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Telecom Plus - Mercuriel rise continues

December 2011

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • TEP
  • Price:
  • 775p
Latest H1 from Telecom Plus, the multi utility supplier, was excellent but then it was always going to be expected that it would deliver the goods. Revenues lifted by 10% to £162m - all organic - but profit before tax grew by 31% to £11.1m. Eps grew 29% to 12.2p.As we have been saying for quite a while, performance is being driven by the acceleration in the growth of its customer base (roughly 7,000 net new customer additions in Q1 grew to 14,000 per month in Q2 to take the total to 392,699). This comes down to various factors, notably a reduced churn arising from the previous strategy to target home owners rather than tenanted properties and also more distributors coming on board. The attrition rate is now under 1.5% a month an ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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