REG - Telecom Plus PLC - Trading Update and Notice of Results

Telecom PlusAnnouncement

11/10/2023 07:00

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RNS Number : 7008P  Telecom Plus PLC  11 October 2023

Trading Update and Notice of Results

 

"Comfortably on track to double the size of our high quality base"

 

Telecom Plus PLC (trading as Utility Warehouse or UW), which supplies a wide
range of utility services focussed on domestic customers, today issues a
trading update for the six-month period ending 30 September 2023.

 

Continued double-digit annualised customer growth in a stable market

 

Over 62,500 additional households switched to UW in the first 6 months of
FY24, representing an annualised growth rate of over 14%. With 949,180
households now taking their services from UW, we are comfortably on track to
double the size of our high quality base over the medium term, and expect to
pass the one million customer milestone during the current financial year.

 

The number of services we supply to our customers increased by 170,698 during
the period, to a total of 2,968,846, reflecting continued strong multiservice
take up amongst new customers seeking to maximise the savings that they can
make on their household bills.

 

As stability has returned to the energy retail markets after two years of
'crisis', the business is continuing to perform strongly, demonstrating its
ability to outcompete and grow rapidly in a normalised environment: our
enduring multiservice cost advantage enables us to sustainably and profitably
offer home owners some of the lowest priced services across the energy,
broadband, mobile and insurance markets.

 

Deepening our long-term relationship with E.ON

 

We are pleased to have updated our existing long-term energy supply contract
with E.ON to ensure the sustainability of the agreement over the remaining 10
year term (until December 2033). This agreement underpins our ability to
deliver comfortable double-digit customer growth over the medium term by
focusing on our unique multi-service proposition, route to market and customer
management expertise. E.ON remains responsible for wholesale energy market
activities, weather-related balancing costs and seasonal working capital
movements associated with our growing energy customer base.

 

The agreement has been refined so that the amount we pay to E.ON for the
wholesale services it provides is more closely matched to the wholesale
cost components in the price cap (rather than using a proxy percentage of the
total price cap). This improved approach is more accurate, reducing risk for
both parties, and means both parties now benefit from the full price cap
allowances which relate to the activities for which they are each responsible
(e.g. customer bad debts in the case of UW). Importantly, the updated supply
contract provides us with greater flexibility, enabling us to develop and
launch a wider range of energy products - for example a broader set of
attractively priced fixed tariffs to both the residential and small business
markets. The amended contract also provides a framework for UW to develop
innovative 'time of use' tariffs (suitable for EV charging and home generation
& storage).

 

Looking ahead, it is clear there will be significant opportunities as the
energy retail market evolves and continues its transition towards net zero.
Our updated energy supply agreement will provide the capabilities and
flexibility required to take full advantage of these over time, and we
therefore anticipate modestly increasing our investment in the proposition
from FY26 to further accelerate our customer growth trajectory.

 

Outlook and notice of results

 

We reaffirm our guidance for the full year and look forward to providing a
further update with our half year results on 21 November 2023.

 

Stuart Burnett and Andrew Lindsay, Co-CEOs, said:

 

"Our disruptive model - of not simply supplying energy, telecoms or insurance
like other suppliers, but bundling those services together and sharing the
savings we make with our customers - means we have consistently been offering
the lowest priced energy in the country for the past two years.

 

As a result more and more households are hearing about UW, and choosing to
switch their household services to us: we are hugely proud to have helped a
further 62,500 families to stop wasting time and money with their existing
suppliers since April.

 

We are delighted to have updated our existing energy supply agreement with
E.ON, ensuring its sustainability for both of us over the next ten years, and
enhancing it to enable us to innovate more freely within the energy market and
to support increasing numbers of UK households as we transition to net zero
over the decade ahead.

 

We now have the platform from which we can further build on our current strong
rate of growth, and with pressure on household budgets driving ongoing demand
for savings, we look forward to welcoming our millionth customer to UW in the
coming months."

 

Steven Grove, Director of Energy Markets UK at E.ON, said:

 

"UW is a key partner for E.ON and we are delighted to have updated our
long-term contract, reducing risk and allowing both parties to focus on the
services for which they have proven competencies."

 

For more information, please contact:

Telecom Plus PLC

Andrew Lindsay, Co-CEO
                                 020 8955 5000

Stuart Burnett, Co-CEO

Nick Schoenfeld, CFO

Peel Hunt

Dan Webster / Andrew Clark
                                 020 7418 8900

Numis Securities

Mark Lander / Joshua Hughes
                              020 7260 1000

For investor relations:

Julian Wais
 
           07720 999764

 
 
                    jwais@uw.co.uk

 

For media relations:

Lansons Communications LLP

Tom Baldock
 
            07860 101715

 
 
  utilitywarehouse@lansons.com

About Telecom Plus PLC ("Telecom Plus"):

Telecom Plus, which owns and operates Utility Warehouse (UW), is the UK's
leading multiservice utility provider, offering bundled household services -
energy, broadband, mobile and insurance - through one account.

Customers benefit from the convenience of a single monthly bill, consistently
good value across all their utilities and exceptional levels of service.

Customers sign up through a network of local UW Partners all across the
country. These Partners recommend UW's services to friends, family and people
they know by word of mouth.

Telecom Plus is listed on the London Stock Exchange (Ticker: TEP LN).  For
further information please visit telecomplus.co.uk

LEI code: 549300QGHDX5UKE58G86

Cautionary statement regarding forward-looking statements

This Announcement may contain "forward-looking statements" with respect to
certain of the Company's plans and its current goals and expectations relating
to its future financial condition, performance, strategic initiatives,
objectives and results. Forward-looking statements sometimes use words such as
"aim", "anticipate", "target", "expect", "estimate", "intend", "plan", "goal",
"believe", "seek", "may", "could", "outlook" or other words of similar
meaning.  By their nature, all forward-looking statements involve risk and
uncertainty because they are based on numerous assumptions regarding the
Company's present and future business strategies, relate to future events and
depend on circumstances which are or may be beyond the control of the Company
which could cause actual results or trends to differ materially from those
made in or suggested by the forward-looking statements in this Announcement,
including, but not limited to, domestic and global economic business
conditions; market-related risks such as fluctuations in interest rates; the
policies and actions of governmental and regulatory authorities; the effect of
competition, inflation and deflation; the effect of legislative, fiscal, tax
and regulatory developments in the jurisdictions in which the Company and its
respective affiliates operate; the effect of volatility in the equity, capital
and credit markets on profitability and ability to access capital and credit;
a decline in credit ratings of the Company; the effect of operational risks;
an unexpected decline in sales for the Company; any limitations of internal
financial reporting controls; and the loss of key personnel.  Any
forward-looking statements made in this Announcement by or on behalf of the
Company speak only as of the date they are made.  Save as required by the
Market Abuse Regulation, the Disclosure Guidance and Transparency Rules, the
Listing Rules or by law, the Company undertakes no obligation to update these
forward-looking statements and will not publicly release any revisions it may
make to these forward-looking statements that may occur due to any change in
its expectations or to reflect events or circumstances after the date of this
Announcement.

 

 

 

 

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