Good morning, everybody, and welcome to the Telecom Plus PLC Full-Year Results presentation for the year ending 31 March 2025. I'm Stuart Burnett, CEO, and I'm joined by Nick Schoenfeld, CFO. We're very pleased to report another year of record performance across the board, resulting in record customer and service numbers, as well as record profits and returns to shareholders. Now, before we get into the detail today, here's a quick overview of the running order this morning. I'm going to kick off with a run-through of our highlights for FY25. Nick will then take you through our continued strong financial performance, and I'll then finish with our exciting outlook for the years ahead. As we go through the update today, I think there are three key takeaways that you can see on this slide.
First of all, once again, our compounding double-digit growth performance is underpinned by three things: our unique multi-service subscription-style business model, secondly, our structural cost advantage, and thirdly, our partner route to market. Together, these three things enable us to sustainably outcompete as we stride on towards our medium-term target of 2 million customers, with expectations of growing at between 10% and 15% a year as we go. In FY2025, of course, we delivered 15% total customer growth, with over 12.5% underlying organic customer growth. Second, for the new financial year for FY2026, we expect total customer numbers to increase again by around 15%, with underlying organic growth in the low double digits. For adjusted profits before tax, we expect a range of between GBP 132 million and GBP 138 million.
Over time, as we head towards that 2 million customer target and beyond, we see a real opportunity to increase our EBITDA per customer from the sort of the mid-120s mark up towards that GBP 150 mark. Third, we've entered into an exciting cross-sell trial partnership with TalkTalk for around 95,000 broadband and landline customers, with the aim to cross-sell additional services from our multi-service platform, utilizing our partners as a unique cross-sell channel. As we prove this out, we'll end up with, I guess, what is something you can think of as a blueprint for acquiring further books of customers, further books of single-service customers from across our service lines, into which we can create value by cross-selling our multi-service offering. Without much further ado, here are the business highlights for the financial year, with the headlines set out on this slide.
As you can see, and as we have said, we had another very strong year in FY2025. We saw a 15% annualized increase in customers, over 12.5% of which were acquired organically, with service numbers increasing by over 265,000. Gross profit was up around 1%, as expected, reflecting significantly lower energy prices during the year compared with FY2024, with adjusted profit before tax up just over 8% to over GBP 126 million, in line with consensus. You might recall that in the first quarter of last financial year, energy prices were particularly high, and that resulted in a positive impact of a handful of millions of pounds last year. When you strip that out, profit growth in FY2025 was in line with customer growth.
Of course, this profit trajectory was aided by admin costs falling despite double-digit growth, which was driven by our ongoing efficiency initiatives, including our investments in digitization and AI. Finally, we've increased the full-year dividend by 13% to GBP 0.94, in line with our policy of distributing 80-90% of adjusted profits after tax. It goes without saying that we are once again very pleased with these results. I think it's important to call out that we're now four years into delivering double-digit percentage growth in both customers and profits, and that trend gives us significant confidence about the future.
To understand exactly how the business delivered this record performance and why it's such a positive indicator of what's to come, I think it's important to also understand the key competitive dynamics in play during the year that you can see on this slide. First of all, over the last year or so, I think everyone in their own lives will have sort of seen some of this firsthand. Competition has firmly returned to the energy market. All major suppliers are out there advertising and actively seeking to acquire new customers. Despite this, given the sort of stable and resilient marketplace that we're now in, pricing strategies have remained rational, as they should be in a highly regulated, commoditized, essential services marketplace.
Now, having shown that the business can grow rapidly with energy prices rose significantly in FY 2022 and FY 2023, and also when energy prices fell significantly in FY 2024, we've now demonstrated how the business can continue to grow rapidly when energy prices have been much more stable, with the price caps over recent quarters moving more by sort of tens of GBP a quarter rather than hundreds or even thousands of GBP a quarter. As a result of this, as we mentioned, we've delivered our fourth consecutive year of double-digit organic customer growth. You can see the bar charts on the left-hand side here, which show the impressive four-year compound annual growth rate from FY 2021 through FY 2025 of over 15% for customer growth and over 22% for adjusted profit before tax growth.
Now, our slightly slow rate of service growth in FY2025 is due to a combination of things, including, first of all, the temporary pause on new insurance sales that you'll be aware of, an increase in customers taking our two-service bundle versus our three-service bundle, and an increase in some customers taking mobile-only services from us. Going forwards, we expect service growth to pick up, first of all, now that we've fully relaunched our insurance products, and also as we build out our cross-sell capabilities, which I'll come on to a little bit later. Those are some of the key dynamics in play during the period. In broad summary, we're essentially back to exactly the sort of marketplace that our business model was originally designed for. Here you can see on the screen that very simple but incredibly powerful business model.
