“Public transport is a good space to be in at the moment,” affirms Stagecoach Group finance director Martin Griffiths.

He’s got a point: the nation is adopting green practices with zeal and they include taking the bus in favour of driving a car. But inward migration is also having an impact. “People are coming to the UK who are comfortable with public transport,” Griffiths explains.

Stagecoach’s figures certainly back up his claim. In 2007, the group reported revenue from continuing operations of £1.5bn, up from £1.3bn in 2006. Profit before tax stood at £184.1m, up from £91.5m in 2006.

The finances seem to be on track again this year, too. Stagecoach’s interim results, which were released last December, showed strong revenue growth in bus and rail in the UK and North America. Revenue from continuing businesses was up 9.1 per cent at £820.8m.

Griffiths was appointed finance director of Stagecoach in April 2000. He’s responsible for financial policy, taxation, treasury management, rail franchise bidding and the overall management of the group’s property portfolio. He also supports chief executive Brian Souter in the management of operations and new business development. And, Griffiths is a member of Stagecoach’s pension oversight committee.

It’s a wide-ranging remit, which Griffiths loves. “One of the great things about my job is I get involved in all aspects of the business,” he says. “I have a much wider management role perhaps than some other finance directors; that’s what I like about what I do.”

The ease with which Griffiths discuss the many facets of Stagecoach’s business (not just the finance function) shows just how involved he is. He seems just as happy talking about the green agenda as he is when discussing IFRS, which is handy as environmental concerns are having a big impact on Stagecoach’s operations.

While the company is benefiting from a trend towards greater use of public transport, it also has to look at how it can be more eco-friendly. “We’re very much looking at green fuels,” Griffiths says. “It’s an issue for manufacturers and operators and we’re trying to get a balance.

“A very good example of what we’re trialling at the moment is in Kilmarnock. We’re taking eight buses on a dedicated service and then working with other stakeholders – such as local authorities and customers – and getting them to recycle old chip fat. We’re working with a company that takes the fat and turns it into a fuel we can use on the buses.”

Griffiths adds: “Of course there are still emissions but engines are also generally becoming better. There are certain standards in the EU and we’re working with manufactures to progress that even further.”

Operations in the US

Away from Europe, the US is becoming more and more important to Stagecoach. Griffths says: “It’s a more diverse portfolio in the US; we’ve a mixture of different businesses out there.” In addition to its usual transport vehicles, Stagecoach runs sightseeing buses and a small number of school buses.

Stagecoach has also introduced Megabus services (which offer low cost bus travel between cities) to the US. “We have quite high hopes for that in North America,” Griffiths says.

Stagecoach launched Megabus in Chicago then expanded to cities such as San Francisco, Los Angeles, New York and Boston. So far, things are going well. “The Americans have embraced the Megabus concept,” Griffiths says. “We wondered what they would think of it but they’re very positive. It’s different to Greyhound bus services. We think that 75 per cent of our passengers are coming from cars and trains rather than other bus companies.”

Back in the UK, Griffiths says Megabus is also doing well. “We combined a lot of the operations into a joint venture in Scotland. That’s incredibly successful and growing very nicely. The residual Megabus business in the UK is still small compared to the rest of the group but turnover is around £10m and moving into profitability,” he says.

Listening to Griffiths speak about Stagecoach’s prospects, it’s hard to find fault with his earlier assertion. It certainly does seem like a good time to be a public transport operator.

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Tags: stagecoach group, martin griffiths, stagecoach, finance director, fd, public transport, carbon footprint, green fuels, megabus, us operations,

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