Stagecoach (LSE: SGC) — the Scottish-based company that has extensive bus and coach and operations in the UK, United States and Canada, and which also runs rail franchises in the UK — this morning published its preliminary results for the year ending 30 April 2013. Pre-tax profit had increased 8%, to £218.9m, on revenue that was up just over 8%, to £2,805m.
Whilst operating profit at is regional UK bus operations only increased by 1.4%, to £165m, there was far more impressive growth in its London bus operations, where operating profit soared over 63%, to £22m, on revenue that thad only risen 1%, to £232m. The company also said that its North American division was the the fastest-growing part of the group, seeing revenue increase 32%, to £641m.
Earnings per share were up 18.9%, beating expectations, and the board has recommended that the dividend be increased by 10.3% to 8.6p per share.
Commenting on the results, Stagecoach’s Chief Executive, Martin Griffiths, said:
“This is another strong set of results, which are ahead of market expectations. We have achieved ten years of sustainable growth, reflecting our successful strategy of targeting organic growth in our bus networks, rail franchise opportunities and selected acquisitions.
“Stagecoach has secured a leading position in a range of growing markets in the UK and North America. Our innovation can deliver further growth in the commercial, deregulated bus market. We are helping the UK Government to deliver a new, improved rail franchise model and are shortlisted for two rail franchises. Our ground-breaking alliance at South West Trains with Network Rail is producing a more efficient, joined up railway at one of Europe’s premier commuter rail networks. In North America, we are focused on converting the transformation our megabus.com business has made in the inter-city bus market into profitable growth.
“The public transport market has long-term fundamental strengths and a positive outlook. I am confident we can make bus and rail the travel modes of choice for increasing numbers of people in the UK and in North America.“
Stagecoach’s share price is currently up around 4.5% in early trading, and at just over 313p is up 19% on this time last year. And as a bonus to the capital growth, with the proposed increase in dividend, it will yield just under 3% this year.
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> Jon doesn’t own shares in Stagecoach.. The Motley Fool has recommended Stagecoach.
