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

Telecom PlusAnnouncement

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RNS Number : 1020C  Telecom Plus PLC  28 April 2026

 

28 April 2026

Telecom Plus PLC

Year End Trading Update and Notice of Results

Telecom Plus PLC (trading as Utility Warehouse), an integrated and unique
platform for bundling subscription-style essential household services in the
UK, today issues a trading update for its financial year ending 31 March 2026
(FY26).

Trading highlights

●     Organic net customer growth of 10.3%, with total net customer
growth of 23.3% (including broadband customers acquired from TalkTalk)

●     Cross-sell trial into the acquired TalkTalk customers continuing
to perform strongly with 14.5k customers upgraded and cross-sold to date

●     Adjusted profit before tax for FY26 is expected to be at the
bottom end of our previously guided range of £132m-£138m, following reduced
energy consumption during an unseasonably warm winter

●     Continued strong interest in our unique Partner income
opportunity, with Partner numbers increasing to 77k

●     Winner of Best Value for Money at the uSwitch 2025 Energy awards,
together with 2025 Which? Recommended Provider awards for Energy and Broadband

Financial

Adjusted pre-tax profits for FY26 are expected to be at the bottom end of our
previously guided range of £132m-£138m, following reduced energy consumption
during an unseasonably warm winter.

We anticipate the FY26 year-end leverage ratio to be around 1.0x net
debt/adjusted EBITDA, including the consideration for acquiring the TalkTalk
customers, demonstrating our robust balance sheet and strong underlying cash
generation, notwithstanding continued strong organic customer growth.

In response to feedback from many shareholders, we have decided to review our
shareholder distribution policy.  We intend to maintain a total payout ratio
of at least 80% of adjusted profit after tax, but this will, from our upcoming
full year results in June, now be split between both dividends and share
buybacks, with at least 50% of the total payout each year being allocated to
ordinary dividends and the remainder being allocated to either share buybacks
or special dividends, depending on whether the Company is able to repurchase
shares at below their fair value. This revised policy recognises the cash
generative nature of the Group and its strong balance sheet and reiterates our
commitment to maximising total shareholder returns.

Trading

Customer numbers increased by 23.3% to 1.43m (FY25: 1.16m), including 193k
fixed-line/broadband customers acquired from TalkTalk as part of a cross-sell
trial partnership.  Organic customer numbers continued their double digit
growth trajectory, increasing by 10.3% to 1.26m (FY25: 1.14m)(( 1 )).

The total number of services we provided increased by 12.1% to 3.80m (FY25:
3.39m). Organic service numbers increased by 7.6%(( 2 )) during the year.

Despite a 29% increase in Mobile services, our overall organic services growth
rate during FY26 was behind our customer growth rate, primarily reflecting
continued strong competitive activity in the Energy and Broadband markets,
resulting in lower than expected growth in Energy and organic Broadband
services (1.8% and 3.8% in FY26 respectively), whilst Insurance services
(-8.3% in FY26) have been slower than expected to recover from the temporary
pause in new Insurance sales during FY25.

Our churn rate increased slightly to 14.2% (FY25: 13.7%), reflecting the
competitive dynamics mentioned above, with the shape of the energy wholesale
forward curve enabling competitors to offer fixed price energy tariffs
meaningfully below the Ofgem price cap for much of the year.

Macro-economic pressures and longer-term structural trends (such as the work
transition and the pensions crisis) continue to provide a favourable backdrop
for new Partner recruitment and engagement. Partner numbers increased to 77k
(FY25: 72k) with an encouraging increase in monthly active Partners during the
second half of the year.

TalkTalk update

The customers acquired from TalkTalk increased our broadband services by 193k.
These customers are expected to generate a return above post-tax WACC, even
without cross-selling any other services to them.

160k of these had been migrated onto our systems by year end, with the
remainder expected to migrate by the end of the first quarter of FY27.
Initial cross-sell results are continuing to perform strongly, with 14.5k
customers upgraded and cross-sold during the year.

Looking forward

We have now delivered compound double-digit percentage organic customer growth
across a range of market conditions for close to five consecutive years, and
we remain focused on our medium-term target of increasing our customer base to
two million households and beyond.

While recent competitive dynamics have impacted services per customer and our
churn rate, our unique platform and word-of-mouth route to market remain a
proven model for delivering high quality, multiservice customers at scale,
generating a long-term source of growing, recurring, subscription-style
revenues.  In addition, our wholesale energy supply arrangements continue to
insulate us from the current energy market volatility caused by events in the
Middle East.

Our focus is on progressively increasing services per customer, reducing
churn, growing contribution per customer, and enhancing customer lifetime
values, in order to maximise long-term shareholder value. As a result, we are
currently considering a number of potential initiatives to achieve these
goals; we will provide an update on the outcome of this review together with
our full year results for the financial year ended 31 March 2026, which we
expect to announce on 23 June 2026.

Stuart Burnett, CEO said:

"We have now delivered a fifth consecutive year of record customers, services
and profits, all through helping households to save time and money via our
unique, subscription-style, essential services platform.

Our annual Partner sales conference took place earlier this month, attended by
a record number of Partners, and we launched a number of changes to our
customer proposition designed to improve the quality of new customers gathered
over the coming months. With our Partner income opportunity increasingly of
its time, we remain focused on growing our business to supplying two million
households and beyond over the coming years.

We look forward to providing an update in June on our plans to support more
households with even more services, in order to maximise long-term shareholder
value."

For more information, please contact:

 Telecom Plus
 Stuart Burnett, CEO         0208 955 5000
 Nick Schoenfeld, CFO

 For Investor relations
 Louise Rich                 louise.rich@uw.co.uk (mailto:louise.rich@uw.co.uk) / 07486 895017

 For Media relations
 Lansons Communications LLP  utilitywarehouse@lansons.com
 Tom Baldock                 07860 101715

 

This announcement includes inside information as defined in Article 7 of the
Market Abuse Regulation No. 596/2014 (as it forms part of domestic law by
virtue of the European Union (Withdrawal) Act 2018) and is being released on
behalf of Telecom Plus PLC by David Baxter, Company Secretary.

LEI code: 549300QGHDX5UKE58G86

About Telecom Plus PLC ("Telecom Plus"):

Telecom Plus, which owns and operates Utility Warehouse (UW), is
the UK's leading multiservice utility platform, offering a wide range of
subscription-style essential household services - energy, broadband, mobile
and insurance; all these services share similar characteristics where the
revenues and profitability are highly predictable, and where customers can be
expected to remain with us for an extended period once all their chosen
services have been successfully migrated.

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

Customers sign up through a national network of local UW Partners, who
recommend UW's services to friends, family and people they know.

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

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.

 

(( 1 )) Organic customer numbers exclude customers acquired from Talk Talk
which have not been upgraded or cross-sold

(( 2 )) Organic service numbers exclude the services from those customers
acquired from Talk Talk who have not been upgraded or cross-sold

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