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KCOM makes modest progress

RESULTS: Shares in telecoms group KCOM have risen by more than 30 per cent since early June and the group's modest progress is looking thoroughly factored in
November 26, 2013

These half-year figures from Hull-based telecoms group KCOM (KCOM) revealed a fairly soft overall performance, but the group did make progress on a several fronts - including further deployment of fibre and an increasing uptake of fibre-based services.

IC TIP: Hold at 102p

The KC unit, which offers telephony and broadband services in Hull and East Yorkshire area, saw more customers taking up bundled products - this helped to push divisional cash profits up by about 1 per cent year on year to £28.1m, despite a modest fall in divisional revenues. Investment, especially in fibre, remains substantial - £13.5m was spent in the first half alone - but the company should reap longer-term benefits form this spend going forward. The KCOM division, meanwhile - which focuses on business communications - also saw revenues slip slightly, despite a number of key customer wins and a rising order backlog. It's still feeling the pinch from a lacklustre UK economy and divisional cash profits dropped 4 per cent in the period to £13.9m.

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