Now, you've all seen it before, so we'll jump straight in to showcasing some of what we've been doing across each of the three key pillars, starting with our unique multi-service subscription platform. Now, we are continually improving our proposition to make sure that we're consistently competitive and giving our customers what they're asking for. Now, over the half year, we stepped through various developments, including our EV tariff launch, our faster full-fiber broadband launch, our growing partnership with CityFibre, and our multi-SIM mobile offering. Since then, there have been a number of additional highlights, including something which we're all very proud of here, is attaining the Which? Recommended Provider Award for both energy and broadband. That makes us the first provider to ever hold both of those awards at the same time. Now, that's a testament, I think, to two things.
First of all, to the incredible service that we provide our customers, but also to the fact that we're uniquely positioned as the only true multi-service provider in the U.K. On the energy side, we also launched our new Free Energy Days initiative to reward our highest value multi-service homeowner customers with free energy. On broadband, our big move was to launch a loyalty, also recontracting tariff, for broadband customers who reach the end of their contract so that they don't face such a steep price increase after their initial term. That is sort of a key part of the ethos of the business of providing long-term peace of mind pricing. In mobile, service growth continues to go from strength to strength, with our new multi-SIM offer helping to take our mobile service numbers over the 600,000 mark.
Finally, on our unique cashback card, our customers are now consistently, month after month, receiving over GBP 1 million in cashback, which reduces their budget. It gets knocked directly off their multi-service bill with us, and therefore really builds that extra level of loyalty. Into that program, we have added recently all of the major cinema chains alongside Café Nero and Pizza Express. We are also trialing various additional initiatives, like trialing free cashback cards for some customers to see whether that will boost take-up, because we know that when customers take the cashback card and use the cashback card, they are our longest-standing, most loyal customers. To top it all off, our multi-service proposition is getting back to full strength now that we have fully reopened insurance sales.
Just by a bit of background here, we launched insurance as our sort of fourth core service a few years ago. When we did that, uptake really started to build, and we actually saw a 40% increase in insurance policy numbers during FY2024. We also took the step to set up our own in-house underwriter to provide security of supply. Now, as we discussed last year, we began a product review with the FCA, and as part of that, we voluntarily paused new sales of our bill protector and boiler and home cover policies. Since then, our positive dialogue with the regulators resulted in all of our insurance products being cleared for new sales, and we've now fully reintegrated them into the customer journey, with our boiler and home cover policies returning to the front-end new customer sign-up journey since April.
Now, that brief pause in new sales for insurance resulted in a moderate fall in insurance service numbers during FY2025, but we expect to see a return to growth in the service line now it's fully reintegrated. It is a service line that we're really excited about. There's a significant opportunity to scale. Currently, only around 10% or so of our existing customers take insurance from us. At the same time, we're exploring what other complementary insurance products we could add into our current offer. Currently, we offer home insurance, boiler cover, and a sort of an income protector product. We're exploring how over time we can add motor, travel, pet, and potentially other insurance lines as well.
In addition to that, we're also actively looking at how we can leverage our sort of really broad, wide-ranging in-house data that we collect from our multi-service customers to support insurance growth and performance. Long story short, it's really great to get insurance properly back on the road, and we're really looking forward to building out and growing this exciting service into a key part of our multi-service bundle going forwards. Our multi-service platform is in great shape, and the great thing about multi-service customers is that they are core to enabling us to generate our unique structural cost advantage. To underpin our structural cost advantage, we've been increasingly focusing on driving efficiency across the business, especially given the way that our admin costs increased as we went through the energy crisis.
We're pleased to see, as we indicated at the half year, that our admin costs in FY25 not only did they increase below the rate of customer growth, but they actually decreased by 5% during the year. That was at the same time as boosting and improving our overall customer service and customer experience. I mentioned earlier about the Which Recommended Awards that we achieved for both energy and broadband, and those are just two examples. We've also consistently been rated at the top or towards the top of the Citizens Advice rankings, as well as the Institute of Customer Service rankings and the Uswitch Awards, and the list goes on and on. Key to our continued progress here is our investment in AI and digitization, which is continuing to improve our efficiency and, at the same time, create some revenue-generating opportunities.
We're pushing forwards with our 24/7 sort of AI-powered WhatsApp knowledge assistants, which have been launched now for both customers and also for engaging with our partners. We're already handling over 10% of customer queries through this channel, as well as around 5% of partner queries. Of course, there's much more to come. This is the tip of the iceberg for it. In addition to that, at the half year, we talked about our Copilot tool, which listens to live calls between our customer service agents and customers, and then surfaces to the agent in real time the information or articles that they need in order to provide an accurate and speedy answer to the customer, which again is further improving efficiency and call quality. Looking forward over the coming months, we're already working on using AI to drive revenue growth.
