AdEPT Telecom plc (LON:ADT), one of the UK’s leading independent providers of unified telecommunications and IT solutions, today announced a trading update for the year ended 31 March 2017 (ahead of its final results which are expected to be announced in early July 2017).
· Net borrowings of £15.8m were £1.3m lower than consensus market expectations
· Underlying EBITDA increase of around 26% will be ahead of market expectation of a 18% rise year-on-year
· Board recommendation of an increased final dividend of 4.00p (2016: final 3.50p)
· Total dividends proposed for the year of 7.75p represents an increase of 19% over the prior period
Trading performance
The Company is pleased to announce that it anticipates that underlying EBITDA will be around 26% ahead of the previous year (ahead of the market consensus expectation of an 18% rise year-on-year). Turnover is expected to be approximately 16% ahead of the previous year and above market consensus expectation.
Cash flow and net debt
Net borrowings of £15.8m as at 31 March 2017 were £1.3m lower than market expectations. The company continues to generate consistently strong free cash flow. This improved performance in debt reduction is after payment of (i) £9.7m aggregate initial consideration for the acquisitions of Comms Group UK Limited, CAT Communications Limited and OurIT Department Limited, (ii) £3.0m deferred consideration for the acquisition of Centrix Limited and (iii) a £0.4m increase in dividends paid in the year.
Dividends
AdEPT Telecom plc announced an interim dividend of 3.75p per share in its September 2016 interim statement, which will be paid to shareholders on 7 April 2017. The Board today announced that as a result of strong free cash flow and trading results it recommends an increased final dividend of 4.00p (2016: 3.50p) per Ordinary Share which, subject to Shareholder approval at the Annual General Meeting later in the year, will be paid in October 2017. Total dividends proposed for the year ended 31 March 2017 of 7.75p per Ordinary Share represent a 19% increase year-on-year (2016: 6.50p).
