Passengers cutting back on non-essential travel and uncertainty over the future of concessionary fares have led to a 'difficult' year of trading at First Eastern Counties Buses (FECB).

The Norwich-based firm, which runs bus and coach services in Norfolk and Suffolk, has seen a decline in demand for some of its routes as customers have reigned in their spending, according to managing director Alan Pilbeam.

The company, which employs 917 in the region, including 22 in its Norwich headquarters, is also facing the prospect of significant cuts in reimbursements from the government to cover concessionary bus fares, including free travel for over-60s and disabled people, which could affect bus operators nationally.

The firm's accounts for the year to March 27 2010, published recently on the Companies House website, showed an increase in turnover of more than �500,000 to �38.3m, while profit before tax was up about �230,000 at almost �1.7m.

Despite the challenges in the current financial year, Mr Pilbeam said the company was on track to hit its targets for the year through greater efficiency.

He said: 'Trade this financial year has been very difficult. There has been some growth on some routes, but on others disappointingly there has been decline.

'We believe that our customers are continuing to hold back on discretionary travel where possible, in order to save money, which makes sense in the current climate.

'With regards to turnover and profit, we do expect to hit our targets for the year. However to achieve this we have had to continue a very strict focus on costs throughout the period.'

He warned Norfolk and Suffolk had seen 'potentially large reductions' in income for concessionary fares from the government, adding: 'This has the potential to impact on the networks being operated by bus operators as they seek to cover their costs.'

Mr Pilbeam said the opportunities going forward were to 'improve the level of service', such as punctuality, reliability and 'presentation', 'in order to attract as many people on to public transport in what are going to be difficult times'.

The company is a subsidiary of First Bus (South), a division of public transport firm First Group, which operates bus, train and tram services across the country, in Europe, the US and Canada.