Telecom Plus (TEP) H2 2025 earnings summary

Executive summary

• Achieved record year in FY2025 with 15% customer growth, reaching 1.16 million customers, including approximately 25,000 acquired via TalkTalk partnership.

• Double-digit growth in customers and profits for four consecutive years, driven by a unique multiservice proposition, structural cost advantage, and Partner referral model.

• Adjusted profit before tax rose 8% to over GBP 126 million, with adjusted EPS up 9% and full-year dividend increased 13% to GBP 0.94.

• On track for medium-term target of 2 million customers, targeting 10-15% annual net customer growth and increasing EBITDA per customer from mid-120s to GBP 150.

• Cross-sell trial and partnership with TalkTalk, with potential for further inorganic customer acquisitions.

Financial highlights

• Revenue declined 10% year-over-year to just under GBP 1.84 billion due to lower energy prices, but gross profit increased 0.8% to GBP 358.1 million and margin rose to 19.5%.

• Adjusted PBT increased 8% to GBP 126 million; adjusted earnings per share up 9% to 119p.

• Admin costs decreased by 5% year-over-year, reflecting efficiency gains and digitization.

• Net debt improved by GBP 7 million to GBP 116 million, with a net debt to EBITDA ratio of 0.8x.

• Dividend increased 13.3% to 94p, targeting 80-90% payout of adjusted net profit.

Outlook and guidance

• FY2026 guidance: total customer growth of approximately 15%, including around 70,000 broadband customers from TalkTalk, with low double-digit organic growth.

• Adjusted profit before tax expected between GBP 132 million and GBP 138 million; dividend to increase in line with adjusted net profit.

• Medium-term target of 2 million customers, with EBITDA per customer targeted to rise from mid-120s to GBP 150.

• Continued market share expansion expected across all services, with new service additions and cross-sell opportunities.

• Focus on expanding subscription-style services and operational efficiency.