KCom tops up pension pot

published 2 April 2012

Hull-based telecoms firm KCom is following in the foot-steps of its bigger rival, BT, and bringing forward planned payments to its defined benefit pension schemes.

The group, which said it is trading in line with trends reported back in November, is throwing off so much cash that it feel able to make an accelerated payment of £10m to its pension schemes.

This comprises £6.9m of advance payment to fiscal 2013's previously committed deficit contributions and an additional one-off contribution for fiscal 2012 of £3.1m.

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Making these payments in the current financial year allows the group to benefit from the higher corporation tax rates of 26% in the fiscal year just ended, compared to 24% in fiscal 2013. "We expect the resulting net debt to be no greater than £80.0m at 31st March 2012 (31st March 2011: £82.0m)," the group revealed.

As for current trading, the group said its KC brand continues to benefit from sustained growth in broadband penetration across the East Yorkshire network area, with customers attracted to bundled offerings in particular. In addition, and three years ahead of the government's 2015 targets, KCom is able to provide broadband services with a minimum 2 megabytes per second (Mbps) download speed to all households and businesses across the KC network.

"Our Smart421 and Eclipse brands continue to make good progress with their own growth momentum," the group said.

Results for the financial year just ended are expected to be in line with market expectations, and the group said it will be making good on its pledge to increase the full year dividend by at least 10%.