Final Results

Telecom Plus PLC
23 May 2001

                               TELECOM plus PLC

Preliminary results for the year ended 31st March 2001

Telecom plus plc, the low-cost provider of fixed and mobile telephony, gas and
electricity, announces preliminary results for the year ended 31 March 2001.


Financial and business highlights:

*         Turnover up 46% to £28.1m (2000: £19.2m)



*         Profits before tax of £2.5m (2000: Loss £0.4m)

*         Maiden final dividend of 1.5p (total of 2p for the full year) to be
paid 20 July 2001

*         Subscriber base now exceeding 88,000 (under 0.5% of UK households) -
representing a huge opportunity for continued growth

*         Encouraging performance from the Virtual Network, turnover of £6.6m
over the last quarter (£4.7m over corresponding period last year)

*         Successful gas trials completed


Commenting on the results, Chairman Peter Nutting, said:


'I am pleased to report a year of continued growth across all our principal
activities.  We have now started to offer electricity to existing customers
and have recently applied to OFGEM for an extension to our existing gas
supplier licence.



'We believe that it is our provision of value for money services, coupled with
attentive customer handling and cost effective marketing, that has enabled the
Company to flourish in extremely competitive market conditions.'




For press enquiries or further information, please contact:

Charles Wigoder                                      Neil Boom
Telecom plus PLC                                     Gresham PR
020 8955 5000                                        020 7329 7555





23 May 2001


CHAIRMAN'S STATEMENT



I am pleased to report a year of continued growth across all our principal
activities.



We are encouraged that turnover exceeded £28.1 million (2000: £19.2 million)
representing an increase of over 46%, and pre-tax profits for the full year
reached £2.5 million (2000: Loss £0.4 million).  Cash flow remains strong with
the cash balance increasing by over £600,000 during the last quarter to £9.0
million.  This occurred despite a cash outflow of approximately £650,000 in
January on the purchase of additional premises.



In view of the Company's strong cash position and rising profitability, the
Board have decided to pay a maiden final dividend of 1.5p (making a total of
2p for the year) which will be paid on 20 July 2001 to shareholders on the
register at 22 June 2001. It is the directors' intention to adopt a
progressive dividend policy to reflect the Company's growth in earnings over
the next few years.



Our customer base has been growing steadily throughout the year, which is
reflected in the increased turnover from our Virtual Network Business of £6.6
million during the last 3 months compared with £4.7 million during the
corresponding period last year.  The operating profits from this business have
been increasing steadily throughout the year, reaching £1.4 million during the
quarter ended 31 March 2001.  This brings the total profit for the year from
providing services to our customers to £4.9 million (2000: £1.7 million).



Our Distribution Business continues to generate steady growth in new
customers, with application forms being received for more than 74,000 services
during the year. Our total subscriber base now exceeds 88,000 customers, who
together subscribe for more than 140,000 services provided by the Company.
Given that BT and Centrica retain a market share of over 70% of UK households,
the directors believe that Telecom plus, with a market share of under 0.5%,
has considerable potential for further organic growth.



The extensive trials of gas and electricity to our independent distributors
have been successfully completed, and we have now started to offer electricity
to our existing telephony customers.  We have recently applied to OFGEM for an
extension to our existing gas supplier licence, and hope to start offering gas
to all customers in the near future.



Unlike many businesses which capitalise the investment in their subscriber
base on their balance sheets, we continue to charge all costs relating to
acquiring new subscribers through the profit and loss account.  We regard this
as prudent accounting.  Our customer base has, we believe, a substantial value
that is not reflected in the balance sheet.



Our internal systems are performing well, and we have more than adequate
capacity to support  significant customer growth in future.  We continue to
invest substantial resources in enhancing our unique computerised subscriber
administration and convergent billing system to deal with the specific needs
of the businesses in which we operate.  We believe the system we are using
gives us a significant edge over our competitors in terms of a lower overhead
base-cost, greater efficiency and the ability to provide a cost effective yet
enhanced level of customer care and support. In particular, we are able to
send customers a single, easy-to-understand bill for all the services we are
providing to them.



We now have nearly 100 full time employees, and I would like to take this
opportunity to thank them for their commitment and support during a further
period of rapid growth.



I am delighted that so many shareholders have chosen to take advantage of the
Shareholder Discount Scheme introduced following our successful flotation, and
I take this opportunity of reminding other shareholders of the valuable
savings this provides on our services.



In the light of the steady and consistent growth in customers and
profitability now being achieved by the company, your directors believe that
the additional costs and diversion of resources required to publish quarterly
results is no longer appropriate. The next interim accounts will therefore be
published in mid-November in respect of the 6 month period ending 30 September
2001.



We believe that it is our provision of value for money services, coupled with
attentive customer handling and cost effective marketing that has enabled the
Company to flourish in extremely competitive market conditions.   We continue
to look for opportunities to introduce additional complementary new services
which will enhance the profitable long-term growth of the Company, and I
remain extremely  confident in our future prospects.



