Year ended 31 March 2022

Report and Accounts

Strategic Report

Financial and Operating Highlights 1

Our Approach 2

Our Services 3

Chairman’s Statement 5

Co-Chief Executives’ Review 8

Financial Review 17

Principal Risks and Uncertainties 20

People and Organisation 27

Sustainability Report 31

Task Force on Climate-related Financial Disclosures 43

Governance Reports

Board of Directors 47

Corporate Governance Statement 51

Nomination Committee Report 55

Audit Committee Report 57

Directors’ Remuneration Report 60

Directors’ Report 83

Directors’ Responsibilities 87

Financial Statements

Independent Auditor’s Report 88

Financial Statements 96

Notes to the Financial Statements 102

Shareholder Information 138

Contents

• Revenue up 12.3% to £967.4 million

(2021: £861.2m)

• Adjusted pre-tax profit* up 10.3% to

£61.9 million (2021: £56.1m)

• Statutory pre-tax profit up 8.5% to

£47.2 million (2021: £43.5m)

• Adjusted EPS* up 10.1% to 63.2p

(2021: 57.4p)

• Statutory EPS up 8.7% to 45.1p

(2021: 41.5p)

• Full year dividend maintained at 57p

• Number of customers up 10.8% to

c. 729,000

• Number of services supplied up

9.2% to c. 2.3m

• Notable improvement in customer

retention levels, as customers

benefit from higher savings on their

UW services

• Return to rational pricing

environment following permanent

energy retail market reset

Adjusted pre-tax profit (£61.9m) and Adjusted EPS

exclude share incentive scheme charges (£1.0m),

amortisation of the energy supply contract

intangible asset (£11.2m), the minority share of

Glow Green losses (£0.5m), loss on disposal of

UWHS (£1.1m), impairment of goodwill associated

with Glow Green (£1.5m) and the profit on disposal

of a freehold property (£0.6m). The reconciliations

for adjusted profit before tax and adjusted EPS

are set out in notes 1 and 19 respectively of the

financial statements.

Revenue

Adjusted pretax profit

Services provided

38.1% increase on 2016

2,264,909

20222016 2017 2018 2019 2020 2021

29.9% increase on 2016

£967.4m

£744.7m

£740.3m

£792.9m

£804.4m

£875.8m

£861.2m

20222016 2017 2018 2019 2020 2021

26.8% increase on 2016

£61.9m

20222016 2017 2018 2019 2020 2021

£48.8m

£53.3m

£54.3m

£56.3m

£60.8m

£56.1m

1,639,558

1,709,495

1,748,124

1,901,319

2,022,706

2,073,797

Telecom Plus Plc Report and Accounts 2022 /

Financial and Operating Highlights

Our word-of-mouth model

Unlike other suppliers, we don’t acquire our customers directly.

In fact, almost every one of our 729,000 customers has been

introduced to us by word-of-mouth.

And at the heart of this is our community of over 48,000

self-employed Partners, who earn an income by referring UW

to family, friends and people they know.

All your

home

services

in one

A structural cost advantage

Through providing our customers with multiple home

services, we generate multiple revenue streams from a

single set of overheads. This gives us a structural and

enduring cost advantage relative to our competitors,

enabling us to consistently price competitively across

each of the services we supply.

This creates a highly attractive and referable proposition

for our Partners to recommend, acquiring high-quality,

multiservice customers on our behalf, and maintaining

our unique structural cost advantage.

Everything in one

We bundle together all your home services - energy,

broadband, mobile and insurance - into one, great

value, monthly bill. And the more services our

customers take, the more they save.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Our Approach

Our Services

One bill

with a promise of great value.

One number

whatever their query.

One account

with a single password for all their services.

All your home

services in one

We save our customers time and money by providing all

their home services in one:

So customers can switch to UW, be sure of great value,

and never have to think about their utilities again.

Unlike our competitors, we’re not

an energy company, a broadband

company, a mobile company or

an insurance company. We’re the

UK’s only multiservice provider.

Telecom Plus Plc Report and Accounts 2022 /

Energy

Consistently fair prices, which we guarantee will be lower than the

Government’s price cap.

Broadband

Super-fast broadband with no in-contract price rises and outstanding

technical support.

Mobile

Market-leading tariffs and no EU roaming fees, all on a 30-day rolling

contract.

Insurance

Top-rated by Defaqto and Moneyfacts, and always the best premium from

our panel of insurers.

Winning awards

year in, year out

We’ve earned over 70 awards - and counting - in

the last decade alone, for the service we provide,

the products we offer and the environment we’ve

created for our team. Most recently we were

awarded, Best Customer Service, Most Likely to

Recommend and Best Rewards in the Uswitch

Energy Awards 2022.

Best Customer Service

Most Likely to Recommend

Best Rewards

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Chairman’s Statement

I am pleased to report a strong performance by the Company during

a period of exceptional market turbulence, with turnover, profit,

customer and service numbers all reaching record highs.

Adjusted pre-tax profits increased by 10.3% to £61.9m (2021: £56.1m)

mainly reflecting higher customer numbers during H2, on revenue

up by 12.3% to £967.4m (2021: £861.2m) largely due to higher energy

prices and a growing customer base. Adjusted earnings per share

for the year rose by 10.1% to 63.2p (2021: 57.4p). Statutory pre-tax

profits rose by 8.5% to £47.2m (2021: £43.5m), and statutory EPS

rose by 8.7% to 45.1p (2021: 41.5p).

Customer numbers for the year increased by 71,269 (2021: 5,174) to

728,680 and core service numbers grew by 191,112 (2021: 51,081) to

2,264,909, representing growth of 10.8% and 9.2% respectively. All

this growth was achieved organically, and predominantly during H2,

representing an annualised customer growth rate for H2 of slightly

over 20%. This was achieved despite our decision not to participate

in the multiple opportunities which arose to acquire customer bases

from insolvent suppliers during the autumn.

