1 / 36

Interim Results For the six months ended 31 October 2010 8 December 2010

Interim Results For the six months ended 31 October 2010 8 December 2010. Interim Results 2010. Cautionary statement. This document is solely for use in connection with a briefing on Stagecoach Group plc (“the Group”).

nikki
Download Presentation

Interim Results For the six months ended 31 October 2010 8 December 2010

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Interim ResultsFor the six months ended 31 October 20108 December 2010 Interim Results 2010

  2. Cautionary statement This document is solely for use in connection with a briefing on Stagecoach Group plc (“the Group”). This document contains forward-looking statements that are subject to risk factors associated with, amongst other things, the economic and business circumstances occurring from time to time in the countries, sectors and markets in which the Group operates. It is believed that the expectations reflected in these statements are reasonable but they may be affected by a wide range of variables which could cause actual results to differ materially from those currently anticipated. No assurances can be given that the forward-looking statements in this presentation will be realised. The forward-looking statements reflect the knowledge and information available at the date of preparation. This document is not a full record of the presentation because it does not include comments made verbally by Stagecoach Group management or by others.

  3. Robert SpeirsChairman

  4. Highlights • Adjusted earnings per share up 35.6% • Revenue and operating profit growth in all divisions • Strong organic growth with improving market conditions • Excellent operational performance and customer satisfaction • Interim dividend of 2.2p, up 10% • Positive outlook

  5. Martin GriffithsFinance Director

  6. Summary income statement 31 Oct 10 £m 31 Oct 09 £m Change £m UK Bus (regional) operating profit UK Bus (London) operating loss North America operating profit incl megabus North America joint ventures’ profit after tax UK Rail operating profit Virgin Rail Group profit after tax Restructuring costs, group overheads and other items Operating profit Finance charges (net) Tax Profit excluding intangibles and exceptionals Intangibles and exceptionals, net of tax Reported profit from continuing operations 73.3 (0.1) 15.1 8.8 22.9 10.0 (5.3) 124.7 (16.0) (21.5) 87.2 (1.2) 86.0 58.9 Nil 8.3 7.4 14.9 9.3 (5.3) 93.5 (18.0) (11.1) 64.4 (7.7) 56.7 14.4 (0.1) 6.8 1.4 8.0 0.7 Nil 31.2 2.0 (10.4) 22.8 6.5 29.3

  7. UK Bus (regional operations) 31 Oct 10 31 Oct 09 Change Revenue (£m) Like-for-like revenue (£m) Operating profit (£m) Operating margin (%) Estimated like-for-like passenger journeys* (m) Like-for-like vehicle miles operated (m) 445.1 438.9 73.3 16.5% 334.7 163.2 433.0 429.2 58.9 13.6% 330.5 167.1 2.8% 2.3% 24.4% 290bp 1.3% (2.3)% * Excludes inter-city coach services operated as a sub-contractor

  8. Government spending & regulationBus

  9. North America 31 Oct 10 31 Oct 09 Change 237.3 45.4 282.7 23.1 13.9 37.0 13.1% 221.4 41.0 262.4 13.5 12.0 25.5 9.7% 7.7% 45.1% 340bp Revenue – wholly owned (US$m) Revenue – joint ventures (US$m) Revenue – total (US$m) Operating profit – wholly owned (US$m) Operating profit – joint ventures (US$m) Operating profit – total (US$m) Operating margin (%)

  10. UK Rail (wholly-owned) 31 Oct 10 31 Oct 09 Change Revenue (£m) Like-for-like revenue excluding tram (£m) Operating profit (£m) Operating margin (%) Estimated passenger miles - South Western Trains (m) Estimated passenger miles - East Midlands Trains (m) 525.0 505.6 22.9 4.4% 1,708.4 647.6 512.9 475.0 14.9 2.9% 1,635.6 584.8 2.4% 6.4% 53.7% 150bp 4.5% 10.7%

