Go-Ahead, which runs buses and trains across Sussex, said its lacklustre aviation arm was making progress after a shake-up at Gatwick.

The group said it was confident profitability would improve at Aviance, which has been hit by a slump in the aviation market since the September 11 terrorist attacks.

Go-Ahead has been trying to boost the performance of the subsidiary, which provides ground handling and other services to airports, with a number of initiatives at Gatwick.

In August, the company said the division had done a deal with Virgin Aviation to buy the 50 per cent share of cargo-handling business Plane Handling that it does not already own.

A trading statement accompanying the group's annual meeting yesterday said its restructured operations at Gatwick would help Go-Ahead.

The company, whose core business is running buses and trains, said its first-quarter performance had been in line with expectations.

The group, which owns the Brighton and Hove Bus and Coach Company, said its bus division continued to perform well.

Advance buying of fuel was helping to offset the impact of soaring oil prices and the group's London bus operations were performing well.

Go-Ahead said its Thameslink operation was meeting expectations given the disruption caused by the modernisation of London's St Pancras station for the Channel Tunnel rail link.

But it said the introduction of new trains and related upgrades to the southern rail network's power supplies had affected operating performance at Southern trains, which runs London Victoria-Brighton and Sussex coast services.

However, it said it expected an improvement during the year as it realised the benefits of new rolling stock.

Go-Ahead said work was continuing on the Kent Integrated franchise, for which it is bidding in competition with Great North Eastern Railway and First Group, among others.

The company said: "The board remains confident of another solid performance for the year."

Meanwhile, Brighton and Hove's real-time bus stop information signs have helped the city council win the Chartered Institute of Logistics and Transport award for its partnership with the bus company, run by Roger French.

The modern shelters, which give accurate bus arrival and departure times, were cited as one of the successes of the partnership.