards for auditors 
scope of the audit of the financial statements 
an audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance 
that the financial statements are free from material misstatement whether caused by fraud or error this includes an assessment of 
whether the accounting policies are appropriate to the parent company’s circumstances and have been consistently applied and 
adequately disclosed the reasonableness of significant accounting estimates made by the directors and the overall presentation  
of the financial statements in addition we read all the financial and nonfinancial information in the annual report to identify material 
inconsistencies with the audited financial statements if we become aware of any apparent material misstatements or inconsistencies  
we consider the implications for our report 
opinion on financial statements 
in our opinion the parent company financial statements 
• give a true and fair view of the state of the company’s affairs as at 31 december 2012 
• have been properly prepared in accordance with united kingdom generally accepted accounting practice and 
• have been prepared in accordance with the requirements of the companies act 2006 
opinion on other matters prescribed by the companies act 2006 
in our opinion 
• the part of the directors’ remuneration report to be audited has been properly prepared in accordance with the companies act 2006 
and 
• the information given in the directors’ report for the financial year for which the financial statements are prepared is consistent with the 
parent company financial statements 
matters on which we are required to report by exception 
we have nothing to report in respect of the following matters where the companies act 2006 requires us to report to you if in our opinion 
• adequate accounting records have not been kept by the parent company or returns adequate for our audit have not been received 
from branches not visited by us or 
• the parent company financial statements and the part of the directors’ remuneration report to be audited are not in agreement with 
the accounting records and returns or 
• certain disclosures of directors’ remuneration specified by law are not made or 
• we have not received all the information and explanations we require for our audit 
other matter 
we have reported separately on the group financial statements of national express group plc for the year ended 31 december 2012  
nigel mercer senior statutory auditor 
for and on behalf of deloitte llp  
chartered accountants and statutory auditor 
birmingham uk 
28 february 2013  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
financial statements 
company balance sheet 
at 31 december 2012 
 147 
 
d finch group chief executive  
j k maiden group finance director 
28 february 2013 
company number 2590560 
  