As I mentioned, we're in a very early stage trial of how we can use machine learning to deliver increased conversion when we're doing cross-sell, and we can already see some increased conversion coming through compared to traditional approaches. In addition, in our partner channel, we've also launched, again, sort of an early stage sort of version of that Copilot tool I mentioned we're using in our call centers. It's a Wingman tool called Ask Me to assist partners in sign-up appointments. On top of that, we've created a new churn model using AI, which is much better at predicting when customers might be at risk of churning, so we can then take action to retain them. That's something we'll be putting into action as we go through the year. Again, in summary, a huge amount going on here, but even more to come.
It is really early days, particularly as we go on this digitization and AI journey, but we do feel like we have an emerging line of sight to aim at reducing our FTE per customer numbers over time as we scale by as much as 30-50%. A significant opportunity. With all of that, hopefully you can see how our one-of-a-kind multi-service value and service proposition creates a product that is really worthy of recommendation. That is exactly what our partners are for. Now, I will move quickly through this slide, because I think you have seen it before, but as a reminder, we have got over 71,000 partners who are ordinary people based all over the country, as you can see from this heat map, who are, put simply, experts at recommending our unique model to their friends, their family, and people in their local communities.
One way to think of them is sort of as micro-influencers, whether in person at the school gates, in the golf club, or online on Facebook or Instagram. Now, our partner model, as we've been talking about for a few years now, is increasingly of its time. There are two really important tailwinds here. The first is around what you might call the work transition. Put very simply, there are now 20 million people in the U.K. who have some form of second or third income on the go. These are people who do not want to do the 9 to 5, who do not want to do the daily commute, people for whom our partner model is right up their street. Our partner model is increasingly closer to the modern way of working than a traditional 9 to 5 opportunity.
Second of all, the pensions crisis, which I'm sure you all understand, which is tens of millions of households not saving enough for retirement and therefore facing retirement poverty. Our model, with its really important upfront income, but critically, this long-term sort of revenue share or sort of residual income approach really fits squarely into that gap. At the half year, you might recall I shared a video which shows how right here right now some of our partners are using the UW opportunity to build the sort of long-term residual income. Today, I wanted to share another video, which interestingly is over 20 years old. Please, I apologize in advance for the slightly poor sort of film quality for it. This was from one of our original training programs over 20 years ago.
There are really so many good things about the business, but for me personally, the best thing is the fact that I'm building up a residual income. I currently work as a software engineer. It's a very well-paid job, but I have a little boy. His name's Joe. He's got Down syndrome, and I have to work away from home. Joe always tells me how much he misses me, and I really miss him when I'm away. This business is going to allow me essentially to retire in one or two years' time so I can spend my time at home with Joe. When he gets up to go to school in the morning, I can be there. When he comes home from school in the evening, I can be there. When he's on holiday, I can be on holiday.
Now, that gentleman there was Tony Griffiths. Very sadly, Tony passed away last year. Because of UW, he was able to retire. He was able to spend more time with his disabled son, Joe, who needed his presence and support, and who Joe will continue after Tony's passing to benefit from his father's UW residual income, because the residual income asset you build up as a UW partner can be willed to your family as a form of legacy. That is the power of the UW income model. Now, before handing over to Nick, there were a couple of final sort of very exciting developments that I wanted to share and talk about briefly, about how we can acquire and drive even more leads into our partners and into our unique multi-service platform. First of all, connectors.
Now, we've been experimenting over the past year or so through a number of small trials about how we can link up small local businesses, community groups, organizations, clubs, and charities with our partners, whereby these organizations can earn a new commission or income stream by introducing their customer base or their membership base to one of our partners, where our partners can then sign up those customers onto our multi-service offer. Now, these trials have been a real success, and as a result, we've launched what we are now calling, what we're now calling, connectors. Now, think of this as a new lead generation source for our partners. If you're the average partner, you might expect that in your town, you might know maybe 5% of the people, but all of the local small businesses, community groups, clubs, and charities will collectively know pretty much everybody.
By putting in place this connector model, partners will share 50% of their commission with the local business or local organization in exchange for the successful warm lead. This creates a real win-win between the partner who gets this additional new source of leads from people in their local area that they may not have known or may not have come into contact with, and also for the local business, which generates a new income stream and also a deeper relationship with their own customers or membership base. Now, it's early days. We launched this connector program back in April. We've already signed up over 1,000 connectors onto the program, and these range from everything from estate agents and hairdressers to local clubs and charities. We're going to be very excited to see how this develops over time.
Secondly, towards the end of FY2025, we agreed a partnership agreement with TalkTalk, who are a long-standing broadband partner, under which we have acquired around 95,000 broadband and landline customers, with around 25,000 of those arriving at the tail end of FY2025 and with the balance approaching 70,000 or so due to land during the new financial year FY2026. Not only are these customers already serviced by the same underlying broadband technology that we have, which makes migrations sort of relatively straightforward, but by moving to UW, they will, of course, benefit from our Which Recommended Broadband service and offering. The key reason for the trial is to demonstrate how, with our unique multi-service offer, plus with our partner route to market, we can provide even better value to and create significantly enhanced value from these customers through cross-selling our other services: energy, mobile, and insurance.
