Telecom Plus upbeat on strong first-half growth

(Sharecast News) - Telecom Plus, operating under the Utility Warehouse (UW) brand, reported significant first-half growth on Tuesday, with revenue increasing 57.1% to £883.6m. The FTSE 250 company said adjusted profit before tax also saw a substantial rise, up 36.1% to £43.7m, while statutory profit before tax increased 22.7% to £35.7m.

It refinanced its borrowing facilities and maintained an underlying net debt-to-EBITDA ratio of 0.7x.

Additionally, the interim dividend per share was increased to 36p, up from 34p in 2022.

On the operational front, Telecom Plus said it continued to perform strongly in a more normalised energy market.

The company said it experienced high-quality customer growth, with an annualised rate of over 14%.

Total services supplied also rose, increasing by 170,698 to reach 2,968,846.

Telecom Plus said it deepened its long-term relationship with E.ON, creating opportunities for incremental growth, and also expanded its broadband service reach by incorporating CityFibre's footprint into its proposition.

Telecom Plus said it was in its fifth consecutive half-year period of delivering comfortable double-digit customer growth in the current trading environment.

Macroeconomic pressures were favourable for new partner recruitment and engagement, with Telecom Plus now the seventh-largest energy supplier in the UK.

The company said it saw significant organic growth potential ahead, with 97 of every 100 UK households still using other suppliers.

Additionally, Telecom Plus said it was on track to sign on its one-millionth customer during the second half.

"We have consistently offered the lowest-priced energy tariffs in the UK for over two years," said co-chief executive officer Stuart Burnett.

"Our unique multiservice model means we can continue to sustainably beat the competition, and is the primary driver of our continued rapid growth.

"We are fast approaching the 1m customer milestone, and our current rate of growth places us firmly on track to double the size of the business by welcoming a further million customers to UW over the medium term."

In terms of its outlook, Telecom Plus said it was confident in meeting expectations for the full year, as it prepared for an initial £10m share buyback programme set to commence in the second half.

"With no obvious end in sight for hard-pressed families across the country, demand for our income opportunity remains high, and we are committed to supporting all of our partners to achieve their personal goals through UW," added co-CEO Andrew Lindsay.

"Over the past 24 months, the business has consistently delivered double-digit growth in customers and profit.

"This ongoing strong performance reflects a business that has never been in such good health in terms of its customer proposition, its competitive position and the levels of engagement within its partner community."

At 0831 GMT, shares in Telecom Plus were up 1.18% at 1,722p.

Reporting by Josh White for Sharecast.com.