BUS and rail group Arriva has predicted a firmer focus on its passenger transport business would lead to an improved performance this year.

Speaking at the group's AGM, chairman Gareth Cooper said the Sunderland group had a "clear and focused strategy", after moving away from car leasing and motor finance.

The group sold its car leasing business, Arriva Automotive Solutions, about 18 months ago in order to focus on passenger services.

Mr Cooper said Arriva, which saw pre-tax profits fall last year, had made a good start to 2001.

He said: "After repositioning the group over the last two years, the board is confident that the benefits from that period of fundamental change will be reflected in improved performance during 2001."

New developments include the group reaching an agreement with the Strategic Rail Authority (SRA) for a two-year extension to its franchise for Northern Spirit and Merseyrail Electrics, now called Arriva Trains Merseyside.

It also acquired Danish bus company Combus.