CMD 2021

Oct 18, 2021

Hello, and welcome. I'm delighted that you have joined us for our 1st Capital Markets Day in many years. I have spent the last 11 months conducting a thorough and comprehensive business review, truly understanding what the group stands for, assessing the depth and breadth of the talent we have and taking a critical dispassionate look at the current portfolio and the opportunities ahead of us. Today, we will take you through this. I know that the recent stake coach transaction has grabbed the headlines, but the focus of today is to outline our standalone group strategy and growth prospects, which we are very excited about. But before we get into the mid of the day, let me give you a sneak preview of the slide we're going to end this presentation with, the investment case. There are six reasons to be excited about the future. First, we have long term sustainable structural growth opportunities from the model ship to public transport. More and more cities need our services. They share or decide to deliver cleaner, greener, livable spaces. This cannot happen without shared mobility. These are the services and solutions we offer. 2nd, as we will outline today, we have 5 compelling hard to replicate customer propositions to leverage this growth. 3rd, we are the best in class operator. This means we do the things our customers value and we pay for better than anyone else. 4th, as you know, we are uniquely diversified and balanced, providing resilience as well as a platform for future growth. 5th with driving environmental leadership, an issue of vital importance to us all. I will expand on our group commitments later in this presentation. Finally, we have a track record of delivering strong financial outcomes. And as Chris will show later, we expect more of the same. To start us off, I'm going to play a short video to remind you of the role shared mobility will play in society and Audi's anchors for purpose and vision. During COVID, we saw a shift in transport use back to the private and if this were to continue as growth comes back to normal, we would see over 400,000,000,000 more passenger kilometers per and thorough and The World Health Organization estimates that there are 7,000,000 deaths annually caused cars off the road, significantly reducing congestion and freeing up livable spaces. Imagine freeing up over 100 hours a year Just because you no longer need to sit in congestion, that's what drivers in big U. S. And European cities put up with now. And thorough and And with students 70 times more likely to arrive safely than traveling by car. Modal shift from private cars to public transport remains the single most and funding for ZEVs to meet their decarbonization and clean air targets. Progressive partnerships between cities, businesses and passengers Freeing up on road parking spaces in London, for example, would create the equivalent of 10 Hyde Parks or 5 Central Parks in New York. Affordable, clean, safe and accessible transport provides connectivity and mobility to everyone, opening up opportunities, I hope you can see why I'm excited about the future. Let's take a look at the agenda for today. I'm going to spend a few minutes recapping the basics of the group before walking through the Evolva strategy. I I will then hand over to Tom, Gary, Paco to take you through a little more detail on each of our 3 divisions and how they are executing Evolve. Chris will then outline the 5 year profitable growth ambitions for the group before a quick summary and close. A full agenda will take around 2 hours, including time for Q and A. National Express is the only UK listed internationally diversified multimodal transfer provider. We operate in North America, Europe, Northern Africa and the U. K. With a school bus, urban and regional bus, long distance coach, corporate, shuttle, paratransit and limited rail services in Germany. Contract. The chart shows the pre pandemic scale of the group, which we expect to at least march in 2022. As you can see on this chart. We're reasonably well balanced across each division. Our 50,000 employees operating in 50 cities and 11 countries provide close to 1,000,000,000 annual passengers journeys on 32,000 vehicles. And importantly, or transport services remove about 500,000,000 car journeys a year. The group's revenues are also underpinned by high quality contracts. And although National Express is known for its retail culture business, in fact, over 60% of revenue is contract based with very little customer concentration risk. This global diversity of contract based businesses is a very significant differentiator of the group. And a business of this scale and scope requires talented leadership, and I am blessed with an exceptional executive team with extensive transport experience. Together, we also have vast experience in safety and winning new contracts, in M and A, in operations and in implementing market leading technology. Before we get into our specifics, let's take a look at the backdrop. It really is an exciting time to be in public transport. The demographics are favorable in the areas in which we operate. Bermingham, where our U. K. Bus business operates, is the youngest city in Europe and is growing. Millennials are more inclined to use public transport. Owning a car is no longer the right of passage that it used to be and younger generations are more concerned about the environmental impact. The cities in Morocco are also growing quickly and in North America an aging population supports growth for our paratransit business. Model shift into public transport is also key to social mobility, which is a focus of governments around the world. Public transport connects people with places of work, education and health care. The cost of using a bus is around a quarter of what it cost to own and run a car. And after many months of restrictions, there is pent up demand for travel. A McKinsey survey in July revealed trial to be the 2nd most desired activity as we exit the pandemic. And in the U. K, the owner of the U. K. Largest holiday lettings website say in September that U. K. Holiday bookings for summer 2022 are up 82% on the same period into 2019. Government support for public transport is better than ever with policies and investment to encourage model shift out of private cars. In the U. K, there is the recently unveiled national bus strategy with £3,000,000,000 of investment, including support for at least 4,000 more 0 emissions buses. In the U. S, there is a 1,200,000,000,000 dollars infrastructure package including $39,000,000,000 of new investment to modernize transport and to improve accessibility for the elderly and for people with disabilities. In Spain, there is a €13,000,000,000 plan by the government to boost the transition to electric Pre pandemics, cars generated 70% of EU surface transfers emissions. Model shift is key to decarbonization and this is going to be a hugely positive factor for public transfer in the coming years. Shortly after joining, I kick it off a business review, leveraging the local know how and experience across our group with selective use of external expert to stimulate and challenge our thinking. We really challenge ourselves on some big questions. What is core purpose. Where do we operate? What products do we want to offer? How do we deliver? We started with an open mind. Through the process we were keen to do 2 things. 1st, challenge ourselves on the existing portfolio and second, get all the growth opportunities on the table and ranked them according to risk weighted returns potential. While we have trimmed and streamlined our existing portfolio with contract, which will deliver a more profitable base. We truly believe that we are in the right places offering the right products. Our current portfolio is strong. Our initial list of opportunity added up to over £4,000,000,000 of growth initiatives. We then set about how to prioritize the growth initiatives. We went through a rigorous process to understand the truly addressable market size for each opportunity, our ability to execute, our ability to scale and most importantly, the ability to make money to deliver sustainable profits and cash flows. This yielded a near term pipeline of £1,500,000,000 of revenue opportunity, primarily in North America and Alcent. This pipeline excludes Stagecoach. I'm sure you will have a number of questions about our proposed combination, and we will touch on this throughout the session. But put very simply, I see the proposed transaction and as an accelerator of our strategy, generating capacity to go after these growth opportunities at even more pace, whilst at the same time deleveraging the balance sheet. So let me start with our vision. We want to be the world's premier mobility operator with services offering leading safety, reliability environmental standard that customers trust and value. Supply shifting from mass transit to shared mobility reflects the reality of what customers want and cities need. But fundamentally, it is still about moving people through cities more safely and efficiently that can be done by car. So our vision is embedded in our purpose to lead the model shift from cars to public transport. I'm now going to outline our strategy to deliver this vision before diving deeper into each aspect. Rather than focus on products such as school bus, urban buses, coach, etcetera. We have distilled the solutions that will solve the problems cities face in the 21st century. We will deliver on our purpose and vision through our 5 compelling hard to replicate customer propositions. 