Peter Nutting                                      23 May 2001
Chairman


PROFIT AND LOSS ACCOUNT

YEAR ENDED 31 MARCH 2001


                                                           2001            2000
                                                          £'000           £'000

Turnover                                                 28,106          19,197

Cost of sales                                          (18,083)        (14,146)

Gross profit                                             10,023           5,051

Sales and marketing costs                               (2,393)         (2,025)

Administrative expenses                                 (5,234)         (3,326)

Operating profit/(loss)                                   2,396           (300)

Interest receivable                                         372             173

Interest payable                                          (258)           (235)

Profit/(loss) on ordinary activities before taxation      2,510           (362)

Tax on profit on ordinary activities                       (74)               -

Profit/(loss) after taxation                              2,436           (362)

Dividends                                               (1,077)               -

Retained profit/(loss) for the year                       1,359           (362)

Basic earnings per share                                   4.6p          (0.7)p

Diluted earnings per share                                 4.4p          (0.7)p

Dividend per share                                         2.0p               -


Turnover and operating profit/(loss) derive entirely from continuing
operations.


The company has no recognised gains or losses other than the profit/(loss) for
the period.




BALANCE SHEET

AS AT 31 MARCH 2001




                                          2001                      2000
                                  £'000           £'000       £'000       £'000

FIXED ASSETS

Tangible assets                                   2,134                   1,107

CURRENT ASSETS
Stocks                            2,048                       2,271
Debtors                           3,311                       1,909
Cash at bank and in hand          9,008                       3,951

                                 14,367                       8,131
CREDITORS
Amounts falling due within one   (6,867)                     (4,479)
year

NET CURRENT ASSETS                                7,500                   3,652

                                                  

TOTAL ASSETS LESS CURRENT
LIABILITIES                                       9,634                   4,759
                                                  

CREDITORS

Amounts falling due after more
than one year (includes
convertible debt instruments)                    (2,097)                 (2,521)

                                                  7,537                   2,238

CAPITAL AND RESERVES
Called up share capital                           2,702                   2,536
Share premium account                             3,795                      21
Profit and loss account                           1,040                    (319)

SHAREHOLDERS' FUNDS                               7,537                   2,238





Approved by the board on 23 May 2001.





CASH FLOW STATEMENT

YEAR ENDED 31 MARCH 2001


                                                   2001                    2000
                                                  £'000                   £'000

Reconciliation of operating profit/(loss) to cash
flow from operating activities
Operating profit/(loss)                           2,396                    (300)
Depreciation                                        265                     142
Decrease/(increase) in stocks                       223                  (1,807)
Increase in debtors                              (1,402)                   (301)
Increase in creditors                             1,919                   1,768
Amortisation of loan stock issue costs               22                      20

Net cash flow from operating activities           3,423                    (478)

CASH FLOW STATEMENT

Net cash flow from operating activities           3,423                    (478)
                                                                       
Returns on investments and servicing of finance     129                       -


Capital expenditure                              (1,592)                   (607)

Dividends paid                                     (267)                      -

                                                  1,693                  (1,085)

Financing                                         3,364                   4,685

Increase in cash                                  5,057                   3,600

Reconciliation of net cash flow to movement in
net funds

Increase in cash                                  5,057                   3,600

Cash inflow from issue of loan stock                  -                  (2,650)
Cash outflow from capital element of hire           148                     115
purchase contract repayments

Change in net funds resulting from cash flows     5,205                   1,065

New hire purchase contracts                           -                     (11)
Conversion of loan stock to equity shares           428                      46

Movement in net funds for the year                5,633                   1,100


Net funds at 1 April 2000                         1,179                      79

Net funds at 31 March 2001                        6,812                   1,179







NOTES



1.                    The results for the year ended 31 March 2001 are not
statutory accounts and are unaudited.  The results for the year to 31 March
2000 are an abridged version of the company's full accounts which received an
unqualified audit report and have been filed with the Registrar of Companies.



2.                    Dividends


                                                       2001                2000
                                                      £'000               £'000
Interim ordinary dividend paid 0.5 per share            267                   -
Proposed ordinary final dividend of 1.5 per             810                   -
share

                                                       1077                   -



3.                    Earnings Per Share



The calculation of basic earnings per share is based on a profit of £2,436,000
(2000 : £362,000 loss) and a weighted   average of 52,698,017 (2000 :
49,154,932) shares in issue.


                                                    2001                   2000

Basic earnings per share                            4.6p                  (0.7)p
                                                                        
Diluted earnings per share                          4.4p                  (0.7)p



Diluted earnings per share assumes that dilutive options have been converted
into ordinary shares.  Convertible loan notes are not dilutive.  The
calculations are as follows:


                                     2001                       2000
                         Profit          Shares         Loss         Shares No.
                                            No.
                          £'000             000        £'000                000

Basic earnings            2,436          52,698        (362)             49,155
Dilutive effects:
- Options                     -           2,506            -                  -

Diluted earnings          2,436          55,204        (362)             49,155