3 December 2016

Telecom Plus


04/06/03 Leslie Copeland

Cheap-rate telecoms, gas and electricity reseller Telecom Plus delivered another sterling set of results for the year to March, showing pre-tax profits raised 38% to £5.6m for the year to March, on turnover raised 78% to £58m. Total dividends of 5.75p for the year came from 7.5p of earnings, reiterating the company's welcome policy of returning the bulk of its extremely healthy cashflows to shareholders. It has such a good cash profile because of a historical business model that incentivises customers to act as its sales force, thereby incurring few fixed costs on those sales. This model has been changed somewhat through the acquisition of Sussex-based Telecommunications Management Limited (TML), a business-focused telecoms supplier that contributed £600,000 of profits during the year, and Oxford-based Opus Power, a budding supplier of electricity to businesses. But during the year 77% of revenues came from the traditional distribution channel, in which there are 10,000 active individuals making sales out of a customer base totalling 134,000, many of which take more than one service. 'Significantly higher profits' are expected this year as high growth is continuing apace. Max Royde of house broker KBC Peel Hunt forecasts pre-tax profits of £8.6m and EPS of 9.6p this year and £10.8m in 2005, noting the 'relatively high rating', though adding that 'TEP remains our core pick in the telecoms sector'.

Sector: Mobile Telecommunications

Companies: Telecom Plus

Market cap: £128.1m

PE Forecast: 22.2

Share price: 213.5p

Cash Shells 2015

Published in September 2015 this annual research report provides a comprehensive overview of cash shells on the Main Market, AIM and PLUS landscape. Order your copy today


Superb investment toolkit for private investors

SharePad is the new web-based service from ShareScope. Easier to use and more powerful. Perfect for tablets, Macs and Windows PC. Covers ALL your investment requirements.

Growth Company Investor: free trial

Since 2008, our share tips outperformed the benchmark by 281%. Take a free trial and get access to our recommendations today. Start free trial now.

Share recommendations and small-cap stock picks

Small-cap and growth company share recommendations on AIM- and PLUS-listed companies. Latest analysts' stock tips and advice on which are the best shares to buy on London's junior stock markets.

What Investment magazine: save 45% on the shop price

Be the first to receive our independent analysis and research, designed to help you generate more wealth for you and your family over the long term. Subscribe and save.

Popular Recommendations

Latest Recommendations

Mirada 04/01/16

Avoid this digital TV software stock until we see some more contract wins  

Sector: Software & Computer Services

Tracsis 16/02/16

A quality stock that's up with events

Sector: Software & Computer Services

OptiBiotix Health 15/04/16

A 'gut feel' buy

Sector: Pharmaceuticals & Biotechnology

More Recommendations