1st, reinvigorate public transfer, rebuilding confidence in the public transport system by offering high quality operations that passengers want to use. 2nd, multimodal expansion, expanding the breadth of our product offering based on our global know how and local relationships. 3rd, operational transformation, driving growth by delivering transport solutions more efficiently than our competitors. 4th, filling the transit gap, helping business and cities transition from the private cars in places that are not well served by existing mass public transport. And 5th, consolidating and componenting compartmental markets to bring the benefits of scale and consistent service. These positions are underpinned by our focused applications of technology. This is not technology for the technology's sake. This is about careful targeted investment into a profit technology that really makes a difference to the outputs we are driving for, which leads us onto the outputs of this strategy, superior outcomes for all our stakeholders. We aim to be the safest, the most reliable, the environmental leader, have the most satisfied customers and be the employer of choice. I'm absolutely confident that delivering this output will deliver growth because these are the things that matter to our customers and as such, will deliver profitable growth. Through the next few slides, I will take you through each layer of this strategy, starting with the 5 customer propositions. Each of these customer propositions will deliver growth. Let's go through them. Reinvigorate public transport is about rebuilding confidence in the public transport system by offering high quality operations that passengers want to use. Look at Morocco, we where we reversed declining ridership. And in Birmingham, we consistently outperform the U. K. Passenger trend. We are the partner of choice for delivery transport solutions. This particular customer proposition is one of the most likely entry points into those other 100 and 50 cities in which we do not currently participate. Authorities are looking for a trusted partner to transform the experience for the citizens. This is how we recently entered Portugal, and we are currently bidding for the large contracts in a number of new locations. Let me show you a video to illustrate what I mean. I think this really is a golden moment for reinvigorating public transport after the pandemic. I think a thorough and agenda. Indeed, I think National Express already is leading that agenda. Here in the West Midlands, our relationship with local government is the best of any operator in local government in the country. It's coincidence that Boris Johnson came to our depot to launch his national bus strategy, which talks about working closely with local authorities and operators to make buses better. We're reinvigorating public transport in the West Midlands in 3 key ways. 1, we're working in partnership with local authorities to invest in highways priority. 2, we're leading on sustainability, massive investment in 0 emissions, electric and hydrogen. And 3, we're cutting fares and making it simpler and cheaper for our passengers travel. Now obviously, as we bounced back from the pandemic, it's really important that people move back to buses and indeed other forms of public transport. So what could be and constructive decision taken by National Express to cut nearly all fares by an average of about 15%. It and comprehensive decision that reflected our partnership with National Express and their commitment to the future economic and social success of this As a result, we're seeing growth in patronage and revenue and we're recovering from COVID faster than anywhere else. Over the next decade, 450,000 people Moving here to the West Midlands, that's the population of Bristol, moving to the Greater Birmingham area. But no new roads are being built, so it all has to be public transport to accommodate demand. And what we're doing through the Bus Alliance is working. So far, we've secured over £100,000,000 for new bus priority measures and highways enhancements to make buses faster. We've secured In Morocco, there's huge migration from the countryside to the big cities, which is provoking challenge for city councils to cope with these new needs the urban transportation because we provide complete solutions for public transport. For example, in Casablanca, we a major transformation of the transport system from the old buses service to a totally new service with the most modern fleets in Morocco, integrating state of the art technologies to increase customer satisfaction, safety and comfort, but also with 3,000 employees trained and ready to work under new procedures and objectives. We are known as a problem solver Today, we can say that Casablanca is a benchmark not only in Morocco but also for other countries in the region. We doubled the transport supply in terms of patronage. We more than doubled the number of passengers per day. The number of accidents by 53%. Our next customer proposition is multimodal expansion. This is about expanding the breadth of our product offering in places where we already have an established presence, combining local relationship with our global know how. For example, using our paratransit expertise from North America to help develop our accessible transport business in the U. K. We see significant opportunity to offer more products in the places where we have a strong geographical presence. And delivered both cost and revenue benefits. Taking cost first, an example is our Coventry depot in the U. K. From one side we are now operating urban buses, long haul coaches and accessible transport mini buses. Once we have got established presence, economics of adding service offerings whilst utilizing our existing infrastructure is compelling. To give you an example of our revenue opportunities, we first established a presence in New York through to which we added power transit, followed by private charter and corporate shuttle. So that's 4 services offering, each of which we have grown. In 4 years, we went from 0 to $100,000,000 of revenue in New York. Moving to operational transformation. Put simply, this is about delivering transport solutions better and more efficiently than our competitors. When we take over operations, we have a playbook, the NX Way, a globally consistent set of processes that can be rapidly implemented and scaled and that drive outcomes that matter to our customers. When we deliver this, we drive real change. Opportunities include implementing our operational blueprint at scale across fragmented and inconsistent operations such as in a school bus, turning around under invested networks as we have done in Morocco and modernizing operations like our accessible transport division in the U. K. In order to deliver this transformation, we have implemented a consistent global quality management framework that we are upskilling for workforce 1. We have commenced training over 1500 colleagues in this quality management framework across all our 4 divisions. Let me now show you a video that to illustrate the power of operational transformation. Operational transformation is about being the leader in all the markets that we're in. It's really about consistent delivery of excellent service, and I think of it as being enabled by 3 pillars. Firstly, technology. We invest huge amounts in both on vehicle and back office technology. The second is about using the data that comes off that technology and using it for insights that makes change. And the 3rd and the most important thing is about focusing on the processes that matter. It's not about investing in technology for technology's sake. So we have processes implemented by the best trained workforce in the industry, all seeking for continuous improvement. And really, this is exemplified by our very successful Driving Excellence program in North America. Driving excellence is about putting in standard operating procedures to make sure that our operations are running efficiently, effectively and dependably. The overall objective We're happy about what we've achieved so far. We've achieved significant driver wage savings. We've also achieved record on time performance metrics and record customer satisfaction metrics, but we don't want to stop there. We don't just want to be best in class in the school bus thorough and compulsory. We want to be best in class anywhere. So far, we've just laid the groundwork for driving excellence, which includes many little deliverables. As an example, when we implemented the process for master schedules, we saw an increase of yard departure, which resulted in an increase of on time performance, a decrease in speeding events, a decrease in accidents as well as a decrease in injuries. We've created 130 standard operating procedures, which is inclusive of all business units in North America. We have standardized across the entire business, how we schedule routes and schedule drivers and making sure that those routes are as efficient and cost effective as possible. BikeCurve is the system that allows transparency, allows us to look at lifetime management of our drivers as well as on route activity that allows us step by step view on the progress of each employee all day long. The principles we've used to develop driving excellence here in North America are being applied to other parts of the business when they face challenges. They're using the same principles that we used over here in North America to drive further improvements across National Express Group. We've seen an increase of on