Preliminary Results Annual Results 27 th June 2007

Preliminary Results Definitions  Like-for-like refers to the comparison of businesses and individual operating units that have been part of the Group throughout the whole of the most recent financial year and the immediately preceding financial year.  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.

Preliminary Results Robert Speirs Chairman

Preliminary Results Highlights  Good underlying revenue growth in all core divisions  63 pence per ordinary share returned to shareholders in May/June 2007  Full year dividend of 4.1p, up 10.8%  Further strong growth in profit  Adjusted earnings per ordinary share up 10.4%  Strong start to new South Western rail franchise  New franchise wins: East Midlands, Manchester Metrolink

Preliminary Results Martin Griffiths Finance Director

Preliminary Results Financial summary *excluding exceptional items and intangible asset expenses + UK GAAP Revenue – continuing operations Operating margin* - continuing operations (%) Adjusted earnings per ordinary share* Basic earnings per ordinary share Net funds/(debt) + Dividend per ordinary share Year to 30 April 07 Year to 30 April 06 £1,504.6m 9.8% 11.7p 25.4p £186.4m 4.1p £1,343.9m 9.5% 10.6p 10.7p £(135.9)m 3.7p Change 12.0% 0.3% 10.4% 137.4% n/a 10.8%

Preliminary Results Summary income statement UK Bus operating profit – like-for-like UK Bus operating profit – 2005/6 acquisitions North America operating profit Rail operating profit Share of joint ventures’ profit Restructuring and group overheads Finance income/(charges) (net) Tax Profit excluding intangibles and exceptionals Intangibles and exceptionals, net of tax Reported profit from continuing operations Year to 30 April 07 £m Year to 30 April 06 £m (14.3) 0.7 (37.8) (1.9) (11.5) (15.9) (25.3) 91.8 (20.6) 71.2 Change £m (0.1) 8.6 (2.8) 16.6 (12.5)

Preliminary Results Development of UK Bus  Operating profit increased  and £267.8m collected from London sale! Operating profit: Like-for-like 2005/06 acquisitions London Year to 30 April 07 £m Year to 30 April 06 £m (1.9) Change £m (18.4) 3.0

Preliminary Results UK Bus (like-for-like)  Revenue and journeys benefiting from strong marketing, competitive fares strategy, concessionary travel schemes and continued fleet investment  Continued underlying revenue and volume growth  Some benefit in second half from more stable crude oil prices  Pension scheme changes mitigated potential cost increases in second half  Stable insurance & claims costs Revenue (£m) Operating profit (£m) Operating margin Passenger journeys (m) Year to 30 April 07 Year to 30 April % % Change 10.3% 26.9% 1.8% 6.6%

Preliminary Results UK Bus (2005/6 acquisitions)  Margin improvement from integration of acquired businesses  Further margin improvement expected Revenue (£m) Operating profit (£m) Operating margin Year to 30 April 07 Year to 30 April 06* % 38.5 (1.9) (4.9)% Change 114.0% n/a 7.3% * Partial year, 2007 represents full year

Preliminary Results North America  Further margin improvement from optimising asset deployment  Double digit margin targeted by 30 April 2009  Excellent response in the US to Megabus  Launch of Splash Tours in New York Revenue (US$m) Like-for-like revenue (US$m)* Operating profit (US$m) Operating margin Year to 30 April 07 Year to 30 April % % Change 5.5% 9.1% 15.3% 0.7% * Adjusted to exclude revenue from businesses sold or closed during the two years and to include revenue from Canada on a constant currency basis

Preliminary Results Scheduled service/line run/commuter Charter Sightseeing & tour School bus & contract Like-for-like revenue Closed operations and Canada fx Total Year to 30 April 2007 US$m Year to 30 April 2006 US$m % Growth 10.0% 8.3% 9.5% 7.5% 9.1% (63.5)% 5.5% North America revenue breakdown

Preliminary Results Rail (wholly-owned)  Strong start to new South Western franchise  Challenging but deliverable revenue and cost targets  Manchester Metrolink from July 2007  East Midlands from November 2007  Sheffield Supertram record passenger volumes Revenue (£m) Operating profit (£m) Operating margin Passenger miles (000’s) Year to 30 April 07 Year to 30 April % 3, % 2,802.1 Change 12.8% (0.2)% (1.3)% 8.9%

