Operator of Britain's busiest train service, Stagecoach Group Plc. reported a 13% decline in earnings for the current fiscal year's first six months as recession pulled down the demand for travel, and fuel and pension costs hiked.

Net earnings slipped to 60.6 Million Pounds ($98 Million) or 8.4 pence per share, from last year's recorded figure of 69.4 Million Pounds, to 9.6 pence a share, for the same period. Sales, however, did manage to rise by 3% to 1.08 Billion Pounds.

Revenues also hiked by 1.9% to 512.9 Million Pounds, in the six months up-to October 31.

"Our working assumption is that it will still be a challenging trading environment in 2010,” Chief Financial Officer Martin Griffiths said, while stressing that the company is still very interested in "targeted acquisition opportunities".

Stagecoach has shared that it will keep examining all possible opportunities for expansion and taking on new franchises. “We are a franchise operator and we are in that business", Mr. Griffiths said.

Stagecoach is the owner of 49% of the Virgin Rail Group and operates the East Midlands rail franchise. The company also operates bus services in over a 100 towns and cities across UK, right from Northern Scotland to the South-West.