Churn within our energy customer base is continuing to run at an

annualised rate of less than 3%, and in the absence of a return to

heavily discounted introductory fixed tariffs from other suppliers

- which now seems unlikely given the current regulatory focus

on ensuring a sustainable retail energy marketplace - we would

expect our churn rate to remain well below historical levels for the

foreseeable future.

Interest in our income opportunity for UW Partners accelerated over

the course of the year, particularly during the second half, as people

focussed on the impending cost of living crisis. We progressively

improved both our customer and Partner propositions; of particular

importance was the simplification of our bundling structure in March,

enabling customers to lock-in guaranteed savings of up to 5% below

the Government’s energy price cap when they take any combination

of our other core services.

We received a number of awards during the year recognising both the

value we offer and the quality of service provided by our UK-based

support teams; these are testament to our customer-centric approach,

our commitment to treating our customers fairly, and the significant

efforts by our teams to deliver the best possible customer service.

Telecom Plus Plc Report and Accounts 2022 /

Dividend

We are proposing a final dividend of 30p (2021: 30p),

bringing the total for the year to 57p (2021: 57p); this

will be paid on 5 August 2022 to shareholders on the

to approval by shareholders at the Company’s AGM which

will be held on 26 July 2022.

We remain committed to a progressive dividend policy

consistent with the underlying strong cash generation

of our business, with a significant increase to at least

65p expected for the current year.

Our ESG strategy

As a Company, we remain focussed on delivering against

our ESG strategy. Never before has sustainability been so

relevant. The challenges of collectively achieving net zero,

the energy crisis of last autumn - and now the sharply

increasing cost of living faced by families throughout the

UK - have brought into sharper focus the importance

of helping our communities thrive, supporting a more

sustainable future and doing business responsibly. These

three pillars underpin our ESG strategy and I am pleased

to report that we have made good progress over the last

year, as set out in our ESG Report and in our Sustainability

Report on pages 31 to 40 below.

We recognise the importance of a low carbon future and

are actively developing a detailed Net Zero transition plan.

We are committed to implementing the recommendations

of the Task Force on Climate-related Financial Disclosures

(“TCFD”) and our TCFD disclosures, consistent with the

TCFD framework, can be found on pages 43 to 46 of

this Report.

Our ESG targets and goals for the year ahead are set

out in our ESG Report and Sustainability Report and

demonstrate the Company’s continued engagement and

focus on its ESG agenda.

Corporate governance

The UK Corporate Governance Code (the “Code”)

encourages the Chairman to report personally on how

the principles in the Code relating to the role and

effectiveness of the Board have been applied.

As a board we are responsible to the Company’s

shareholders for delivering sustainable shareholder value

over the long term through effective management and

good governance. A key role of mine, as Chairman, is to

provide strong leadership to enable the Board to operate

effectively.

We believe that open and rigorous debate around key

strategic issues and risks faced by the Company is

important in achieving our objectives and the Company

is fortunate to have non-executive directors with

diverse and extensive business experience who actively

contribute to these discussions.

Further detail of the Company’s governance processes

and compliance with the Code is set out in the Corporate

Governance Statement.

Board changes

As previously announced, non-executive directors Julian

Schild and Melvin Lawson will be retiring from the Board

after the AGM in July. Melvin and Julian have each made

significant contributions to the success of the business

and will leave with our sincere thanks.

We are delighted to welcome Carla Stent to the Board

as a Non-Executive Director with effect from the AGM in

July. Carla brings a broad range of skills and experience

at large and fast growing businesses, and demonstrates

the importance we place on meeting the highest possible

standards of corporate governance. She will immediately

assume the role of chairing our Audit Committee.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

I am pleased to report a

strong performance by the

Company during a period

of exceptional market

turbulence.

Outlook

We have now entered what seems likely to be an

extended period of normal and sustainable competition

across the various essential household services

we provide - an environment in which our clearly

differentiated and effective route to market can

be expected to thrive. It is hugely exciting to see our

community of Partners once again demonstrating their

ability to deliver rapid and high quality organic growth.

In helping UK households to manage and reduce their

bills, we are a business of its time. Consumer demand to

reduce bills has never been higher, and is likely to continue

to grow over the coming months. Our multiservice model

enables us to offer consumers some of the cheapest

energy tariffs in the market - with guaranteed savings of

up to 5% below the Government energy price cap - in an

entirely sustainable way.

And we are actively increasing our investment in staff and

technology to further improve the already strong customer

experience and service levels that earned us top position

in the May 2022 survey carried out by Uswitch.

Whilst we expect our customer base to grow by around

20% during FY23, the fundamental strengths of our

business model mean there is much more to aim for.

Indeed, with 98 out of every 100 households in the UK

taking their essential home services from suppliers other

than UW, our organic growth opportunity is, for all practical

purposes, unlimited.

Our new medium-term goal is to sign-up at least 1,000,000

additional customers over the next four to five years - a

target we believe is comfortably achievable against an

economic background where our ability to help families

both save on their bills and earn a meaningful additional

income have never been so needed or so valuable.

In the absence of unforeseen circumstances, and with

growing visibility over the level of the Government price

cap for the coming winter period, we expect that full-year

adjusted profit before tax for FY23 will be around £75m,

ahead of current consensus market expectations; this

would enable an increase in our dividend to not less than

65p for the full year in line with our progressive dividend

policy.

Once again, I would like to thank my boardroom colleagues

for their support and all our staff and Partners for their

loyalty and hard work throughout a difficult and challenging

few years, and the contribution they are making to the

strong performance we are currently seeing.

Charles Wigoder

Executive Chairman

21 June 2022

Telecom Plus Plc Report and Accounts 2022 /

Chairman’s Statement

continued

The year in summary

The business has experienced a dramatic turnaround in

the past 12 months, delivering a very strong performance

that exceeded our expectations at the start of the year.

We have regained our long term competitive edge, are

offering some of the best value services in the country,

and starting to fire on all cylinders again.

A continuation of the long-running and value-destructive

price war in the energy retail market, combined with the

after-effects of social distancing restrictions associated

with the pandemic, led to a slow first six months until

September 2021.