  11. Government spending & regulationRail

  12. Virgin Rail Group 31 Oct 10 31 Oct 09 Change Revenue - 49% share (£m) Operating profit - 49% share (£m) Operating margin (%) Dividends received (£m) Estimated Passenger miles (millions) 195.6 13.7 7.0% 7.3 1,790.5 170.4 12.8 7.5% 8.6 1,594.6 14.8% 7.0% (50)bp (15.1)% 12.3%

  13. Miscellaneous income statement items 31 Oct 10 31 Oct 09 Change Citylink joint venture (£m) Group overheads (£m) Restructuring costs (non-exceptional) (£m) Intangible asset expenses (£m) Post-tax exceptional items (£m) 1.1 (5.4) (1.0) (5.3) (4.4) 21.2 0.9 (5.8) (0.4) (5.3) (5.7) 1.0 0.2 0.4 (0.6) Nil 1.3 20.2 • Exceptional items: • £18.5m pre-tax gain – release of liabilities related to past business disposals • £4.6m pre-tax gain – pre-acquisition insurance provision no longer expected to be settled • £0.6m pre-tax loss – London Bus acquisition costs

  14. Finance charges and credit ratios 31 Oct 10 31 Oct 09 Change Net Group finance charges, including net finance income from joint ventures (£m) EBITDA from continuing operations and joint ventures* (£m) • last six months • last twelve months Period-end net debt (£m) Net Debt/EBITDA (12 months)* EBITDA*/Net finance charges (including net finance income from joint ventures) (15.9) 171.7 314.9 (313.4) 1.0x 10.8x (17.9) 147.9 300.9 (343.1) 1.1x 8.3x (11.2)% 16.1% 4.7% (8.7)% (0.1)x 2.5x • Strong financial position • Ongoing evaluation of capital structure * excluding exceptional items

  15. Taxation 31 Oct 2010 Pre-tax Profit £m Tax £m Rate % Excluding intangible asset expenses and exceptional items Intangible asset expenses Exceptional items Reclassify joint venture taxation for reporting purposes Reported in income statement Cash tax paid (net) 113.2 (4.4) 4.0 112.8 (4.5) 108.3 (26.0) 0.5 (1.3) (26.8) 4.5 (22.3) 5.8 23.0% 11.4% 32.5% 23.8% 20.6%

  16. Movement in net debt 31 Oct 10 £m EBITDA from Group companies before exceptional items Loss on disposal of plant and equipment Equity-settled share based payment Dividends from joint ventures Movement in retirement benefit obligations Working capital movements Net interest paid Tax paid Net cash from operating activities Net capital expenditure including new hire purchase and finance leases Acquisitions /disposals of businesses, intangibles and investments Token sales and redemptions/others Cash generation Foreign exchange/income statement movements Share capital movements Increase in net debt Opening net debt Closing net debt 147.4 0.7 2.3 15.5 (9.2) (35.0) (5.1) (5.8) 110.8 (73.7) (56.8) (0.9) (20.6) 5.7 (1.8) (16.7) (296.7) (313.4)

  17. Capital expenditure Cash spent on capex £m New hire purchase and finance leases £m Impact of capex on net debt £m Disposal proceeds £m Net £m UK Bus/Central North America UK Rail 47.8 10.9 19.3 78.0 5.3 - - 5.3 53.1 10.9 19.3 83.3 (1.4) (1.4) (6.8) (9.6) 51.7 9.5 12.5 73.7

  18. Pensions 31 Oct 2010 Cash contributions £m 31 Oct 2009 Cash contributions £m 31 Oct 2010 Pension expense £m 31 Oct 2009 Pension expense £m 16.6 0.5 14.2 31.3 16.7 0.5 11.2 28.4 UK Bus/Central North America UK Rail 9.4 0.5 12.2 22.1 11.8 0.6 8.1 20.5 • Post-tax deficit of £80.6m (April 2010: £145.7m) • Accounting value of pension assets, liabilities and costs will continue to vary with market fluctuations and assumptions • Rail – risks mitigated with obligations limited to contributions payable over duration of franchises. Increase in contributions and expense reflects introduction of salary sacrifice scheme (with a corresponding reduction in salary costs) • Bus – schemes closed to new entrants and contributions have stabilised

