A turnaround at East Midlands Trains and a £4m Olympic windfall easily offset the $2-$3m (£1.3m-£1.9m) of business blown away by Hurricane Sandy and meant Stagecoach (SGC) beat forecasts. The second half has started well, too, so hitting full-year targets should be straightforward.
Now in revenue support, East Midlands Trains arrived with an underlying operating profit of £22.7m compared with a loss of £6.9m in 2011, steering group operating profit up 34 per cent to £142m. Expect a deal to extend the West Coast franchise, possibly for another year, before the 8 December deadline. The regional bus division impressed, too. Even stripping out the Olympics-related boost and a one-off claim, like-for-like revenue here grew 3.7 per cent and operating profit rose 9 per cent to over £87m - despite high fuel costs and government subsidy cuts. Stagecoach predicts further modest progress in the months ahead - and in London, too, where the once lossmaking bus business increased profit by three-quarters to £9.6m. In North America, like-for-like revenue increased by 37 per cent at the Megabus budget coach operation, although start-up costs are eating into profits - a business to watch for the long term, though.
Broker Nomura expects adjusted pre-tax profit of £210m for the full year, giving adjusted EPS of 28.2p (from £209m and 25.4p in 2012).
STAGECOACH (SGC) | ||||
---|---|---|---|---|
ORD PRICE: | 299p | MARKET VALUE: | £1.72bn | |
TOUCH: | 298-299p | 12-MONTH HIGH: | 300p | Low: 228p |
DIVIDEND YIELD: | 2.7% | PE RATIO: | 9 | |
NET ASSET VALUE: | * | NET DEBT: | £552m |
Half-year to 31 Oct | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
---|---|---|---|---|
2011 | 1.29 | 108 | 10.4 | 2.40 |
2012 | 1.40 | 134 | 15.7 | 2.60 |
% change | +9 | +24 | +51 | +8 |
Ex-div: 6 Feb Payment: 6 Mar *Negative equity shareholders' funds |