Now, we're in the relatively early stage of exploring and trialing a whole range of different cross-sell opportunities with our partners at the center. This is including matching our partners with customers who live near them, through using various prompts whenever we interact with these customers, through app engagement, when they call us into our call center, through outbound marketing trials, testing, learning, and improving as we go. Once we've proven out the model, this will provide essentially what you can think of as a blueprint for us to acquire further books of customers, whether broadband or mobile or insurance or indeed energy, and whether through acquisition or through partnership, and sort of pots of customers who are not receiving a differentiated service from their current provider.
We look out there and see large numbers of customers who are sort of stranded with a non-differentiated provider, where there is a demonstrable opportunity for us to acquire those customers and increase customer LTV through our model. Now, it is early days, so I do not have a detailed sort of numbers-based update on how that cross-sell trial is performing yet or indeed when the next opportunity might arise. What I can say is that we are seeing some early positive signs, and we are quietly confident about how it is progressing. Watch this space. There you have it, the three key pillars of our unique business model, hopefully brought to life in a way which helps to explain why the business is performing so well and why we expect that to continue. With that, over to Nick to talk through the numbers.
Thank you, Stuart.
Let's start with the P&L. Now, as Stuart mentioned, adjusted PBT is up 8% to GBP 126 million. That is driven primarily by the strong year-on-year organic customer growth, partly offset, as expected, by the much higher energy price cap level that there was in the prior year, particularly in quarter one of FY2024. Without that prior year quarter one energy price impact, FY2025 adjusted PBT growth would have been more in line with overall customer growth. Now, highlighting the main themes within the P&L, revenues of just under GBP 1.84 billion are 10% lower than the prior year, driven by energy prices returning from their higher levels, as just mentioned.
As we have said before, though, revenue is a KPI which is not particularly relevant as a driver of profit growth, and that is because the energy commodity cost movements are passed on to customers via their bills. More importantly, these same effects feed into the gross profit line, which is up year-on-year by 1%, driven by customer growth, but meaningfully offset by those energy price reduction effects that we have mentioned. Admin costs decreased by 5% year-on-year, and that is with these efficiency initiatives significantly kicking in, together with some of the higher costs associated with customer service during the previous extreme energy price period no longer being needed. This resulted in a restructuring charge of GBP 5.7 million, which has been excluded from the adjusted PBT view, given its one-off nature.
Now, as these initiatives develop, we expect admin expenses going forward to increase below the rate of customer growth in the coming year. The bad debt charge as a % of sales was 1.8% compared to an underlying 1.6% in the prior year when you exclude those energy price guarantee revenues from the government that we had in FY2024. That level has been mainly driven by the continued impact from the temporary moratorium which was imposed by Ofgem in February 2023 on those involuntary installations of prepayment meters. Now, although the moratorium has since been lifted, it will take time to ramp up those debt recovery processes back to previous levels.
There were higher interest costs this year, given that in half one of the prior year, we benefited from the temporary cash timing difference from the government's energy price guarantee scheme before that normalized by September 2023 in the prior year. All this contributes to this adjusted PBT increase of 8% to GBP 126 million, with adjusted earnings per share increasing 9%. If we now look at the balance sheet key movements, you have net current assets, which are driven by working capital and which I will cover off in more detail on the cash flow slide. You have net debt improving slightly relative to the prior year-end position by GBP 7 million to GBP 116 million, which results in a conservative net debt to EBITDA ratio of around 0.8 times.
Now, in terms of debt facilities, we increased our revolving credit facilities with our banks by GBP 30 million to GBP 205 million and increased the maturity of these to November 2028. We also increased our private placements from GBP 75 million, which mature in 2030, by another GBP 50 million, which mature in 2032. That all in results in diversified total facilities of GBP 330 million relative to our net debt level of GBP 116 million, and that's to support our ongoing double-digit annual growth plans of the company. Moving onto the cash flow, the cash flow starts with an FY25 adjusted EBITDA of GBP 148 million. From that, there's a working capital outflow of GBP 15 million, and that also includes a small final reconciliation true-up benefit following the end of the energy price guarantee scheme, which finished last year.
The typical working capital outflow expected across the whole year going forward, given our rate of growth, continues to be around the GBP 25 million-GBP 30 million mark. You then have the tax charge and also CapEx at GBP 17 million, which continues to be primarily technology development. With all this and the payment of dividends, which in the prior year included GBP 10 million of share buybacks before we moved back to a 100% dividend payout approach, you have a small improvement in net debt by GBP 7 million, as I mentioned previously, to GBP 116 million, the net debt to EBITDA position of 0.8 times. That is in line, of course, with the leverage of around 1 times, which we usually have.
