Stagecoach profits rise as more people take the bus

Jun 25 2009 by Iain Laing, The Journal

TRANSPORT group Stagecoach said that its profits have jumped ahead of forecasts as more people take the bus in the recession.

The company, which runs bus services across the North East, yesterday revealed a 13% rise in annual profits to £196.4m.

It carries two million passengers a day using a fleet of 7,000 bus and coaches and growing demand for bus travel from people trying to save money and commuters leaving their cars at home had helped the division to operating profits of £125.6m, an improvement of 14% on a year earlier.

Sunderland-based Arriva has similarly reported a strong performance in its bus services and Newcastle-based Go Ahead this week said it was in line to hit profit forecasts.

Stagecoach’s rail arm was more sensitive to economic conditions after profits fell to £55.7m from £59.1m a year ago.

The South West Trains and East Midland Trains operator has responded to slower revenues growth with a cost reduction programme and efforts to attract new customers.

Chief executive Brian Souter said there was “no doubt“ the transport sector faced a challenging year ahead, but he added Stagecoach was well placed to withstand the economic pressures.

“We have a record of being able to respond quickly to the changing business environment,” he said.