The online rail ticket retailer Trainline has warned of coming “headwinds”, including the expansion of London’s contactless travel zone and economic uncertainty denting foreign travel.
Shares in the London-listed company tumbled by as much as 8% during early trading on Wednesday, despite reporting surging profits for the year to 28 February.
Trainline, which has 18 million customers and mostly makes money from earning commission on sales of coach and rail tickets, has benefited from the growing popularity of digital tickets over their paper equivalents among travellers.
However, the company warned on Wednesday that the expansion of Transport for London’s (TfL) contactless travel zone could impact sales growth.
TfL began an expansion of the zone in February to include 47 commuter stations in the south-east, such as Sevenoaks and Bletchley, meaning passengers will not require separate tickets.
Trainline also said it was facing “headwinds” from the continuing impact of Google’s changes to its search engine results, and “recent macroeconomic uncertainty” that could affect foreign travel.
The company also faces a significant threat to its business in its main UK market, amid the government’s plans to create a new online train ticket retailer as is part of its dedicated public body, Great British Railways (GBR).
Trainline has grown quickly in recent years as customers have used it to find tickets in a rail system operated by several private-sector companies, which sometimes operate on the same route.
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In a bid to simplify the process of buying tickets from different rail operators, Labour wants to create a new retailer, which will be made available once GBR has been established, although this is not expected before late 2026.
The prospect of a new rival has seen Trainline shares plummet by over a third so far this year, amid fears that it could erode the company’s dominant position in the market.
Trainline said on Wednesday that it and other independent retailers were “taking an increasingly assertive stance with the government to deliver on its commitment to deliver a fair, open and competitive future retail market”.
The latest fall in Trainline’s shares came as the company reported an operating profit of £86m for the last financial year, 56% higher than a year earlier, and brought in record sales.
Trainline recorded £5.9bn from selling tickets, 12% higher than a year earlier, which was mostly driven by fast sales growth and expansion in European countries.
However, it is forecasting lower net ticket sales growth of between 6% and 9% in the coming year, while it also expects slower revenue growth of between 0% and 3%.