 note 
2012 
£m 
2011
£m 
fixed assets    
intangible assets 4 05 – 
tangible assets  5  01 01 
investments  6  16051 11856 
derivative financial instruments 7 310 237 
  16367 12094 
current assets    
debtors  8  7420 9738 
derivative financial instruments  7  01 80 
cash at bank and in hand  9  366 322 
  7787 10140 
creditors amounts falling due within one year  10  9449 9504
derivative financial instruments  7 05 02
provisions for liabilities and charges 12 26 – 
net current liabilitiesassets   1693 634 
total assets less current liabilities   14674 12728 
creditors amounts falling due after more than one year  11  6552 5834
provisions for liabilities and charges  12  27 145
net assets   8095 6749 
shareholders’ equity    
calledup share capital  15  256 256 
share premium account  16  5327 5327 
capital redemption reserve  16 02 02 
own shares  16 05 140
profit and loss account  16  2515 1304 
shareholders’ equity   8095 6749  national express group plc annual report and accounts 2012 
financial statements 
notes to the company accounts 
148 
1 accounting policies  
basis of preparation  
the separate accounts of the parent company are presented as required by the companies act 2006 the accounts have been prepared 
on the going concern basis and under the historic cost convention except for the recognition of derivative financial instruments and 
available for sale investments detailed below and in accordance with applicable accounting standards in the united kingdom  
in applying these policies management is required to make estimates and assumptions that affect the reported amounts of assets and 
liabilities and disclosure of contingent assets and liabilities at the date of the accounts and the reported amounts of revenue and expenses 
during the reporting period actual results could differ from those estimates  
no profit and loss account is presented by the company as permitted by section 408 of the companies act 2006  
the retained profit of the company for the year is £1807m 2011 £847m 
leases  
leases of tangible fixed assets where substantially all the risks and rewards of ownership of the asset have passed to the company are 
classified as finance leases and the assets are capitalised in the balance sheet as plant and equipment finance leases are capitalised at 
the present value of the minimum lease payments the capital element of future obligations under hire purchase contracts and finance 
leases is included as a liability in the balance sheet the interest element of rental obligations is charged to the profit and loss account  
over the period of the lease and represents a constant proportion of the balance of capital repayments outstanding assets acquired under 
finance leases are depreciated over the shorter of the useful life of the asset and the lease term  
leases of assets where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating 
leases rentals paid under operating leases are charged to the profit and loss account on a straightline basis over the term of the lease 
incentives received under operating leases and initial direct costs in negotiating the lease are amortised to the profit and loss account  
on a straightline basis over the term of the lease or to the first review if shorter  
tangible fixed assets  
tangible fixed assets are stated at historic cost less accumulated depreciation and any impairment tangible fixed assets are depreciated 
on a straightline basis over their estimated useful lives as follows  
the carrying value of fixed assets is reviewed for impairment if events or changes in circumstances indicate that the current carrying value 
may not be recoverable and are written down immediately to their recoverable amount repairs and maintenance are charged to the profit 
and loss account during the financial period in which they are incurred  
software  
computer software that is not integral to an item of property plant and equipment is recognised separately as an intangible asset and  
is carried at cost less accumulated amortisation and accumulated impairment losses costs include software licences consulting costs 
attributable to the development design and implementation of the computer software and internal costs directly attributable to the 
development design and implementation of the computer software costs in respect of training are expensed as incurred amortisation  
is calculated using the straightline method so as to charge the cost of the computer software to the income statement over its estimated 
useful life 3 to 7 years  
the carrying value of intangibles is reviewed for impairment if events or changes in circumstances indicate that the carrying value may  
not be recoverable  
investments in subsidiaries  
investments are held at historic cost less any provision for impairment  
available for sale investments  
available for sale financial assets are nonderivative financial assets that are designated as such or that are not classified as a loan or 
receivable held to maturity or at fair value through profit or loss after initial recognition these assets are measured at fair value with gains 
or losses being recognised as a separate component of equity until the investment is derecognised or the investment is determined to be 
impaired at which time the previously reported cumulative gain or loss is included in the income statement  
interest bearing loans and borrowings  
loans and borrowings are initially recognised at the fair value of the consideration received net of issue costs after initial recognition 
interestbearing loans and borrowings are subsequently measured at amortised cost using the effective interest method  
hedge accounting is adopted where derivatives such as fixed to floating interest rate swaps are held as fair value hedges against fixed 
interest rate borrowings under fair value hedge accounting fixed interest rate borrowings are revalued at each balance sheet date by the 
change in fair value attributable to the interest rate being hedged  
plant and equipment  – 3 to 5 years   overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 149 
1 1 accounting policies continued  
provisions  
provisions are recognised when the company has a present legal or constructive obligation as a result of past events it is probable  
that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be made where the 
company expects a provision to be reimbursed the reimbursement is recognised as a separate asset but only when reimbursement  
is virtually certain  
pensions  
the company participates in both the national express group multiemployer funded defined benefit scheme and a defined contribution 
scheme the company is unable to identify its share of the underlying assets and liabilities of the multiemployer scheme on a consistent 
and reasonable basis and therefore has accounted for the scheme as if it were a defined contribution scheme under the requirements  
of frs 17 ‘retirement benefits’  
sharebased payment  
in accordance with the transition provisions frs 20 has been applied to all grants after 7 november 2002 that were unvested as of  
1 january 2005  
the company awards equitysettled sharebased payment to certain employees equitysettled sharebased payments are measured at 
fair value at the date of grant by an external valuer using a stochastic model nonmarketbased performancerelated vesting conditions 
are not taken into account when estimating the fair value instead those nonmarket conditions are taken into account in calculating the 
current best estimate of the number of shares that will eventually vest and at each balance sheet date before vesting the cumulative 
expense is calculated based on that estimate marketbased performance conditions are taken into account when determining the fair 
value and at each balance sheet date before vesting the cumulative expense is calculated irrespective of whether or not the market 
conditions are satisfied provided that all other performance conditions are met  
deferred tax  
deferred tax is recognised in respect of all material timing differences that have originated but not reversed by the balance sheet date 
deferred tax is measured on a nondiscounted basis at tax rates that are expected to apply in the periods in which the timing differences 
reverse based on tax rates and laws enacted or substantively enacted at the balance sheet date deferred tax assets are recognised where 
it is more likely than not that there will be suitable taxable profits from which the future reversal of underlying timing differences can be 
deducted  
foreign currencies  
foreign currency assets and liabilities are translated into sterling at the rates of exchange ruling at the year end foreign currency 
transactions arising during the year are translated into sterling at the rate of exchange ruling on the date of the transaction any exchange 
differences so arising are dealt with through the profit and loss account  
derivative financial instruments  
the company uses derivative financial instruments such as foreign currency contracts and interest rate swaps to hedge its risks 
associated with foreign currency and interest rate fluctuations such derivative financial instruments are initially recognised at fair value and 
subsequently remeasured to fair value for the reported balance sheet the fair value of forward exchange contracts and interest rate swaps 
is calculated by reference to market exchange rates and interest rates at the period end  
in relation to cash flow hedges which meet the conditions for hedge accounting the portion of the gain or loss on the hedging instrument 
that is determined to be an effective hedge is recognised directly in equity and the ineffective portion in the profit and loss account the 
gains or losses deferred in equity in this way are recycled through the profit and loss account in the same period in which the hedged 
underlying transaction or firm commitment is recognised in the profit and loss account  
for derivatives that do not qualify for hedge accounting including the foreign currency contracts gains or losses are taken directly to the 
profit and loss account in the period  
hedge accounting is discontinued when the hedging instrument expires is sold terminated or exercised or no longer qualifies for hedge 
accounting  
the company has taken advantage of the exemption under frs 29 for parent company accounts the disclosures are included within the 
consolidated accounts  national express group plc annual report and accounts 2012 
financial statements 
notes to the company accounts continued 
150 
2 exchange rates 
the most significant exchange rates to uk sterling for the company are as follows 
3 directors’ emoluments 
detailed information concerning directors’ emoluments shareholdings and options is shown in the directors’ remuneration report 
4 intangible fixed assets 
 2012 2011 
 closing rate average rate closing rate average rate 
us dollar  163 159 155 161 
canadian dollar  161 159 158 158 
euro  123 123 120 115 
 
