Stagecoach has won a dispute with the Department for Transport regarding the date from which it could receive revenue support from the DfT for its South Western Trains franchise.

Stagecoach said the start date for calculating revenue support for the year ended 31 March 2011 should be April 2010, while the DfT said the start date should be February 2011.

In addition Stagecoach said that support levels should be calculated to exclude all car park revenue, while the DfT said that come car park revenue should be included.

An arbitrator appointed under the Rail Industry Dispute Resolution Rules last year has ruled in favour of Stagecoach on the issue of when revenue support should be calculated from, however on the issue of including car park revenue the arbitrator sided with the DfT.

Stagecoach said that the ruling in its favour meant that its UK Retail Division is likely to remain profitable for the year ending 30 April 2011, although profits will be lower than "they would otherwise have been" thanks to the car park ruling.

A spokesman for Stagecoach, said, "We are pleased at the outcome of the arbitration process, which has ruled in our favour on the central issue of revenue support. We believed this was a matter of integrity over a contract signed in good faith and we had strong legal advice in support of our position.

"We will continue to remain focused on running punctual and reliable trains for our passengers, investing in stations and train services, and increasing customer satisfaction. At the same time, we are committed to delivering strongly on our franchise commitments to Government, providing value for money to taxpayers and ensuring good returns to our shareholders."

By 11:38 shares in Stagecoach were up 2.79 per cent on the FTSE 250 to 191.40 pence per share.

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