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Edited Transcript of SGC.L earnings conference call or presentation 22-Jul-20 6:30am GMT

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Full Year 2020 Stagecoach Group PLC Pre-Recorded Earnings Presentation Perth Aug 26, 2020 (Thomson StreetEvents) -- Edited Transcript of Stagecoach Group PLC earnings conference call or presentation Wednesday, July 22, 2020 at 6:30:00am GMT TEXT version of Transcript ================================================================================ Corporate Participants ================================================================================ * Martin Andrew Griffiths Stagecoach Group plc - CEO & Executive Director * Ross Paterson Stagecoach Group plc - Finance Director & Executive Director ================================================================================ Presentation -------------------------------------------------------------------------------- Martin Andrew Griffiths, Stagecoach Group plc - CEO & Executive Director [1] -------------------------------------------------------------------------------- Hello, everyone, and welcome to the Stagecoach preliminary results for the year ended 2nd of May 2020. I'm Martin Griffiths, the Stagecoach Chief Executive; and I'm joined today by our Finance Director, Ross Paterson. There's no question, this has been one of the most challenging periods for our sector and the communities that we serve. We're very proud of the incredible response of all of our people and the other key workers to the COVID-19 pandemic and the part that they have played in getting the country through the very worst of this challenging period. Against that backdrop, we have achieved a credible set of financial results for 2019/'20. This reflects the underlying strengths of the business before the COVID-19 pandemic. We have substantial available liquidity to navigate through the COVID-19 situation with over GBP 800 million of undrawn, committed bank facilities and available cash deposits, and Ross will cover in more detail the actions we've taken to underpin our finances. The Board and our management team took swift, decisive action to respond to COVID-19. Crucially, we have also put in place a plan for the future to secure the significant long-term opportunities we see for public transport. In the short term, our management actions and the continuing support of national and local government should ensure we remain EBITDA positive and poised to benefit from new opportunities. Despite the impact of COVID-19, we have made good progress in delivering on our key strategic objectives. At the same time, we've maintained our relentless focus on safety and customer service. We see strengthened long-term prospects for our sector and for Stagecoach. The direction of government bus policy and investment has been encouraging. The renewed focus on health, wellbeing and the environment as a result of current challenges present significant opportunities moving forward. We have all seen what our urban spaces can look like without cars. Public transport has a major role to play in supporting the renewal and leveling up of our economy, tackling road congestion, delivering cleaner air and addressing climate change. COVID-19 has, of course, dominated recent months, so I would like to provide a brief summary of our immediate response to the pandemic and the principles that we have followed. Our priority has been to protect the health and wellbeing of our people and our customers while taking action to protect the long-term sustainability of the business and the communities we serve. Very quickly, we mobilized our crisis action team and ensured the rapid deployment of new operational processes, enhanced safety regimes and customer assistance programs. We have worked in close partnership with national and local government on the initial emergency public transport networks, which ensured key workers could support the national effort. This close working has continued throughout with the phased step-up in services to keep communities connected and help restart the economy and daily life. We have sought to do the right thing and take care of our customers. This includes providing more than GBP 1 million in refunds for thousands of customers and also extending the validity of tickets with the agreement of our customers. Throughout COVID-19, we've demonstrated we are an agile business which can move fast, respond to challenges and innovate to grasp new opportunities. From very early on in COVID-19 pandemic, we have taken comprehensive and decisive action to respond, building on our experience of having dealt with the impact of SARS in the early 2000s in Asia. The slide here summarizes the key actions we have taken, and I won't cover these individually in detail, but you can see our rapid response has covered all aspects of our business. It has included significantly revised service levels, new operational regimes, director and senior management salary sacrifices, extensive cost-reduction measures and revised capital expenditure plans. We have now identified and targeted around GBP 9 million in potential annualized savings beyond those related to mileage changes in phase 1 of our recovery plan. Work is also underway to seek further non-mileage cost-related reductions. In terms of capital expenditure, we're very fortunate that Stagecoach was well invested