software 
£m 
cost  
at 1 january 2012  – 
additions  06 
at 31 december 2012 06 
amortisation  
charge in the year 01 
at 31 december 2012 01 
net book value  
at 31 december 2012 05 
at 31 december 2011  –  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 151 
5 5 tangible fixed assets 
tangible fixed assets held under finance lease agreements are analysed as follows 
leased assets and assets under hire purchase contracts are pledged as security for the related finance lease and hire purchase liabilities 
6 financial assets investments 
the information provided below is given for the company’s principal subsidiaries a full list of subsidiaries and investments will be annexed 
to the next annual return to companies house the principal country of operation in respect of the companies below is the country in 
which they are incorporated 
the group’s train passenger services in the uk are operated through franchises awarded by dft rail as delegated by the uk 
government 
the following holdings are 100 held directly by the company 
incorporated in england and wales  
national express intermediate holdings limited holding company for all group operating companies except rail 
national express trains limited  holding company for rail operating companies 
 
 
the £4195m of additions represent shares acquired in national express intermediate holdings limited in relation to the petermann and 
transit acquisitions and shares received from national express group holdings limited in exchange for an intercompany loan receivable 
 
plant and 
equipment 
£m 
cost  
at 1 january 2012 and 31 december 2012 21 
depreciation  
at 1 january 2012 and at 31 december 2012 20 
net book value  
at 1 january 2012 and at  31 december 2012 01 
 
2012
£m 
2011
£m 
plant and equipment   
– cost  02 02 
– depreciation  02 02
 – – 
   
investments in 
subsidiaries
 £m 
cost or valuation    
at 1 january 2012   16915 
additions    4195 
at 31 december 2012   21110 
provisions    
at 1 january and 31 december 2012   5059
net carrying amount    
at 31 december 2012    16051 
at 31 december 2011   11856 
incorporated in guernsey  
national express guernsey limited  insurance captive  national express group plc annual report and accounts 2012 
financial statements 
notes to the company accounts continued 
152 
7 derivative financial instruments 
full details of the group’s financial risk management objectives and policies can be found in note 30 of the consolidated accounts as the 
holding company for the group the company faces similar risks over foreign currency and interest rate movements 
the company has taken advantage of the exemption under frs 29 for parent company accounts the disclosures are included within the 
consolidated accounts 
8 debtors 
9 cash at bank and in hand 
cash at bank and in hand earns interest at floating rates based on daily bank deposit rates short term deposits are made for varying 
periods of between one day and three months depending on the immediate cash requirements of the company and earn interest at the 
respective short term deposit rates the fair value of cash equals the carrying value 
10 creditors amounts falling due within one year 
trade creditors are noninterest bearing and are normally settled on 30 day terms and other creditors are noninterest bearing and have  
an average term of six months 
 
2012  
£m 
2011 
£m 
interest rate derivatives 310 237 
derivative financial assets due over one year 310 237 
foreign exchange forward contracts 01 80 
derivative financial assets due under one year  01 80 
foreign exchange forward contracts  05 02
derivative financial liabilities due under one year  05 02
 
2012  
£m 
2011 
£m 
amounts owed by subsidiary undertakings  7322 9405 
corporation tax recoverable – 271 
deferred tax asset see note 13  90 13 
other debtors  05 01 
prepayments and accrued income  03 48 
 7420 9738 
 
2012  
£m 
2011 
£m 
short term deposits  286 250 
cash at bank  80 72 
 366 322 
 
2012 
£m 
2011 
£m 
bank overdraft 408 1256 
bank loans  1078 – 
trade creditors  03 07 
amounts owed to subsidiary undertakings  7410 7745 
corporation tax payable 68 – 
accruals and deferred income  190 197 
bonds – accrued interest 292 299 
 9449 9504  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 153 
1 11 creditors amounts falling due after more than one year 
12 provisions for liabilities and charges 
1
 the claims provision arises from estimated exposures at the year end £26m of which will be utilised in the next year and the remaining in five years  
it comprises provisions for existing claims arising in the uk and north america 
2
 a provision was recognised in 2006 for the company’s onerous contract for eurostar with icrrl this was settled in 2012 with a final payment of 
£90m  
13 deferred tax 
the major components of the provision for deferred taxation are as follows 
the reconciliation of deferred tax balances is as follows 
timing differences associated with group investments 
no deferred tax 2011 £nil is recognised on the unremitted earnings of subsidiaries and associates as no dividends have been accrued 
as receivable and no binding agreement to distribute the past earnings in future has been entered into by the subsidiaries 
unrecognised tax losses 
deferred income tax assets are recognised for tax loss carryforwards to the extent that the realisation of the related tax benefit against 
future taxable profits is probable deferred tax assets that the company has not recognised in the accounts amount to £41m 2011 
£92m which arise where the company does not expect to generate sufficient suitable future profits  
 
