A round of strikes earlier this year cost rail operator South West Trains �1.5m a day, a report has shown.

The rail operator's owner, Stagecoach, has revealed that six days of strikes hit operating profits by �6m.

The action was called by the Rail, Maritime and Transport union in support of a better pay deal.

SWT, which serves the south-east and south-west of England, also suffered a 2.4% decline in passenger numbers over the last year, as speed restrictions and engineering problems troubled the business's performance.

"In recent weeks we have seen the first small signs of improvement in underlying passenger trends," Stagecoach said.

"But the speed of recovery depends on a positive economic outlook combined with a sustained infrastructure improvement that will restore passenger confidence in rail travel."

Off-peak travel has been the worst affected, a Stagecoach spokesman told BBC News Online.

"It's your shopping trips - people are concerned about timetables, whether they will be able to get back," the spokesman said, adding that the decline reflected a nationwide problem.

Mixed fortunes

Stagecoach also revealed that its US-based tour and charter business Coach USA was still suffering from a slump in travel after the 11 September attacks.

Operating profits at the unit, which operates about 9,500 vehicles, will be $12-15m below earlier forecasts, despite the implementation of a $25m cost-saving programme.

"While the domestic charter market has largely recovered, we have still to see a full recovery in the school overnight trip market," the Stagecoach statement said.

But the firm said that overall profits for the year to the end of this month would be in line with analysts' forecasts.

Chiefs at Virgin Rail, in which Stagecoach has a stake, are in talks with the Railtrack's administrators and the Strategic Rail Authority over rebates for delays blamed on infrastructure problems.

And, thanks to "strong growth" in urban operations, Stagecoach's bus division saw revenue climb 6% over the year.

Stagecoach shares stood 0.75p lower at 77.75p in midday trade in London.