AGM TRADING UPDATE AND IMS

19 July 2012

KCOM GROUP PLC (KCOM.L)

AGM TRADING UPDATE AND INTERIM MANAGEMENT STATEMENT

KCOM Group today announces its trading update for the period 1 April to 19 July, ahead of its Annual General Meeting at 11am.

Since its preliminary results announcement in May, the Group has continued to perform well, making good progress against its longer term objectives and the Board confirms that trading continues to be in line with expectations. Our focus remains on executing our growth strategy and we expect the performance of the Group to reflect this during the current financial year.

As anticipated, the Group's Employee Benefit Trust has completed the acquisition of 7.3 million shares in the first quarter of the year for a cash consideration of £5.1 million. These will be used to satisfy the Group's obligations in respect of certain share incentive plans that will vest as at 24 July 2012.

Subject to shareholder approval at today's AGM, the Group will be paying a final dividend of 2.67p (2011: 2.50p) to shareholders who were on the share register on 29 June. This brings the total dividend for the year to 4.00p per share, an increase of 11 per cent year on year. Payment of the final dividend will be made on 27 July 2012 and we reconfirm our commitment to delivering a minimum ten per cent increase in dividend for the current financial year.

ENDS

For more information on the KCOM Group, please go to www.kcomplc.com

Enquiries:

Bill Halbert, Executive Chairman / Paul Simpson, CFO

KCOM Group PLC

020 7422 8707

Cathy Phillips, Investor Relations

KCOM Group PLC

07778 335735

Jon Coles/Aideen Lee

Brunswick

020 7404 5959