  19. Summary • Strong performance from all divisions • Reflected in adjusted earnings per share up 35.6% and dividend up 10.0% • Management action and financial discipline underpin a strong business emerging from recession • Positive outlook for second half of financial year

  20. Brian SouterChief Executive

  21. Overview • Strong financial position • Strong organic growth across Group portfolio • Improving economic environment • Clearer picture on UK public sector spending • Opportunities ahead: • Maximise opportunities from commercial bus model • Rail regulatory reform • megabus.com expansion in North America

  22. Growth strategy at UK Bus • Strong industry-leading margins and passenger growth • UK leader on commercial smartcard development • Turnaround plans at London bus • Overhead reductions • Business review • Efficiency improvements

  23. Rail recovery and reform • Strong revenue growth across all franchises • Cost control, operating performance and customer satisfaction • Significant opportunities from radical industry reform and better franchising

  24. megabus.com: North America growth engine • Growing footprint and volumes in US and Canada • Focus of investment and redeployment of resources • Extension of successful hub concept • Stabilisation of non-megabus.com revenue

  25. Current trading and outlook • Current trading in line with management expectations • Improving trends continue • Continued focus on organic growth and shareholder value

  26. Interim ResultsFor the six months ended 31 October 20108 December 2010

  27. Appendices

  28. Divisional income statements Six months ended 31 October 2010 UK Bus (regional) £m North America £m UK Rail £m VRG (100%) £m Revenue Rail revenue support Rail franchise support Other operating income Staff costs Fuel costs (i.e. diesel) Insurance and claims costs Depreciation Rolling stock costs – lease & maintenance Other operating leases Network Rail Electricity for trains Commissions payable Material & consumables Other costs Operating profit 445.1 - - 7.8 (220.0) (55.5) (16.4) (29.7) - (5.3) - - - (17.2) (35.5) 73.3 155.1 - - 2.1 (63.3) (15.7) (13.7) (10.7) - (3.8) -` - - (10.8) (24.1) 15.1 525.0 41.5 (131.7) 37.2 (133.7) (16.7) (2.7) (1.7) (94.4) (1.4) (103.4) (17.0) (12.6) (14.9) (50.6) 22.9 399.2 11.8 (59.2) 13.2 (68.3) (9.7) (1.7) (1.3) (105.8) - (79.3) (5.0) (23.2) (0.7) (42.0) 28.0

  29. UK Bus Revenue 31 Oct 2010 £m 31 Oct 2009 £m Change % Like-for-like Acquisitions: Islwyn Borough Transport (acquired January 2010) Start-ups: Rail replacement South (started May 2009) Preston Bus Total reported 438.9 1.0 0.6 4.6 445.1 429.2 - 0.5 3.3 433.0 2.3% 2.8%

  30. North America revenue breakdown 31 Oct 10 US$m 31 Oct 09 US$m % Growth 96.7 48.3 38.0 15.0 198.0 3.0 201.0 36.3 237.3 45.4 282.7 94.3 49.6 39.6 14.3 197.8 3.5 201.3 20.1 221.4 41.0 262.4 2.5% (2.6)% (4.0)% 4.9% 0.1% (14.3)% (0.1)% 80.6% 7.2% 10.7% 7.7% Scheduled service/line run/commuter Charter School bus & contract Sightseeing & tour Like-for-like revenue excl megabus Closed operations and foreign exchange movements Total North America excl megabus megabus Total North America incl. megabus 60% share of Twin America Total North America incl Twin

  31. Rail subsidy/(premia) profiles South Western £m East Midlands £m West Coast £m Year to 31 March: 2010 2011 2012 2013 2014 2015 2016 2017 (161.6) (224.9) (309.6) (394.9) (448.6) (526.4) (609.2) (582.4) 3.8 (33.5) (81.8) (117.3) (124.8) (186.3) - - (101.0) (147.8) (206.9) - - - - - The above amounts are subject to future adjustment for: (1) various inflation measures (2) risks borne by the Department for Transport (3) called options and (4) changes in regulated Network Rail charges. The amounts shown above are based on estimated inflation and options called to date. The amounts shown above reflect estimated changes arising from changes to Network Rail charges for Control Period 4, which began on 1 April 2009. These changes to the rail subsidy/premia amounts are not yet finalised.

