ComfortDelGro (CDG), through its Australian subsidiary, ComfortDelGro C52 Corporation Australia, has won three bus franchises within the Victorian Department of Transport and Planning’s Metropolitan Zero Emission Bus (ZEB) Franchises tender process. There were a total of five contracts up for tender.
The three franchises are worth around A$1.6 billion ($1.4 billion) over 10 years. Under the new franchises, which comprise 250 public bus and school routes serviced by over 360 buses, buses and depots are funded as part of the contracts and will transition to full ZEB operations prior to the end of the contract term. The term will commence on July 1, 2025.
The latest win will see CDG increasing its market share in the state by 30%; CDG will serve 20% of Melbourne’s metropolitan network upon the start of the contract.
“We are delighted to have been awarded the three franchises in Victoria. This significant expansion will add resilience to our portfolio and solidify the group's position as a leading bus and multi-modal transport provider in Australia. We look forward to continuing to serve the local community by providing safe and reliable services,” says CDG’s managing director and CEO Cheng Siak Kian.
“The award of these zero-emission bus tenders in Melbourne underscores our commitment to electrifying our fleet and reducing our environmental footprint. We are proud to support governments in building safe, reliable, and sustainable transportation systems for the communities they serve,” adds CDG’s chairman Mark Greaves.
On a pro forma basis, had the contracts been awarded on Dec 31, 2023, CDG’s net asset value (NAV) per share would have been slightly higher at $1.21 for FY2023 ended Dec 31, 2023, from $1.20.
See also: How ComfortDelGro continues to drive innovation and return value
Had the contracts been awarded on Jan 1, 2023, CDG’s earnings per share (EPS) for FY2023 would have been at 8.99 cents from 8.33 cents originally.
Shares in CDG closed at $1.41 on Sept 3.
