This morning Stagecoach have issued the following Trading Statement in advance of a series of meetings with analysts.
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The overall profitability of the Group has remained good, and there has been no significant change to our expected Group profit before tax for the year ending 30 April 2013.
Like-for-like revenue growth for the financial year to date in each of the Group's main businesses is provided below.
UK Bus (regional operations) + 3.6% twenty four weeks ended 14 October 2012
UK Bus (London) - 0.9% twenty four weeks ended 14 October 2012
UK Rail + 7.9% twenty four weeks ended 14 October 2012
North America + 10.7% five months ended 30 September 2012
(including Megabus.com, excluding disposed Wisconsin school bus business)
Virgin Rail Group + 2.7% twenty four weeks ended 14 October 2012
The like for like revenue growth of 3.6% reported for UK Bus (regional operations) excludes the revenue earned from the contracts to provide transport for the London 2012 Olympics. The growth figures do, however, include any indirect incremental revenue at UK Rail and UK Bus (London) related to the London 2012 Olympics.
The 0.9% decline in revenue at UK Bus (London) is consistent with our previous expectation that some less profitable contracts would not be retained as we restructured the acquired business and improved its overall profitability. This reflects the revenue lost from contracts that ended during the year to 30 April 2012. For the year as a whole to 30 April 2013, UK Bus (London) is well placed to maintain revenue with contract losses being offset by some contract wins and inflationary price increases on existing contracts.
In October 2012 the Group issued US$150m of loan notes in a private placement transaction with United States investors, which will mature in October 2022. The funds raised by the issue were used to repay the bank loans that were initially drawn to finance the July 2012 acquisitions from Coach America and accordingly the headroom available under existing bank facilities has increased. Further details are given in the announcement made by the Group on 19 October 2012.
On 3 October 2012, the Department for Transport ("DfT") announced that the competition for the InterCity West Coast Rail franchise had been cancelled and that the DfT planned to conduct two independent reviews into both the specific InterCity West Coast competition and rail franchising more widely. The Group welcomes the opportunity to participate in these reviews where appropriate.
As previously reported, the United States Department of Justice and the New York Attorney General's Office are reviewing the Twin America joint venture, which was formed by Stagecoach North America and City Sights in 2009. We understand that the authorities are now well progressed with their reviews and will shortly decide what, if any, further steps they intend to take. Discussions between the joint venture parties and the regulatory authorities are ongoing.
Overall current trading remains good and the prospects for the Group remain positive.
The Group plans to announce its interim results for the six months ended 31 October 2012 on 5 December 2012.