Telecom Plus to boost divi by 15 per cent

Telecom Plus, the FTSE 250 utilities services provider, said Monday that it was confident that it will report full year profits in line with market expectations, following a period of continued strong organic growth.

It said underlying cash generation has continued to be strong, while total group services were up by 55,488 during the quarter ended December 31st to 1.54m.

As such, it plans to increase its total dividend by 15% to 31p for the current financial year (2012: 27p).

Chief Executive Andrew Lindsay said: "The business has delivered another strong performance over the period and I am particularly pleased with the sustained improvement in customer quality and the strong growth we have achieved in the number of services we supply."

"The high levels of distributor activity we have seen since the beginning of January, and the increased interest being shown by new distributors in taking advantage of this exciting business opportunity, bode extremely positively for the year ahead."

"Our confidence that we will announce record results when we report our full year figures in May is reflected in our commitment to a substantial increase in the total dividend for the year."

The company said that since the beginning of the year, distribution channel activity bounced back strongly after the traditional Christmas lull, with a significant increase in the number of new distributors joining the business over the last few weeks. It also said that it has made "good progress" developing its online presence, and has begun to see encouraging results from marketing additional services to existing members of its residential club.

Customer numbers at the club increased by 41,156 and service numbers have increased by 210,237 over the last 12 months, representing year-on-year growth rates of 13% and 18% respectively. The number of services taken by these members continues to climb, and has now reached an average of 3.76 (2012: 3.58).

"This reflects the continuing high proportion of new members taking at least four major services, which remained at over 55% for the quarter. These high quality members now account for 38.1% of the residential Club, up from 33.8% at the end of our last financial year," Telecom explained.

Opus Energy Group, in which Telecom has a 20% equity investment, is performing ahead of budget and is on track to deliver record turnover and profits for the current financial year.