Telecom Plus (TEP) H2 2024 earnings summary

Executive summary

• Achieved record FY 2024 results with 14% customer growth, all-time highs in services, profits, and shareholder returns, driven by a unique multi-service model and strong partner referrals.

• Adjusted profit before tax (PBT) rose 21% year-over-year to just under GBP 117 million, with a 4% dividend increase and GBP 10 million share buyback.

• Business model leverages bundled services, award-winning customer service, and a cost-efficient partner network.

• Medium-term target to reach 2 million customers, with 10%-15% annual net customer growth expected.

Financial highlights

• Customer base grew 14% year-over-year, all organically, with 12% service growth.

• Gross profit increased 16% to GBP 355 million and adjusted PBT rose 21% to GBP 117 million.

• Revenues declined 18% to just over GBP 2 billion due to normalization of energy prices, but gross margin improved from 12.4% to 17.4%.

• Dividend per share increased to GBP 0.83, with a 4.4% yield and GBP 10 million share buyback completed in H2.

• EBITDA reached GBP 133 million; net debt at GBP 123 million (0.9x EBITDA).

Outlook and guidance

• FY 2025 guidance: customer growth of 12%-14%, adjusted PBT between GBP 124 million and GBP 128 million.

• EBITDA per customer expected in the mid-high GBP 120s for FY25, with a long-term goal to reach GBP 150.

• Medium-term (FY 2026-2027): 10%-15% annual customer growth, new EV tariffs and business offerings to support expansion.

• Plan to return 80%-90% of adjusted profits after tax via inflationary dividends and share buybacks.

• Dividend expected to increase modestly, supplemented by further buybacks.