Gamma Communications PLC AGM Trading Update (1972Z)
May 20 2021 - 1:00AM
UK Regulatory
TIDMGAMA
RNS Number : 1972Z
Gamma Communications PLC
20 May 2021
20 May 2021
Gamma Communications plc
AGM trading update - Continuing to grow and generate cash
At the Annual General Meeting ("AGM") to be held later today at
The Barn, Hobbs Hole Farm, Ledwell Road, Great Tew OX7 4DN, Richard
Last, Chairman of Gamma Communications PLC ("Gamma" or the "Group")
will read the following statement:-
Group overview
Gamma saw continued growth in the first quarter of the year,
with that positive momentum expected to continue as each economy in
which the Group operates is anticipated to recover following the
pandemic.
Highlights from 1 January 2021 to date include:
-- In its core UK market, Gamma has successfully launched a
number of key products (all of which have been well received by
both Channel Partners and End Users) -
o Phone Line + is a replacement service for customers who
currently use a basic telephone line; it is a cloud based voice
application which is easier to adopt than a full UCaaS
solution.
o Horizon Contact is our fully integrated Cloud Contact Centre
as a Service ("CCaaS") solution.
o An enhanced mobile service which deepens the existing
relationship with Three and gives users access to 5G and Wifi
calling.
o Customers can now order SoGEA Broadband which allows them to
receive broadband without having a traditional phone line.
-- Development of new products continues well, and during Q3 our
customers will be able to fully integrate their Horizon Cloud PBX
with Microsoft Teams.
-- In the Netherlands, we have launched video calling and
conferencing alongside our existing voice product.
-- Gamma's rate of bad debt remains at historically low levels
across the group, despite the challenging economic conditions which
are affecting our end users.
-- Unit additions of key products are in line with historical levels.
-- As reported, on 3 March 2021, the Group acquired Mission Labs
Limited for GBP40.2m (on a cash free basis) with up to an
additional GBP6.0m contingent deferred consideration payable over
the next three years. The acquisition of Mission Labs will enable
Gamma to enhance and expand its cloud contact centre (CCaaS)
technology. In addition, the acquisition will enable Gamma to
accelerate its digital channel strategy. Mission Labs has a UCaaS
technology platform called CircleLoop (www.circleloop.com).
Integration of the business is proceeding well and early
performance is in line with expectations.
Balance Sheet
Our balance sheet remains strong and underlying trading
continues to generate cash. Gamma had GBP34m in cash at 30 April
2021 having paid approximately GBP40m in connection with the
acquisition of Mission Labs.
Dividend
In our Annual Report we proposed the payment of a final
dividend, in respect of the year ended 31 December 2020, of 7.8
pence per share (2019: 7.0 pence), being GBP7.3 million in cash
terms. When added to the 3.9 pence interim dividend (2019: 3.5
pence) this will equate to a total dividend declared of 11.7 pence
for the year as a whole (2019: 10.5 pence). The Board continues to
recommend the payment of this dividend which will be proposed as a
resolution at the AGM later this morning.
Capital Markets Day
The Group will host a Capital Markets Event at 1400 (BST) on
Thursday 10 June. This will give additional information about the
new products discussed above.
For more information please email Gamma@tulchangroup.com.
Outlook
Based on our trading in the first quarter and the expectation
that the UK will not enter into another lockdown period, we
anticipate revenue, adjusted EBITDA and adjusted EPS for the year
ended 31 December 2021 to be at the higher end of the range of
market forecasts*.
The Board will provide its next trading update prior to the
publication of the half year results.
* Note: Company compiled consensus is based on forecasts which
have been updated to take into account Gamma's 2020 audited
results. The ranges are Revenue GBP442.4m - GBP461.3m; Adjusted
EBITDA GBP86.0m - GBP94.0m; and Adjusted EPS 54.9p - 63.1p.
Gamma Communications plc Tel: +44 (0) 333 006 5972
Andrew Taylor, Chief Executive
Officer
Andrew Belshaw, Chief Financial
Officer
Tulchan Communications LLP Tel: +44 (0) 207 353 4200
James Macey White / Matt Low
Investec Bank plc (NOMAD & Tel: +44 (0) 207 597 5970
Broker)
Patrick Robb / Virginia Bull
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