LONDON -- The shares of National Express (LSE:NEX) rallied 2% to 208 pence during early London trade this morning after the coach operator reported an 18% boost in revenues at its North American school bus division.

National Express, which operates buses and coaches in the U.K., North America and Europe, revealed broadly flat revenue performance across its divisions.

The company confirmed it had spent £40 million so far this year improving its fleet of vehicles, with a further £60 million earmarked for investment in 2013. National Express said it plans to reduce its £830 million net debt to two-times pre-tax profits by the end of next year.

Chief executive Dean Finch added: "We have made a positive start to the year, continuing to deliver a high level of value and service to our customers and building our new business pipeline through regular contract wins. Our focus on driving up returns on capital, strong cash generation, organic growth and leveraging our international transport skills to deliver new opportunities is proving to be successful."

Looking ahead, National Express confirmed it was on track to meet its 2013 profit expectations. The company claimed it was building on this momentum by "securing new contracts and launching exciting new services".

With a market cap of £1 billion, the shares of National Express trade at nine times expected earnings, and offer a prospective dividend yield of 5.1%.

Of course, whether that valuation, today's results and the future prospects for the transport industry all combine to make shares of National Express a buy remains your decision.

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