  32. Fuel Hedging UK Bus (regional) UK Bus (London) North America UK Rail 2009/10 - average effective price (per litre) 2010/11 - % of forecast consumption hedged - average hedge price (per litre) 2011/12 - % of forecast consumption hedged - average hedge price (per litre) 2012/13 - % of forecast consumption hedged - average hedge price (per litre) 2012/13 - % of forecast consumption hedged - average hedge price (per litre) Market price (per litre) 45.4p 98% 36.0p 78% 40.6p 50% 42.5p - - 41.3p n/a - - 38% 41.5p 25% 42.4p 13% 43.5p 41.3p 76.6 cents 82% 50.5 cents 77% 57.7 cents 5% 62.4 cents - - 61.2 cents 32.5p 77% 31.3p 75% 40.4p 28% 41.0p - - 40.0p Market prices are as at 30 November 2010 Prices excludes delivery margins, duty, taxes and Bus Services Operators Grant

  33. Fuel costsLatest forecasts Fuel costs Volumes 2009/10 Actual £m 2010/11 Forecast £m 2011/12 Forecast £m 2012/13 Forecast £m 2013/14 Forecast £m 2011/12 Forecast Litres m UK Bus (regional), excluding BSOG* UK Bus (regional), BSOG* UK Bus (London), excluding BSOG* UK Bus (London), BSOG* North America South Western Trains East Midlands Trains Total (201.2) 80.0 - - (38.7) (5.0) (21.3) (186.2) (184.8) 77.0 (24.5) 9.7 (29.9) (6.2) (21.4) (180.1) (196.8) 76.2 (46.0) 17.9 (32.4) (6.4) (25.8) (213.3) (199.0) 65.1 (46.1) 14.4 (33.5) (6.4) (25.7) (231.2) (197.8) 65.1 (46.1) 14.4 (33.5) (6.4) (25.6) (229.9) 192.7 - 45.0 - 69.1 12.4 49.2 368.4 Market prices are as at 30 November 2010, when Brent Crude was US$86 per barrel Forecast costs for the unhedged element of fuel are based on 30 November 2010 spot prices Above costs include delivery margins, duty and taxes (duty forecast at current levels) and exclude 3rd party fuel costs * Bus Services Operators Grant (“BSOG”) represents a rebate of an element of fuel duty costs in respect of certain UK Bus Services. The forecasts are based on the latest announced BSOG rates and in the absence of any announcements, BSOG rates are assumed to remain constant.

  34. Exchange rates October 2010 October 2009 Closing rate Average rate Closing rate Average rate US$ C$ 1.5988 1.6270 1.5301 1.5851 1.6484 1.7756 1.6207 1.7885

  35. Definitions • Like-for-like amounts are derived, on a constant currency basis, by comparing the relevant year-to-date amount with the equivalent prior year period for those businesses and individual operating units that have been part of the Group throughout both periods. • Operating profit for a particular business unit or division within the Group refers to profit before net finance income/charges, taxation, intangible asset expenses, exceptional items and restructuring costs. • Operating margin for a particular business unit or division within the Group means operating profit as a percentage of revenue. • Exceptional items means items which individually or, if of a similar type, in aggregate need to be disclosed by virtue of their nature, size or incidence in order to allow a proper understanding of the underlying financial performance of the Group. • Gross debt is borrowings as reported on the consolidated balance sheet, adjusted to exclude accrued interest, deferred gains on derivatives and the effect of fair value hedges on the carrying value of borrowings, and to include the effect of foreign exchange derivatives that synthetically convert an element of borrowings from one currency to another. • Net debt (or net funds) is the net of cash and gross debt.

  36. Interim ResultsFor the six months ended 31 October 20108 December 2010

More Related