Stagecoach Group has published an interim management statement, for the start of the financial year to August 26, 2014. The group said there has been no material change to its expected adjusted earnings per share for the year ending April 30, 2015.
Like-for-like revenue growth, for the 12 weeks ended July 20, was 4% in UK regional bus operations, 14.4% in London bus operations, 4.9% in UK rail and 5.7% in Virgin Rail group. Revenue growth in the North American business for the three months ended July 31 was 4.9%.
Stagecoach said its UK region bus operations continued to grow both passenger volume and revenue year-on-year. Like-for-like passenger volume growth for the 12 week period was 0.9%. Higher commercial revenue contributed most to overall revenue growth, with concessionary, contract, tendered and school revenue also continuing to grow. The group highlighted local authorities ‘continuing to seek to minimise concessionary reimbursement amounts’ and said it would continue its endeavours to deliver good growth in commercial revenue to offset inflationary cost increases.
In London, revenue growth was strong during the period due to the commencement of two new contracts and the continuing effect of contracts won in the last financial year. Revenue growth was, however, slightly below expectations due to quality incentive income being adversely affected by traffic disruption related to continuing road works.
Excluding the uplift in contract prices to compensate for the cessation of Bus Service Operators’ Grant, revenue increased by 8.7%. The group said its focus is on keeping costs under control and bidding competitively to retain existing and win new contracts.
Revenue growth in North America reflecting the continued expansion of megabus.com services. Megabus.com increased revenue by 14.9% in the three months ended July 31, 2014.
The group said that although there are a number of challenges to growing profit in the year ending April 30, 2015, overall current trading is satisfactory and it remains on course to meet expectations.