2012 
£m 
2011 
£m 
bonds 5900 5834 
other debt payable 652 – 
 6552 5834 
 
claims 
provision
1
 
£m 
eurostar  
onerous  
contract
2
 
£m 
 
other
£m 
total
 £m 
at 1 january 2012 50 90 05 145 
charged to profit and loss account  04 – – 04 
utilised in the year  01 90 05 96
at 31 december 2012 53 – – 53 
 
2012
£m 
2011
£m 
accelerated capital allowances  02 02 
other timing differences  02 04 
losses carried forward 86 07 
net deferred tax asset  90 13 
 £m 
deferred tax asset at 1 january 2012 13 
credited to profit and loss 77 
deferred tax asset at 31 december 2012 90  national express group plc annual report and accounts 2012 
financial statements 
notes to the company accounts continued 
154 
14 interestbearing loans and borrowings 
the effective interest rates at the balance sheet date were as follows 
1
 this date is the ultimate maturity date of the syndicated credit facility 
details of the company’s interest rate management strategy and interest rate swaps are included in note 30 and note 31 of the 
consolidated accounts 
15 calledup share capital 
 
2012 
£m 
2011
 £m 
at 31 december   
authorised   
800000000 2011 800000000 ordinary shares of 5p each 400 400 
issued calledup and fully paid   
511732603 2011 511726026 ordinary shares of 5p each  256 256 
the total number of share options exercised in the year by employees of the group was 1984855 2011 1175455 of which nil 
exercises were satisfied by newly issued shares 2011 nil and 1919772 2011 1175455 exercises were satisfied by transferring  
shares from the national express employee benefit trust the remaining exercises were settled via a direct purchase of shares from  
the open market 
 
2012  
£m  maturity effective interest rate 
2011 
£m maturity  effective interest rate 
current 
      
bank overdraft  408 on demand libor  1 1256 on demand libor 1 
european bank loans 794 august 2014
1
libor  145 – – – 
european bank loans 284 feb 2013 12 – – – 
bank loans 1078      
accrued interest 304   299   
total current  1790   1555   
noncurrent       
7 year sterling bond 3601 january 2017 654 3516 january 2017 654 
10 year sterling bond 2299 june 2020 685 2318 june 2020 685 
bonds 5900   5834   
euro private placement 652 august 2021 455 –   
other debt payable 652      
total noncurrent  6552   5834    overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 155 
1 16 shareholders’ funds and statement of changes in shareholders’ equity 
own shares 
own shares comprises 535658 2011 380430 ordinary shares in the company that have been purchased by the trustees of the 
national express employee benefit trust the ‘trust’ during the year the trust purchased 2075000 2011 991615 shares and 
1919772 2011 1175455 shares were used to satisfy options granted under a number of the company’s share schemes the market 
value of these shares at 31 december 2012 was £11m 2011 £09m the dividends payable on these shares have been waived 
the group’s treasury shares were sold during the year and therefore are nil 2011 1668688 no shares were added or cancelled during 
the year 2011 nil 
17 retirement benefits 
the company participates in both the national express group staff pension fund a multiemployer funded defined benefit scheme and 
the wm pension scheme a defined contribution scheme the company is unable to identify its share of the underlying assets and 
liabilities of the multiemployer scheme on a consistent and reasonable basis and therefore has accounted for the scheme as if it were a 
defined contribution scheme under the requirements of frs 17 ‘retirement benefits’ contributions to this scheme are determined by 
independent professionally qualified actuaries the details of the latest actuarial valuation are detailed in note 34 to the consolidated 
accounts 
the total pension charge for the year including contributions to the defined benefit scheme above the normal charge amounted to  
£42m 2011 £59m 
 
share
 capital 
£m 
share 
premium 
£m 
capital 
redemption 
reserve 
£m 
own  
shares  
£m 
profit and
 loss account 
£m 
total 
£m 
at 1 january 2012 256 5327 02 140 1304 6749 
shares purchased  – – – 48 – 48
own shares released to satisfy employee share 
schemes – – – 45 45 – 
disposal of own shares – – – 138 98 40 
sharebased payments – – – – 40 40 
profit for the year – – – – 1807 1807 
dividends – – – – 493 493
at 31 december 2012  256 5327 02 05 2515 8095 
 
