Interim Management Statement

RNS Number : 2614K
Telecom Plus PLC
13 July 2011
 



13 July 2011

 

 

Telecom Plus PLC (the "Company")

 

Interim Management Statement

 

 

Telecom Plus PLC (trading as the Utility Warehouse), which supplies a wide range of utility services (gas, electricity, fixed line telephony, mobile telephony and broadband internet) to both residential and business customers, today issues its Interim Management Statement to cover the period from 1 April 2011 to 12 July 2011. This incorporates information relating to the performance of the business for its first quarter ended 30 June 2011, to coincide with its Annual General Meeting ("AGM") being held later today.

 

Highlights

 

·           Continuing organic growth

·           Strong cash generation

·           Significant improvement in customer quality

·           Customer numbers up by 7,388 during the quarter to 378,738 (30 June 2010: 351,442)

·           Number of services up by 38,140 during the quarter to 1,209,276 (30 June 2010: 1,075,363)

 

Operating Review

 

We have seen an encouraging start to the current year, with organic growth significantly ahead of the levels we achieved in the corresponding period last year.

 

Overall customer numbers increased during the first quarter by 7,388 (Q1 2011: 5,680), whilst the number of services provided rose by 38,140 (Q1 2011: 30,847). It is particularly pleasing to have seen a substantial rise in the proportion of new members applying for at least 4 different core services from us, and annualised growth in the number of mobile services holding steady at around 60% for a second consecutive quarter.

 

Following the successful sales conference held at the beginning of April, our distributors are making steady incremental progress in gathering higher quality customers, as shown by the further improvement in the average number of services taken by residential club members (which has increased from 3.43 to 3.48 during the quarter). Activity levels remain high with a net increase of around 1,500 distributors during the quarter.

 

Demand from new customers for our exclusive CashBack card remains at record levels, with over 80,000 cards now in issue. Penetration of these cards within our residential club customer base has increased from 17% to 27% over the last 12 months.

 

We have just completed the final phase of refurbishing our office headquarters in north-west London, and look forward to consolidating virtually all our employees into this building over the next few weeks.

 

 

 

 

 

 

 

 

 

Customer, Distributor and Service Numbers

 

Telecom Plus Group

FY2012

FY2011



Q1

Q4

Q3

Q2

Q1








Distributors

32,922

31,459

29,818

30,696

30,116








Customers







Residential Club

299,973

293,292

285,450

280,009

275,097


Business Club

25,240

24,506

23,729

23,066

22,259


Total Club

325,213

317,798

309,179

303,075

297,356


Non Club

43,153

43,156

43,197

43,552

42,821


Total Telecom Plus

368,366

360,954

352,376

346,627

340,177


TML

10,372

10,396

10,452

10,673

11,265


Total Group

378,738

371,350

362,828

357,300

351,442








Services







Electricity

303,495

296,412

288,895

282,135

274,519


Gas

255,741

249,482

243,064

236,836

230,251


Fixed Telephony

217,308

215,059

214,093

214,096

212,656


Fixed Line Rental

170,556

166,194

162,911

160,400

156,611


Broadband

118,252

113,411

109,813

107,052

102,835


Mobile

48,891

42,151

36,607

35,795

35,360


CashBack card

80,851

72,611

63,412

54,661

46,814


Non Geographic numbers

14,182

15,816

16,030

16,242

16,317


Total Group

1,209,276

1,171,136

1,134,825

1,107,217

1,075,363









Residential Club

1,044,786

1,007,185

971,354

943,577

913,537


Business Club

61,534

59,781

58,403

56,807

54,685


Total Club

1,106,320

1,066,966

1,029,757

1,000,384

968,222


Non Club

70,311

70,240

70,616

71,590

70,712


Total Telecom Plus

1,176,631

1,137,206

1,100,373

1,071,974

1,038,934


TML

32,645

33,930

34,452

35,243

36,429


Total Group

1,209,276

1,171,136

1,134,825

1,107,217

1,075,363








 

Cash Flow

 

Underlying cash flow remains in line with management expectations, with positive cash generation of over £10m during the period. We anticipate that our short term borrowings as at 30 June 2011 of approximately £5.0m (31 March 2011: £15.5m) will have been eliminated and replaced by a positive cash balance of a similar size on 30 September 2011, notwithstanding the £9.7m cost of paying the proposed final dividend for last year which is expected to be made on 5 August 2011.

 

Outlook

 

We expect a steady increase in our current rate of organic growth over the coming months, driven by the large number of new distributors joining each month, and continuing strong demand for our unique multi-utility proposition.

 

We are investing considerable resources in developing an updated internet presence, which is due to be launched this summer. This will not only enable our distributors to sign up new members more efficiently, but will also give us an effective fulfilment mechanism for our customer referral scheme.

 

Several of the 'Big 6' energy suppliers have recently announced price rises, averaging around 15%-17% for dual fuel customers. As we are affected by similar cost pressures, it is reasonable to expect that we will shortly also announce higher tariffs, whilst maintaining our current competitive position.

 

Our financial performance since the year end has been in line with management expectations, and we anticipate that our half yearly report (which is expected to be announced on 22 November 2011), will show earnings, pre-tax profits and organic growth significantly ahead of the figures for the comparable period last year.

 

Andrew Lindsay, Chief Executive said:

 

"We have seen an encouraging start to the current year, with organic growth significantly ahead of the levels we achieved in the corresponding period last year."

 

"We expect a steady increase in our current rate of organic growth over the coming months, driven by the large number of new distributors joining each month, and continuing strong demand for our unique multi-utility proposition."

 

"We anticipate that our half yearly report will show earnings, pre-tax profits and organic growth significantly ahead of the figures for the comparable period last year."

 

For more information please contact:

 

Telecom Plus PLC

Andrew Lindsay, Chief Executive                                                                  020 8955 5000

Chris Houghton, Finance Director    

                          

Peel Hunt

Richard Kauffer / Dan Webster                                                                     020 7418 8900

 

Brewin Dolphin

Nick Owen                                                                                                     0845 059 6412

 

MHP Communications

Reg Hoare / Katie Hunt                                                                                 020 7357 9477

 

About Telecom Plus PLC:

Telecom Plus which owns and operates the Utility Warehouse brand, is the UK's only fully integrated provider of a wide range of competitively priced utility services spanning both the Communications and Energy markets.

 

Customers benefit from the convenience of a single monthly bill, consistently good value across all their utilities and exceptional levels of customer service. The Company does not advertise, relying instead on "word of mouth" recommendation by existing satisfied customers in order to grow its market share.

 

Telecom Plus also has a wholly owned subsidiary called TML purchased in 2002, which supplies predominantly fixed line telephony to small and medium sized business customers through a network of authorised resellers and dealers.

 

Telecom Plus is listed on the London Stock Exchange (Ticker: TEP LN).  For further information please visit: www.telecomplus.co.uk.


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