going into this pandemic. In view of the scale of the COVID-19, we have reduced our planned net capital expenditure for 2021 by around 50%, and we will continue to keep all capital expenditure under careful review. I'd now like to hand over to Ross to discuss the financials in more detail. -------------------------------------------------------------------------------- Ross Paterson, Stagecoach Group plc - Finance Director & Executive Director [2] -------------------------------------------------------------------------------- Hello, everyone. I'll begin with a brief overview of the results for the year just ended. We have been keeping the market updated on how COVID-19 is affecting us, and the adjusted earnings per share of 13.5p for the year ended 2nd of May are towards the upper end of the guidance of between 12.5p and 14p that we provided in our announcement of 28th of May. The profitability of the regional bus business in the last 2 months of the year was affected by COVID-19 with the public following government advice to avoid all but essential travel, and that is reflected in the year-on-year change in its operating profit. The London bus business, on the other hand, is underpinned by its contracts with Transport for London. Notwithstanding the COVID situation, that business surpassed our expectations of profit for the year through its strong operational performance and good cost control. We are pleased that our Citylink joint venture ended the year with profit almost in line with the previous year. The North America division, of course, was sold at the end of the prior year, while the change in the rail profit reflects the expiry of our East Midlands franchise in August 2019 as well as legal and overseas bidding costs during the year. Similarly, our share of profit from the Virgin Rail Group joint venture reflects the end of the West Coast rail franchise in December 2019, which delivered strong profitability for the final period of the franchise. We took steps last year to reduce our group overheads to reflect the change in the size and scope of the group following the sale of the North American division and our exit from UK Rail franchising. As you have heard, we've also taken further steps to reduce cost, including management pay and bonuses in response to the COVID situation. Those actions are reflected in the year-on-year saving in group overheads and the further steps that Martin explained that we have already taken on costs, including the GBP 9 million of annualized savings already identified will be reflected in our future cost base. The lower finance costs reflect the sale of North America, and the tax charge takes account of the changes in the pretax profit. We do have some separately disclosed items in the year which are set out in today's announcement, which include COVID-related items. So overall, while the results reflect some effects from the COVID situation, we are pleased to be at the upper end of our recent guidance. So let's look further at the regional bus business. In December, when we reported our results for the first half of the financial year, I suggested that we expected to see higher revenue in the second half of the year than the like-for-like growth of 1.6% reported for the first half. And indeed, for the first 14 weeks of the second half, we saw increased like-for-like revenue growth of 2.7%. Revenue in February was affected by poorer weather, and then we saw substantial falls in revenues the COVID situation unfolded. We reduced our vehicle mileage in light of that, and we took other actions to reduce our ongoing cost base. We are fortunate in that we operate transport services that government wishes to see continue to some extent. And as a result, our sector has been -- has seen significant payments from government for the continuity of local bus services. This chart shows trends in our regional bus business for March when the COVID situation in the U.K. first affected us right through to the end of last week. The blue line shows our commercial sales relative to last year using a rolling 7-day average. That is sales made each day to customers that pay for their own travel as opposed to, for example, amounts we received from government for concessionary travel. So at the start of March, sales were slightly ahead of last year, but fell to as low as 10% of prior year levels as people followed government instructions. The red line shows us reducing vehicle mileage as demand fell. We did not reduce mileage by as much as the change in commercial sales as government paid to maintain certain levels of service. Our mileage, therefore, floored at around 40% of the prior year levels. Mirroring the reduction in vehicle mileage, the green line shows the percentage of regional bus operating staff who were furloughed. As we reduced mileage, we increased the numbers of employees on furlough, albeit on a rotational basis, and that was implemented under the U.K. government's Coronavirus Job Protection Scheme. So with mileage down at around 40% of the prior year, we accordingly saw around 60% of the operating company employees on furlough. Government messaging has influenced use of public transport, and the capacity of each vehicle is temporarily limited by social distancing requirements. We have, however, seen some recovery in commercial sales as COVID restrictions have been progressively relaxed. Sales have been creeping