share
 capital 
£m 
share 
premium 
£m 
capital 
redemption 
reserve 
£m 
own  
shares  
£m 
profit and
 loss account 
£m 
total 
£m 
at 1 january 2011 256 5327 02 141 914 6358 
shares purchased  – – – 27 – 27
own shares released to satisfy employee share 
schemes – – – 28 28 – 
sharebased payments – – – – 29 29 
profit for the year – – – – 847 847 
dividends – – – – 458 458
at 31 december 2011  256 5327 02 140 1304 6749  national express group plc annual report and accounts 2012 
financial statements 
notes to the company accounts continued 
156 
18 sharebased payment  
during the year ended 31 december 2012 the company had the following sharebased payment arrangements which are described in 
note 7b to the consolidated accounts  
for the following disclosure share options with a nil exercise price have been disclosed separately to avoid distorting the weighted average 
exercise prices the number of share options in existence during the year was as follows 
there were no options outstanding at 31 december 2012 excluding options with a nil exercise price 2011 none the range of exercise 
prices for options was as follows 
the options have a weighted average contractual life of one year 2011 one year options were exercised throughout the year and the 
weighted average share price at exercise was 223p 2011 244p 
  2012  2011 
 
number 
of share 
options 
weighted 
average  
exercise price  
p 
number  
of share  
options 
weighted
average 
exercise price
p
options without a nil exercise price     
at 1 january  15035 479 26724 386 
forfeited during the year  – – 16544 339 
group transfers during the year  – – 12511 474 
expired during the year 15035 479 7656 448 
outstanding at 31 december – – 15035 479 
exercisable at 31 december  – – – – 
options with a nil exercise price 
  
  
at 1 january  3819477 nil 3115965 nil 
granted during the year  2564947 nil 2103653 nil 
forfeited during the year 208594 nil 595456 nil 
group transfers during the year 313161 nil 220151 nil 
exercised during the year  796482 nil 597633 nil 
expired during the year 223462 nil 427203 nil 
outstanding at 31 december  5469047 nil 3819477 nil 
exercisable at 31 december  193928  444461  
total outstanding at 31 december  5469047  3834512  
total exercisable at 31 december  193928  444461  
exercise price p  2012  2011 
300600 – 15035 
 – 15035  overview delivering on our strategy business review governance 
wwwnationalexpressgroupcom
financial statements 
 
 157 
1 18 sharebased payment continued  
the weighted average fair value of the remaining share options granted during the year was calculated using a stochastic model with the 
following assumptions and inputs 
experience to date has shown that approximately 24 2011 24 of options are exercised early principally due to leavers this has been 
incorporated into the calculation of the expected option life for the share options without nil exercise price  
expected volatility in the table above was determined from historic volatility over the last nine years adjusted for oneoff events that were 
not considered to be reflective of the volatility of the share price going forward the expected dividend yield represents the dividends 
declared in the 12 months preceding the date of the grant divided by the average share price in the month preceding the date of the grant  
for share options granted during the year under the ltip the tsr targets have been reflected in the calculation of the fair value of the 
options above  
19 commitments and contingencies  
operating lease commitments  
the company has entered into operating leases on certain properties annual commitments under noncancellable operating leases are as 
follows 
contingent liabilities  
a guarantees  
the company has guaranteed credit facilities totalling £159m 2011 £156m of certain subsidiaries  
b bonds and letters of credit  
in the ordinary course of business the company is required to issue counterindemnities in support of its operations as at 31 december 
2012 there was a performance bond for £nil 2011 £90m in respect of intercapital and regional rail limited letters of credit have been 
issued to support insurance retentions of £361m 2011 £308m 
20 related party transactions  
the company has taken advantage of the exemption in paragraph 3c of frs 8 ‘related party disclosures’ from disclosing transactions 
with wholly owned subsidiaries  
21 post balance sheet events 
there are no post balance sheet events 
 share options with nil exercise price 
  2012   2011 
risk free interest rate  050055 130144 
expected volatility  400445 515516 
peer group volatility  385455 551570 
expected option life in years  35 years 3 years 
expected dividend yield  416456 347364 
weighted average share price at grant date 223p 244p 
weighted average exercise price at grant date nil nil 
weighted average fair value of options at grant date 167p 144p 
 land and buildings 
 
