Telecom Plus confident of hitting record numbers after strong Q1

15th Jul 2014 07:43

- Record full year numbers reiterated- Q1 customer numbers up 25%- Regulatory changes expected to deliver growthFirst-half profits are expected to be "significantly" ahead of last year's and record full year earnings are on track at utility supplier Telecom Plus, as customer numbers rose by 25% in the first quarter.The encouraging momentum leaves management increasingly confident of lifting full year profits by almost 50% to £63m for the full year, as previously guided.Chief Executive Andrew Lindsay said he revenue, profits, earnings and dividends would all hit record levels for the full year.The FTSE 250 company believes regulatory changes in the energy industry looked likely to lead to it gaining increasing numbers of customers in the coming 12 months. Lindsay said: "The momentum within the business is continuing, with organic growth in customer numbers during the first quarter comfortably ahead of the levels achieved last year." "We are confident that we will achieve the target we have set ourselves of growing our customer base to around 600,000 by the year end, which would represent net growth of around 70,000 customers." He pointed to extended upheavel in the energy industry following the introduction of the new license conditions imposed by regulator Ofgem as part of its recent Retail Market Review (RMR) and a recently announced investigation from the Competition and Markets Authority (CMA). Seen as an independent supplier, Telecom Plus believes "it is logical to expect" it will gain from recent RMR changes to customer bills where suppliers must include information on any cheaper tariffs available as well as from any action taken by the CMA to encourage a more competitive energy market.The group expects stable energy prices in the run-up to the general election next year to be followed by upward pressure on costs from regulatory, environmental and political changes, being offset by lower wholesale costs. Underlying cash flow remains strong, with net debt expected to increase by about £10m over the course of the year as it refurbishes its new headquarters.Looking forward, Lindsay said: "With a current market share of less than 2%, we are well placed to continue to deliver significant organic growth for many years to come." Shares in the company were up 8.2% to 1,346p at 08:19 on Tuesday.OH