up day by day and are now at around 40% of last year's levels. Mileage is back at around 80% as the government continues to pay for increased service levels, and furlough numbers are now down to around 20%. So reflecting on devolved system of government, the COVID-related restrictions do vary across the U.K., and that is reflected in our business. Within the overall regional bus mileage, which is now at around 80% of prior year levels, mileage has been ramped up to a greater extent in England and in Scotland, with vehicle mileage in Wales still at less than half of last year's levels. The variations in COVID-related restrictions of vehicle mileage are also reflected in sales trends. For the time being, government is continuing to pay for ongoing bus services, and we remain EBITDA positive and around EBIT breakeven. Looking ahead, we are planning for a range of possible scenarios, recognizing that there will be some longer-term effect of COVID-19 on people's travel patterns. We do, however, continue to see a strong opportunity for bus to take a bigger overall share of travel and to play a major role in a cleaner, greener and more resilient economy. Switching to London bus, which, as I said earlier, is a business underpinned by its contracts with Transport for London. Profit from the London business exceeded our initial expectations. We have continued to focus on cost control and reduction and have benefited from our strong operational performance, with the quality incentive income we received based on that operational performance up GBP 3.9 million on the previous year. We had anticipated that our revenue would decrease this year as a result of the changes in our portfolio of contracts. In addition, we have reached some reductions in vehicle mileage with Transport for London in response to the COVID situation. We also agreed that any savings we achieved in variable costs as a result of operating less mileage would be passed back to Transport for London through reduced contract payments. The effect of that is to reduce both revenue and cost, but with no significant adverse effect on the profitability of our London bus business. Our experience of contract tenders over the last year has been good, with net wins that will add to our business from the new financial year to May 2021. While we are mindful of the financial pressures facing Transport for London, we are pleased with the performance of our London bus business and remain positive on its outlook. COVID-19 has, of course, sharpened organizations' focus on liquidity, and we have taken action to further strengthen our own liquidity. We currently have over GBP 800 million of undrawn, committed bank facilities and available cash and deposits. In March, we refinanced our core bank facilities. We entered into new facilities for GBP 325 million, which should run until at least 2025. Our GBP 400 million bonds also run until 2025, so we have long-term borrowing capacity in place for around the next 5 years. With respect to those new bank facilities, we took the precautionary step in June of agreeing covenant waivers for the years ending 31 October 2020 and 1 May 2021, not because we saw it as inevitable that the covenants would otherwise be breached, but because we saw it as a sensible move to allow some time of financial flexibility to respond to the emerging situation in the short to medium term. We did agree with the banks to maintain minimum levels of liquidity during those periods. In addition, we issued GBP 300 million of commercial paper in May under the COVID-19 Corporate Financing Facility. Those issuances mature in February or March 2021 when we expect to be able to issue a further GBP 300 million through to February and March 2022, if appropriate. And this slide summarizes our liquidity position as of Monday. You can see the available liquidity of over GBP 800 million. And even if we assume full settlement of all the remaining net train operating company liabilities and the expiry or cancellation of the bank facilities maturing in October 2021, we still have almost GBP 600 million of available liquidity. Our cash flow has remained positive. Before dividend payments and share repurchases, we generated a reduction in net debt of GBP 64 million in the year just ended. And since we last updated the market at the end of May, we have seen net cash generation of GBP 26 million, and that is reflected in our improved liquidity position. We are comfortably in compliance with our bank covenants for the year ended, and we ended the year with reported net debt of 1.5x adjusted EBITDA. As I mentioned, we are receiving payments from government for continuing transport services and to protect jobs. I mentioned earlier that we have had significant numbers of employees on furlough. In common with other organizations that have been significantly affected by COVID-19, our regional bus and London bus operations have received grant income under the COVID-19 Job Retention Scheme. I have already explained the arrangements regarding London bus contract payments. The methodology for determined contract payments has now been agreed for the period up until 22nd of August, by when we expect to be back to 100% of pre-COVID service levels and related contract payments. Our Sheffield Supertram business has continued to receive concessionary revenue at prior year levels as well as receiving specific COVID-related payments