time performance by 200 basis points. And why that's important is that is what our customers deem success for us. If you have efficient routes, You have the buses out on time. You have a pretty good chance of being on time to the customer. And last school year, we had record on time performance. As a result on We've seen increased performance levels and we anticipate $20,000,000 of annual benefit. So driving excellence has already been a multiyear journey for us and we've got many more years to go, but we've made a great improvement in just a short period of time. So I'm very excited about a thorough and this kind of operational transformation program is a true differentiator for us. Our intention is to drive this kind of change across the globe. Excellence really is about giving us a competitive edge. Why? I think there's 3 key reasons. Firstly, we've got industry leading that really are hard to replicate. It takes time and it takes commitment, and it's about doing thousands of things right consistently every single day. Technology that makes a difference. That is excellence. The 4th area where we excel is filling what we call the transit gap. This occurs when the existing public transport system does not match demand. It takes a long time to build a new railway. Our employee shuttle business is an example of how filling the transit gap solves a very real need. It is flexible, adaptive and dynamic. It is helping businesses and cities transition from the private car in places that are not well served by existing mass public transit. This can range from providing full commuter services to bridging the last few months between a public transport stop and an office campus. We're also focused on fulfilling intra campus travel for customers such as universities, hospital or large corporates who have multi properties over a quite spread area. There's a big opportunity here. It is a $2,000,000,000 market in the U. S. Alone. We see increasing demand for these services throughout the rest of the world, including the U. K. And Spain. Our final customer proposition is the consolidation of fragmented markets and we operate in a number of fragmented markets across the group. In U. S. Sculpas, for example, after the 4 biggest competitors, there is a long tail of local operators. Over a number of years, we have been acquiring these attractive multiples and then plugging them into our system. For instance, procurement and insurance, take out duplicated back office cost and drive returns averaging around 15%. We have replicated this in the urban and regional bus in Spain and more recently in accessible transport and transport solutions divisions in the U. K. We also have a strong track record in selective larger acquisitions. In 2012, for instance, we acquired Pitcherman for around $250,000,000 it has been fully paid back in cash and has led us with a recurring annuity like profit stream from the 99% of contract retained since acquisition. Our 5 customer propositions are digitally enabled by a suite of technology. In this context, technology means all of the following: using automation tools to streamline processes making us more efficient and driving down cost adopting artificial intelligence to solve problems and spot patterns better and faster than humans can. We already use AI in pricing and some of our safety applications, embracing best in class third party solutions and crucially driving their successful implementation at use, using data to make better, quicker, more informed management decisions. We believe that it is the way in which we adopt and implement technology that give us the edge in the market. One example of how we make use of technology to be the safest is the use of a speeding control technology that links data and telematics to give us real time information. The image on this chart shows what we can see in our control centers. We can use this to take immediate corrective actions and also later on in training and development of drivers. On the right hand side of this page is an example of how technology supports as being the most reliable. It shows an image of the network optimization software we use in our U. K. Bus business. This was developed in our own innovation center and it monitors running times and traffic patterns, helping to take out running time and therefore cost as well as improving punctuality. It would require hundreds of manual analysts to do the same job that this does for us. The results are impressive. 45% reduction in late passes and a 2% driver cost saving from some of our high frequency routes. Success come from the rapid adoption and implementation of the right technology to improve a specific outcome, not for the sake of technology itself. The final layer of our strategy is the outputs that we are seeking to achieve. I will take you through the first five of these now and Chris will take you through the financial returns later on. Firstly, the safest. We will lead the industry in safety by continually driving down the number of accidents and incidents. We monitor this through a measure pioneered in the rail industry, which we feel hold us to the highest possible standard, FWI. This stands for fatalities weighted index and assigns a numerical score to each level of severity of incidents. Our goal is simple, to drive a reduction in this number every year, and we're starting from a very low base as you will see. You have seen this slide before, but I make no apology for that. We're proud to have reduced FWI per million mass by 98% over the last decade. The second chart here is the risk score compiled by Lytics or provider of DriveCam. And put simply, shows that we are the safest across the universe of operators they work with and widening the gap. I'll now show you a video to expand on this. Safety is our number one priority at National Express. It's our CEO's passion that we become an injury free business and are focused on delivering that's relentless. Safety and the health of our customers, our staff and any other related with our operations is the core of what we do. In 2010, we started our safety program, driving out harm with the aim to ensure that all that we do comply with the highest levels of safety. When we focus on safety, we not only reduce accidents and injuries, a thorough and comprehensive approach to safety, first of all, is by having 15 global safety standards and policies that means all of our business are governed in exactly the same ways. And that gives us foundation that we can share best practices between divisions. We do that by using technology, training and people to implement safety practices that are world class. People are at the heart of what we do. Our people create safety. People are what make safety come to life and drive safety results. All of our people are well trained going back to our policies and our procedures and our standards. We're very specific around what and we create a culture where learning, training and development are key. Technology has revolutionized our approach to safety management. By using tools like DriveCam and Zonar, we're able to identify risky behaviors and take action to correct them before they lead to an accident or injury. Zonar provides us the ability to do electronic pre trip and post trip inspections and also monitor driver speeding as well as the location of the vehicle. We have lytics drive cam units on the front of our coaches on the front of our buses. These are pieces of kit that enable us to identify behaviors that we can develop to prevent any future incidents. We also have AlcoLock equipment on our vehicles. Very simply, our drivers blow into a machine. If there is alcohol on their breath, Let's focus on safety has led to fewer accidents, injuries and risky driving behaviors. When we talk to our insurers, the fact that we use the safety technology means that our premiums are kept as low as they can possibly be. National Express's strategy has always been to work really closely with the insurance industry a thorough and thorough insurance terms for National Express. When we bid for alternative work, it has a value. Our customers tell us that safety for them is one of the decision making criteria that they have. We're proud to have the best safety record. Technology, all of the pieces of the jigsaw that we have to make sure that we are the safest and we are the best. As you can see from that video, safety is and will remain our number one priority. As a provider of transport services, we also know that reliability is key. Our passengers need to be able to plan with confidence to know they will get to work or school on time where passengers experience unreliable services, they have to add more contingency time into their journeys, reducing the attractiveness of the service compared to the car. Reliability is key for our contract customers as well. As I told you before, the 6 outcomes we have defined are the things that matter to our customers. To bring this to life for you, the chart on this slide shows how customers in some recent contract tenders awarded quality marks in assessing the bids. If you don't get quality right, you compete only on price. Nearly 60% of quality marks were available for being reliable. By being the most reliable, we give ourselves a competitive edge, driving customers' retention and powering growth. The benefit of this is lower cost because our services are more efficient and higher customer satisfaction. Converting. Moving on to their next outcome, we will be the environmental leader by leading the transition to 0 emission vehicles. Once we