Since then, our trading environment and long term outlook

have significantly improved, as shown by the 10% growth

in both customers and service numbers in the second half

of the year - equal to the previous five years of growth

combined.

The end of the energy price war was a huge contributor

to this rapid improvement in performance: prior to

September 2021, our long term cost advantage and

multiservice approach had struggled to compete against

the irresponsible, below-cost pricing models of many

now-failed energy competitors. As wholesale energy

prices rose last year, it exposed these short-termist,

unsustainable business models, resetting the energy

market and enabling the core strengths of our business

model to come back to the fore.

Our disciplined refusal to engage in the value destructive

fray of the energy price war, instead remaining focused

on long term value creation, has paid off. Today, we are

operating in a much smaller market with only ~15 remaining

suppliers and ongoing regulatory intervention that will

prevent any possible recurrence of unsustainable pricing

practices.

But it is not simply the reset of the energy markets that

has enabled the business to return to growth and deliver

a strong second half. The macro-economic outlook for the

UK is worsening, household budgets are coming under

increasing pressure, and demand for what we offer is

clearly rising.

An inflationary environment is one that has historically

suited our business model, as we cater for both those

looking to save money on their bills, and those seeking

to earn an additional income.

Households across the country are experiencing price

rises for all their essential home services - be it energy,

broadband or mobile - and are increasingly focussed on

managing their monthly outgoings and interested in hearing

about ways to save.

At the same time, more and more people are looking to

supplement their earnings, and turning to the near-term

income opportunity we offer our Partners. It is hugely

rewarding to see record numbers of Partners joining UW

and being active in recommending UW to their friends,

families and colleagues, helping them reduce their bills

whilst earning a meaningful additional income in the

process. After several years of challenging conditions,

the path ahead for us to deliver sustainable and profitable

double-digit annual growth is clear.

The strong performance of the business over the last six

months is exciting, but with the cost of living squeeze

driving increased consumer demand for what we offer, and

with 98 out of every 100 households across the UK using

suppliers other than UW, we believe there is much further

to go. The business is perfectly positioned to capitalise on

these very positive dynamics, and we continue to invest

to ensure we maximise our growth prospects over the

years ahead.

A unique business

All your home services in one

We supply households and small businesses throughout

the UK with a wide range of essential services under the

UW brand - energy, broadband, mobile and insurance.

Our customers bundle together the services they want,

and benefit from a unique multiservice proposition that

offers them:

• Simplicity - just one, simple bill for all their home

services;

• Savings - compared with the prices they were previously

paying; and

• Service - an award-winning customer app backed up

by UK-based support teams.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Co-Chief Executives’ Review

We help our customers to get on with more important

things in their lives than managing their bills, by delivering

consistently fair value and great service, ensuring they

never need to think about switching their utilities again.

We believe that one supplier offering a single place to

manage all your essential home services, and a single

monthly bill for all of them together, is logically the easiest

and most cost-effective way to deal with your bills.

Our ultimate objective is that by fully delivering on our

‘all your home services in one’ customer proposition, we

create something that is truly referable.

Word-of-mouth

The power of a personal recommendation from someone

you know and trust is as great today as it ever has been,

and delivers real impact. This is increasingly apparent in

a world of ubiquitous online reviews and relentless digital

marketing campaigns hitting consumers from all angles.

Almost every one of our 729,000 customers has been

introduced to us by word-of-mouth. Central to this

differentiated marketing approach is our community of

UW Partners: they are local, trusted brand advocates

who spread the word about UW, one neighbour at a time.

In return for successfully recommending us to their friends

and family, and helping them switch their essential home

services to UW, we offer our Partners the opportunity to

earn a meaningful additional income.

Our sustainable cost advantage

It is the combination of our unique ‘all your home services

in one’ customer proposition with our powerful ‘word-

of-mouth’ route to market (that in itself represents an

attractive proposition to many consumers), that lies at

the heart of our business model. These are underpinned

by strong wholesale supply agreements for each of our

services and a fully-integrated technology stack that we’ve

built in-house.

As the UK’s only genuine multiservice provider, we derive

significant ongoing operating efficiencies relative to our

competitors by spreading a single set of overheads across

the multiple individual service-related revenue streams

we receive from each of our customers.

This creates a sustainable, structural cost

advantage that enables us to consistently

price competitively across each of the

services we supply.

This in turn creates a highly attractive and

referable customer proposition that enables

us to harness the most powerful form of

marketing - word-of-mouth.

Our Partner-led word-of-mouth route to

market enables us to achieve high levels

of multiservice take-up by new customers,

maintaining our sustainable cost advantage.

Our focus

The energy, broadband, mobile and insurance markets are

each individually significant; combined, they present us

with a vast opportunity. Further, with a market share of

around 2.5%, there are few practical constraints on the

size of business we can build organically.

However, we have never pursued growth at all costs. We

take pride in building an ever more robust and sustainable

business that serves the interests of all our key audiences:

our customers, Partners, employees and our shareholders.

The underlying strength of our business and the conviction

in our approach is founded on two key areas of focus:

Telecom Plus Plc Report and Accounts 2022 /

Co-Chief Executives’ Review

continued

Loyal customers creating long term value

We believe sustainable value can only come from

long term relationships with our customers. We must

compete toe-to-toe in each of the competitive markets

we operate in, but we’re not trying to persuade people

to buy something they don’t already have or may not

need. We simply offer a better solution for the essential

household services they’re already using, and one that’s

recommended by a trusted friend or neighbour.

We seek to generate loyalty amongst our customers in a

number of key ways:

• Incentivising them to take more services from UW

There’s a clear correlation between the number of

services a customer takes and their lifetime as a UW

customer, and so we offer incrementally better value

with each additional service they take from us.

• Providing outstanding service and treating them fairly

Above and beyond our award-winning customer app and

telephone support, we offer a promise of great value

for as long as a customer stays with us, eschewing the

short-term ‘tease and squeeze’ pricing tactics that

inevitably undermine customer trust and loyalty.

