Bus and train operator Go-Ahead has reported that profits have been given a further boost as more hard-pressed motorists opt to use the company’s services.

Go-Ahead, which has a fleet of 3,800 buses and is part of a joint venture responsible for Southern, Southeastern and London Midland rail services, said its buses represented “better value” than travelling by car.

It also said marketing and improved operating standards were helping to drive growth as it forecast profits for the year to July will be ahead of previous expectations – the second upgrade in four months.

Chief executive Keith Ludeman, who is due to stand down next month, said: “Since the depth of the recession in 2008, Go-Ahead has seen solid growth.”

Go-Ahead expects full-year passenger revenues at its bus division, which includes Metrobus in Sussex, Plymouth Citybus and Oxford Bus Company, to increase by 4% after growth of around 2% in passenger numbers.

Revenues for its Southern and Southeastern franchises have both grown by 9%, with London Midland seeing an improvement of around 8%.

Rail providers across the UK raised prices by an average of 6.2% in January, and some fares at Southeastern went up by as much as 12.8%, but Go-Ahead has claimed it would not benefit from the rises which would be effectively passed on to the Government in reduced subsidies.

Mr Brown said: “The business is trading strongly and has a solid foundation for the future.”

Investec Securities said it now expected Go-Ahead to post pre-tax profits of £96 million, a 7% increase on its previous forecast and an improvement of 9.5% on the previous year.