Stagecoach benefits from rising fuel costs

Source: Supply Chain Digital

Date :29/08/2008 09:09:52

Stagecoach plc said on Thursday, August 28, its full year profit would exceed previous expectations as more travellers have been using buses.

In a statement, the bus and train operator said that UK bus revenue had risen a better than expected 9.3 percent over the 16 weeks to August 17.

"People are continuing to switch from travelling by other modes of transport to travelling by bus ... (This) provides further evidence of a modal shift towards bus and train prompted by high fuel costs, environmental concerns and healthy lifestyles," the firm said.

Despite the positive outlook, Stagecoach shares fell nearly three percent to 294.25p by 07:30 GMT, valuing the business at around £2.1 billion.

The shares have risen 35 percent in the past three months.

Stagecoach, which has operations throughout the UK and North America, said like-for-like revenue in UK rail business was up nine percent in the sixteen weeks.

Its North America division - which launched its version of low-cost buses, Megabus, in May - was up 7.6 percent in the three months to end July.