SGC.L Share News (SGC)

(Sharecast News) - Transport operator Stagecoach issued a profit warning on Monday adding that was unlikely to pay any further dividends as the coronavirus pandemic hit passenger numbers.
The company, which runs regional and London bus services, said it expected to maintain a "significant proportion" of revenue during the downturn based on existing contractual arrangements and discussions with government bodies.

It added that it had completed a re-financing of core bi-lateral bank facilities, entering into ?325m of new, bi-lateral bank facilities committed through to March 2025.

The company said directors would take a 50% pay cut "for a period of time" and would not receive any bonuses for 2019/20 or a pay rise for 2020/21.

"Whilst we continue to monitor the situation closely, it is too early to predict reliably the effect on profit," Stagecoach said.

Stagecoach said concessionary bus passenger numbers had halved and commercial patronage around 40% as a consequence of the Covid-19 situation.

"We are reducing our regional bus mileage to take account of the changes in customer demand. Our services on all days will more closely resemble Sunday services. The result is a reduction in mileage of around 40% and we will continue to review our service levels.

The company said it was in talks with Transport for London, where passenger numbers had fallen, about contract changes and mitigating the financial effects on bus operators.

"In addition, we are continuing to engage with government and local authorities on other targeted measures which will protect sector jobs and the long-term health of public transport," the company said.

"In rail, we continue to expect the 2019/20 operating profit from our now-expired, wholly owned rail franchises to more than offset our business development and bidding costs."