Interim Results 5 th December 2007 1 Interim

Interim Results 5 th December 2007 1 Interim Results 2007

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. 2 Interim Results 2007

Robert Speirs Chairman 3 Interim Results 2007

Highlights § Good underlying revenue growth in all core divisions § Interim dividend of 1. 35 p, up 12. 5% § Adjusted earnings per ordinary share up 62. 1% - Operating profit growth - Earnings-enhancing return of value in May/June 2007 § Strong start to new South Western rail franchise and Manchester Metrolink tram contract § East Midlands rail franchise from November 2007 4 Interim Results 2007

Martin Griffiths Finance Director 5 Interim Results 2007

Financial summary Revenue - continuing operations 31 Oct 07 £ 820. 8 m 31 Oct 06 £ 752. 1 m Change 9. 1% Operating profit* - continuing operations £ 100. 0 m £ 80. 7 m 23. 9% Adjusted earnings per ordinary share* 9. 4 p 5. 8 p 62. 1% Basic earnings per ordinary share 9. 0 p 18. 9 p (52. 4%) Net (debt)/funds £(494. 7)m Dividend per ordinary share 1. 35 p £ 140. 9 m 1. 20 p 12. 5% * Excluding exceptional items and intangible asset expenses 6 Interim Results 2007

Summary income statement 31 Oct 07 £m 52. 5 31 Oct 06 £m 34. 1 Change £m 18. 4 North America operating profit excl Megabus 18. 0 17. 2 0. 8 Megabus North America operating loss (1. 1) (0. 5) (0. 6) UK Rail operating profit 25. 3 31. 4 (6. 1) Share of joint ventures’ profit after tax 13. 2 4. 4 8. 8 Restructuring and group overheads (7. 9) (5. 9) (2. 0) Finance charges (net) (15. 4) (3. 3) (12. 1) Tax (15. 7) (18. 5) 2. 8 Profit excluding intangibles and exceptionals 68. 9 58. 9 10. 0 Intangibles and exceptionals, net of tax (3. 1) 15. 0 (18. 1) Reported profit from continuing operations 65. 8 73. 9 (8. 1) UK Bus operating profit 7 Interim Results 2007

UK Bus 31 Oct 07 31 Oct 06 Change Revenue (£m) 367. 1 339. 6 8. 1% Like-for-like revenue (£m) 364. 5 338. 0 7. 8% Operating profit (£m) 52. 5 34. 1 54. 0% Operating margin 14. 3% 10. 0% 4. 3% Estimated passenger journeys (m) 316. 0 304. 2 3. 9% Total vehicle miles operated (m) 157. 3 157. 4 (0. 1)% § Revenue and journeys benefiting from marketing campaigns, investment in fleet and excellent value fares § Continued underlying revenue and volume growth § Stable year-on-year fuel costs § Reduced pension costs 8 Interim Results 2007

UK Bus - Revenue § Maintaining revenue growth momentum § Focus on non-London operations delivering growth 9 Interim Results 2007

UK Bus – Operating Profit § Strong UK Bus profit progression § c. £ 270 m for London bus sale in 2006/07 10 Interim Results 2007

North America (excluding Megabus) 31 Oct 07 31 Oct 06 Change Revenue (US$m) 258. 9 251. 3 3. 0% Like-for-like revenue (US$m) 255. 6 247. 0 3. 5% Operating profit (US$m) 36. 2 32. 2 12. 4% Operating margin 14. 0% 12. 8% 1. 2% § Further margin improvement from optimising asset deployment § 10% annualised operating margin targeted by 30 April 2009 (12 months to 31 Oct 07: 8. 7%) § Reduction in dedicated charter fleet § Some signs of economic weakness resulting in a reduced rate of revenue growth 11 Interim Results 2007

North America revenue breakdown Scheduled service/line run/commuter Sightseeing & tour Charter School bus & contract Like-for-like revenue excl Megabus Closed operations and foreign exchange movements Total North America excl. Megabus Total North America 12 31 Oct 07 US$m 31 Oct 06 US$m % Growth 99. 0 62. 5 53. 4 40. 7 255. 6 3. 3 258. 9 4. 8 263. 7 93. 9 55. 9 53. 3 43. 9 247. 0 4. 3 251. 3 2. 2 253. 5 5. 4% 11. 8% 0. 2% (7. 3)% 3. 5% (23. 3)% 3. 0% 118. 2% 4. 0% Interim Results 2007