are focused on all aspects of our environmental footprint as vehicle emissions accounts for 95% of the group's scope 1 and 2 emissions, this has to be focus. Nearly 100 percent of our diesel bus fleet in the U. K. And around 50% of our Alta diesel bus fleet is Euro 6 compliant, which is the cleanest variant of diesel engine that you can get. Year 6 vehicles emit fewer emissions than a private car. Nonetheless, we want to go much farther and we are committing to the most ambitious zero emission fleet target. Last year, we launched our targets for the U. K. Bus and U. K. Coach fleets to be 0 emissions by 2,030 and 2,035 respectively. We are now adding targets for the other regions and the whole group. In Spain, we are targeting the bus fleet to be 0 emissions by 2,035. We are then targeting Spanish coach, Morocco and North America to be 0 emissions by 2,040. So that means an entirely 0 emissions fleet by 2,040. And it is not just about vehicles. We are targeting all Scope 1 and 2 emissions to be net 0 by 2,040. For clarity, This is before the hugely positive impact we can make on emissions more widely from model ship from private car to shared mobility. We have committed to never buy another diesel bus in the U. K. And in fact, we are not buying electric buses again either. We have worked with various stakeholders to enable us to fulfill our very good requirements through availability contracts, meaning no capital expenditure, a faster transition, less technology risk, no residual value risk and a stronger balance sheet. Chris will expand on this later. So this is good for the environment, good for the passengers, good for cities, good for our shareholders. Moving on to most satisfied customers. Satisfied customers drive profit. Satisfied customers are also less likely to put contracts out to tender, we are more tolerant of the inevitable issues that do arise and so are less inclined to impose contractual penalties. We start from a strong base in this area. We have consistently improved our customer satisfaction measures in the U. K, Spain and North America. We have been recognized as the best transport company in Spain and the number one transport brand in the U. K. With an excellent rating on Trustpilot. We also know that happy customers drive margin, improve contract retention and will recommend us to others. We have said before, for example, that our customers in North America, School Bus, who rate us 5 out of 5 are with us longer and have a higher margin. We have improved the percentage of customers who rate us 5 out of 5 from 46% to 66% in the last 3 years with improved ratings even through the pandemic. Over the next 12 months, we will refine and standardize the measurements of NPS across the group and set a target for top quartile benchmarked performance. Our people are the heart of our business. We employ 51,000 colleagues who keep our customer and moving every day. I'm very privileged to lead each and every one of them. Our ambition is to become an employer of choice across all our markets, and my aim is to create a culture based on transparency, empowerment and meritocracy. We will achieve this ambition by building on the strong foundations. However, we need to make improvements like all good companies to deliver this goal. To be an employer of choice, we need robust performance management processes, strong talent and development programs as well as environments which enable pioneer thinking. We also need to build a diverse workforce. We operate in 11 countries around the globe and diversity is in our G and A. Diverse teams make us think better, perform better, deliver better passenger experiences. We take employee engagement incredibly seriously. And recently, we have standardized our engagement survey tools across the globe as we track towards our target of upper quartile engagement. By listening to our people, building world class people processes and creating a culture of meritocracy, who will become an employer of choice. I want National Express to be a company where people want to join and love to stay and develop. To summarize our evolved strategy, our vision is to be the world's premier shared mobility operator. This is grounded in our purpose to lead the model ship from cars to public transport. We will do this through our 5 customer propositions, all underpinned by the focused application of appropriate technology. We will measure our success against a range of outcomes, ensuring we are delivering for all our stakeholders. Strong and consistent financial returns is a critical aspect of this, and Chris will cover that before we wrap up. Before I hand over to our divisional leaders, let me say a few words about the planned Estate Coach transaction. You will appreciate that at this stage, we are somehow constrained in what we can say. Discussions are ongoing and there can be no certainty that this combination will necessarily happen, but the Board of National Express and as a stake coach, believe that the combination of our 2 companies would be a strategically compelling proposition with significant growth and cost synergies as well as delivering strong value creation for both sets of shareholders. I see the proposed transaction an unparalleled opportunity for value creation. PwC, the reporting accountant, has signed off on grounded, sensitized synergies of at least £30 £5,000,000 per year and there are revenue synergies on top of that. The transaction will generate capital capacity to accelerate growth opportunities in Alpha and North America, partially because the pro form a balance sheet will be lower geared creating headroom to our target gearing threshold. And secondly, as those synergies throw out cash. This of course accelerate our deleveraging as we recover from the pandemic and facilitates a faster return to paying a dividend. We target restating the dividend in 2022. Not only does it accelerate our strategy and fuel profitable growth in Alta North America, it also creates a leadership position in an increasing bus friendly U. K. Market ahead of the £3,000,000,000 national bus strategy funding becoming available. That's all from me for now. I will come back to close the session. We will now turn to the divisions starting with ASSA. So I will hand over to Paco and Cimu later. Good afternoon, everyone. I'm Francisco Iglesias or Paco. I will now take you through the ALSA business, starting with a video to give you an overview. Alsace is very diversified well balanced business because we are operating in all kind of products in transport by road and commercial services. So this is a very well balanced portfolio. We have an iconic and local brand with over 90% top mine. Our vision is to be a sustainable, multimodal and connected mobility operator. This sustainability It's a key point in the strategy of ALSA. It's linked to the policies of the European Union with the Green Deal proposal, and we have a clear commitment in terms of sustainability of the fleet. Additionally, we are advancing in the autonomous driving, the main markets for opportunities in Spain. 1 is the transport in urban and metropolitan areas and the other is a segment of occasional services, tourism related because it's a very fragmented market with good potential for merger and acquisitions for Alsace. Alsace has been transformed from a familiar company as it was like 10 years ago, to be part of a national and international company. So this basically proves and that we have been able to adapt very quickly and very well. Both ALSA and National Express have a very solid and a very disciplined growth strategy. We prioritize profitability over size or over volume. They must be scalable. We discard isolated opportunities. I'll say Morocco is a successful story. We started in 1999 with the urban a thorough and We have a very particular way to interact and to meet the customer expectations and requirements. I believe also that our values, ALSA values, the ambition for growth, the local knowledge, the way we do things, Just one word, I would say reliability. And I think that's something that National Express really values because we have always delivered what we have promised. As you have just seen in the video, we operate in a number of attractive markets and have the potential to grow significantly and from where we are today, both organically and via acquisition. I'd now like to show some examples of the group's 5 customer proposition in Alsace. Firstly, how we reinvigorate public transport. You have already seen the example of Casablanca a little earlier. And on the next slide, I will show you another example in Bilbao. Then after that, I will demonstrate multimodal expansion in Madrid. Bilbao is one of several cities where we have reinvigorated public transport. Under the previous operator, the urban bus service was performing very poorly due to continual strikes and service interruptions, a lack of spare parts and maintenance causing frequent vehicle breakdowns, poor relationships with the city council and poor financial results with heavy losses. After ALSA took over the contract, there were significant and rapid improvements. 