If we now talk about capital allocation, the backdrop continues to be that we have a capital-light business model, given that this has low working capital requirements as we grow, and it has CapEx, which is limited primarily to technology development. That is what determines our progressive distribution policy, where we maintain low leverage of around that 1 times net debt to EBITDA, but at the same time, return between 80-90% of adjusted net income to shareholders via dividends. Given that dividend growth last year was lower whilst we were returning money in the form of both share buybacks and dividends, now that we are returning solely to dividends, the full year dividend growth for FY2025 will be over 13% to GBP 0.94. Stuart.
Thank you, Nick. We have now talked through our record operational and financial performance during FY2025.
Now let's take a few minutes to look forward to the years ahead and our journey to our next big milestone of 2 million customers and beyond. As you can see on this slide, we have currently 3% energy market share, are the seventh largest energy supplier in the U.K., and the biggest independent challenger to the new Big Six. Of course, our market share is meaningfully smaller than 3% in our other services of broadband, mobile, and insurance. Thinking ahead, when we hit that 2 million customer milestone, we'll only have 6% energy market share based on this here, and we'll still only be the seventh largest energy supplier. The question to my mind, to our mind, is not about the size of the opportunity, but it's about our journey to delivering on it.
As a reminder, on this slide, you can see our 25-year journey so far to this point. I think you're all aware of some of the different dynamics that we've talked about in depth in the past, between the period 2008 to 2014 and then from 2014 to 2021. Now, having gone through the energy crisis, which cleaned out all of those unsustainable operators that entered the market, we're now, as we mentioned a few times, four years into delivering double-digit net customer growth. In this normalized marketplace with our market-leading customer proposition and tailwinds around our partner opportunity, we have a lot of confidence in our continued growth trajectory. What does this customer growth opportunity mean in terms of returns?
You can see on the right-hand side of this chart our EBITDA per customer evolution over time, which has stabilized at around the mid-120s level since FY2023. In FY2025, we again delivered EBITDA per customer in the mid-120s. Now, in terms of the drivers and looking forward as we go on that journey to 2 million customers and beyond, we can see a clear opportunity to further increase our EBITDA per customer from the 120s to the 130s, 140s, and ultimately towards that 150 mark. We've set out the key components of that on the slide, but just to sort of break it and step through the gross profit and then the admin cost side of it. On the gross profit side of things, the main levers are in the positive direction. First of all, improved supplier terms that come with greater scale and buying power.
Second of all, selling additional higher margin services into our customer base and increasing multi-service penetration through cross-sell opportunities and also through adding new additional services into the mix. Thirdly, by optimizing our pricing for overall returns. Pulling in the other direction, of course, there's the headwind that comes from lower energy prices and also things like that reduced operating cost allowance in the energy price cap. Together, on the gross profit side of things, we see these as being worth GBP 10 and maybe up to GBP 20 of additional EBITDA per customer over time. On the admin cost side of things, as mentioned earlier, we're scaled for growth, and whilst we delivered meaningful operating leverage improvements in FY2025, there's real scope for more to come. Linked to this, we see real opportunities to come from our investments in digitization and AI.
In the other direction, you've got the impact from things like increased employer national insurance contributions and the national living wage. Putting those together over time, we might see the admin cost opportunity as being worth in the region of GBP 10-20 or more. Bringing it all together in summary, in FY2026, we expect to deliver total customer growth of around 15% with low double-digit organic growth. We expect to deliver adjusted profit before tax in the range of GBP 132 to GBP 138 million and a full year dividend increasing in line with our adjusted net profit.
Now, the profit before tax range is slightly behind customer growth as a result of the modest headwind that we see from the operating cost review that Ofgem has undertaken and the increase in national insurance contributions and national living wage, both of which we'll be looking, of course, to mitigate. When you look out further over the medium to longer term, so sort of think of this from FY2027 onwards, we expect to continue building market share across all our services. Remember that there's really significant upward potential here, given that at 2 million customers, we're just 6% market share in energy. We expect to be building out our platform for these sort of subscription-style services, adding further additional services into our platform across both insurance and financial services, as well as in the energy as a service space.
We expect to be opening up new opportunities. We've already talked about the TalkTalk cross-sell partnership, which could be a blueprint for further transactions and partnerships as we prove out the model. We see some powerful structural drivers leading to continual demand for our partner opportunity. As all of these elements come together, we expect to be delivering continued growing shareholder returns with the opportunity to increase our EBITDA per customer over time. Thank you very much, everybody. Let's move on to questions. I think we've got a microphone to be passed around, so if you could pass that on to Charles to kick off the questions.
