The legal action over Stagecoach’s shock disqualification for three UK rail franchises will be heard in the High Court in London in the new year, it has been confirmed.
The Perth-based group said in a trading update: “We have worked collaboratively with the new operator to ensure the smooth transition of the East Midlands rail franchise. We are proud to have operated the franchise for 12 years and are most grateful to all of our employees and partners who have been involved in delivering our transformation of the East Midlands rail network.
“We and our joint venture partner, Virgin, will approach the forthcoming transition of the West Coast franchise in the same spirit of collaboration. “We continue to pursue our claims against the Secretary of State for Transport regarding his decisions to disqualify us from three rail franchise competitions. The three cases are due to be heard in the High Court in early 2020."
The group forecast of adjusted earnings per share for the year ending 2 May 2020 is unchanged from the full year results in June 2019 while the financial performance of bus operations has been broadly in line with expectations.
“We are pleased by the strong performance during the period of our UK Bus (London) Division, where favourable service performance has resulted in higher than anticipated Quality Incentive Contract income. We are also encouraged with our performance on current year tenders for Transport for London contracts, and believe our bidding strategy will support the long-term sustainability of the business.
Like-for-like revenue growth at our UK Bus Division was 1.0% for the 20 weeks ended 14 September 2019.
“That lower than anticipated growth is below the growth rate we reported last year, reflecting various factors including 2018's exceptionally good summer weather contrasting with this summer's poorer weather and the non-recurrence of prior year revenue from operating bus services related to rail re-signalling work in the Derby area,’’ said the statement.
Stagecoach is exploring potential new income streams, including partnerships with airports, festivals and events around the UK.
Since a £60 million share buyback programme was announced the company has purchased 21,830,035 ordinary shares at a cost of approximately £28.5 million. The board plans to continue the programme until around £30 million of shares have been bought back.