2012 
£m 
2011
£m 
operating leases which expire   
within one year 01 01 
within two to five years  02 03  financial statements 
shareholder information
shareholder electronic communications
by registering for electronic communications you can help  
us to reduce print paper and postage costs log on to 
wwwshareviewcouk if you would like to
 register your email so that you are able to access future 
shareholder information including the annual report  
and accounts electronically
 check the balance of your shareholding
 set up a dividend mandate online
 change your registered postal address or your dividend 
mandate details or 
 submit your vote online prior to a general meeting
to sign up for the ﬁrst time you should click on ‘register’ 
and follow the simple instructions – you will need your 
shareholder reference number from your share certiﬁcate  
or dividend voucher or any other correspondence sent to 
you by equiniti limited
dividends paid direct to your bank account
having dividends paid direct to your bank account has the 
following advantages
 avoids the risk of cheques being lost and incurring a 
replacement fee
 saves you time in presenting the cheque for payment and
 the dividend is credited to your account on the payment 
date
consolidated tax vouchers
the company currently issues tax vouchers to shareholders 
with every dividend payment  following a review of this 
procedure the company will now issue a consolidated 
tax voucher ctv once a year to all shareholders save for 
corporate and institutional shareholders the ﬁrst ctv will be 
despatched with the 2014 agm mailing and will contain the 
tax and payment information for dividends paid during the 
tax year 20132014
to set up a new dividend mandate please log on  
to shareviewcouk or contact the registrar  
equiniti limited aspect house spencer road lancing 
west sussex bn99 6da shareholder helpline number 
0871 384 2152 or 44 121 415 7047 from overseas
  calls to this number cost 8p per minute plus network extras  
lines open 830am to 530pm monday to friday
share dealing service
a telephone and internet share dealing service which 
provides a simple way to buy and sell shares is available 
through our registrar equiniti for further information  
log on to shareviewcoukdealing or telephone  
0845 603 7037 or 44 121 415 7560 from overseas
 calls to this number are charged by bt at the local rate
company website
the company website at nationalexpressgroupcom  
has information about the group including press releases 
share price data and copies of the half year results 
and annual report and accounts as well as corporate 
responsibility reporting the company no longer publishes 
the half year results in hard copy these will now only be 
available via the website
sharegift
sharegift is an independent charity share donation scheme 
administered by the orr mackintosh foundation registered 
charity number 1052686 those shareholders who hold  
only a small number of shares the value of which makes  
it uneconomic to sell them can donate the shares to 
sharegift who will sell them and donate the proceeds to a 
wide range of charities further information about sharegift 
can be obtained from its website at sharegiftorg  
and a sharegift transfer form can be downloaded from 
nationalexpressgroupcom
unclaimed assets register
the company participates in the unclaimed assets  
register uar which provides a search facility for 
shareholdings and other ﬁnancial assets that may have  
been forgotten for further information contact uar by  
email at uarenquiriesukexperiancom tel 0844 481 8180 
or visit uarcouk
158 national express group plc annual report and accounts 2012  financial statements 
dividends and ﬁnancial calendar
final dividend ex dividend date 24 april 2013
final dividend record date 26 april 2013
annual general meeting 9 may 2013
final dividend payment date 17 may 2013
half year results announced 25 july 2013
interim dividend ex dividend date 4 september 2013
interim dividend record date 6 september 2013
interim dividend payment date 20 september 2013
overview delivering on our strategy business review governance 
159 wwwnationalexpressgroupcom
financial statements  financial statements 
corporate information
secretary and registered ofﬁce 
michael hampson
national express group plc 
national express house 
birmingham coach station 
mill lane 
birmingham  
b5 6dd 
tel 44 08450 130130 
wwwnationalexpressgroupcom
registered number
2590560
auditor
deloitte llp
four brindley place 
birmingham 
b1 2hz
registrar
equiniti limited
aspect house 
spencer road 
lancing 
west sussex 
bn99 6da 
shareholder helpline 0871 384 2152  
or 44 121 415 7047 from overseas
  calls to this number cost 8p per minute plus network extras  
lines open 830am to 530pm monday to friday
principal banker
hsbc bank plc
8 canada square 
london 
e14 5hq
corporate solicitors
ashurst llp
broadwalk house 
5 appold street 
london 
ec2a 2ha
financial advisors
bank of america merrill lynch
2 king edward street 
london 
ec1a 1hq
stockbrokers
bank of america merrill lynch
2 king edward street 
london 
ec1a 1hq
morgan stanley
25 cabot square 
canary wharf 
london 
e14 4qa
160 national express group plc annual report and accounts 2012  bps basis points
bsog bus service operators grant
code the uk corporate governance code published by the financial reporting council in june 2010
cpi consumer price index
csog coach service operators grant
the company national express group plc
ctv consolidated tax voucher
dft department for transport
ebt employee beneﬁt trust
ebit earnings before interest and tax
ebitda is ‘earnings before interest and tax plus depreciation and amortisation’ it is calculated by taking normalised 
operating proﬁt and adding depreciation ﬁxed asset grant amortisation normalised proﬁt on disposal of non
current assets and sharebased payments 
efqm european foundation for quality management
eps earnings per share – the proﬁt for the year attributable to shareholders divided by the weighted average 
number of shares in issue excluding those held by the employee beneﬁt trust and shares held in treasury 
which are treated as cancelled
etr effective tax rate
eu european union
euribor euro interbank offered rate
gearing ratio for debt ﬁnancing purposes is calculated as net debt adjusted to reﬂect any cash which is restricted  
in use divided by ebitda
the group the company and its subsidiaries
hmrc her majesty’s revenue and customs
ias international accounting standards
ifric international financial reporting interpretations committee
ifrs international financial reporting standards
kpi key performance indicator
lcr london and continental railway ltd
libor london interbank offered rate
ltip long term incentive plan
napf national association of pension funds
net capital expenditure is the increase in net debt arising on the purchase of property plant and equipment and intangible assets 
less proceeds from disposals of property plant and equipment it excludes capital expenditure arising from 
uk rail franchise entry and exits and discontinued operations which are included in these headings growth 
capital expenditure is calculated as investment in ﬂeet for new contracts and concessions after deducting ﬂeet 
released from contracts and concessions lost and ﬂeet reused in new contracts and concessions
net debt is deﬁned as cash and cash equivalents cash overnight deposits other short term deposits and other debt 
receivables offset by borrowings loan notes bank loans and ﬁnance lease obligations and other debt payable 
net interest expense is ﬁnance costs less ﬁnance income 
nxea national express east anglia
financial statements 
glossary
overview delivering on our strategy business review governance 
161 wwwnationalexpressgroupcom
financial statements  normalised earnings per 
share 
earnings per share excluding the proﬁt or loss on sale of businesses exceptional proﬁt or loss  
on the disposal of noncurrent assets intangible asset amortisation exceptional items and tax  
relief on qualifying exceptional items
normalised operating proﬁt are the statutory results excluding proﬁt or loss on the sale of business exceptional proﬁt or loss on sale of 
noncurrent assets and charges for goodwill impairment intangible asset amortisation exceptional items 
and tax relief thereon the board believes that the normalised result gives a better indication of the underlying 
performance of the group
normalised proﬁt margin is normalised proﬁt divided by revenue expressed as a percentage
normalised results are deﬁned as the statutory results before the following as appropriate proﬁt or loss on the sale of business 
exceptional proﬁt or loss on sale of noncurrent assets and charges for goodwill impairment intangible asset 
amortisation exceptional items and tax relief thereon
operating cash ﬂow is intended to be the cash ﬂow equivalent of normalised operating proﬁt
rcf revolving credit facility
return on capital employed 
roce
is normalised operating proﬁt divided by the sum of net assets and net debt
return on equity is normalised proﬁt after tax less the posttax amortisation of intangible assets divided by  
shareholders’ equity
return on tangible assets is normalised operating proﬁt dividend by the sum of net assets excluding intangible assets and net debt
rps railway pension scheme
rrev research recommendation and electronic voting – a corporate governance advisory service
spad signal passed at danger
tfl transport for london
underlying revenue compares the current year with the prior year on a consistent basis after adjusting for the impact  
of currency acquisitions disposals and rail franchises no longer operated
toc train operating company
tsr total shareholder return – the growth in value of a shareholding over a speciﬁed period assuming  
that dividends are reinvested to purchase additional shares
uk gaap uk generally accepted accounting principles
ulsd ultra low sulphur diesel
financial statements 
glossary continued
162 national express group plc annual report and accounts 2012  financial statements 
notes
overview delivering on our strategy business review governance 
163 wwwnationalexpressgroupcom
financial statements  financial statements 
five year summary
2012  
£m
201 1 
 £m
2010 
£m
2009 
£m
2008 
£m
 
