Stagecoach boss in line for £51m
Friday 19 August 2011
The boss and founder of transport group Stagecoach is in line for a £51 million windfall after the company unveiled its second huge cash handout in four years.
Brian Souter, chief executive of the Perth-based group, owns 15.1% of the shares and will get a pro-rata share of the £340 million payment, which is in addition to ordinary dividends.
His sister and fellow founder Ann Gloag will get almost £37 million from her 10.9% stake.
The group, which runs the South West Trains commuter franchise and East Midlands Trains, had previously made a special payment of £700 million to its shareholders in 2007, but said strong cash generation since then had enabled it to release more cash.
The decision to make the payment was taken after a full board meeting with all of the non-executive directors present, it added.
The cash return comes just days after passengers were told that regulated fares across the rail network will rise by 8% in 2012.
Stagecoach also issued an upbeat trading statement today showing growth in all of the group's four businesses in the 12 weeks to July 24.
UK buses - where it daily carries 2.5 million passengers on 8,400 buses serving London, Liverpool, Newcastle, Hull, Manchester, Oxford, Sheffield and Cambridge - saw revenues rise by 2% on a like-for-like basis over the three months.
UK rail posted revenues up by 8.4%.
The US arm, where it runs coaches in the North East and North central regions of the United States and Canada, boosted revenues by 12.7%, while Virgin Rail, the west coast main line joint venture between London and Glasgow, raised revenues by 11.1%.
"The group has performed well since April 30 and remains on course to meet its expectations of profitability for the year ending April 30," it said.
Shares in the group were one of the few risers on a tough day for markets everywhere, adding 2% at 236p as brokers said the size of the cash return was higher than expected.
Gert Zonnerveld at Panmure Gordon stockbrokers added that the trading outlook was positive with Stagecoach shortlisted for two rail franchises and North America growing rapidly on the back of the expanding Megabus network.
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