for the continuation of tram services. Those payments are designed to put the business in the position it would have been without COVID. The current arrangement runs until 3rd of August with discussions ongoing regarding payments thereafter. Our regional bus businesses have continued to receive concessionary and tender revenue at close to pre-COVID levels. Generally, concessionary revenue payments have not been reduced in line with lower passenger journey numbers. In addition, to ensure the continuity of local bus services in England, we have received COVID-19 Bus Services Support Grant payments or CBSSG. Those are designed to cover operators' pretax losses to achieve broadly breakeven. It does not necessarily exactly result in our reported breakeven position because there are specific terms and conditions on how revenue and costs are determined for the purposes of calculating CBSSG. The current or a replacement arrangement should run until October 2020, and we are already discussing with government arrangements for continuing bus services thereafter. A similar arrangement applies for bus and coach services in Scotland, and discussions are ongoing with the Welsh government in relation to increasing bus service levels there. So forecasting profit for next year is a little more difficult than usual, particularly in relation to our regional bus business. It involves judgments on the extent and duration of COVID-related restrictions and messaging around public transport, the timing and extent of recovery and demand for our services, the extent to which COVID-related payments by government continue and the levels of vehicle mileage we operate in light of all of those factors. For those of you who are interested, this slide is intended to provide some information for modeling different scenarios. It shows the broad makeup of our regional bus income statement expressed as a percentage of net revenue without the effect of COVID. It also shows for each cost category an estimate of the percentage of the cost that vary with mileage and, therefore, facilitates modeling different combinations of mileage, demand, et cetera. The illustration we give is not a long-term base case forecast, but there's a downside scenario based on only 50% of pre-COVID commercial revenue, 70% of pre-COVID miles and non-mileage-related savings equivalent to 2% of pre-COVID net revenue. So for the avoidance of doubt, this is not intended as a profit forecast, but perhaps it will help you with your own scenario analysis. So in summary, we have seen a creditable performance given the COVID-19 situation. Our liquidity is strong because of the actions we have taken, and we have also made steps to reduce ongoing costs. Currently, we are EBITDA and cash positive with ongoing government payments for our transport services. Clearly, some uncertainty remains, but we remain positive on the long-term prospects for the business. Thank you for your attention. I shall now hand you back to Martin. -------------------------------------------------------------------------------- Martin Andrew Griffiths, Stagecoach Group plc - CEO & Executive Director [3] -------------------------------------------------------------------------------- Thank you, Ross. So I would now like to cover 3 areas: first, the steps that we are taking to transition from the emergency arrangements in this lockdown to the new normal; secondly, an update on the delivery of our business strategy; and finally, how Stagecoach and our mobility services are integral to the community, national and local government plans for a safer, healthier and more prosperous future. As governments across the U.K. seek to reopen the economy and daily life, we are very focused on how we transition our sector and our business from the emergency arrangements in place to what will be the new normal. Central to this understanding is our customers, how are they feeling, what are their priorities, and also establishing future consumer behavior and travel patterns. After a lengthy period where government messaging has told people to avoid public transport, it is now critical that government works with operators to restore customer confidence in public transport. Indeed, in recent days, we have seen the first steps in a change in government messaging. We also need to see the same but flexible approach to the implementation of social distancing on short bus journeys that has already been given to airlines who passengers travel in an enclosed space for several hours at a time. Our research shows that levels of worry about coronavirus are reducing, and this reflects the trends observed at other third-party research. However, we know there remain concerns about a second wave, so customer reassurance about the extensive steps we are taking to provide safe and secure traveling environment are critical. The 3 key priorities for our customers and the focus of our own measures are around a comprehensive and visible cleaning and hygiene regime, the implementation of social distancing and the use of face coverings by passengers. Turning to future consumer demand for travel and how we can influence it, we know that short-term demand for bus travel will remain significantly lower. However, we now have around 80% of bus mileage back in operation across most of the U.K. The commuter market is starting to show some signs of recovery. And at the start of July, we also