20th Nov 2013 08:36
LONDON (Alliance News) - Telecom Plus PLC Wednesday said it has boosted its energy market credentials with two acquisitions and 20-year supply agreement with Npower Ltd., while also reporting higher pretax profits in its first half.
The utility services company, which trades under the Utility Warehouse brand, said it has entered into an agreement to acquire Electricity Plus Supply Limited and Gas Plus Supply Limited from Npower for GBP218 million. nPower, a subidiary of RWE AG of Germany, holds the UK assets of the former generator National Power.
The payment will be split between GBP196.5 million due on completion and GBP21.5 million deferred for three years.
Telecom Plus said that, in order to fund the acquisitions, it will raise GBP130 million through a combination of a firm share placing and a placing and open offer, both underwritten by broker Peel Hunt, while it will drawdown roughly GBP100 million from a new debt facility with Barclays PLC.
The placing will made at 1,475 pence per share. In early trading Wednesday, Telecom Plus shares were priced at 1,715.20 pence, up 14%, putting it top of the FTSE 250 gainers.
The company also announced that its pretax profit increased 9.6% to GBP13.7 million for the six months ended September 30 from GBP12.5 million the previous year, as sales jumped significantly.
The company said its sales increased 17% to GBP245.8 million from GBP210.0 million and that 60% of its new members during the period took at least four major services.
Telecom Plus also increased its interim dividend by 23% to 16 pence from 13 pence the previous year.
Utility Warehouse doesn't advertise, relying on word of mouth and up-selling current customers. It regularly scores very highly on surveys of customer satisfaction.
"We intend to maintain consistently competitive energy prices in future as we continue to grow, and look forward to passing on to customers the benefit of any reduction in the cost of the so-called green levies if this widely expected measure is announced by the Chancellor in his forthcoming autumn statement," Chief Executive Andrew Lindsay said in a statement.
By Tom McIvor; [email protected]; @TomMcIvor1
Copyright © 2013 Alliance News Limited. All Rights Reserved.
Related Shares:
Telecom Plus