Preliminary Results Virgin Rail Group  Good prospects for re-negotiated West Coast franchise  Winning market share from airlines  Further yield management  Successful marketing campaigns  Capacity increases in December 2007 & December 2008 Revenue – 49% share (£m) - West Coast - CrossCountry Operating profit – 49% share (£m) Operating margin Dividends received (£m) Passenger miles (000’s) Year to 30 April 07 Year to 30 April % , % Nil 3,742.3 Change 15.4% 17.1% 12.4% 134.0% 1.5% n/a 11.1%

Preliminary Results Scottish Citylink/Megabus JV  JV has delivered enormous passenger benefits  Better value-for-money  More sensible co-ordination of routes, timetables, etc.  More services  Strong support from passengers, politicians and other stakeholders  Concerning decision from Competition Commission Revenue – 35% share (£m) Operating profit – 35% share (£m) Operating margin Year to 30 April 07 Year to 30 April 06* % % Change 123.7% % 12.7% * Partial year, 2007 represents full year

Preliminary Results Miscellaneous income statement items  Exceptional gains include sale of London Bus and restructuring of main Group pension scheme  £4.3m further gain in second half from London Bus completion accounts and tax finalisation  Further pension credit in second half of £6.1m Intangible asset expenses (£m) Group overheads (£m) Restructuring costs (£m) Pre-tax exceptional items (£m) Year to 30 April 07 Year to 30 April 06 (14.7) (11.1) (3.2) (20.5) (10.0) (1.5) 17.4 Change 28.3% (11.0)% (113.3)% 874.7%

Preliminary Results Finance income/(charges) and credit ratios Net finance income/(charges) (£m) EBITDA from continuing operations and joint ventures excl exceptional items (£m) Year-end net funds/(debt) (£m) Net Debt/EBITDA - Net funds increased by £726m for Return of Value & special pension contributions Year to 30 April 07 Year to 30 April n/a 2.3 (15.9) (135.9) 0.7 Change n/a 1.6

Preliminary Results Interest rate risk 30 April 2007 net funds Approximate return of value (including costs) Special pension contribution – June 2007 Pro forma net debt £m (696.0) (30.0) (539.6) £324.6m 60.2% Fixed Rate at 6.2% blended* £215.0m 39.8% Floating Rate * Taking account of interest rate derivatives

Preliminary Results Taxation Excluding intangible asset expenses and exceptional items - Before joint ventures - Joint ventures Intangible asset expenses Exceptional items Joint venture tax Reported in income statement Cash tax paid (net) Pre-tax Profit* £m Tax* £m (14.7) (3.0) (37.8) (3.0) (40.8) 2.9 (8.7) (46.6) 3.0 (43.6) 22.9 Rate % 25.6% 17.4% 24.7% 19.7% 23.6% 24.9% 23.7% 2007 * Excludes London Bus

Preliminary Results Capital structure  c.£700m return of value completed  Reflects robust business model  Quantum determined with reference to credit ratios, including Net Debt/EBITDA and Debt Service Cover  Ordinary shares currently in issue 707.9m  2007/08 pro forma average Ordinary shares in issue 724.3m

Preliminary Results Pensions  £21.7m* total pension costs (2006: £33.4m)  £18.1m* (2006: £27.1m) continuing operations  IAS 19 pre-tax deficit of £36.2m (2006: £222.2m) for Group  c.£107m of additional contributions to reduce deficit  £77m paid by 30 April 2007  £30m paid in June 2007  further deficit reduction  Rail pension schemes: under IFRS, only the part of the deficit that we expect to fund during the relevant franchise is recognised  Positive changes to schemes * excluding past service adjustment

Preliminary Results EBITDA from Group companies before exceptionals EBITDA from discontinued operations Dividends from joint ventures Movement in retirement benefit obligations Working capital and other operating cash 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 cashflows with shareholders Equity dividends Other share capital movements Reduction in net debt Opening net debt Closing net funds 30 April 2007 £m (94.9) 29.8 (3.9) (22.9) (82.5) (2.2) (2.3) (41.5) (135.9) Movement in net debt

Preliminary Results Nil (8.2) (2.8) Nil (11.0) Capital expenditure UK Bus North America Rail Capex on new hire purchase £m Impact of capex on net debt £m Disposal proceeds** £m Net £m Cash spent on capex* £m * Excludes capitalised intangible assets of £13.3m (2006: £0.6m) ** Excludes proceeds from selling businesses Note: Vehicles with a capital value of £12.1m were acquired by UK Bus during the year on operating leases (2006: £Nil )

