Kcom agrees to make £21m pensions payments
YORKSHIRE telecoms firm Kcom believes that it will continue to grow this year after agreeing a £21m programme to provide certainty around its pensions provision.
The Hull-based company said in an interim management statement for the three months to June 30 that its trading was in line with expectations as it looks to improve its overall financial position.
It revealed that its two defined benefit pension schemes will close in September and it is also “breaking the link to final salary alongside other changes to our pension arrangements”.
From October 1, the group will provide a single defined contribution scheme for all employees.
The statement says: “We have reached an agreement, pending the final outcome of the actuarial valuation, that Kcom will make total deficit repair payments to this scheme of £21m over the three years to March 2013 – previous deficit funding had been £2.9m per annum.
“Of this, £9.2m will be paid during the current financial year with the remainder spread equally over the subsequent two years.
“Following the substantial change and progress last year, our emphasis is on a return to growth in this, the second year of transformation.
“We will achieve this by exploiting our core strengths and capability, together with those of our new strategic partnerships.
“We continue also to improve further the overall financial position of Kcom through a combination of measures, including debt and working capital management and rigorous cost control.”
The group has achieved a number of significant milestones over the last financial year including the creation of two business units – Kingston Communications and managed communications business Kcom.
Agreements with BT Wholesales and Phoenix IT Group have given it access to national network coverage as well as market leading products and field support services.
Pre-tax profits for the group for the year ended March 31 rose to £29.4m compared to £17.9m for the previous year.
Kcom will announce its next interim results on November 23.
