Divi hike for KCOM despite revenue fall
TELECOMS group KCOM has announced a 10% increase in the interim dividend it will pay to shareholders despite half year revenues falling by £10m.
The Hull-based group said the fall reflected “the anticipated reduction in certain areas of the Kcom business”.
The reduction in revenue contributed to a decline in group EBITDA before exceptional items to £39.1m for the six months to September 30 compared with £40.7m last time.
However, profit before tax increased by almost 2% to £27.5m. Net debt increased by almost £20m over the period to £94.3m.
KCOM also announced this morning that Stephen Long will join as managing director of its national Kcom arm from Fujitsu in January.
The KC part of the group, which operates telephony and broadband over the group’s East Yorkshire network and provides publishing services, saw revenues increase by 1%.
The fall in group revenues was down to the enterprise business Kcom. The revenue decline was caused by factors including a £7.7m reduction in the revenue associated with a specific one-off network build contract.
Chairman Bill Halbert said: “I am pleased to announce further progress towards our longer term goals and another solid set of results, with profitable contributions from all our operating brands. In KC, we continue to see strong demand for our bundled services.
“Our initial deployment of super-fast fibre based broadband services has been completed very successfully, and the encouraging results have led us to announce today that we will treble the number of homes we reach with our next phase of fibre deployment.
“In Kcom, we have achieved growth in our multi-year order backlog even though businesses continue to be cautious, slowing the speed and reducing the level of investments being made. Despite the economic headwinds, there are opportunities for us to provide more services to our existing customers, as well as winning new contracts in both the enterprise and public sector.”
The interim dividend per share has been raised to 1.47p, following a promise set out by the group last month.
