Highlights
· Revenue and EBITDA in line with our expectations, representing a solid performance in challenging conditions
· Profit before tax of £27.6 million, up 2.2%
· Net debt increased to £94.3 million, comfortably below 1.5x EBITDA
· Successful completion of the initial deployment of super-fast fibre based broadband, passing 15,000 homes and businesses in Hull & East Yorkshire
· Continuation of roll-out of fibre broadband to a further 30,000 customers by 2015 announced today
· Growth in multi-year order backlog
· Increase in interim dividend of 10%, to 1.47p
Bill Halbert, Executive Chairman, 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. As a result of this performance, and our confidence in future prospects, we have increased our dividend by ten per cent."
Outlook
While we expect the macro-economic uncertainty to continue to slow decisions on new investments across our markets, we remain very confident about the Group's prospects, its underlying strength and continuing cash generative capacity.
We anticipate that KC will continue to outperform its peer group and remain confident that Kcom will continue to gain market share despite the difficult trading environment.
The Board remains committed to a minimum 10 per cent growth in the dividend for this financial year. Accordingly we have announced an increase in the interim dividend per share to 1.47p (2011: 1.33p) and will, at the full year results, be providing guidance on our future dividend policy.