1st and foremost, safety. We achieved a 70% reduction in the rate of accident at fall through the implementation of our group safety policies and technology. We quickly improved labor relations, generating trust through the employee committee with a number of collective agreements being signed over the period and no strike for the past 6 years, the quality of service rapidly improved as evidenced by punctuality, reliability and improved image. This resulted in our Bilbao operations being recognized as the urban transport company of the year and the strength of our relationships with the local authorities is demonstrated with the successful renewal of the contract in 2019 team for a further 10 years and with multimodal expansion through tourists bus services. Contracts. Moving on to Madrid, where we have successfully implemented multimodal expansion. In 2005, National Express acquired Alsa. And shortly after in 2007, we made the acquisition of Continental Auto, which expanded our urban bus business in the city as well as adding some long haul routes running to Madrid. Expanded our urban bus operation further. In 2016, we entered the taxi and car transfer services market through our partnership with Uber and our own Alsakap business. In 2017, we entered the corporate shuttle market with acquisition of Mytours, running services for the likes of Iberia and Santander. In 2018, we again expanded our a thorough and compulsory to the urban bus through the acquisition of Arga Bus and launched further private car services through our partnership with Cabifari. And most recently in 2020, we launched an autonomous bus services at the University of Madrid. So you can see that over the years, we've added many types of services and we have done this through a mix of organic growth, bidding for contracts together with a number of strategic acquisitions. And this means that we are able to achieve significant benefits and efficiencies. Examples include greater fleet utilization as we are able to share across different aspects of the business as well as share depots providing services for our long haul, regional and MURVEM fleet. Of course, all of this is served by centralized marketing and operation teams. Turning to the growth opportunities we see ahead of us. Starting with Spain, here we believe the wider public transport market will provide a positive backdrop for passenger growth as government policy will promote the use of public transport and restrict mobility for private vehicles in its drive to meet its decarbonization targets. For some years now, we have been increasing the focus in our business toward the urban and regional markets. Long haul now accounts for less than 20% of our revenue versus 2 third in 2010. We continue to attractive opportunities to grow market share in urban, growing the proportion of revenue protected contracts within our business mix. We are already the market leader in the regional market with 15% market share, a market which is highly fragmented and where we have competitive advantage through the synergies from the connectivity with our long haul network. We are also looking to build our exposure to tourism, charter services and corporate shuttle sector, leveraging our existing operation as much as possible. This is the multimodal expansion strategy that we talked about on the previous slide. And we have a strong pipeline of opportunities with over £250,000,000 of annual revenue in coming tenders and acquisition targets over the next 18 months. In Morocco, there are opportunities to win contracts in other cities. We are focusing more on the cities which will have opportunities for revenue protective contracts. We also see opportunities within our existing contracts where local authorities may be looking to introduce changes and are keen for us to help find the solution. A good example of this is the proposed bus rapid transit service in Agadir. Intercity is clearly a market where we know well in Spain and we believe Morocco represents other interesting opportunities. Long distance travel in Morocco is not well served with limited intercity rail network, So the main option is by road. This market is currently worth €300,000,000 and is very fragmented, which only a handful of operator at scale. And we also see many opportunities to grow our international business. Last year, we won 2 contracts in Portugal, which we are currently mobilizing and which will both start in 2022. And we see opportunities to grow in other countries in Europe where we can see attractive tenders opportunities coming up in large cities with a pipeline worth over £100,000,000 in high potential European cities. So overall, plenty of opportunities. I'll now hand you over to Gary. Good afternoon, everyone. I'm Gary Waits, CEO of the North American business. I'm delighted to have the opportunity to tell you about our business, how it aligns with the group strategy and the exciting opportunities for growth. I'd like to start by showing you a video that gives you an overview of our business and introduces you to some of my team. So in North America, we have 3 product lines. We have school bus business where we're the number 2 school bus provider in the $25,000,000,000 school bus industry. We also have transit business where we provide fixed route and paratransit services for transit authorities. We're the number 4 a thorough and competitive competitive advantage. And we're also the largest competitor in the fast growing corporate shuttle market with our WeDrive use subsidiary. There's approximately 460,000 school buses in North America. And that's across 34 states and 3 provinces in Canada. The school bus business is a business where service is important. Getting the kids to a thorough and comprehensive market for high quality service like the service that National Express provides. It's also a highly fragmented market where there is opportunity either win business off of other competitors or acquire those competitors and drive efficiency through their operations. We've been on the forefront of technological innovations that have affected the school bus industry. From being the 1st company to put in DriveCam We're well positioned to professionalize in source operations but also win business or acquire smaller competitors where we can professionalize and bring our technology and efficiency to improve the operation. In addition, there's a large amount of in house operations that can be further outsourced, again, bringing professionalism and efficiency and complete operation. The transit industry is a $25,000,000,000 industry and market, and we're just scratching surface. And I think and expand to and create a bigger footprint as well. We've grown transit pretty aggressively over the last couple of years, mainly focusing on paratransit, which allowed us to secure some long term contracts in some of the biggest metropolitan areas in the United States, that being Boston, Chicago and Washington, D. C. Paratransit is a government mandated system that requires anybody running fixed route service to provide a complimentary service to anybody with a disability or otherwise who would be unable to ride fixed route services. We do paratransit really well. We've also established a really experienced business development group and operating team that will allow us to retain our current contracts, but then also go into these new contracts and win them with our best foot forward. When National Express wins a paratransit contract, we usually renew that contract. This is represented in Boston, which we just renewed for an additional term, and Chicago as well for another 10 year term. So We Drive You provides B2B commuter shuttles. What I mean by that on thorough run. We help employees commute to and from the office, help them stay productive during their commute with robust Wi Fi. And when they arrive on the campus, we reduce parking congestion. We have contracts with some of the biggest companies in the world, companies like Google, Facebook, Apple, Tesla. We also have contracts with universities like Princeton University in Northwestern. Today, we're focused primarily on the corporate shuttle market where we have about 20% of the market. We also are focused on the university sector, which is a sizable market. We only have 1% market opportunities with the Transit division. As we continue to expand throughout the United States, we're constantly looking to leverage school bus and transit infrastructure to enable multimodal expansion. We drive you differentiates from its competitors through its customer success teams who continually work to improve the passenger experience, through service and technology planning, reporting and analysis, all for the customer. We've been actively working to transition our fleet to electric. Today, our fleet is 11% electric. And by 2,030, our intention is to have our fleet 100% All of our businesses have strong positions in their respective markets, each of which present attractive growth opportunities both organically and via acquisition. But before we look at the growth potential, I want to show you some examples from North America of the group's 5 customer propositions. And comprehensive. You have already seen in the video earlier an example of how we have deployed operational transformation in our school bus business through our Driving Excellence program. In the next couple of slides, I will show you firstly, how we have successfully expanded on a multi modal basis in Chicago And then secondly, how our shuttle business WeDriveYou is filling the transit gap. We first entered Chicago with the acquisition of CDT in 2017, which provided entry into the paratransit market. Since then, we have rapidly expanded our offering across Chicago, entering the student transportation market and the charter services market and we have also expanded our presence in paratransit, winning the South Cook County contract. So having no presence in Chicago before our acquisition of CDT, we now have around $70,000,000 of revenue across a number