Telecom Plus trading statement

TELECOMPLUSPLC

Trading as the Utility Warehouse, Telecom Plus PLC provides a range of services to households and small to medium sized businesses. The Company is engaged in the supply of fixed telephony, mobile telephony, gas, electricity and Internet services through independent distributors. I have a holding in my growth portfolio (epic code: TEP).

Telecom Plus issued today a positive trading statement in advance of its half year results, that will be announced on 19 November.

Customer numbers were up by 34,733 to 565,372 and service numbers were up by 126,537 to 2,033,697.  Management say they are on target to achieve 70,000 new customers by the year -end.  Underlying churn of the customer base has continued to fall, management state that this reflects the steady and continuing improvement in the quality of their customer base and maintaining high levels of service. 

Management state that performance is in line with market expectations for the full year.  They expect that their interims will show adjusted pre-tax profit and EPS that are significantly ahead of last year.

For the year as a whole they expect to achieve market expectations of adjusted pre-tax profit of £63m, an increase of almost 50%.  Management intend to increase in the interim dividend by 19% to 19p.

Net debt will rise by £10m by the year-end as the company continues with the refurbishment of their new HQ.

Following on from the announcement in early June that Chris Houghton, FD, will leave in October, the company announced that Nick Schoenfeld will join the Board as CFO in the New Year, he is currently Group FD of Hanover Acceptances, a private company with holdings in the food manufacturing, real estate, and agri-business sectors; a position he has held since 2006.  Schoenfeld has no public company experience and there is no hand over from the previous FD, so he will have a steep learning curve.  It is a little disappointing that a £1bn market cap FTSE 250 company, was unable to attract a finance executive with some public company experience.

The SP has responded well to the trading statement and is up over 7% this morning to 1343p.