FirstGroup plc Finalizes Initial £24.8m Segment of £100m Share Repurchase and Initiates Second £25m Phase

Overview of FirstGroup's £100 Million Share Buyback Programme

On 18 June 2026, FirstGroup plc announced a structured £100 million on-market share buyback programme aimed at returning capital to shareholders. Designed to be executed in multiple tranches, this approach offers flexibility to adapt to market conditions. The announcement on 27 July 2026 confirms the successful completion of the first tranche, with RBC Europe Limited serving as the executing broker for this initial phase.

The first tranche involved purchasing 13,553,662 ordinary shares on 24 July 2026 at a total cost of £24,806,895, averaging approximately 183 pence per share. These shares are currently held in Treasury, granting FirstGroup flexibility for future uses such as cancellation, employee share schemes, or other corporate purposes, consistent with London Stock Exchange practices for significant buyback programmes.

Initiation of Second £25 Million Tranche with Panmure Liberum Limited

Following the first tranche's completion, FirstGroup appointed Panmure Liberum Limited as the executing broker for the second tranche, which commenced on 27 July 2026 with a £25 million allocation. Utilizing different brokers for successive tranches is a common strategy to optimize execution and maintain programme continuity.

This second tranche accounts for 25% of the total buyback value, reflecting a measured progression through the capital return plan. Specific completion dates and share targets for this phase have not been disclosed, allowing operational flexibility amid varying market conditions. The company anticipates continuing with the third and fourth tranches as per the original 18 June 2026 announcement.

Treasury Shares and Capital Management Strategy

The shares acquired in the first tranche are held in Treasury rather than being immediately cancelled. This approach provides FirstGroup with strategic options, including cancellation to reduce issued share capital or utilization for employee incentives or acquisitions. Holding shares in Treasury aligns with UK company law and London Stock Exchange regulations, offering capital structure management flexibility.

By retaining 13,553,662 shares in Treasury, FirstGroup maintains the ability to influence earnings per share positively through cancellation or to reinstate shares if used for incentive schemes. The company has not disclosed its intended treatment of these Treasury shares, leaving investors to monitor future announcements for clarity.

Compliance and Forward-Looking Statements

The announcement includes standard forward-looking statements disclaimers in line with UK Listing Rules and regulatory requirements for London Stock Exchange-listed companies. FirstGroup acknowledges that actual outcomes may differ due to risks and uncertainties and clarifies that no statements should be interpreted as profit forecasts.

With a Legal Entity Identifier (LEI) of 549300DEJZCPWA4HKM93 and classification under DTR 6 Annex 1R section 2.4, the disclosure complies with regulatory standards. The company confirms no obligation to update forward-looking statements post 27 July 2026, except as mandated by law or listing rules.

Market Context for the Buyback Programme

FirstGroup plc operates extensive transport services across the UK and North America, including school bus, transit, and coach operations, generating revenue from government contracts and commercial activities. Share repurchase programmes typically indicate management’s confidence in the company’s valuation and financial strength. Although the announcement does not specify the rationale for timing or valuation, the £100 million programme signifies a substantial capital return commitment.

The multi-tranche execution strategy aims to minimize market impact and achieve favorable average purchase prices, allowing FirstGroup to adapt to market and operational developments while fulfilling shareholder return objectives.

Broker Roles and Market Execution

RBC Europe Limited executed the first £24.8 million tranche, while Panmure Liberum Limited is responsible for the second £25 million tranche. Both brokers are experienced in managing significant UK equity buyback programmes, offering FirstGroup enhanced market access and execution flexibility.

Contact details for representatives at both broker firms, as well as FirstGroup executives David Blizzard (General Counsel and Company Secretary) and Marianna Bowes (Head of Investor Relations), are provided to facilitate transparent communication regarding the buyback programme.

Timeline and Progress of the Buyback

The initial tranche concluded on 24 July 2026, with the subsequent tranche commencing on 27 July 2026, demonstrating timely disclosure in line with London Stock Exchange requirements. While no specific completion timeline for the second tranche is provided, the company intends to proceed with remaining tranches as outlined in the 18 June 2026 announcement.

Investors are advised to consult the original announcement for detailed programme timelines and targets, as no modifications were indicated in the latest update.

Investor Implications and Capital Allocation Insights

The completion of the first tranche and initiation of the second phase provide tangible evidence of FirstGroup’s capital allocation strategy in action. The average acquisition price of approximately 183 pence per share offers investors a benchmark to evaluate the buyback’s execution quality and valuation.

The programme’s scale and timing suggest management’s confidence in cash flow generation and financial flexibility, although no commentary on dividend policy or alternative capital uses was included. The immediate market impact of the buyback remains unspecified.

Regulatory Adherence and Ongoing Disclosure

All shares acquired in the first tranche are held in Treasury, ensuring compliance with UK company law and London Stock Exchange Listing Rules. The company is subject to continuous disclosure obligations, including reporting buyback details regularly and providing updates on programme progress.

The 27 July 2026 announcement marks a key milestone in the programme’s execution, with further disclosures expected as subsequent tranches are completed, enabling investors to monitor FirstGroup’s capital allocation effectiveness.