restarted part of our megabus network in England and Wales as the leisure and hospitality industry started to reopen. New government social distancing guidelines means our vehicles can now accommodate one person on every double seat, delivering around 40% of normal capacity. While capacity will remain constrained in the short term, the growth opportunities over the medium to longer term remain. Remember that travel by bus pre-COVID-19 accounted for less than 5% of overall miles traveled, and the biggest potential for growth in our market remains modal shift from the car. In fact, a 1% modal shift from car to bus would increase bus passenger volumes by around 10%. As Ross has explained, Stagecoach, along with other groups in the public transport sector, are continuing to engage with the U.K. and devolved governments as well as regional transport authorities on transitional financial arrangements to reflect the continuing restrictions on passenger demand and our ability to operate at full capacity. We are also in discussions with government about a joint communications campaign to proactively promote public transport as a safe and sustainable choice, which can help deliver safer, healthier, more connected and more prosperous communities. Building back better has been identified by government as a key priority, and this focus on sustainable towns and cities is an agenda where our public transport solutions are very well placed. As part of our planning to transition to the new post-COVID environment, we've been focused on 2 core areas: one, Stagecoach's commercial development and diversification; and secondly, our own business recovery and restructuring. I'm pleased to announce today that we have launched a new B2B platform called Stagecoach Solutions, a dedicated new website, giving businesses and other organizations access to a suite of specialist services which are in addition to our core local and intercity transport products. Stagecoach Solutions offers access to corporate ticketing products, customized digital demand responsive services, business shuttles, rail replacement services and travel support for major festivals and events. We are able to leverage our extensive experience of managing event travel for sporting competitions and major music festivals. More than a year ago, we started a program to make our business Fit for the Future. The work to make us a more agile and responsive business is more important than ever as a result of the COVID-19 pandemic and the changes it is accelerating on how we all live, work and travel. As part of this work, we have reviewed our support teams in all our operating companies and our central support functions to look at how we can significantly reduce costs based on our immediate operating needs. We are in the process of implementing the changes from that review. We will continue to review the structures and resources we need to meet the immediate challenges and provide a sustainable platform to maximize the opportunities to grow in the future. Across the economy, COVID-19 has sparked activity by the private sector to innovate, pivot and work collaboratively with the public sector. And I'm very proud that Stagecoach has been at the heart of this, and our culture of enterprise and innovation has been able to help the national effort. We've developed and launched Stagecoach Connect, the U.K.'s first dedicated app-based demand response bus service for the NHS workers, first launched in May with our technology partner, ViaVan, is now in place in hospitals in Nottinghamshire and Lincolnshire. Remember, the NHS is one of the world's largest employers with around 1.7 million people based at hundreds of locations around the U.K. We believe there is strong potential for the service to be rolled out to other parts of the NHS, and we're looking forward to engaging with them. Stagecoach Connect was developed from concept to delivery in just 2 weeks to help the COVID-19 response, demonstrating how our agile and innovative teams can grasp new opportunities in a rapidly changing environment. More widely, we believe there is a key role for targeted on-demand solutions as part of future public transport plans. I'd now like to provide an update on the delivery of our business strategy that we outlined just in our interim results in December 2019, just a few months ago, but my goodness, how much has changed. However, our strategy had 3 core elements: maximize our core business' potential in a changing market; manage change through our people and technology to make it simpler and better; and grow by diversifying to balance the portfolio and open up new markets. And while our short- and medium-term priorities have changed to reflect the COVID-19 situation, our strategic objectives are even more relevant in a post-COVID world. Firstly, turning to how we maximize our core business potential in a changing market, we're proud to have some of the highest levels of independently assessed customer satisfaction in the U.K. public transport sector with approval ratings of 90% and above. And Stagecoach also continues to offer the lowest average weekly bus fares of Britain's 4 main national bus operators. In early 2020, we launched our new Stagecoach brand and values as part of a wider commitment to simplify, modernize and enhance the customer experience. Under the banner Proud to Serve, it includes a new design for our buses and our work