StockMarketWire.com - Transport services company FirstGroup said the UK government had extended the emergency funding arrangements for the rail industry for the next six to 18 months.

The New Emergency Recovery Measures Agreements, or ERMAs, which replaced the Emergency Measures Agreements launched in March, came into force on 20 September for 'our South Western Railway (SWR), TransPennine Express (TPE), and West Coast Partnership (WCP, comprising HS2 shadow operator and Avanti West Coast) operations,' the company said.

During the term of the ERMAs, the Department for Transport would continue to waive the revenue, cost and contingent capital risk of the train operating companies and pay them a fixed management fee.

There was also the potential for an additional performance-based fee, based on measures including punctuality, passenger satisfaction and financial performance, FirstGroup said. The overall fee potential was a maximum of 1.5% of the cost base of each franchise prior to the pandemic.

The company also said that passenger volumes on its first rail operations had 'increased modestly from the lows of c.95% below pre-pandemic levels on average in late March and April, but still remain [nearly] 70% below across our operations.'

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