a thorough and comprehensive and comprehensive financial performance. This is driving efficiency benefits through shared infrastructure, facilities, including depot and maintenance and driver and vehicle pools. This image shows you the different types of vehicles we run from our Chicago depot Ranging from small vans for school bus through to medium vans for paratransit and coaches for charter services. Turning to filling the transit gap. Shuttle is all about filling the transit gap with private transport solutions where public transit is not an option, and thorough and providing environmental benefits by removing private cars from the road. We entered the market in 2019 through the acquisition of We DRIVE U. We are providing a vital service to large and fast growing corporates as they continue to develop and expand their campuses. Our customers want to attract the best talent and providing high quality commuter services is a key part of employee attraction and retention. We provide a range of services tailored to each customer from full end to end commute through to last mile connectivity inter campus shuttles. Now moving on to growth opportunities. Starting with School Bus, we believe there are both organic growth and inorganic growth opportunities in this large and fragmented market. Indeed, we see over £300,000,000 worth of annual revenue from upcoming opportunities over the next 18 months. We see potential for market share gains in the upcoming school bidding season, which we expect to be significantly larger than normal given the high level of contract extensions in the previous bidding season. We believe that smaller local operators are likely to face financial challenges and that some will not be in a position to bid for those contracts as they come up for renewal. Continued pressure on state and local government budgets coupled with ever more complex operational challenges may well lead currently in source school board districts to conclude that it's more cost effective to outsource, especially for those who need to reinvest in the fleet. Even without any step change in conversions, the outsourced market is forecast to grow at 3.5% per annum through to 2,030, growing from $8,000,000,000 today to over $11,000,000,000 by 2,030. We also see opportunities to grow our private charter business growth in Charter over the next few years. We also see significant growth opportunities in the transit market. Our sweet spot is paratransit where an aging U. S. With greater market share and improved margins as customers value the high standards of service that we deliver. Our track record with these contracts provides the credentials to bid other large city paratransit contracts. There are significant bidding opportunities coming up in the next few years and we are fostering relationships with the relevant authorities well ahead of the individual bidding processes. Overall, we see a targeted pipeline of £250,000,000 of annual revenue in upcoming bidding opportunities over the next 18 months alone. Turning to Shuttle. As I said earlier, we entered this attractive growth market in 2019 with the acquisition of We DRIVE U, a business which achieved rapid growth leading up to the pandemic. And the corporate shuttle market is still expected to grow by around 4% per annum. WeDriveView's Strong growth in Corporate Shuttle has partly reflected the growth of our customers where we have developed deep relationships over the years with the likes of Google, Facebook and Tesla to name a few. The good news is that they continue to grow fast despite potential changes in office working patterns, expanding their campuses and workplaces to accommodate a growing workforce. To date, the vast majority of our business has been centered in California. However, going forward, we see more opportunity now to grow with our existing customers outside of our current footprint and to leverage the wider geographic footprint of our school bus and transit operations. We also see significant growth potential for shuttle in the university sector with the market forecast to grow by around 3% a year through to 2,030. We're already building our credentials here with a recent example being the successful launch services with Princeton University. We have a strong pipeline with contract bidding opportunities of over £150,000,000 coming up in the next 18 months And lastly, decarbonization of the fleet is becoming an increasingly more important factor for customers in the shuttle market. So it's an exciting future ahead of us in North America. I'll now hand you over to Tom. Thanks, Gary. I'm Tom Stable, CEO of the U. K. And German divisions. I'm pleased to have the opportunity to give you a flavor of how we align with the group's strategy and the opportunities for growth. I'll also touch briefly on the potential combination with Stagecoach. Express White Coach is an iconic brand with huge brand recognition. 96% of people in the UK know exactly what it is. For the last 7 years pre COVID, we had super year on year growth and we can see that returning to the market. It meets a real niche that people want. And competitive advantage to maintain. It's primarily a digital and marketing proposition where we make sure we put the roots in the right place and we sell them with smart pricing and smart marketing. We put our money into key things safety, digital, pricing, the things that will drive value from the business. A thorough and Biggest single operator commercial bus network anywhere in the country. Before the pandemic, we were growing patronage, speeding up our services, investing in our fleet and working well in partnership with our local authorities. We were cutting fares, growing revenue, growing patronage, pioneering different ways of working, a model that I think could work very well elsewhere in the country as well. We're making travel cheaper and simpler for our customers. We've rolled back our fares to 2012 prices. We were the first with daily capping, with weekly capping. Over 70% of our customers are now paying using digital channels, which is ideally suited to the youngest city in Europe where over half the population millennials. We're leading on sustainability. We'll have 50 Thor and Construction buses by this Christmas, nearly 200 by next Christmas and in 2023 aiming to double that. In terms of growth opportunities for the U. K. Bus business. I look at what we do well. We do well, partnership working, safety, operational delivery, investment in vehicles and sustainability. And I think that model plays well in other places. We know London already franchise their buses, Manchester, Leeds, Liverpool are heading in that direction. Dublin's a nearby interesting market as well. So absolutely think this is a great time for public transport and I think National Express are uniquely well positioned to deliver that. So one of the newest parts of National Express is accessible transport. And within accessible transport, one of the key markets that we're focusing on special needs education transport. These are children that have a range of different disabilities and needs and need transport into school run. It's a statutory service and councils across the UK have to provide it. The demand on those services is growing year on year on year. It's about 15% of the entire U. And thorough and complex. They have challenges around reliability and quality because they a fragmented market dominated by taxi providers and minibus operators. What we are able to do is provide councils with a higher quality solution, raised the standard, raised the bar, providing that governance, the assurance, the reliability, the safety to really give these children the service that they Express Germany started operation of the lines RB7 and RB48 in Northern Australia. Since then, we have not only won 3 new lines of a thorough elevators per year operated and generating about €200,000,000 of turnover. We are an established player in the a thorough run. Thereof, we expect to have significant potential for future growth and conducting a thorough and comprehensive solution. National Express brings together a number of brands under one banner of on National Express Transport Solutions. We are the newly formed division of National Express in the UK that look after private hire and contract the road. The private hire sector has an annualized turnover of around £3,000,000,000 and with over 30,000 coaches operate run. We have an opportunity to transform the private hire and contract sector of that market and deliver consistent product across the UK. Each of our brands have a relationship with the local customer audience. It's a local brand to them, and there's a loyalty to that. They've been established over many years. But it also gives the local team a banner to stand underneath that has a parent company of National Express. So they get the benefits of being part of a larger global business. Those local brands deliver that relationship to the customer combining that with the intercity coach travel allows us to tap into both sectors from fully organized Coach Holidays to travel and destination hotels and attractions. There's no consistent large an operator that delivers that product across the whole of the U. K, and National Express has the opportunity to move into that market space and deliver that product. As you have just seen, we operate in a number of attractive markets and have some great opportunities ahead of us. I'd now like to show you some examples from the U. K. Of the group's 5 customer propositions in practice. The first one, you will