• Encouraging homeowners to sign up to UW

Changes in occupancy pose particular challenges to

broadband and energy suppliers, leading to higher

administrative costs and acting as a prime source of

both churn and bad debt. Our propositions are therefore

weighted towards homeowners as they tend to move

less frequently.

Only a minority of UK consumers actively engage with the

expensive advertising strategies of our competitors; these

are typically serial switchers and are therefore unlikely to

generate long term returns. The majority of people are

considerably less engaged with switching, and it is this

personal recommendation from someone they know that

overcomes this natural inertia and then leads to longer

lifetimes with us once they’ve switched. Moreover, these

‘hard to reach’ customers are where our less formal

‘word-of-mouth’ route to market really comes to the fore,

accessing people who are not actively considering switching.

Our unique multiservice proposition delivered through

our word-of-mouth route to market drives the ongoing

acquisition of loyal customers, thereby building long-term

value for all parties:

• Our customers benefit from consistently lower prices

in return for switching all their services, and stay with

us longer.

• Our Partners receive a long term residual income stream

from a longer-lasting customer.

• Our shareholders receive a sustainable earnings stream

from an inherently sustainable business.

Word-of-mouth as a sustainable route to market

We believe attracting multiservice customers at scale

is best achieved through word-of-mouth. This is a core

tenet of our business model and gives us a significant

competitive advantage, with a direct ability to communicate

the benefits of our unique multiservice retail proposition

to high quality customers, many of whom may never have

previously switched supplier. This is in stark contrast to

the traditional and costly routes to market - billboards

and digital banner ads to name a few - that are adopted

by most other suppliers.

Moreover, and also unlike other routes to market, this

word-of-mouth model creates a genuine alignment of

interests. Our Partners can earn meaningful short-term

financial rewards for introducing new customers to UW,

as well as a long term residual income for as long as their

customers remain with us.

As an opportunity to earn a meaningful additional income

it offers genuine flexibility, as Partners earn in their own

time and on their own terms, and it’s highly accessible, as

anyone can become a UW Partner, recommend UW from

anywhere and no previous experience is needed.

Almost all of our customers have signed up to UW following

a recommendation from a UW Partner. In some cases

this only generates a one-off income, but in most cases

Partners can generate real financial security for themselves

and their families - something that has once again started

to strike a real chord around the country in recent years.

The pandemic reinforced the appeal of the UW Partner

opportunity, with rising demand for an alternative, flexible

income stream to supplement earnings. More recently with

the inexorably rising cost of living, we’re experiencing a

further surge in interest as UK consumers increasingly look

for additional ways to bolster their household finances.

Our core services

We help UK households to save time and money by

bundling together all their essential home services into

one. Whilst a number of price comparison sites seek to

provide an all-encompassing home services proposition

on a brokerage basis, we are unique in doing this on a

genuinely integrated basis, as the actual retail supplier

across each of our core services. We believe this is the

only way to earn the trust and loyalty of our customers,

as we can manage their end-to-end experience.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Yet we are essentially a virtual business. Instead of owning

any of the underlying infrastructure assets necessary to

provide our services, we rely on the investments made by

others, and resell their services. This approach is founded

on strong, long term commercial relationships with the

wholesale suppliers of the core services we supply. It is

also capital-light, ensures access to emerging technologies,

avoids any obsolescence risk, whilst enabling us to retain

full control of our retail proposition.

Our suppliers recognise the value of our unique approach to

each of the markets we operate in, and the importance of

ensuring we maintain a competitive and attractive customer

proposition so our word-of-mouth model continues to

thrive. In return, they benefit from a complementary and

clearly differentiated route to market which increases

their market share, whilst the proven sustainability of our

business model, the strength of our balance sheet, and

the longevity of our multiservice customers means we

benefit from long term competitive terms.

We believe these are genuinely mutually beneficial

relationships, and the average tenure for suppliers -

typically over 15 years - is testament to their strength,

and the value that both sides attribute to them.

None of this would be possible without our in-house

technology platform, which is managed by a team of

engineers who are innovating daily to deliver seamless

customer and Partner experiences. By fully integrating all

the household services we supply into a single monthly

bill, supported by a single set of central overheads, our

technology gives us the fundamental, long term cost

advantage that enables us to sustainably compete with

other suppliers in each of the markets we operate in.

Energy

The energy market landscape has experienced an unprec-

edented upheaval since the energy crisis began in October

last year. Unsustainable pricing and hedging practices

have resulted in 30 companies supplying over four million

customers going into administration in the last year.

The customer impact has gone well beyond a change of

supplier. The rapid inflation in wholesale prices have led to

two consecutive significant increases in the Government

price cap - a key driver of the cost of living crisis. And with

most suppliers not currently accepting new customers

unless onto a very expensive fixed deal, more than 22

million households are now on standard variable tariffs,

priced at the Government price cap, and switching across

the market has dramatically reduced.

Our long term, sustainable approach to pricing giving

customers a guaranteed discount to the Government price

cap, led to us being consistently the most competitively

priced supplier since October. The combination of this

attractive pricing and record low churn, resulted in our

energy service base growing by 13% in the last year, heavily

skewed towards the second half.

We have continued to focus our growth in this period on

high quality customers. We chose not to participate in the

multiple opportunities to acquire customer bases from

insolvent suppliers during the autumn (through the Supplier

of Last Resort (“SOLR”) process) and have maintained our

focus on acquiring multiservice home-owners through our

unique word-of-mouth route to market.

Despite our rapid return to growth, our customer service

quality has remained market leading, and we were

delighted to have won three awards in the Uswitch energy

awards 2022 including ‘Best Customer Service’, ‘Most Likely

to Recommend’ and ‘Best Rewards’ in addition to coming

runner–up for ‘Best App’. More recently, we topped the

Citizens Advice Bureau (“CAB”) rankings - a testament to

our focus and investment in this area, and the exceptional

work of our teams providing the support.

