Britain's biggest rail operator, National Express, unveiled sharply lower pre-tax profits as strife on the network took its toll.

Poor demand, industrial action and infrastructure work were among factors blamed for the disappointing showing by its trains division.

The National Express portfolio includes Gatwick Express, Midland Mainline and ScotRail franchises but operating profits for the division in the six months to June 30 fell to £4.1 million from £20.3 million last time.

Across the group, which also includes bus and coach operations, underlying pre-tax profits slid to £37.2 million from £60.5 million a year earlier.

The company described the last six months as challenging but said it was doing all it could to attract passengers back on to the network.

But it warned that increased work by Railtrack and industrial unrest, which has already cost the ScotRail service £7 million, would continue to affect the division's profits for the rest of the year.

One of the worst-affected businesses has been the London and the South-East region, which includes c2c and Wagn, the service involved in the fatal Potters Bar train crash in May.

National Express said Wagn's performance had been severely impacted by the accident, while the profitability of Gatwick Express had been hit by British Airways' decision to reduce services at the airport.

Turnover in the region was slightly lower at £246.2 million, while operating profits slumped to £5.6 million from £34.4 million because of higher train leasing charges, compensation payments linked to the Hatfield accident and the 12 per cent fall in Gatwick Express passenger numbers.

The regional services division, which includes the Wales and Borders franchise, generated higher turnover of £395.4 million but National Express said usage continued to be affected by reduced leisure traffic and ongoing industrial action.

On a brighter note, the company said trading in its UK bus, coach and North American student bus operations had been good.