towards simplifying our customer offer even more. We now offer local, longer and specialist services to reflect the types of journeys our customers make. And these changes complement the multimillion-pound investments that we've made in greener buses, smarter technology and better journeys. We are coordinating this with a greater emphasis on central coordinated marketing and branding activity, optimizing our position as the U.K.'s largest bus and coach operator. Along with our industry partners, we're also progressing a bold, new bus strategy to work with local and central government to get 1 billion more passenger journeys by bus in England by 2030. We've also invested significant time and effort to develop a new partnership-led model for the delivery of local bus services, provides greater public involvement in the design, delivery and success of local bus networks as well as the improvements that people want. And it offers a lower cost, lower risk and quicker approach than bus franchising. We use this approach to develop an ambitious and wide-ranging proposal for a 10-year partnership in South Manchester with the Greater Manchester Combined Authority. The package included London-style improvement to deliver a further step change in the region's bus network, improving connectivity, delivering cleaner air, ensuring better value for taxpayers and supporting a stronger economy. We're now also seeking to shape the reviews of bus services underway in South Yorkshire and Merseyside metropolitan areas, where strong partnerships have resulted in more robust networks than in many other parts of the country. In Scotland and Wales, we also continue to promote the benefits of a partnership approach. Turning to the second strand of our business strategy: making change through our people and technology to make it simpler and better. As well as responding to the changing external environment of new social and working patterns and the growth of the digital economy, we're also changing internally to becoming more agile business and further reduce our costs. We're upgrading and digitizing our people systems as well as our recruitment and performance management process to ensure that we access and retain the best skill and motivated people. We've achieved further positive results in our annual employee survey across areas such as recognition, communication, customer service and safety. Work is also underway to streamline and modernize our back-office systems, including through an asset management system to revolutionize the way we maintain and look after our bus fleet. We're further enhancing our use of technology to support our customers and their business. During the year, we launched the new enhanced version of the Stagecoach bus app for customers with bus-on-map tracker and a busy bus feature to help customers access their services safely and more easily. We continue to focus on modernizing retailing and fares to open up new channels, secure customer loyalty and attract new passengers. Contactless payment facilities cover all of our vehicles, following the biggest rollout of the technology by any bus operator in the United Kingdom. The proportion of all bus revenue continues to increase. Close to 50% of 2019/'20 bus commercial revenue was from contactless and other digital channels. In addition, we are just launching our bespoke app for our corporate customers and look forward to rolling out this digital enhancement over the coming months. The third strand of our business strategy is to grow by diversifying to balance the portfolio and open up new markets. In line with our successful approach over the last 4 decades, we continue to seek opportunities to grow and diversify our business in new markets. We've carried out detailed assessments of overseas markets to establish those we believe have suitable potential. These need to meet a strict set of criteria of a positive economic outlook, supportive public transport policies, positive demographic factors and relatively low political regulatory risk. We are focused on contract opportunities that offer an appropriate risk/reward balance. And in exploring these opportunities, we are using a combination of our U.K.-based business development team and experienced domestic consultants in each market. We have used our experience from our recent bid to operate Sweden's Roslagsbanan commuter railway to pursue other opportunities. I'm very pleased, we've been shortlisted to bid for the Mälartåg railway operating between Stockholm and several adjoining regions, and we are also involved in 4 bus tenders in the Skåne Municipality of Sweden in the Southwest Malmö region. The 4 bus opportunities would involve limited passenger revenue risk and cover a period of 8 years with a potential 2-year extension. The Mälartåg railway contract is for 8 years and has no passenger revenue risk with expected bid submission in early autumn. The combined scale of Mälartåg contract values are expected to exceed GBP 1 billion of revenue over the contract lens. In addition to these opportunities, we have completed detailed market assessments of the United Arab Emirates, a market which fits our profile. We're actively looking at capital-light and low revenue risk opportunities in the region and are pleased to have been shortlisted to bid for 2 significant bus contracts in Dubai. In line with our considered approach over many years, we will