There's a clear conflict between profiting and charitable giving, but Wikipedia founder and The People's Operator (TPOP) chairman Jimmy Wales may have a solution. The mobile carrier - whose customers can give 10 per cent of their monthly bill to charity and which plans to donate a quarter of its trading profits to an independent foundation - recently launched an online network in the US through which users can support causes and donate to charities.
The start-up costs meant TPOP's operating cash outflow swelled from about £0.5m to £4.8m. Yet the Aim-traded group can acquire customers more cheaply than competitors by tapping into their interest in philanthropy. It has partnered with more than 30 charities, including Save the Children.
TPOP's mobile subscriber base in the UK swelled 43 per cent to about 50,400 in just three months to 29 September, and management expects to surpass 69,000 users before the year ends. Revenues have therefore continued to accelerate - billings in August were around £270,000, about 16 per cent higher than in July. Customer acquisition costs and churn remained steady.
Management plans to expand into countries such as Mexico and Brazil over the next 18 months. Broker FinnCap expects a full-year pre-tax loss of £10m, giving a loss per share of 9.7p, swinging to profits of £17.1m and EPS of 13.3p in 2016.
THE PEOPLE'S OPERATOR (TPOP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 126p | MARKET VALUE: | £97m | |
| TOUCH: | 122-130p | 12-MONTH HIGH: | 145p | LOW: 120p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 19p | NET CASH: | £12.9m | |
| Half-year to 30 Jun | Turnover (£000) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014† | 132 | -0.6 | -1.0 | nil |
| 2015 | 603 | -4.4 | -5.0 | nil |
| % change | +358 | - | - | - |
†The People's Operator floated in December 2014 | ||||