Ofgem continues to run multiple concurrent consultations

on interventions to prevent any recurrence of unsustainable

practices, including, but not restricted to pricing, hedging,

consumer credit balance management, direct debit

management, price cap review timeframes etc. We welcome

this increased scrutiny, and Ofgem’s desire to ensure a

sustainable energy market. Equally we are constantly

alert to the risk of unintended consequences of highly

prescriptive regulatory intervention, not least the significant

administrative burden that this puts on suppliers.

Consumer engagement with the transition to net zero

may have waned somewhat in the face of rising bills, but

remains on a longer term upward trend. Whilst we view

ourselves as a multiservice provider, not simply an energy

supplier, we have both a direct role to play in the transition,

and also an indirect role, by helping our customers to do

likewise. The key priority for the energy retail industry is

the smart meter roll-out programme. Not only is this vital

to the broader transition to net zero, it also improves

billing accuracy and customer satisfaction, and critically,

it helps customers actively monitor in real time how much

energy they are using.

Telecom Plus Plc Report and Accounts 2022 /

Co-Chief Executives’ Review

continued

We maintain our belief that Government intervention is

required if the smart rollout is to achieve its full potential

- namely the introduction of legislation to remove the

ability for customers to opt-out from the national rollout

programme by refusing to have a new smart meter

installed.

We continue to move ahead of the wider market in our

smart meter rollout programme, with penetration now

at 65% (up from 57% at the start of the year) despite our

recent acceleration in growth. In order to focus on our

core multiservice customer proposition, and to ensure

the continued cost-effective rollout of smart meters to

our customers, we took the decision to divest UWHS,

our smart meter installation business, in March. The new

owners will continue to fulfil our smart rollout obligations

in line with our growth.

Our boiler installation business (Glow Green) made a loss

of £1.9m during the year. This disappointing performance

resulted from a combination of labour and supply chain

issues, a more competitive post-pandemic environment,

and start-up costs associated with entering the solar

panel and battery installation market. In order to focus on

our core multiservice proposition, we took the decision to

divest the business in March to Charles Wigoder, Executive

Chairman of the Group, for cash consideration of £1.

Wholesale energy markets remain volatile. We have

just seen the Government price cap increase by 54%

from April, and it is now inevitable that prices will rise

significantly again in October. In addition, the ramifications

of the additional SOLR processes are yet to be fully

seen, with costs still to be absorbed by the market and

new requirements on existing and new market entrants

expected. Energy prices are therefore likely to remain high

for the foreseeable future.

We have already seen early indications of customers

actively taking steps to reduce their energy consumption

in response to higher prices, and it seems increasingly

likely that additional Government support will be provided

for those most at risk of fuel poverty this winter. The

combination of these two factors suggest that any increase

in bad debts across the energy industry this year will

be more manageable than had previously been feared,

although uncertainty remains over the eventual impact.

In any event, we expect to be sheltered to a degree

from these pressures by our customer demographic

which skews towards more mature, creditworthy, and

multiservice homeowners.

Broadband

Consumer expectations for broadband services have

never been higher with demands for faster speeds and

better in-home Wi-Fi coverage as a result of the pandemic

continuing to impact consumer behaviour.

In H1 we saw a dip in our broadband service numbers

following a period of heavy re-contracting during the

pandemic as people sought faster speeds; this resulted

in many of our prospects being locked into their existing

suppliers last summer with large termination fees and

being cautious about disrupting their service.

As the national full fibre roll-out gathers pace, the quality of

the in-home Wi-Fi experience is increasingly the important

factor for customers, and a focus for us. In April last year

we launched our Whole Home Wi-Fi solution, powered by

the Amazon eero mesh system, and we are pleased that

a significant number of new customers now benefit from

this chargeable option. In September we upgraded the

router we offer at no additional cost to all new customers

and we’re delighted that in February Which? awarded it

Best Buy status.

This February, responding to increasing budgetary pressures

on household finances, and in stark contrast to the CPI+

annual price increases forced on their customers by the

majority of large broadband providers, we launched a

competitive pricing structure for new customers alongside

a guarantee that we will not increase prices mid-contract.

At the same time, we introduced a new, faster Full Fibre

500mb product to meet growing consumer demand at the

top of the market. Combined with faster overall customer

growth, these improvements have resulted in a return

to growth for our broadband service and we expect this

improved trajectory to continue.

Mobile

The UK mobile market continues to be split between the

big four Mobile Network Operators (“MNOs”) focussed on

coupled airtime and handset contracts and tied closely to

a handset refresh cycle, and the largely SIM-only Mobile

Virtual Network Operators (“MVNOs”) offering more

flexibility and more data at lower prices. SIM-only demand

continues to grow and with more customers turning away

from expensive handset contracts, our focus remains on

a SIM-first strategy.

We continue to improve the quality of service for our

new and existing customers with the roll-out of 4G and

Wi-Fi calling during the year. Additionally, we have been

proactively migrating some of our customers from legacy

tariffs onto our current proposition to improve their

experience at low or no additional cost.

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Telecom Plus Plc Report and Accounts 2022 /

In September we launched a new tariff structure to reflect

the wider market demand for increased data allowances.

At the same time we improved the pricing of our Unlimited

data SIM - a change which has allowed us to offer one

of the best value Unlimited tariffs in the market with

additional value for households taking multiple SIMs.

In the second half of the year, the majority of mobile

providers began to charge again for EU roaming. Along with

a handful of other MVNOs we have continued to offer this

to our customers at no additional cost as a key customer

benefit and differentiator of our proposition.

Our mobile base has grown by over 7% in the last year. We

look forward to accelerating this rate of growth over the

year ahead on the back of the additional energy discounts

customers can now receive by taking a UW mobile service

in our new bundle structure, and as we continue to deliver

feature improvements such as 5G.

Insurance

Insurance is increasingly proving itself a natural fit for our

brand and business model, and we are pleased to have

grown the number of insurance services by 36% over the

year, and with the pace of growth now accelerating.

We have invested in building an insurance platform that

can scale rapidly with high operating leverage, and are

very excited by the growth opportunity that insurance

represents for UW as our fourth core service: it is a key

pillar of our future growth strategy.