already have seen, is how National Express is reinvigorating public transport in the West Midlands. The second shows how National Express Accessible Transport, ANTHORANCONCONNECT has successfully deployed operational transformation. And the third is how National Express Transport Solutions, or NET, Council were very keen for us to take over the management of the contract as the previous operator delivered a very poor service. Very quickly, we modernized the business through 3 big process and technology changes. Firstly, we implemented routing software, which digitized a previously paper based system, which was inefficient. This reduced driver headcount by around 20% as well as reducing administration costs. We launched a new online home to school platform for routing, dispatch and compliance, providing local authorities schools and crucially parents with assurance on safeguarding and real time performance of the service as well as providing digital information to our drivers. And we're introducing safety technologies such as speed monitoring and DriveCam. This not only improves safety, and but also supports driver development through enabling regular evaluation and intervention to improve performance. Whilst this all has a clear safety benefit, it also reduced the cost of insurance premiums and claims by 50 6% since we took over the contract. All of these measures meant that we quickly reached the milestone a thorough and complete of 100 cancellation free days after taking over from the previous failing operator. The level of performance is simply what we expect on demand of ourselves, but the local council were astounded by the turnaround. They are clearly happy customers as they have not only renewed, but we have also won additional business, both in Birmingham and with other local councils in the West Midlands. We see attractive growth opportunities and has been growing at an average annual rate of 8% since 2016. Every council has a legal obligation to provide school transport to young people with special needs. With several 1,000 providers in the U. K, it is a highly fragmented market. We are already the 2nd largest provider. The application of technology is providing a clear source of competitive advantage, enabling us to position ourselves as the safest and most reliable partner, which should help to drive significant organic growth in this market. Moving on to NETS, another example of our customer propositions. NETS is consolidating and compounding fragmented markets, bringing the benefits of scale and consistent service to deliver growth. In recent years, we have made a number of acquisitions, adding to our existing Kings Ferry commuter and private hire business. We now have a group of businesses providing private hire, commuter, shuttle and holidays. These now operate under one brand, NETs, conducting a one stop shop. We are now able to offer a nationwide product and service, both through our own depots, including West Midland bus locations and our network of trusted coach operators who deliver our coach network. This ability to use the shared infrastructure of owned and third party coach operators depots enables us to combine our brand reputation with a low cost operating base to offer great value and a consistent product. At £2,800,000,000 this is a large but fragmented market. We currently have a small proportion, but we are already the 2nd largest provider. Turning now to the potential combination with Stagecoach. What could this mean for our U. K. Business? It will provide a platform to accelerate our growth and it's a fantastic opportunity to deliver significant operational efficiencies, harnessing the best of both from the combined businesses. It will deliver clear, compelling management and overhead synergies, reduce the cost of operating our coach network through utilizing Stagecoach's a engineering productivity and customer experience. It will also drive revenue growth by providing owned operating basis, enabling the faster expansion of our Transport Solutions businesses that I've just discussed. And concurrently with £3,000,000,000 worth of investment available through the new national bus strategy. We will continue to work hard to enhance strong relationships with key public sector stakeholders. This is something we already have a successful track record of in the West Midlands where we have done it for many years. We will also continue to seek to maintain our industry leading environmental and sustainability standards. Here, we see a significant opportunity to free up cash and capital as we transition our U. K. Fleet to 0 emission vehicles on an availability basis. However, and a key output of our revolver strategy is, of course, delivering strong financial returns. In this section, I'll take you through the shape of those returns and the scale of growth that we see ahead of us. But before we look at the next 5 years, I would like to remind you of what this group has achieved in the 10 years up to 2019. Between 2019, the group has added over €1,200,000,000 of revenue or a compound annual growth rate of 6%. And at the same time, EBIT nearly doubled from around £150,000,000 in 2,009 to almost £300,000,000 in 2019, a compound annual growth rate of 7%. And note that this has been restated to remove Rail from the early years to give you a better sense of the trajectory of today's portfolio of businesses. Now this growth has come from solid organic growth across all the markets in which we operated, and imposed to control the pandemic. 2021, although continuing to sequentially improve, is still materially impacted over the full year. And we anticipate 2022 revenue will be back to 2019 levels. This assumes the recovery trajectory that we've observed over recent months continues and there is no prolonged widespread reimposition of the kind of mobility restrictions we've endured in 2020 2021. And looking further ahead for the 5 year period from 2022 to 2027, we are targeting a further £1,000,000,000 of revenue. Or put another way, on a constant currency basis, we plan to grow revenue by as much in the next 5 years as we did in the 10 to 2019. As well as acquisition opportunities in which we are at least in active discussion. And as you can see on the chart, over 80% of this pipeline is in Alsera in North America. Now on the chart, I've also mapped the pipeline to our 5 customer propositions and you can see it's reasonably well balanced across each one. And clearly, we will not win them all. We are bound to walk away from a number. And in any case, we cannot handle that level of integration, but it is a very healthy pipeline against which to deploy capital. Prior to the pandemic, the group's operating margin averaged around 10%, and we expect it to return to that level, but to take a little time to recover fully. We expect an average margin of around 9% between 20222027 as margin recovery lags revenue recovery somewhat. The near term recovery in margins is impacted by a number of factors. Firstly, mix. For example, Thorong. Since 2019, we have fully mobilized German Rail and that roughly doubles its size, but at Rail margins, which are much lower than the group's average. Also, within each of our divisions, we anticipate the faster growth to come from elements that whilst having strong margins are lower than the average. And consulting. Importantly though, whilst these businesses might have lower than average profit margins, they are typically less asset intensive. The second factor is investment to encourage customers back to traveling. For example, we have frozen or reduced U. K. Bus fares. We see this as an important and worthwhile investment to encourage passengers back, and we're seeing the benefit in higher occupancy levels compared to the industry average. We've also talked before about the impact of competition in our Spanish long haul coach business from high speed rail and from a new competitor in the U. K. Coach market. So we've made some margin investments to maintain our market leading positions. We've discussed the potential margin impact of Spanish long haul concession renewal many times over the last few years, and this is factored into the latter stages of the next 5 years I've outlined here. All of this is mitigated by the £100,000,000 of permanent fixed cost reductions, which we announced earlier this year and which I'll come to on the next slide. And the net of all of this means that we are confident in a return to pre pandemic profit margins, and we are targeting profit growth of over £100,000,000 between 20 The first bar on this slide shows you the composition of our cost base in 2019, I. E, the last full year pre pandemic. In the event of fluctuations in revenue. But during the second half of twenty twenty, we conducted a detailed thorough cost reduction exercise within each division, which identified £100,000,000 of permanent cost reductions. We started to implement these towards the end of 2020 and the program is now largely complete. The savings included: 1, reducing managerial and administrative roles in our divisional head offices 2, reducing customer service roles as we increased automated self-service facilities for customers to buy tickets 3, rationalizing properties, removing costs from rents and utilities and 4, fast tracking a number of the process efficiencies you heard about earlier. Looking now at cash. This is where we expect to exceed pre pandemic levels. We expect cash margins to improve versus pre pandemic levels, with free cash flow conversion averaging over 80% a year over the coming years compared to an average