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2005

THUS Hits Targets for Free Cash Flow, EBITDA and Turnover 

The following is an update of THUS Group’s trading position ahead of its
Preliminary Results for the year ending 31 March 2005, which are scheduled to be announced on 23 May.

Overall performance

THUS Group’s performance has been consistent with the Board’s expectations for positive free cash flow1, EBITDA2 and turnover set out in its Interim Statement on
15 November 2004.

Free cash flow

The Group is expected to deliver its first full financial year of positive free cash flow (FY 04:  £(2.6) million outflow), with an improvement expected in the second half compared to the first.

EBITDA

Group EBITDA for the full year is expected to be not less than £39 million.  The second half EBITDA from continuing operations is expected to improve compared to the £18.8 million recorded in the first half.

Turnover

Group turnover for the year is expected to be approximately £360 million (FY 04: £332.4 million).

Turnover from continuing operations comprising Data and Telecoms, Managed Solution Services and Internet Services will show a solid year on year improvement, up approximately 15% (FY 04: £297.7 million). 

All continuing operations segments are expected to deliver growth in the second half over the first, with Managed Solutions and broadband Internet recording the highest gains.  Second half Data and Telecoms growth has however been lower than expected, principally as a result of a decline in turnover from low margin, wholesale voice services and the impact of the regulatory reduction in fixed to mobile termination rates.  Both factors are expected to continue to affect turnover in the next financial year although they will have minimal impact on EBITDA and cash flow. 

Turnover from discontinued operations3 is expected to be approximately £18 million for the year, some £11.4 million of which was recorded in the first half  (FY 04: £34.7 million).

1 Cash flow after returns on investments and servicing of finance, taxation and capital expenditure and financial investment
2 Earnings before interest, tax, depreciation and amortisation
3 Contact centre (disposed of on 4 August 2004) and Interactive (disposed of on 7 October 2004)