Stagecoach's US business faces disruption

Transport group Stagecoach was counting the cost of the US terrorist crisis today as its New York coach business faced up to major disruption.

Transport group Stagecoach was counting the cost of the US terrorist crisis today as its New York coach business faced up to major disruption.

Stagecoach said the crisis came during one of Coach USA’s busiest trading months and was estimated to have lost it £10.1m in revenues and £6.8m in operating profits.

The scale of the situation is set to have a ‘‘material’’ impact on full-year figures for the whole group.

Shares in Stagecoach, which owns 49% of Virgin Trains and also operates South West Trains and bus services around the UK, fell 8% in early trading.

Chief executive Keith Cochrane said the firm’s balance sheet was strong enough to withstand the short-term impact of the crisis but added it was still too early to assess the longer term effect on the group.

Coach USA’s North East and New England businesses, covering New York City, Newark Airport and Logan Airport in Boston, have been most severely affected by the downturn in passenger numbers.

Commuter and sightseeing services in the New York area were suspended for several days after the attack, while Coach USA’s airport related services were hit by the closure of US airports.

Since the resumption of services on September 17, Stagecoach said it had seen a marked drop in the number of sightseers in New York and in airport services from Newark into midtown Manhattan.

It added airport services across the US remained weak in line with current poor demand.

There had also been a general drop in bookings for sightseeing, tour and charter business across the US, Stagecoach said.

Stagecoach, which generates around a third of its revenues from the US business, said it will now look to boost revenues by meeting demand for other services, including more trips between Boston and New York.

Mr Cochrane added: ‘‘The full economic effect is not yet clear, but I remain convinced that Stagecoach’s strong balance sheet and continuing strong cash flows leaves us more able than most to withstand the short-term effects.’’

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