08/12/2004

Highlights

• Strong half-year of organic growth in bus and rail operations in UK and overseas
• £241.4m of capital returned to shareholders
• Growth in operating margins in North American bus operations to 11.7% from 6.8%
• Innovative growth ideas fuelling good underlying performance at provincial UK bus operations – turnover outwith London up 6.3%
• Continued revenue growth in London bus business with turnover up 22.1%
• UK Bus operating margins up to 10.9% from 10.8%
  - 12.1% versus 11.4% excluding impact of operating leases, megabus.com and Taxibus
• Strong revenue and passenger growth at South West Trains – turnover up 8.3%
• Shortlisted for InterCity East Coast and Integrated Kent rail franchises

Financial Highlights

• Turnover from continuing operations £882.0m (2003 - £826.8m), up 6.7%
• Total operating profit* £78.5m (2003 - £76.9m, £72.6m excluding Citybus, Road King and Trainline disposals)
• Operating profit £69.9m (2003 - £67.3m)
• Profit before tax* £69.2m (2003 - £60.3m)
• Profit before tax £57.2m (2003 – £44.8m)
• Earnings per share* 4.0p, up from 3.2p
• Free cash flow £128.8m (2003 - £100.3m)
• Interim dividend up 11.1% to 1.0p (2003 - 0.9p)

* excluding goodwill amortisation and exceptional items

Commenting on the results, Stagecoach Chief Executive, Brian Souter said: “Strong underlying profit growth has been achieved across our businesses despite the significant increases in fuel prices affecting public transport operators and I am confident that our robust portfolio of cash-generative businesses will continue to deliver further growth.

“We have achieved increased operating margins at our UK bus operations as the benefits of our innovative ideas and new products start to flow through. South West Trains continues to deliver turnover ahead of our original expectations and customers are already benefiting from the introduction of the new £1billion fleet of Desiro trains.

“We have also met our objective of increased operating margins at our restructured North American operations and encouragingly there has been significant turnover growth.”

Enquiries to:

Martin Griffiths, Stagecoach Group +44 (0) 1738 442111
Steven Stewart, Stagecoach Group +44 (0) 1738 442111 or +44 (0) 7764 774680
John Kiely, Smithfield Financial +44 (0) 20 7360 4900

Note to Editors:

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