Stagecoach boosted by rail performance

The UK's rail network has undergone somewhat of a revolution in recent months.

Great Britain's East Coast Main Line is one of the cornerstones of the country's rail network linking both English and Scottish capitals. Services run between London and Edinburgh daily, along with additional routes to Leeds, regularly throughout the week providing passengers with reliable and quick links to either major city.

This route has been passed between the private and public sector over the years and when National Express Group was selected for the contract in 2007 it seemed that it would stay in private hands. However, the ownership was short-lived and by 2009, National Express conceded it was unable to fund the franchise and it was handed to the Directly Operated Railways (DOR), set up by the Department for Transport (DfT).

Back in public hands, under the East Coast banner, it ran smoothly with passengers happy with the service and also the loyalty scheme which allowed them to build up points for free trips or other incentives. However, in March 2015 InterCity East Coast won the tender to take over the franchise changing it to Virgin Train East Coast.

The partnership, a joint venture between Stagecoach and Virgin, would take control of the main line through to March 2023. It drew major criticism by rail unions such as the TSSA whose leader Manuel Cortes branded the franchise award "a national disgrace". However, it has provided some good news for one of the owners.

Stagecoach announced on Wednesday (June 24th) that it had recorded an increase in underlying pre-tax profits. It noted that its 2.4 per cent rise to £185 million in the year to April 30th had been helped by a positive performance in its rail division.

The success of the East Coast Main Line had boosted earnings up to £28 million, representing a £2.6 million rise from the same period a year earlier. This was set against a poor performance across the wider UK rail business including South West Trains and East Midlands Trains. Revenue for this area dropped 22 per cent to £26.9 million.

Officials noted that this fall was down to the rise in premium payments to the UK government. However, for Stagecoach it was a real shot in the arm after it was hit hard by tumbling fuel prices in the US. The company, which owns the Megabus brand, noted that the US' drop in petrol costs has had a detrimental effect on it operations.

Despite this blow, Martin Griffiths, chief executive of Stagecoach, was upbeat about the company's performance. He said: "These are a solid set of results notwithstanding continued tight central and local government spending, and increased competition for public transport from the private car driven by lower fuel prices.

"We have a strong set of bus and rail businesses in the UK, mainland Europe and North America. Our successful strategy is focused on providing a good value, high quality travel experience for our customers, and investing for growth over the medium to long-term."

Contact

Head Office Address:
2nd Floor,
The Junction,
Station Road,
Watford, Herts,
WD17 1ET
Tel: 0203 668 5680

View Map

 

London Office Address:
18 King William Street
London
EC4N 7BP
Tel: 020 7043 6161

View Map 

facebook-icon  twitter-baloon  linkedin  unity-recruitment-g-logo

We use cookies to provide you with the best possible browsing experience on our website. You can find out more below.
Cookies are small text files that can be used by websites to make a user's experience more efficient. The law states that we can store cookies on your device if they are strictly necessary for the operation of this site. For all other types of cookies we need your permission. This site uses different types of cookies. Some cookies are placed by third party services that appear on our pages.
+Necessary
Necessary cookies help make a website usable by enabling basic functions like page navigation and access to secure areas of the website. The website cannot function properly without these cookies.
ResolutionUsed to ensure the correct version of the site is displayed to your device.
essential
SessionUsed to track your user session on our website.
essential
+Statistics
Statistic cookies help website owners to understand how visitors interact with websites by collecting and reporting information anonymously.
Google AnalyticsGoogle Analytics is an analytics tool to measure website, app, digital and offline data to gain user insights.
Yes
No

More Details