Strong demand from bus travellers has lifted transport operator Arriva, with annual operating profit up 7%.

Arriva's performance was aided by marketing initiatives and increased demand. The bus arm achieved a 16% profits increase to £87.9 million, with revenues up 7% to £814.7 million. The improvement came despite fuel price increases costing £8 million in 2007.

Non-London bus services carried 414 million passengers in 2007, an increase of around 2%.

Costs associated with bidding for three rail franchises in 2007 hurt profits at its rail arm, with the figure reducing to £7.5 million from £12.3 million a year earlier.

Arriva won the pitch for the CrossCountry franchise in July, giving it the UK's most geographically extensive network.