Reading Buses appears to have turned a corner after announcing a £50,000 profit for October.

The under-fire operator said cost-cutting measures and the sale of surplus buses has helped bolster its shaky finances.

It is quite a turnaround after chief executive James Freeman revealed in getreading’s sister paper the Reading Post in August that the firm was losing £40,000 a week.

But now the upbeat boss has said the improvement in fortunes is proof the action taken over the past six months is working.

“It is a very encouraging start,” he said.

“We had a very hard summer and had to reduce our costs in face of reducing revenues.

“We told people it would take time to see a result from what we have been doing, so I’m very pleased.

“This is the first time Reading Transport has made a profit for quite a while.

“In fact it is better than we had hoped because we have been more ambitious with our cost-cutting than we first planned.”

Since April, Reading Buses has made four drastic changes in a bid to curtail its losses:

- June 5 – the firm raised some fares by 40p and introduced a new Oyster-style smart card;
- July 13 – it tweaked timetables and withdrew 16 buses;
- September 7 – the administration office in Newbury was closed and operations were streamlined;
- September 28 – the popular Vitality 3 service from Reading to Tadley was withdrawn.

The biggest boost has come from the sale of 20 buses in the past three months, with double-deckers going for around £55,000 each.

Mr Freeman said: “We have sold them on the second-hand market, including many which placed greater demands on the engineering side.

“During the past six months we lost a large amount of money and we have got to get that back.

“We have to break even or do better to stay alive.”

And Mr Freeman is confident this upward trend will continue, although he warned customers to expect further cutbacks.

This is set to include reductions to bus services in Woodley and Earley, to come into force on January 11.

“There will be further changes before we are finally satisfied that RTL is financially fit again,” he said.

“But we are over the nasty bit.”

Directors’ board reshuffle on cards after troubles

A major shake-up of the board is on the cards at Reading Buses after a troubled year at the council-owned firm.

Reading Borough Council’s cabinet will be asked on Monday to approve axing the post of operations director, currently held by Sam Simpson, as well as the separation of the company secretary and finance director roles, currently held by James Carney.

A new post of finance director will be advertised while the present commercial manager will step up into the role of company secretary.

Two new directorships in human resources and performance will be created. Existing managers will step into these roles.

Reading Buses has had a troubled summer with reports it was losing £40,000 a week and threats of a bus strike.

The council recently ordered an inquiry – expected to report by the end of the year – into how it had been misinformed about the source of the bio-ethanol fuel used in the buses.

The fuel was supposed to come from sugar beet in Norfolk but was in fact sourced from wood pulp in Sweden.

The report to Monday’s cabinet, written by Reading Buses’ chief executive James Freeman and council chief executive Michael Coughlin, states the reason for the reshuffle is to make the management of the company “more streamlined”.

The report says the proposals will save £90,000 in a full year, improve communications and show cost savings are being implemented in management.

Earlier this year Mr Freeman faced a vote of no confidence during a meeting between staff and management.

At the time he said Mr Carney and Mr Simpson “were currently out of the office on sick leave”.

A legal report to the cabinet says: “It is legitimate for the council, as shareholder, to monitor and approve the broad strategic direction of the company, including its business plan, profit forecasts, capital investment plan and the methods of financing it, its dividend policy and the analysis of the market and social trends that have informed the company’s planning.”

probins@reading-epost.co.uk

Site navigation

• Home
• News
• Business
• Sport
• Entertainment
• Lifestyle
• Jobs
• Property
• Motoring
• Classifieds

• A A