Rail strikes, fare hikes and European growth: What to expect from Trainline next week

Trainline investors will get a first indication of the ticket seller’s 2024 performance in a trading update next Thursday.

Shares in Trainline have risen over 20 per cent in the last 12 months amid booming ticket sales, particularly in Europe.

The FTSE 250 firm netted £2.6bn from ticket sales in its November half-year results, a 23 per cent year-on-year rise that pushed revenues to £197m. That came despite a £66m hit from ongoing industrial action, which has proven a big headwind for the company in the past.

The bumper results were followed up in December by news the government had cancelled plans to launch a rival digital ticketing service, sending shares in Trainline up as much as 22 per cent on the day.

Last Sunday’s 4.9 per cent hike in UK rail fares will be another boon for the company, which offers ticket services as part of its core operational focus.

Trainline has already forecast higher ticket sales in 2024 and analysts will be looking for any further updates given recent disruption caused by train driver walk-outs.

Rail fares have risen consistently in recent years despite strong backlash. A 5.9 per cent rise in rail fares in March last year was the largest increase in history.

Dominic Richardson, rail partner at Gowling WLG, said: “Given the ability of consumers to push back at a time when the cost-of -living crisis is still tightening its grip on UK society, it is vital that the company looks to diversify is revenue streams in order to better ensure longevity, as competition in the sector couldn’t be fiercer.

“The ability to offer convenience as part of this competitive process is key given that consumers are likely to warm to efforts made in this area as a way of offsetting the inevitable price increases.”

Pleasingly for shareholders, analysts are less concerned over the impact of recent rail strikes in this months update.

Canaccord Genuity hiked its target price for Trainline in February and the broker said: “With only one UK Rail union (ASLEF) still striking and at a reducing rate, we believe the negative impact from strikes is reducing.”

It estimates the disruption will knock off around £120m in net ticket sales, equal to 2 per cent of the full-year number.