of around 65% in the years preceding the pandemic. Now this is driven by that mix of business towards more asset light contracts and the introduction of fleet co arrangements enabling us to transition to 0 emission vehicles through availability arrangements. And contractual capital burden on the group's balance sheet as well as removing the residual value and technology change risks. I will return to this point in a couple of slides' time. Now this improved cash conversion and comprehensive capital allocation priorities. I have spent the last 11 months conducting on thorough and comprehensive capital, resulting in a significant increase in the capital available to be deployed on our three capital allocation priorities. We're targeting at least £1,250,000,000 of free cash flow to be generated between 20222027. Or put another way, at constant currency, that as much free cash as we generated in the 10 years to 2019, delivered in half the time. Before I move on to the outlook, let me take a couple of minutes to reiterate our capital allocation model, which remains largely unchanged. We utilized the group's strong free cash flow generation to invest for growth, targeting investments that deliver 15% returns to pay a dividend with targeted cover of at least 2 times and to maintain net debt to EBITDA in a range of 1.5 to 2 times. This target range of 1.5 two times was revised in 2020 and represents a significantly lower levered business, whose gearing averaged 2.5 times for the 10 years to 2019. Now the group is currently above our target range as the rolling 12 month EBITDA is still building back post pandemic, but we expect to glide into that target range by 2023. Now I've been asked a number of times about the capital impact of transitioning our fleet to 0 emissions. And I firmly believe that the transition to 0 emission vehicles and contract. The total cost of ownership is already in favor of electric versus diesel buses, and the use of availability arrangement does not give away value compared to an outright purchase. On this table, We show you the lifetime impact in terms of discounted cash flows of a platinum specification U. K. Double decker in 3 scenarios: a diesel we purchase outright, an EV we purchase outright and an EV on which we utilize an availability arrangement. You can see that the diesel is the most expensive and that the EV availability arrangement is the most attractive, for electric and diesel public transport, and any shift to further incentivize electric will only further improve the economics. And these arrangements also transfer technology change and residual value risk to the availability provider. And and finally, the substitutability aspects of these arrangements mean that there is no right of use asset under IFRS 16. We've recently signed the first of these arrangements in the U. K. With the Zenobi and are aiming to replicate similar structures in North America an AUSA. Moving on to liquidity and financing. We had £1,000,000,000 of cash and unutilized facilities available at the end of June 2021. We have no material refinancing requirement until the £400,000,000 bond in 2023. We are investment grade rated by both Moody's, Baa2 and Fitch, BBB, who both reaffirmed their ratings recently. We have a supportive banking group who along with our U. S. Private placement noteholders have temporarily waived or amended certain covenants through to June 2022. Now that said, we expect to be back within pre amended covenant levels within the next few months and for gearing to be within our targeted 1.5 to 2 times range by 2023. This slide shows the financial impact of the proposed Stagecoach combination and the impact it could have on our 5 year growth trajectory. You can see that pre pandemic, the combined business would have generated £4,000,000,000 in revenue and nearly £400,000,000 in EBIT with gearing of just over 2x EBITDA. Geographically, you can see the combined business is still well balanced and diversified with the U. K. Contributing broadly 45% of revenue. And PwC, our reporting accountant, has signed off on at least £35,000,000 of post contingency cost synergies, and that excludes revenue and growth synergies. So all in all, this makes for a compelling value creation for both sets of shareholders. However, what is equally important is the impact on our investment capacity and future growth trajectory. A thorough and accountability to accelerate investment in our growth pipeline. This would significantly enhance our medium term earnings growth and the resultant free cash flow generation potential of the combined group is really exciting. So over the last decade or so, we have invested nearly £1,000,000,000 into acquisitions, some large such as Peterman in 2012 for around $250,000,000 or We Drive You in 2019 for around $150,000,000 and some small. But large or small, acquisitions need careful management and disciplined integration, and we have an established approach to operating these businesses post acquisition. We almost always keep the brands, a thorough and but over time introduced the National Express brand in the background as and when helpful for credentials. We typically retain the owners and key managers with whom customers have built the relationship. And we moved quickly to integrate IT, pull out functional costs, and thorough and embed National Express safety tools and processes, integrate into our insurance and procurement programs and rationalize property portfolios. We also expand their models on our network, and WeDrive You is a clear recent example of this. So the proposed Stagecoach transaction is large, but it is contained to the U. K. And we are confident that we have the bandwidth to execute it, integrate it and deliver the benefits associated with it whilst continuing to grow our base business. So to summarize, we anticipate delivering revenue back to 2019 levels in 2022, and we are targeting a further £1,000,000,000 of revenue growth by 2027, as much growth in the next 5 years as we delivered in the 10 years 2019, and this will come from all divisions, but most prominently in ALSA and North America. Operating margin is expected to average around 9% over the coming years with more than £100,000,000 of additional profit in 2027. And cash margins are expected to improve compared to pre pandemic levels with free cash conversion averaging over 80% a year. And we are targeting generation of at least £1,250,000,000 of free cash flow between 20222027 inclusive. And that's roughly the same as we delivered in the 10 years to 2019 in about half the time. Our capital allocation model remains unchanged with a strong free cash flow being used to invest for growth, pay dividends and pay down debt. We will be a lower levered business than pre pandemic targeting a net debt to EBITDA range of 1.5 to 2 times. And we've continually said that we intend to reinstate the dividend as soon as we prudently can. And if this current trajectory holds, that could be in 2022. So overall, we are really excited about the road ahead, exciting top line growth opportunities at robust profit margins converting strongly into cash, and the proposed Stagecoach transaction would accelerate this, generating material synergy benefits and providing greater covenant headroom, enabling us to reinvest for profitable growth and delever faster. I'll now hand you back to Ignacio to wrap up. Thanks, Chris. I hope you are as excited as I am about the potential for £1,000,000,000 more revenue and over £100,000,000 more profit as well as £1,250,000,000 of free cash generation. That is the sharp edge of the evolved strategy. Let me summarize what we have discussed today. Provision and purpose, endure and guide what we do. We want to be the world's premier shared mobility operator with services offering living safety, reliability and environmental standard that customers trust and value. This is grounded in our purpose to lead the model shift from cars to public transport. We will deliver on our purpose ambition through our 5 compelling hard to replicate customer propositions. These propositions are underpinned by our focused application of technology, the careful targeted investment into a profit technology that enables the outputs we are driving for. And these outputs are simply put superior outcomes for all our stakeholders. And as Chris and I have explained, there is a strong pipeline of growth across our 5 customer propositions, particularly in North America and Alta. The proposed stake coach combination would enable us to convert more of these opportunities and faster, whilst remaining within our gearing targets. Finally, as I said at the start of the presentation, let me bring you all back to the investment case. Why should you invest in National Express? First, we have long term sustainable structural growth opportunities from model ship to shared mobility, and this trend is increasing. 2nd, as we have outlined today, we have 5 compelling hard to replicate customer propositions to leverage this growth. 3rd, we are the best in class operator. We have shown today how we will drive and measure that. 4th, we are uniquely diversified and balanced will remain so with or without a stake of a stakeholder transaction. 5th, we're taking environmental leadership. And today, we launched our ALSA and North American commitments to round off our group ambition. Finally, we have a track record of delivering strong financial outcomes. And as Chris outlined, we expect more of the same. Thank you all for your time today. We will now take a brief pause before opening up for questions.