continue to evaluate options for growth closely and pursue opportunities that have an appropriate balance of risk and potential reward for our stakeholders. I'd now like to turn to how the benefits of our public transport services offer and the direction of government policy mean we are well placed to connect new post-COVID world and generate value for all of our stakeholders. In February, Stagecoach and the Centre for Economics and Business Research published a new report looking at our impact on the U.K. economy and our communities. And it shows Stagecoach is critical to 3 key areas of focus for government: we support health, wellbeing and safety in our communities; our services underpin prosperity and connect people with employment, education and skills; and we also deliver long-term value for all stakeholders by driving more sustainable communities. As you can see from the statistics on this slide, our impact is significant across each of these areas. In a post-COVID world, these 3 focus areas are even more important. Recent policy announcements from the U.K., Scottish and Welsh governments have put a greater emphasis on encouraging people to switch from the car to more active travel, and public transport buses are a key part of the government's loneliness and mental health strategies with bus journeys part of an active and healthy lifestyle. Forward-looking regional authorities have also been taking steps to reallocate road and street space for active travel and public transport. Turning to the economy. Stagecoach contributes over GBP 1.6 billion a year in gross value added to the U.K. economy from direct job to the supply chain. We are integral to the U.K. government's post-COVID-19 strategy to restart the economy, level up the regions and help drive our world-leading bus manufacturing sector. Our biggest ability to deliver long-term value for all stakeholders is in driving more sustainable communities. Surface transport is the single largest producer of carbon emissions in the U.K. and the only sector where these are growing. All governments in the U.K. have outlined their ambition to address these environmental challenges and deliver a net zero country in terms of greenhouse gas emissions. These targets are just unachievable without a major switch from the polluting private transport to sustainable public transport. Stagecoach has invested more than GBP 1 billion in new vehicles in the past decade, delivering a greener bus fleet, more electric and lower carbon buses and cutting our impact on the environment. We're proud to have received positive environmental and social and governance ratings from several assessment bodies. Stagecoach is one of the 3 public transport groups to receive the new London Stock Exchange Green Economy Mark. This is reserved for companies that generate over 50% of their total annual revenues from products and services that contribute to the global green economy. And we have also achieved an FTSE4Good global corporate responsibility standard for the 19th consecutive year, having been ranked in the top 3% of companies in the travel and leisure sector. So we look forward to working with government on their decarbonization strategy and measures to deliver better public transport infrastructure. Single-use polluting car journeys are the transport equivalent of single-use plastic bags, and greener public transport provides a compelling alternative. Let this be a defining time. Finally, I'd like to summarize the outlook for the business and the delivery of our strategy in the short, the medium and the longer term. Despite the continuing uncertainty around COVID-19 and the undoubted short-term challenges, the long-term outlook for Stagecoach is positive. Our public transport services are a strong fit with the objectives of national and local government, particularly the renewed focus on health, wellbeing and the environment by government and its citizens. Supportive government policies and funding are in place to help drive more use of public transport and other active travel. This includes investment to support improved infrastructure for public transport, reducing congestion and to help a transition to greener vehicle fleets. We can and will play a major role in a cleaner, greener and more resilient economy and a safer and healthier society. As Britain's biggest bus, coach and tram operator, we have opportunities to grow both our current business and through diversification and new market opportunities. We're making the necessary changes in the business to navigate COVID-19 and the wider lifestyle changes we're seeing in our society. Challenge brings opportunity. And in its 40-year history, Stagecoach has always responded to challenge by seeing and capitalizing on those opportunities. We believe the fast delivery, insight and innovation of Stagecoach and the wider private sector is central to and, indeed, I would argue, has never be more important to delivering the country's transport objectives in a financially constrained future. The same spirit of partnership that has helped the country through the worst of the COVID-19 pandemic can help meet the big challenges ahead around better mobility, cleaner air and climate change. We are going to play our part in the recovery and renewal and help create further value for our customers, the communities we serve, our employees and our investors. Thank you very much for listening.