18th Jun 2019 11:51
(Alliance News) - Telecom Plus PLC on Tuesday reported a modest rise in annual profit due to improved commercial terms from wholesale partners and early benefits from its smart meter roll-out programme.
Shares in Telecom Plus were up 3.6% at 1,514.00 pence in London, among the best performers in the FTSE 250.
The utility services firm's pretax profit for its year ended March 31 was GBP43.0 million, a rise of 4.9% from GBP41.0 million, as revenue increased 1.5% to GBP804.4 million from GBP792.9 million.
Telecom Plus said it benefited from improved commercial terms from its wholesale partners, as well as some early benefits from its smart meter programme. Also a factor was the slower organic growth in the size of the company's membership base in its prior year.
However, these were somewhat offset by growth in its customer support teams, increased investment, and a warmer winter.
Administrative expenses increased to GBP67.9 million from GBP63.2 million while distribution expenses climbed to GBP26.0 million from GBP21.9 million.
The company is proposing a final 27p per share dividend, up from 26p per share. This lifts the total for the year by 4.0% to 52p per share from 50p.
Telecom Plus Chief Executive Andrew Lindsay said: "Our balance sheet remains robust, with low leverage and strong cash flow. In contrast to the majority of other energy suppliers, this puts us in a strong position to take advantage of a challenging retail marketplace."
Lindsay added that, due to "higher partner confidence", steady growth, and improved gross margins, the company expects adjusted profit before tax to be between GBP60 million and GBP65 million in its 2020 financial year, from GBP56.3 million in financial 2019. This is to be accompanied by a 10% dividend increase to 57p per share.
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