We have been directly authorised by the FCA as an

insurance broker since October 2020. We welcome their

intervention to ban dual pricing in the home and motor

insurance markets during the year, as well as the increased

scrutiny of pricing practices more broadly, which we

believe improves customer outcomes and strengthens

our competitive position.

Across our Home Insurance and Boiler & Home Cover

products, we continue to achieve very strong renewal

retention rates of over 90%, demonstrating our focus on

delivering excellent value combined with a best-in-class

experience.

In March 2022 we integrated insurance into our bundle

proposition, which has resulted in an increased propensity

amongst new customers to take an insurance service at

sign-up, and is an important step towards further scaling

our insurance business.

We are committed to taking significant market share

in the insurance markets, and are continuing to invest

significantly in order to achieve this aim. Over the coming

year we therefore will be focussed on further accelerating

our insurance service growth, securing and, where possible,

increasing our margins, and evaluating opportunities to

expand our range of insurance products in the future.

Cashback card

Our unique Cashback card proposition enables our

customers to save up to 10% at a range of participating

retailers, and 1% on all their other spend, applied

automatically as a credit to their next UW bill.

It materially increases the savings opportunity we offer

our customers, from four essential household services

to all their everyday spending - groceries, fuel, travel,

clothing etc.

We launched the Cashback card in 2008 following the

global financial crash and subsequent rise in cost of living.

Petrol had just reached the £1/litre mark, and demand

was high. As we enter a further period of considerably

greater pressure on household budgets, we believe the

Cashback card has a significant role to play in supporting

our customers and accelerating our growth.

During the year we paid out £5.8m of cashback to our

customers, and spend on the programme has grown to

over £368m annually, making it one of the largest prepaid

card programmes in the UK. In January we migrated over

300,000 cards to Mastercard, a move that, combined with

our investment in the full stack infrastructure, will enable

us to accelerate our innovation-led product roadmap in

order to fully capitalise on the growth stimulus we believe

the Cashback card represents.

Operational performance

and non-financial KPIs

The number of customers we supply increased during the

year by over 10% to 728,680, and the number of services

they take to 2,264,909. All of this growth was achieved

organically, and predominantly during H2, in spite of our

decision not to participate in the multiple opportunities

which arose to acquire customer bases from insolvent

suppliers during the autumn.

Our primary focus is the residential market, and in this

segment our customer base increased by over 11% during

the year. With 29 million households across the UK, we

have just 2.5% market share.

Telecom Plus Plc Report and Accounts 2022 /

Co-Chief Executives’ Review

continued

Customers 2022 2021

Residential 705,634 633,613

Business 23,046 23,798

Tot al 728,680 657,411

We offer our customers four core services: broadband,

mobile, energy and insurance, with many also taking our

Cashback card. Customers can take any combination

of services they wish from us, but given the clear

correlation between the number of services they take

and their expected lifetime value to us, we encourage

new customers to switch as many services to us as they

can in order to secure our best prices.

Services 2022 2021

Core services

Energy 1,219,836 1,079,044

Broadband 323,623 324,499

Mobile 324,773 302,654

Insurance 44,834 32,928

Other services

Cashback card 327,949 308,439

Legacy telephony 23,894 26,233

Tot al 2,264,909 2,073,797

Note: The table above sets out the individual services supplied to

customers. Legacy telephony comprises non-geographic numbers

(08xx) and landline only (no broadband) services provided.

The average number of services taken by new residential

customers signed up by Partners fell slightly during FY22

compared with the preceding year, mainly due to an

influx of customers over the autumn who were only

looking to replace their previous energy supplier who

had ceased trading. This temporary bias towards new

customers seeking to switch only their energy to UW was

still visible, albeit less pronounced, in March 2022 on the

back of 22 million households across the UK receiving

price increase notifications from their energy suppliers

in advance of the significant increase in the Government

price cap on 1 April 2022.

Average number of core service types taken

by new residential customers signed up by

Partners

In late March we launched a simpler bundle proposition

for our customers, in order to give them greater flexibility

in accessing our lowest energy pricing. We expect this

to have a positive impact on the average number of

services taken per customer, whilst also reducing the

proportion of new customers taking just energy from

us, and leading to a greater proportion benefitting from

a genuinely differentiated multiservice UW proposition:

by taking two or more core services from us, customers

are receiving a proposition that they cannot get from any

other provider, rendering them less likely to leave us.

We have long benefitted from market-leading customer

loyalty, and use our electricity supply point churn (the

percentage of supply points leaving during the period)

as a proxy for overall churn. This important measure of

customer value fell significantly during the year to around

6% (2021: 13%) for the full year, with churn continuing

at historic levels of around 10% during H1 followed by a

rapid reduction to an annualised rate of 3% during H2 as

all the remaining energy suppliers withdrew their ‘below

cost’ acquisition tariffs in October. Whilst we do not

anticipate that churn will remain at this very subdued

level indefinitely, the ending of the energy price war and

the increasing regulatory scrutiny on the sustainability of

suppliers and their pricing strategies should ensure our

churn rate remains considerably below historical levels

for the foreseeable future.

Average revenue per customer from providing Core

and Other services increased to £1,340 (2021: £1,254)

primarily due to higher energy prices during the winter

following the Government price cap increase in October.

Q1 FY22

Q2 FY22

Q3 FY22

Q4 FY22

2.28

2.16

1.84

2.09

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Supporting our customers

In order to maximise the expected lifetimes of

our customers, and to earn the trusted personal

recommendations of our Partners, we must deliver a

consistently high standard of service to our customers,

treat them fairly, and live up to our promise of letting

them get on with their lives and forget about their utilities.

We rely on the efforts of our colleagues in our unified

support centre to look after all the services that our

customers choose to take from us. Historically based

in north London, these teams now increasingly support

our customers from their homes throughout the UK:

in offering our colleagues a more flexible approach to

working hours, and through accessing a greater pool of

talent nationwide, we believe we are well positioned to

meet the needs of our customers as we grow. During the

year we invested heavily in improving the support we offer

our remote colleagues, providing them with improved

home office systems and quicker and easier access to

expert knowledge that is held within the business.