Thanks. Charles Hall from Peel Hunt LLP. Stuart, could you just talk a little bit about customer growth? I think you're talking about organic growth, low double digits.
How are you thinking about the TalkTalk customers and the opportunity of cross-sell? Does that come in as acquisition customers, organic growth? How do you think about it?
Yeah, no, that's a good question. Obviously, we're guiding towards low double-digit organic growth and total customer growth of around 15%. The difference between those two is essentially the balance of the customers that we've acquired from TalkTalk, sort of landing as we go through the course of this year. Obviously, we're going to be looking to cross-sell to these customers as we go.
If you think of these customers that we've acquired as being a bit like when you've acquired a lead and they haven't engaged or made an active decision to join you, but once they've engaged with you and taken additional services from you, that behavior and activity and that engagement is much more in the nature of an organic customer who's taken the active decision to join you. We'll be thinking of those customers as being organic in nature and the balance of customers who we've just acquired in a sort of more sort of they are more maybe dormant in their behavior as being inorganic customers.
Got it. Can we just talk a little bit about the competitive environment? Last year, churn went up a fair bit, and obviously, that was partly due to timing on the energy price cap.
Have you had to be more competitive on price as a result to offset that churn? When you think about all the other products you're offering, are there any areas where you feel you're having to invest more in price to keep the customer growth going, or are we now in a sort of normal scenario?
Yeah, I mean, whilst it's a rational environment, like I mentioned, and everyone is behaving sort of responsibly and rationally, these are very competitive marketplaces, which is what they should be. That's not something that we're sort of put off by or afraid by. We lean into that.
In terms of the two parts, in terms first of all of the sort of the churn that you mentioned, there were a couple of sort of peak moments around when the price cap was at its highest with a falling forward curve, therefore creating an opportunity for customers to move on to what appeared to be very attractively priced fixed price energy deals relative to the current level of the price cap. Obviously, the price cap will then come down and chase the forward curve down over time, so they will not realize the full perceived savings, but nonetheless, at that moment in time, it feels like a good opportunity. We saw that back in the sort of the September-October period where the price cap rose and then the forward curve tailed off.
The forward curve increased again, leading to a higher price cap period that we are now in. Obviously, the forward curve since then has been trending down other than over the last 10 days where there have been macro sort of geopolitical things at play. Both of those two moments in time led to spikes in churn, and we have seen churn start to trend down as we now approach July when the price cap is due to fall. In terms of price investment, probably there are two areas where we have been investing in price. One is in fixed energy deals because there has been a competitive fixed energy market out there.
That is an area where we are sort of happy to invest in price because at the moment, we have only historically offered fixed energy deals for multi-service customers, and those are customers that we are happy to invest in. The other area where we have been investing in price is we have launched a new sort of broadband recontracting offer that I mentioned as well. That, again, we think is a really good, an area where we are happy to invest because these customers are typically some of our most long-standing loyal customers, and we want to make sure that we are treating them well. All of these marketplaces are competitive, but I would say that energy and broadband are probably the two most competitive, and we have therefore been sort of making some further investments in price in those areas.
Taking that through to EBITDA per customer, just doing the maths on the guidance, you've got EBITDA per customer coming down this year. I guess part of that is because the TalkTalk cross-sell is only going to happen in the back end of this year, and you've also got some headwinds on costs. Do you see those as sort of just both temporary issues on that route to the potentially 150 in the medium term?
Yeah, yeah, I think that's the right characterization. Obviously, things like energy price movements will be a thing that from year to year, there'll be an impact from that up or down of sort of a modest impact.
There'll be the exact rate of customer growth, the proportion of customers that we acquire through not just the TalkTalk deal, but any sort of further deals that we do once we've proven out the blueprint. I think the key thing is being understanding that these levers are there, and we will use them in the right way at the right time. Just because they're there doesn't mean we're going to pull them all at once. The key thing is making sure that we keep the growth trajectory going, and then I'd much rather pull the levers harder once we get to 2 million customers and beyond, rather than pull those levers sooner and either slow or damage that journey to 2 million customers. I think that's definitely the right balance in the way that we're thinking about it, but the key thing is to know that they're there.
Perfect, thanks.
Alex Smith from Berenberg. Just a quick one. You mentioned the size of the opportunity to kind of reduce admin costs and the potential efficiency gains from digitization, AI. Could you maybe provide a bit of color specifically on where you expect those savings, maybe timelines from those savings given the investment in tech?
I can give a feeling of size. As we mentioned, our admin costs are around the sort of GBP 145 million mark. In terms of the people costs within that, it's approximately 70%-75%, so say approximately GBP 100 million. Now, in terms of the ultimate efficiencies that we've been talking about, if you take the sort of 30, the lower end of that range, 30%, that would therefore be equivalent to about GBP 30 million.
