Brian Souter takes home £51m in Stagecoach’s bumper payout

Chief executive Sir Brian Souter will pocket £51m thanks to his 15.1 per cent stake in the Perth-based firm, while his sister, Ann Gloag, will receive nearly £37m through her 10.9 per cent holding.

The one-off pay-day comes on top of more than £13m that the pair shared in full-year dividends from the transport group, which were announced in June – meaning the siblings have been allocated more than £100m in just a matter of weeks.

Together, Gloag and Souter have amassed a fortune worth an estimated £650m. They founded Stagecoach in Perth in 1980 with just two vehicles but quickly grew the group as the UK’s bus industry was deregulated, before expanding overseas.

In the year to 30 April, Souter’s pay package rose by 11 per cent to £844,000 after pre-tax profits motored ahead by 27.5 per cent to £205.7m. His total would have been higher but, for the second year running, Souter waived £250,000 of the bonus to which he was entitled, with the cash instead going to help fund a medical screening scheme for staff at the group’s UK division.

The latest shareholder return totalling £340m is the second large windfall for investors in the past four years, having been given back £700m in 2007.

Stagecoach said that, if the proposed return of funds was given the green light by shareholders at a general meeting in October, then the payout will be made using its cash reserves and existing bank facilities.

It said the decision to make the payment – equal to about 20 per cent of the firm’s market value – was taken after a full board meeting with all of the non-executive directors present.

The cash return comes just days after passengers were told that regulated fares across the rail network will rise by 8 per cent in 2012.

Stagecoach also issued an upbeat trading statement, highlighting growth in all of the group’s four businesses in the 12 weeks to 24 July.

UK buses – where each day the firm carries about 2.5 million passengers on 8,400 buses serving Cambridge, Hull, Liverpool, London, Manchester, Newcastle, Oxford and Sheffield – posted a 2 per cent revenue rise on a like-for-like basis. The UK rail division, which includes South West Trains and East Midlands Trains, saw revenues grow by 8.4 per cent.

The North America arm, running coaches in the north-east and north-central regions of the US and Canada, boosted revenues by 12.7 per cent, while Virgin Rail, the west coast main line joint venture between Glasgow and London, raised revenues by 11.1 per cent.

Stagecoach said: “The group has performed well since 30 April and remains on course to meet its expectations of profitability for the year.”

Shares in Stagecoach were a rare riser in a sea of red yesterday, up 1.5p at 233.4p.

Analysts said the size of the cash return was higher than expected. Gert Zonnerveld, at Panmure Gordon stockbrokers, added that the trading outlook was positive with Stagecoach shortlisted for two rail franchises and North America growing rapidly on the back of the expanding Megabus network.

Paul Hickman, an analyst at Peel Hunt, said: “Stagecoach’s record of cash returns, with £1.3 billion returned in the past five years, marks it out as an efficient manager of investments in its chosen passenger transport field. This confirms our view that Stagecoach is the strongest all-round player in the sub-sector.”