We continue to invest heavily in offering the digital

experience that our customers increasingly expect from

us - enabling them to self-serve without having to speak

to one of our team if they wish. We further improved our

UW customer app and online My Account functionality,

increasing the range of self-service capabilities. We

continue to employ numerous qualitative and quantitative

performance measurement tools to monitor all aspects

of our customers’ interactions with us.

We are pleased to have been recognised as providing

the Best Customer Service in the Uswitch Energy Awards

2022, and to have been identified as the supplier that

customers are most likely to recommend. With numerous

energy suppliers collapsing in the autumn, inflationary

trends becoming apparent across all the markets in which

we operate, and our growth rate accelerating, we have

received significantly greater levels of contact from our

customers in recent months; these endorsements are

vital to our word-of-mouth marketing model, and are

a testament to the positive attitudes and hard work of

our support teams.

Supporting our Partners

The significant acceleration in our organic growth which

started during the autumn was driven by an enthusiastic

response from our Partners to the improved competitive

landscape and the demand for a sustainable, secure and

good value energy supplier.

As the energy market dynamics shifted in the autumn

and our Partners began to understand how much more

referable the UW customer proposition had become,

and grow in confidence, we re-prioritised elements of

our product roadmap accordingly.

Following the removal of social distancing restrictions,

Partners continued to consistently sign up around 40%

of new customers and Partners remotely, realising the

ability to conduct their referrals nationally as opposed

to locally, accessing a broader range of their friends and

family and in a more convenient and efficient fashion.

We are pleased with the impact of the Customer Bonus

that we launched last April, simplifying the structure,

and acting as a key driver of the high recruitment and

customer gathering levels we saw throughout the second

half of the year. The Customer Bonus was originally

conceived in the aftermath of the last inflationary cycle

in 2008-2010, during which we were unable to offer new

Partners a sufficient near-term income. We believe we

are now exceptionally well placed to meet increasing

demand for an additional near-term income, offering up

to £300 in Customer Bonus for signing-up a home owner

taking all four core services from us.

We are hugely encouraged by the number of new Partners

who joined during the second half of the year, and believe

that we can play an important role in helping thousands

of families more than offset the increased cost of living

they are facing, simply by recommending UW.

Our community of Partners is in a very different mode

from 12 months ago. Confidence is returning, momentum

is building, and whilst an informal word-of-mouth route

to market will never respond instantaneously to improved

market conditions, there has been an encouraging uptick

in activity. The number of Partners actively referring

customers, the value of Customer Bonuses earned, and

the number of new and existing Partners earning them,

all reached record levels towards the end of FY22.

Telecom Plus Plc Report and Accounts 2022 /

Co-Chief Executives’ Review

continued

Our priorities for the year ahead

Having delivered 10% growth in customer and service

numbers in the second half of the year alone, and with

a high degree of confidence over our continued growth

trajectory, we have set three key business priorities for

the year ahead.

Building a great culture and environment for

our people

We aim to create a working environment - at home and

in the office - that attracts great people, keeps great

people and gets everyone talking proudly about UW.

The acceleration in the number of customers joining

UW, combined with the severe squeeze on household

incomes leading to heightened concern from our

customers over their monthly outgoings, means our

teams are extremely busy.

This, set against relatively recent adoption of entirely

new ways of working, with the majority of our colleagues

working from home all or most of the time, means we

must redouble our efforts to create a working environment

and culture that enables our people to grow as we grow,

that values and respects the commitment and hard work

of our teams, all of whom contribute to delivering our ‘all

your home services in one’ proposition day in, day out.

Looking after our customers as we grow

We aim to deliver a multiservice customer experience

that customers will increasingly refer to their friends and

families, and view this as a key metric of our success.

We seek to reduce the need for customers joining UW

to contact us directly by providing easier means to

help themselves faster; this includes streamlining our

onboarding processes and proactively providing them

with timely information on each of the services they

take from us.

We will continue to invest in delivering best in class

service and support to all our customers, through

growing our technology and customer support teams

and improving the systems they use to do so.

Maximising high-quality customer growth

More and more people are turning to UW to earn an

additional income, and we see considerable value in

broadening the appeal of our Partner opportunity, making

it more accessible and easier to make a success of, but

still highly rewarding.

With the aim of helping tens of thousands of people,

from all backgrounds, to meet the challenges of the

rising cost of living we will continue to invest in making it

easier for our Partners to successfully refer UW and earn

in the process - be it improving the competitiveness of

our customer offer, or the support and tools we provide

to our Partners.

Ultimately we want all our customers to become genuine

brand advocates, and to make additional savings on their

bills simply by recommending UW to people they know.

Stuart Burnett & Andrew Lindsay MBE

Co-Chief Executive Officers

21 June 2022

Telecom Plus Plc Report and Accounts 2022 /

Strategic Report Governance Report Financial Statements Shareholder Information

Overview of results

Adjusted Statutory

2022 2021 Change 2022 2021 Change

Revenue £967.4m £861.2m 12.3% £967.4m £861.2m 12.3%

Profit before tax £61.9m £56.1m 10.3% £47.2m £43.5m 8.5%

Basic EPS 63.2p 57.4p 10.1% 45.1p 41.5p 8.7%

Dividend per share 57.0p 57.0p 0.0% 57.0p 57.0p 0.0%

In order to provide a clearer presentation of the underlying performance of the group, adjusted profit before tax and adjusted basic EPS exclude

share incentive scheme charges of £1.0m (2021: £1.4m) and the amortisation of the intangible asset of £11.2m (2021: £11.2m) arising from entering

into the energy supply arrangements with npower in December 2013; this decision reflects both the relative size and non-cash nature of these

charges. In FY22 adjusted profit before tax and adjusted basic EPS also exclude: (i) the loss on the disposal of UWHS (£1.1m), (ii) the write-off of

goodwill associated with the conditional disposal of Glow Green of (£1.5m); and (iii) the profit on disposal of a freehold property of (£0.6m). The

reconciliations for adjusted profit before tax and adjusted EPS are set out in notes 1 and 18 respectively of the financial statements.