UK Rail (wholly-owned) 31 Oct 07 31 Oct 06 Change Revenue (£m) 322. 7 276. 8 16. 6% Like-for-like revenue (£m) 318. 8 276. 8 15. 2% 25. 3 31. 4 (19. 4)% Operating profit (£m) Operating margin South Western estimated passenger miles (000’s) 7. 8% 1, 619. 0 11. 3% 1, 513. 1 § Strong start to new South Western franchise § South Western revenue growth 15. 3% § Timing of revenue initiatives may result in profit variability § Manchester Metrolink from July 2007 § East Midlands from November 2007 13 (3. 5)% 7. 0% Interim Results 2007

Virgin Rail Group 31 Oct 07 31 Oct 06 Change Revenue - 49% share (£m) 225. 8 202. 4 11. 6% - West Coast 149. 1 131. 3 13. 6% 16. 3 3. 9 317. 9% Operating profit - 49% share (£m) Operating margin 7. 2% 1. 9% Dividends received (£m) 11. 0 7. 7 Estimated Passenger miles (000’s) West Coast 1, 284. 7 1, 172. 8 § Re-negotiated West Coast franchise performing well § Winning market share from airlines § Network expansion - 21 Super Voyager Trains § Cross. Country franchise ended November 2007 14 5. 3% 42. 9% 9. 5% Interim Results 2007

Scottish Citylink/Megabus JV 31 Oct 07 31 Oct 06 Change Revenue - 35% share (£m) 4. 8 4. 3 11. 6% Operating profit - 35% share (£m) 0. 9 1. 1 (18. 2)% 18. 8% 25. 6% (6. 8)% Operating margin § JV has delivered significant passenger benefits - Better value-for-money - More sensible co-ordination of routes, timetables, etc. - More services § Strong support from passengers, politicians and other stakeholders § Resolution of Competition Commission issues 15 Interim Results 2007

Miscellaneous income statement items 31 Oct 07 31 Oct 06 Change Intangible asset expenses (£m) (6. 2) (7. 5) 17. 3% Group overheads (£m) (6. 2) (5. 2) (19. 2)% Restructuring costs (£m) (1. 7) (0. 7) (142. 9)% Pre-tax exceptional net gains (£m) 2. 0 155. 9 (98. 7)% § £ 2. 0 m gain on sale of Darlington bus operations § Prior year exceptional gains include London bus sale and past service pensions credit 16 Interim Results 2007

Finance charges and credit ratios 31 Oct 07 Net finance charges (£m) 31 Oct 06 15. 4 3. 3 EBITDA from continuing operations and joint ventures excl exceptional items (£m) 135. 1 113. 5 Ratio of EBITDA from continuing operations and joint ventures excl exceptional items to net finance charges 8. 8 times § Efficient capital structure § Good credit ratios 17 34. 4 times Interim Results 2007

Liquidity & interest rate risk § Excellent liquidity - Over £ 280 m of undrawn bank facilities (through to 2012) - Over £ 100 m of other undrawn available credit lines - Cash generative 31 October 2007 net debt £ 494. 7 m £ 329. 2 m £ 165. 5 m 66. 5% 33. 5% Fixed Rate at 6. 0% blended* Floating Rate * Taking account of interest rate derivatives and amortisation of deferred gains on early settlement of derivatives (cash rate 7. 3%) 18 Interim Results 2007

Taxation 31 Oct 2007 Pre-tax Profit £m Pre-tax profit excluding intangible asset expenses and exceptional items - Before joint ventures - Joint ventures Intangible asset expenses Exceptional items Joint venture tax Reported in income statement 71. 4 18. 7 90. 1 (6. 2) 2. 0 85. 9 (5. 5) 80. 4 Tax £m Rate % (15. 7) (5. 5) (21. 2) 1. 1 (20. 1) 5. 5 (14. 6) 22. 0% 29. 4% 23. 5% 23. 4% 18. 2% 4. 9 Cash tax paid (net) 19 Interim Results 2007

Movement in net debt EBITDA from Group companies before exceptionals 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 Acquisitions of businesses, intangibles and investments Disposals of businesses and investments Movement in loans to joint ventures Token sales and redemptions Foreign exchange/other Reduction in net debt before cash flows with shareholders Return of value, including related costs Equity dividends Other share capital movements Increase in net debt Opening net funds Closing net debt 20 31 Oct 07 £m 118. 2 1. 6 11. 0 (47. 0) 7. 1 (12. 7) (4. 9) 73. 3 (41. 6) (2. 6) 3. 3 (0. 2) (2. 0) 5. 4 35. 6 (693. 0) (20. 5) (3. 2) (681. 1) 186. 4 (494. 7) Interim Results 2007