bus and coach nonrail
revenue 16361 15497 14884 15214 14345
normalised operating proﬁt 1852 1818 1 704 147 8 1 726
return on capital pre tax 106 106 102 93 9 1 
basic earnings per share 216p 207p 188p 27 7p 29 1p
group normalised 
revenue 18312 22380 2 1259 271 1 1 2767 0
normalised operating proﬁt 2119 2252 2042 1598 2539
return on capital pre tax 122 14 1  132 107 1 44
diluted earnings per share
1
254p 269p 235p 304p 486p
group statutory
revenue 18312 22380 2 1259 271 1 1 2767 0
operating proﬁt 1176 17 44 859 06 167 8
proﬁtloss before tax 698 1294 402 835 1099
basic earningsloss per share
1
118p 199p 120p 17 6p 404p
dividends per share  declared 975p 950p 600p – 2272p
net debtfunds
cash at bank and in hand 728 925 1288 1058 1059
other debt receivable 10 07 07 08 09
loan notes – ––– 08
bonds 5900 5834 5656 – –
bank and other loans 1146 7 9 398 687 7 11508
fair value of bond hedging derivatives 234 164 1 1 – –
finance lease obligations 1547 1513 1316 756 1339
other debt payable 661 07 18 1 2 1 1
net debt 8282 6337 6104 657 9 1 1798
gearing ratio 25x 19x 2 1x 25x 35x
  normalised results are deﬁned as the statutory results before the following as appropriate proﬁt or loss on sale of businesses exceptional proﬁt or loss on sale  
of noncurrent assets intangible amortisation property plant and equipment impairments exceptional items and tax relief on qualifying exceptional items
 normalised operating proﬁtcapital employed
1
 earnings per share ﬁgures have been restated for the effect of the 2009 rights issue
164 national express group plc annual report and accounts 2012  cautionary statement
this business review is intended to focus on matters 
which are relevant to the interests of shareholders of 
the company the purpose of this review is to assist 
shareholders in assessing the strategies adopted and 
performance delivered by the company and the potential 
for those strategies to succeed it should not be relied  
on by any other party or for any other purpose 
forward looking statements are made in good faith  
based on a number of assumptions concerning future 
events and information available to directors at the time 
of their approval of this report these forward looking 
statements should be treated with caution due to the 
inherent uncertainties underlying any such forward looking 
information the user of these accounts should not rely 
unduly on these forward looking statements which are 
not a guarantee of performance and which are subject to 
a number of uncertainties and other facts many of which 
are outside the company’s control and could cause actual 
events to differ materially from those in these statements 
no guarantee can be given of future results levels of 
activity performance or achievements 
this annual report and accounts is printed on amadeus silk and 
uncoated 100 recycled which are papers with fsc certiﬁcation 
and eu ecolabelled this is your assurance that the wood ﬁbres in this 
product have been sourced from responsible and renewable sources 
with a chain of custody covering the whole process the printing 
process is also covered by iso14001 the standard for environmental 
management if you have ﬁnished reading this report and no longer 
wish to retain it please pass it on to other interested readers or dispose 
of it in your recycled paper waste
thank you
designed by luminouscouk
photography by janie airey and john wildgoose
print managed by urban life support
printed by park communications national express group plc
national express house
mill lane
digbeth
birmingham b5 6dd
tel 44 0 8450 130130
wwwnationalexpressgroupcom