The degree to which that feeds through into, drops through into, an increase in PBT depends on the amount we choose or not to reinvest in the product offer over time. In terms of timeframe, we're not providing a timeframe at this stage. It's to provide a sort of flavor of the opportunity as we progress over the years.
Just one quick one on inorganic growth. TalkTalk, I guess, was the first step. I'm just wondering, has that opened doors to other services other than broadband? Have you been approached from other service providers post this TalkTalk acquisition?
Yeah, so the first thing here is, without question, sort of proving out the blueprint through doing the cross-sell.
As I said, there were some sort of positive early signs that we're seeing from our sort of early activities there, but as we go through the year, we'll learn a whole lot more. Once we've done that, there are for sure going to be further opportunities we expect in the broadband space. Across other services, the reason why broadband was an attractive starting point is because lots of businesses have tried selling or cross-selling telecoms products into energy customers, and they found it quite difficult, albeit they haven't had our sort of developed multi-service offer or our partner route to market to help them to do that. We believe that selling energy and other services into a broadband customer is likely to be more productive because energy is a more simple service to switch, and broadband is a more complex service for people to switch.
That said, we think that having proven it out, it will open up opportunities across the full range of different service lines. Obviously, where those opportunities come from will depend on all the usual things, and obviously, it takes two parties to want to do this. Finding a willing seller as well is obviously the key thing. We do believe, as I mentioned in the presentation, that there are lots of, I sort of think of them as like stranded customers. Customers that they are just there in the hands of a single service supplier providing them with a fairly generic service experience. It's not better value, it's not a better service, and they're sort of slightly lost. I think that we've got a way to create value from that in a way that other people don't.
Yeah, quick one from me.
Stuart, you've mentioned early positive signs twice now on TalkTalk. Can I just encourage you to be maybe a little bit more specific, both about that positivity, but also a year from now, what would good look like in terms of the potential penetration within that TalkTalk book?
Yeah, so I'm not going to give any numbers in terms of more detail on the positivity. What I can say to have you fleshed it out a little bit is that we're trialing a whole range of different things, lots of small trials with small cohorts of customers. Some of those trials that we've done have started to deliver sort of conversion rates sort of in line with our expectations, some slightly below our expectations, and some slightly above our expectations.
If you've got any of your trial samples with a cohort that's delivering something that's slightly ahead of your expectations, then you might, yeah, we've got this belief that we'll be able to sort of double down on that particular approach and build out that particular approach and roll that out to the other cohorts and therefore deliver a strong outcome. Yeah, we can do lots of different, we can do lots of all the trials that we're doing, we're sort of iterating on a pretty much daily basis with how we're doing it. We're also doing very small-scale trials before we sort of roll it out at a larger scale. We're not in a rush to do it either.
It's important to make sure that we migrate and onboard these customers in a really positive way, that we warm them up, that they get introduced to a new business and a new business model. We are not in a rush. I think it's very much making sure that we and some customers do not want to move that quickly. They want to check, "Okay, let's see how my broadband experience goes with you over the first period of time. I like the sound of the additional services. In six months' time, if everything's gone well, then let's have a conversation then." There will be a whole range of different types of customers within it as well. I think that the measure of success ultimately is going to be us having the confidence as we go through the year to perhaps actively explore additional opportunities in this space.
That's ultimately the litmus test of us delivering what we wanted it to deliver.
John Chris from Deutsche Numis, a few questions, please. Can I just confirm that the 10-15% yearly customer growth on the way to 2 million, is that organic only, or is it likely to be a mix of organic and inorganic per annum going forward?
Yeah, looking at FY2026, first of all, we've obviously talked about low double-digit underlying organic growth within a total customer growth of around 15%. I think as a starting point, that's a useful lay down to think about going forward. Obviously, it will depend on what opportunities present themselves and the extent to which we're able to cross-sell using our partners into those opportunities.
Because obviously, for every bit of activity that we're steering our partners to do to cross-sell over on the right-hand side might take them away from doing something that they otherwise would have been doing over on the left-hand side. There will be like an interplay of sorts between the amount of cross-sell that we do and what you might call the sort of the more sort of natural historic organic growth that we've delivered. I think it's too early to sort of be, for hopefully understandable reasons, to be sort of too fine-tuned about how it might play out over a multiple-year period. Hopefully, that gives you enough of a lay down for how we're thinking about it.
Thank you. Yes. In terms of the exceptional admin cost to do with the energy crisis, I guess I have two questions.
The first one is the assumption was that you sort of rent out call centers somewhere overseas. I'm not quite sure why that would result in exceptional restructuring costs at the end of it. Did you sort of end the contracts earlier? Sorry, related to that, how much of this exceptional cost is left in the GBP 144 million or whatever the number was? What's the timing of that moving out, please?
