The online rail ticket retailer Trainline has warned of “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% on Wednesday, before recovering slightly to a fall of 4%, 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 among travellers of digital tickets over their paper equivalents.
However, the company said 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 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.
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The company also faces a significant threat to its business in its main UK market, amid government plans to create an online train ticket retailer as 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.
In an attempt to simplify the process of buying tickets from different rail operators, Labour wants to create a single retailer, which will be made available once GBR has been established, although this is not expected before late 2026.
Trainline shares have plummeted by more than a third so far this year with the prospect of a rival, amid fears 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”.
Trainline reported an operating profit of £86m for the last financial year, 56% higher than a year earlier, and brought in record sales. The company 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%.