Summary:
 overview
national express group at a glance
a leading global
transport provider 
delivering services in the uk north america spain and morocco every year more than 
800 million journeys are made on our buses trains light rail services and coaches
segment description
more information
financial highlights
north america bus uk bus spain bus and coach
 alsa
our spanish business 
alsa operates long distance 
regional and urban bus and 
coach services across spain 
and in morocco
alsa was acquired by 
national express in 2005 
and our position in spain 
was strengthened with the 
acquisition of continental 
auto in 2007  apart from its 
bus and coach services 
the business also operates 
service areas and other 
transportrelated businesses 
such as fuel distribution
 durham school services
 stock transportation
 petermann
the main focus of our business 
in north america is student 
transportation and operates 
in 32 us states and four 
canadian provinces
the business is the second 
largest private operator of 
school buses in north america 
we are also building the 
number of transit and 
paratransit contracts we 
operate in the us
 national express 
west midlands
 national express coventry
 national express dundee
 midland metro
national express is the market 
leader in the uk’s largest urban 
bus market outside of london 
we also run services in 
coventry and dundee 
in addition we operate 
the midland metro light rail 
service between birmingham 
and wolverhampton
revenue
£5350
m
operating proﬁ t
£838
m
revenue 
£5783
m
operating proﬁ t
£59 1
m
revenue
£2690
m
operating proﬁ t 
£34 1
m
24
read more
28
read more
32
read more
4 national express group plc annual report and accounts 2012 uk coach uk rail
 national express
 eurolines
 the kings ferry
national express is the 
largest operator of scheduled 
coach services in the uk 
the business operates high 
frequency services linking 
around 1000 destinations 
across the country
we are the uk partner in the 
eurolines network which serves 
over 500 destinations across 
europe and north africa
 c2c
national express operates the 
industryleading c2c franchise 
which serves london and 
south essex
it is an important commuter 
route serving 25 stations on 
the line out of fenchurch street 
station london
we ran national express east 
anglia until february 2012 
revenue 
£255 1
m
operating proﬁ t 
£206
m
revenue 
£1 95 1
m
operating proﬁ t
£267 
m
our global position
national express group
the group operates in the uk north america spain and morocco 
and at the end of the year we employed 42000 people and operated 
over 25000 vehicles passengers made more than 800 million 
journeys on our services in 2012 
the national express name ﬁ rst appeared on uk coaches in 1972 
and the company was listed on the london stock exchange in 1992
group revenue by market
 spain 29
 north america 32
 uk bus 15
 uk coach 14
 uk rail 10
group operating profi t by market
 spain 38
 north america 26
 uk bus 15
 uk coach 9
 uk rail 12
revenue and proﬁ t percentage in sterling
36
read more
40
read more
uk
 national express bus
north america
 durham school services
 stock transportation
 petermann
 c2c
 national express
 eurolines
 the kings ferry 
spain and morocco
 alsa 
delivering on our strategy business review governance 
5 wwwnationalexpressgroupcom
financial statements overview