Scotland business

Transport firm Stagecoach reports drop in earnings

Stagecoach bus Image copyright Stagecoach

Transport firm Stagecoach, which is based in Perth, has reported a drop in earnings for May to October, while setting its sights on long-term opportunities.

Revenue for May to October edged up from £1.97bn to £2bn. Pre-tax profits edged down from £91m to £89.5m.

Coach passenger numbers in the US have been hit by lower fuel costs driving passengers to use their cars instead.

In the UK, the company has faced headwinds in its rail franchises.

Its south-west franchise has been extended until August 2017, and it has submitted a bid for the next franchise.

Chief executive Martin Griffiths said the company remains focussed on a growth strategy including investment, value-for-money travel and customer satisfaction.

He said: "There is a large market opportunity for modal shift from cars to public transport against a backdrop of population growth, urbanisation, technological avancements and an increase in pressure to tackle road congestion and improve air quality."

Joshua Raymond, an analyst at XTB.com, said the company has to tackle staff costs, which are seen as one of the main causes of declining profit margins.

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