Preliminary Results Brian Souter Chief Executive

Preliminary Results Five-year track record Adjusted EPS* Dividend per Ordinary Share Share Price Return of value announced 6.4p 2.6p 44.0p - 6.7p 2.9p 82.25p £240m 9.5p 3.3p 103.0p p 3.7p 108.5p p 4.1p p £700m 16.3% 12.1% 43.5% CAGR Year ended 30 April * Before intangible asset expenses and exceptional items (2002 – 2004: UK GAAP; 2005 – 2007: IFRS) + dividends

Preliminary Results The Stagecoach Differential UK Bus  Revenue growth* 10.3% (22.6% higher than average market revenue growth of 8.4%**)  Underlying full fare passenger volume growth of approximately 2.4%  Like-for-like operating profit up 26.9%* from £65.0m to £82.5m  Lower than average weekly ticket prices  increases financial flexibility  underpins volume growth and long term prospects  High fleet reliability  Getting modal shift from innovation and marketing *Like-for-like **Determined from most recently rolling 12 months’ revenues available for UK Bus divisions of major UK-listed Groups

Preliminary Results The Stagecoach Differential North America  “Sweating” the assets; units closed; segment profitability  revenue growth* 9.1%  further margin improvement from 7.1% to 7.9%  Product developments  Splash Tours  megabus.com  internet selling  Targeting 10% margin on core business by April 2009 * Like-for-like constant currency

Preliminary Results The Stagecoach Differential UK Rail  Winning Franchises  South Western  East Midlands  strong momentum  Manchester Metrolink  Revenue growth* 12.9% (9.3% higher than the London and South East TOC average of 11.8%*)  Passenger Performance Measure – Punctuality +  South Western 90.3%  West Coast 87.2%  CrossCountry 84.3%  Passenger Satisfaction**  South Western 81%  West Coast 87%  CrossCountry 84% + Industry passenger performance measure for calendar year 2006 *Year to 31 March 2007 **Percentage of passengers satisfied overall as determined by Spring 2007 National Passenger Survey  London & South East TOCs 89.3%  Long distance TOCs 85.2%  Industry 79%

Preliminary Results The Stagecoach Differential “Addressing the issues”  CAPITAL STRUCTURE  Consistently generating surplus cash for investment & shareholder return  £940m returned to shareholders in three years  Plus continued dividend growth  PENSIONS  Accelerating funding  Securing employee pensions  affordable pension scheme  Managing cost and volatility  INVESTMENT  UK Bus Fleet Addressing the “London” issue Modern fleet for a modern business

Preliminary Results Current trading and outlook  Strong start to new financial year  Current trading in line with our expectations  Continued focus on organic growth and bolt-on acquisitions  Good potential for further growth

Preliminary Results Annual Results 27 th June 2007

Preliminary Results Appendices

Preliminary Results Gross debt & related derivatives Interest bearing cash balances Non-utilisation/commitment fees Insurance letters of credit Discount on insurance provisions Interest on notes receivable Other Finance income/ (charges) £m Annual effective rate % (16.6) (0.8) (0.5) (2.9) ** Finance income Average balance* £m (332.0) *Average of month end debt/cash balances ** £0.7m reported as net finance income in income statement and £0.6m relating to London Bus reported within profit from discontinued operations

Preliminary Results Fuel hedging % of Group fuel hedged - fixed - cap/floor Average hedge price (crude price US$/barrel) - fixed - cap/floor Forecast 2007/08 37% 51% $59 US$59/US$28 Continuing Bus divisions use 1.6m barrels of fuel a year Each US$10 per barrel movement in crude oil price impacts variable fuel costs by approximately US$16m if no hedging in place 2006/07 year-on-year increase of £21m in fuel costs of continuing operations Forecast 2008/09 Nil 44% n/a US$89/US$58 Forecast 2009/10 Nil n/a

Preliminary Results Exchange rates US$ NZ$* C$ Closing rateAverage rate April 2006 Closing rateAverage rate n/a n/a April 2007 * Average and closing rates up to date of disposal used – 29 November 2005

Preliminary Results Annual Results 27 th June 2007