Stagecoach boosted by strong UK rail showing

LONDON (Reuters) - British transport group Stagecoach said it had traded well in its first half due to a strong performance from its British rail and U.S. bus businesses.

The Scotland-based company, on Tuesday said like-for-like revenues at its British rail unit rose 7.9 percent in the 24 weeks to October 14, while sales at its North America coach business, which includes Megabus, rose 10.7 percent.

Its British regional bus division reported a 3.6 percent sales uplift during the period but its London bus business posted revenues down 0.9 percent after it dropped some contracts as part of a restructuring drive.

Stagecoach said the overall profitability of the group had remained good, and that there had been no significant change to its annual pretax profit forecasts.

Virgin Rail, jointly owned by Stagecoach and Richard Branson's Virgin Group, was last month stripped of the West Coast Mainline franchise, which runs from London to Scotland, after Britain's Department for Transport (DfT) awarded the 13 year franchise to rival FirstGroup.

However, the DfT has since asked Virgin and Stagecoach to continue operating the service for up to 13 months from December, while it revamps the country's rail franchising process.

"The group welcomes the opportunity to participate in these reviews where appropriate," Stagecoach said.

"Overall current trading remains good and the prospects for the group remain positive."

Stagecoach, which transports some 2.5 million passengers a day, is also shortlisted for Britain's Greater Western and Thameslink rail franchises.

The company said a review into its Twin America joint venture, formed by Stagecoach North America and City Sights in 2009, by the U.S. Department of Justice and the New York Attorney General's Office would likely be completed soon.

Shares in the company, which have fallen 4.5 percent in the last three months, closed at 270.4 pence on Monday, valuing the group at around 1.55 billion pounds ($2.48 billion).

($1 = 0.6241 British pounds)

(Reporting by Rhys Jones; editing by Paul Sandle)

Source: http://news.yahoo.com/stagecoach-boosted-strong-uk-rail-showing-073516420--finance.html

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