Bus and train operator Stagecoach to cut its full-year earnings forecast, saying that passengers are avoiding travelling to major cities in the wake of last month’s terrorist attacks in Paris.

Stagecoach, whose megabus.com inter-city coach business operates between Britain and Europe, said rail and coach sales had been hit across the UK and continental Europe since the attacks on November 13, which killed 130 people.

Stagecoach said: “We believe that revenue has been adversely affected by the terrorist attacks in Paris discouraging people from travelling to major cities.”

Stagecoach said that as well as reduced demand for coach journeys between the UK and Europe, discretionary travel in the UK had also been hit, with wary passengers travelling less on its South West train network outside commuter times and between London and Oxford on its coach services.

Stagecoach said that it expected the impact on passenger numbers from the terrorist attacks to be only short-term, but it also warned that it was seeking weaker-than-expected revenue from its UK regional bus arm, which includes some services in Cambridgeshire and west Suffolk.

The earnings alert came despite Stagecoach reporting a 12% rise in underlying pre-tax profits to £121.5million for the six months to October 31 although on a reported basis pre-tax profits fell 7.6% to £90.8m.

Martin Griffiths, chief executive of Stagecoach, said that while “challenges remain in our sector in the short-term” the group was in “good financial shape”.

But analysts at Liberum said they were concerned over the “worsening” performance at Stagecoach’s regional UK bus business and the outlook for its megabus division in America.