Telecom Plus: Shares soar despite decline in profits in crisis-hit industry
Shares in Telecom Plus rocketed 11.57 per cent yesterday with expectations of a 10 per cent growth in customers over the next six months.
The company, which trades as Utility Warehouse, is a London-based supplier of gas, electricity, landline, broadband and mobile services to residences and businesses.
It has reported net customer service growth of 15,000 in October, and now provides services to 660,700 people.
In its half-year results, the company also reported a six per cent rise in revenues year-on-year with resilient performance across all parts of its businesses.
Telecom Plus has maintained its interim dividend at 27p per share.
This is despite the wider energy crisis in the industry which has seen 21 suppliers cease trading and Bulb enter a special administration process.
Utility Warehouse has also statutory profits before tax falling from £21.5m to £19.9m, a 7.4 per cent drop on last year’s results
It has also suffered a 7.3 per cent increase in cost of sales, which have now reached £286.3m, while administrative expenses have rocketed 12 per cent to £36.3m.
However, it has also revealed an uplift in partner recruitment in response to the emerging cost of living crisis.
Meanwhile, the group continues to grow with more and more customers in an evolving market.
Andrew Lindsay, co-chief executive said: “The recent energy crisis has brought a seven-year destructive price war to an abrupt end, and the subsequent spate of energy supplier failures has demonstrated the inherent flaws in the regulator’s policy of ‘competition at all costs’.”
He also called on market regulator Ofgem to reform the market to prevent more firms from going bust.
Commenting specifically on the group’s results, Lindsay added: “”Our recent trading has set new records. With momentum and confidence building within our community of partners, and the recent paradigm shift in the retail energy market, we look forward to delivering around 10 per cent growth in our customer base during H2, and double-digit annual percentage growth thereafter.”
Utility Warehouse recently paid £1.5m into Ofgem’s voluntary redress fund, after failing to provide debt repayment plans to some of its poorer customers.