Stagecoach Group Driving growth through innovation and service

Stagecoach Group Driving growth through innovation and service Brian Souter Chief Executive Credit Suisse Conference 19 November 2007 1

Agenda 1. Business overview 2. Strategy 3. Stagecoach equity proposition 4. The Stagecoach differential 5. Summary 6. Questions & Answers 2

Business overview • One of the world’s leading public transport groups • Three key operating divisions with strong market positions • Annualised turnover in excess of £ 1. 7 bn • Annual EBITDA in excess of £ 200 m 3

Group Structure *Full listing on the London Stock Exchange Market capitalisation approximately £ 1. 75 billion 4

UK Bus • • Approx 14% share of UK domestic bus market Annual revenue over £ 700 m 19 operating companies, 100 depots Metropolitan, suburban, rural and inter-city services >90% of revenues from scheduled passenger services Provincial, de-regulated, commercial market UK Bus division accounts for approx 46% of continuing Group turnover and 52% of continuing Group profit* *Profit = pre goodwill and exceptionals for year ended 30 April 2007 (including Group overheads and redundancy/restructuring costs) 5

Rail - 1 • • Approximately 25% of UK passenger rail journeys Franchises let by UK Department for Transport Group runs two major wholly-owned UK rail franchises Ø South Western: largest UK commuter rail network with mainline and suburban services from London Waterloo to southwest England; revenue approx £ 557 m Ø East Midlands: main line train services to London St Pancras International, regional rail services in East Midlands, inter-regional services between Norwich and Liverpool; revenue approx £ 235 m 49% interest in Virgin Rail Group Ø Operator of West Coast inter-city rail franchise; revenue approx [x]m *Profit = pre goodwill and exceptionals for year ended 30 April 2007 (including Group overheads and redundancy/restructuring costs) 6

Rail - 2 • Britain’s biggest tram operator Ø Sheffield Supertram Ø Manchester Metrolink Ø Operations and maintenance contracts • Rail division accounts for approx 38% of continuing Group turnover and 36% of continuing Group profit* *Profit = pre goodwill and exceptionals for year ended 30 April 2007 (including Group overheads and redundancy/restructuring costs) 7

• • North America Significant operator in North American market Market mix: Ø Ø • Geography: Ø Ø Ø • • Scheduled service/line run/commuter (New York, Chicago) Sightseeing (mainly New York, plus Chicago and Montreal) School bus (Wisconsin) Tour and charter North East Midwest Canada Revenue approx US $465 m North America accounts for approx 16% of continuing Group turnover and 11% of continuing Group profit* *Profit = pre goodwill and exceptionals for year ended 30 April 2007 (including Group overheads and redundancy/restructuring costs) 8

Group Strategy Delivering shareholder value through: • Organic revenue growth in all key divisions • New product development (eg budget inter-city coach service megabus. com) • Complementary bolt-on acquisitions • Targeted opportunities and maximising contract value in franchised UK rail market 9

Stagecoach equity proposition • Strong growth track-record • Cash-generative business • Predictable earnings • Alignment of management and shareholders • Strong capital discipline • Excellent potential for further growth 10

Excellent potential for further growth - 1 • Supportive environment for public transport • Rising road congestion • Climate change agenda • Pro-public transport Govt policy Ø concessionary travel schemes Ø road pricing Ø ‘green’ taxation 11

Excellent potential for further growth - 2 • Stagecoach expertise • Entrepreneurial and performance-focused • Innovation Ø new product development Ø marketing • Experienced management • Strong stakeholder partnerships • Good operational delivery driving financial results • Delivering above–industry growth 12

The Stagecoach differential: UK Bus - 1 § Revenue growth*: Ø 10. 3% v average market revenue growth of 8. 4%** Ø Stagecoach out-performance of 22. 6% § Organic passenger growth Ø Underlying full fare passenger volume growth of approx 2. 4% Ø Over-and-above concessionary travel growth § Like-for-like operating profit up 26. 9%* from £ 65. 0 m to £ 82. 5 m - Year ended 30 April 2007 * Like-for-like ** Determined from most recently rolling 12 months’ revenues available for UK Bus divisions of major UK-listed Groups 13

The Stagecoach differential: UK Bus - 2 § Market-leading innovation and marketing generating modal shift Ø megabus. com Ø Goldline Ø telemarketing campaigns Ø online sales (eg Unirider) § Competitive pricing strategy Ø lower than average weekly ticket prices Ø increases financial flexibility Ø underpins volume growth and long-term prospects § High fleet reliability 14

Stagecoach: Bus of Britain TV campaign 15

Goldline: targeting modal shift • Pilot of new premium bus concept • ‘BMW’ of bus travel • Luxury leather seats • State-of-the-art green travel • Customer promise: service guarantees • Hand-picked, uniformed drivers • Price: no initial premium • Pilot projects launched in Perth and Leamington Spa 16

Award-winning telemarketing • Telemarketing unit based in Perth • Focus on people whose lifestyle is most suited to switching from car to bus • Desktop research using demographics data from census and other sources • Discuss travel choices, local bus network and environmental issues • Offer seven days’ free travel • More than 610, 000 customers contacted in past two years • Campaigns included Manchester, Newcastle, Sheffield, Lincoln, Aldershot • Generated more than 4. 2 million additional bus passenger journeys a year - 2. 95 m previously made by car. 17

Yield management § Budget travel concept - flexible pricing from £ 1 § Online booking via secure e-commerce website § megabus. com: 40 UK cities, 2 m customers a year § megatrain. com introduced at South West Trains in Nov 2005 § Maximising off-peak capacity and generating new customers § megatrain. com -16 destinations at South West Trains; more than 3, 000 passengers a week § integrated budget coach and rail website since March 2007 § Expansion to East Midlands franchise 18

Summary • Strong portfolio of businesses • Excellent organic growth delivered and continuing • Rail division expanded through franchise wins • Clear strategy for further success • Stagecoach expertise • Supportive environment for public transport sector 19

Questions & Answers 20

Stagecoach Group Driving growth through innovation and service Brian Souter Chief Executive Credit Suisse Conference 19 November 2007 21