First of all, going through the energy crisis, there was a number of things that we did as we both returned to double-digit growth, but also dealt with all the inbound contact that customers were giving. People were terrified about what was going on with their energy bills, and we received disproportionate amounts of contact.
We did a whole range of things, including significantly scaling up our employed workforce to deal with that, as well as taking on outbound, expensive, predominantly onshore contact center support as well. That onshore contact center support is something that has broadly washed through the system before last year. What was in last year was, amongst other things, us beginning the process of normalizing our core employee base as we go through that. Going forwards, I think it's quite difficult to say how much of that is still left because so many other things are changing. Because of the progress we're making on digitization and AI, we've got just a different view now of how much resource you need to provide a great experience to people.
If you'd asked us a year or two ago, we'd probably have said that there wasn't that much additional sort of over-investment to recover. If you asked us now, I think we'd say that there is, but it's for slightly different reasons. Yeah, I think the question on the GBP 5.7 million is probably, has the cash been paid out? The answer is pretty much predominantly it has. Right, in FY2025. In FY2025.
Okay, thank you. Lastly, there are sort of recurring headlines about TalkTalk going bust. In that scenario, I'm sure somebody will come in and pick up the pieces. Would you incur exceptional costs? I don't know, would you have to change the routers, for example, as a consequence? If that were to happen, what would be sort of the worst-case scenario for Telecom Plus PLC, please?
Our contract with, it's actually with, technically speaking, it's with PXC, which is sort of like the platform sister company of TalkTalk Retail, but all under the overall sort of TalkTalk umbrella. Our contract with them is a profitable cash flow generating contract for them, and therefore will be a valuable asset for whoever, if the scenario that you painted was to arise, our relationship will be a valuable asset that whoever picked up the pieces would absolutely want to hold on to. If they didn't, and if they weren't able for whatever reason, there's other people, because we've had regular interest in people who sort of would covet our broadband business.
Our expectation is that, like you say, first of all, because of the fact that they've got, however many it is, two point something million customers that would need to be looked after, it would need to be the sort of the management of that situation would need to be orderly and have the customer situation at heart. We'd expect that we would end up being a sort of a very valuable part of whatever the resolution is, and any new ownership would want to really look after us.
If I were to buy it, would you have to change your routers, or would you ask me to wear the cost of that if I needed to do that?
I think it would depend on exactly who, depending on who bought it and what sort of migration was needing to be planned, if any, from what network to what network over what time frame. It is quite just a whole range of factors. As I said, the key thing to understand is that the customers will need to be looked after, so therefore there will need to be an orderly sort of process. We are probably the crown jewel part of that sort of relationship and would be expected to be heavily fought over by whoever was involved in picking up the pieces. Thank you. Great. Maybe one more question, and then I think we will have to wrap up.
Thanks, Stuart. Just a quick one from me. It is Andrew Ford from Peel Hunt.
Just on the customers, so obviously there's more two than three on the customer sign-up. I just wondered whether there was anything more underlying in there which, yeah, sorry, I've got a nosebleed. Anything more underlying in there from a customer service perspective that's changed from a mixed perspective or anything else?
Yeah, no, I think it's a combination of points that I mentioned in the presentation. It's in part the fact that we didn't have insurance available during a large part of the year for new customer sign-ups.
It's in part we made changes, actually, as we came out of the energy, or as we were going through the energy crisis, to make it easier to get great value from us by just taking two services, whereas in the past, the only way, and that's because we could, whereas before that, the only way that we could compete with some of the irrational pricing in the marketplace was providing three services plus to you, as we reinvested the additional margin from all the services into the energy price during that period. That for sure would have had a diluting effect on the number of services per customer. The third and final thing, which is important not to overlook, is also an increase in mobile-only customers.
But also now with the addition of the TalkTalk customers that came in, we had 25,000 sort of essentially broadband-only customers that landed during the year as well. As we look to the new year, we're obviously going to have 70,000 or so, so the balance of the customers that we bought of broadband-only customers that are going to be landing in FY2026 as well. That will have an impact on that sort of mix as we look forward. Great. I think that takes us to time. Let's wrap up quickly. I think the place to wrap up is maybe back where we started on the three key takeaways.
First of all, as a reminder, our double-digit growth performance is underpinned by those three key strands of our business model, which enable us to sustainably outcompete as we go on our journey to the 2 million customer mark. Second, for FY2026, we expect total customer growth of 15% with low double-digit % organic growth, adjusted PBT between GBP 132 million-GBP 138 million, and fully a dividend increasing aligned with adjusted net profit. As we head towards that 2 million customer mark over time, we see a real opportunity to increase our EBITDA per customer. Third, we have opened up a new and exciting opportunity to acquire and drive further leads into our multi-service platform through this partnership that we put in place with TalkTalk. We really expect that to provide a blueprint for further inorganic and partnership opportunities in the future.
Thank you very much, everybody.