Capital expenditure UK Bus North America UK Rail Group § Cash spent on capex* £m Capex on new hire purchase £m Impact of capex on net debt £m 3. 8 4. 4 3. 4 0. 2 11. 8 29. 9 2. 2 32. 1 33. 7 6. 6 3. 4 0. 2 43. 9 Disposal proceeds** £m (1. 9) (0. 4) (2. 3) Net £m 31. 8 6. 2 3. 4 0. 2 41. 6 Significant capital expenditure planned for second half of year to 30 April 2008 * Excludes capitalised intangible assets of £ 1. 1 m (2006: £ 0. 1 m) and assets acquired through business combinations ** Excludes proceeds from selling businesses 21 Interim Results 2007

Brian Souter Chief Executive 22 Interim Results 2007

The Stagecoach Equity Story Above-industry organic growth § Revenue up 9. 1% § UK Bus** 7. 8% v industry 6. 7% § South Western 15. 6% v industry 10. 7% Strong Earnings Momentum § EPS* up 62. 1% - 5 year CAGR 16. 3% § Operating profit* up 23. 9% § Efficient capital structure approximately £ 940 m returned to shareholders in last five years § Dividend up 12. 5% - 5 year CAGR 12. 1% ** Like-for-like Determined from applying the most recently available year on year revenue growth trends for UK Bus divisions of major UK-listed Groups London & South East train operating companies revenue growth for six months to 31 October 2007 * Before intangible asset expenses and exceptional items For last full financial year 23 Interim Results 2007

Well balanced portfolio Excellent potential for further growth § § Drivers of bus and rail growth - Supportive government policy: e. g. concessionary fare schemes; road pricing - Increasing environmental awareness - Rising road congestion - Inward immigration Stagecoach factors - Innovative and entrepreneurial management with short chains of command - New products - Good operational delivery - Strong stakeholder partnerships 24 Delivering above-industry growth Interim Results 2007

UK Bus A Continuing Growth Story § Revenue growth* 7. 8% (1. 1% higher than average market revenue growth of 6. 7%**) § Underlying estimated full fare passenger volume growth of approximately 2. 4% § Operating profit up 54. 0% from £ 34. 1 m to £ 52. 5 m § New products, marketing and branding - TV Campaign - Goldline § Environmental initiatives § Building long-term stakeholder partnerships * Like-for-like ** Determined from applying the most recently available year on year revenue growth trends for UK Bus divisions of major UK-listed Groups 25 Interim Results 2007

North America Continuing Margin Improvement § “Sweating” the assets; segment profitability; cost control - revenue growth* 4. 5% - further underlying margin** improvement from 12. 8% to 14. 0% § Product developments - Splash Tours - megabus. com - Internet selling § Environmental initiatives § Still targeting 10% annualised operating margin on core business by April 2009 * Like-for-like constant currency including megabus ** Excluding megabus 26 Interim Results 2007

UK Rail Consolidated Market Share § Now have excellent portfolio of high growth franchises on long term contracts § Continued excellent operational performance § Revenue growth above the industry average § Integrating recent wins - East Midlands - Manchester Metrolink § Maximising shareholder value from existing rail contracts 27 Interim Results 2007

Current trading and outlook § Strong earnings momentum - good operational delivery - efficient capital structure § Current trading in line with our upgraded expectations § Continued focus on organic growth and bolt-on acquisitions § Increased fuel costs in 2008/9 but outlook remains positive and good potential for further growth 28 Interim Results 2007

Interim Results 5 th December 2007 29 Interim Results 2007

Appendices 30 Interim Results 2007

Fuel Hedging North America Heating Oil No 2 UK Rail Gasoil 0. 1% 188 m litres 72 m litres 62 m litres 2007/08 86% 93% 56% 2008/09 95% 76% 77% 2009/10 N/A 77% 2007/08 25. 0 p/litre 45. 5 cents/litre 30. 5 p/litre 2008/09 33. 6 p/litre 56. 8 cents/litre 30. 5 p/litre 2009/10 N/A 30. 5 p/litre Product Approximate annual usage UK Bus ULSD 10 ppm % hedged Average hedge price 31 Interim Results 2007

Finance charges Finance income/ (charges) £m Interest on cash & debt Non-utilisation/commitment/arrangement fees Insurance letters of credit Discount on insurance provisions Interest on notes receivable 32 (12. 6) (1. 0) (0. 3) (1. 6) 0. 1 (15. 4) Interim Results 2007

Exchange rates October 2007 Closing rate US$ C$ Average rate 2. 0774 1. 9731 2. 0133 2. 1034 33 October 2006 Closing rate 1. 9073 2. 1370 Average rate 1. 8687 2. 0914 Interim Results 2007

Interim Results 5 th December 2007 34 Interim Results 2007