Summary

Adjusted profit before tax increased by 10.3% to £61.9m

(2021: £56.1m) on higher revenues of £967.4m (2021:

£861.2m). Statutory profit before tax increased 8.5% to

£47.2m (2021: £43.5m). These increases mainly reflect

the impact of customer growth and higher retail energy

prices from 1 October 2021 (in line with an increase in

the Government price cap).

Distribution expenses increased to £29.7m (2021: £27.8m),

mainly reflecting increased Partner activity during the

second half.

Administrative expenses (excluding share incentive

scheme charges and amortisation of the energy supply

agreement intangible) increased during the year by

£7.6m to £84.4m (2021: £76.8m), mainly as a result of

higher staff, technology and infrastructure costs as we

responded to the rapid increase in the rate of customer

growth during the autumn.

The bad debt charge for the year (separately identified

on the income statement as impairment loss on

trade receivables) increased to £11.6m (2021: £11.2m)

representing 1.2% of revenues (2021: 1.3%).

Adjusted earnings per share increased by 10.1% to 63.2p

(2021: 57.4p), with statutory EPS increasing by 8.7% to

45.1p (2021: 41.5p). In accordance with previous guidance

and our strong cash position, the Board is proposing to

pay a final dividend of 30p per share (2021: 30p), making

a total dividend of 57p per share (2021: 57p) for the year.

Revenues

The growth in the number of services we are supplying

significantly accelerated, with an increase of 191,000

services (2021: 51,000) during the course of the year, taking

the total number of services provided to our customers

to a little under 2.3 million (2021: 2.1 million).

The increase in revenues mainly reflects higher customer

numbers and energy prices during the period:

Revenues £m 2022 2021

Electricity 450.5 391.8

Gas 295.7 248.0

Landline and broadband 129.7 132.2

Mobile 44.7 40.6

Other 46.8 48.6

967.4 861.2

Margins

Our overall gross margin for the year was 19.5% (2021:

20.1%) mainly reflecting the higher proportion of energy

sales during the period resulting from higher customer

growth and increased prices.

Telecom Plus Plc Report and Accounts 2022 /

Financial Review

Distribution and administrative expenses

Distribution expenses include the share of our revenues

that we pay as commission to Partners, together with other

direct costs associated with gathering new customers.

These increased to £29.7m (2021: £27.8m), mainly reflecting

higher Partner commissions and incentive costs associated

with our rapid return to sustainable growth in the second

half of the year.

Administrative expenses (excluding share incentive scheme

charges and amortisation of the energy supply agreement

intangible) increased during the year by £7.6m to £84.4m

(2021: £76.8m), mainly as a result of higher staff, technology

and infrastructure costs. The increase in staff costs mainly

reflects the investment in strengthening our customer

service and management teams in order to ensure we

continue to deliver outstanding service levels across all

of our services as our growth accelerates.

The bad debt charge for the year increased to £11.6m

(2021: £11.2m) representing 1.2% of revenues (2021: 1.3%).

The proportion of customers with at least two energy

bills outstanding, fell marginally to 2.04% (2021: 2.08%).

Disposals

During the period the Group disposed of its shareholding

in UW Home Services Limited (“UWHS”) on 31 March

2022 for a consideration of £1 to Lowri Beck Holdings

Limited, a specialist meter operator owned by the Calisen

Group. The net assets of UWHS at the point of disposal

were £1.1m and the loss on disposal for the Group was

£1.1m. This has been shown separately on the face of

the Consolidated Statement of Comprehensive Income.

The Group also agreed to sell, subject to the necessary

FCA change of control approval, its 75% shareholdings in

Glow Green Limited and Cofield Limited (“Glow Green”)

for a cash consideration of £1 to Charles Wigoder,

Executive Chairman of the Group. As a result, the goodwill

associated with Glow Green of £1.5m has been impaired

in the current period, and this has been reflected in the

‘Goodwill impairment’ line in the Consolidated Statement

of Comprehensive Income.

Since acquiring Glow Green in 2018, the business has

been consistently loss-making; this has contributed to

a cumulative funding requirement of over £6m that will

remain with Glow Green as a debt to the Group and be

repaid over time. The repayment of the loan has been

personally guaranteed by Charles Wigoder. The Board

believe that the disposal of Glow Green is in the best

interests of the Group given the significant management

resource it would otherwise require, particularly at a time

when the growth opportunities within the core business

are so exciting.

As a smaller related party transaction, this disposal fell

within the requirements of section 11.1.10R of the Listing

Rules and the Board obtained written confirmation from

its sponsor (Peel Hunt) that the terms of the proposed

transaction were fair and reasonable as far as the

shareholders of the Group are concerned.

The Group also disposed of a freehold building during

the period which realised a profit on disposal of £0.6m.

This has been reflected in the Other income line in the

Consolidated Statement of Comprehensive Income.

In order to show the underlying performance of the

business, the loss on disposal of UWHS, impairment

of goodwill associated with the conditional disposal of

Glow Green, and the profit on disposal of the freehold

building, have been excluded in calculating the adjusted

profit before tax of £61.9m.

Cash, capital expenditure,

working capital and borrowings

We ended the period with a net debt position including

lease liabilities of £70.4m (2021: £71.4m), comprising

bank loans of £99.2m and lease liabilities of £0.8m, less

cash of £29.6m. This slight decrease mainly reflects a

reduction in lease liabilities due to the disposal of UWHS,

offset by increases in working capital. The Group’s Net

Debt/adjusted EBITDA ratio remains low at around 1.0x

(adjusted EBITDA of £73.7m used in this ratio represents

operating profit of £50.9m plus impairment of goodwill

of £1.5m, depreciation and amortisation of £20.3m and

share incentive scheme charges of £1.0m).

Our net working capital position showed a lower year-

on-year cash outflow of £10.4m (2021: cash outflow of

£12.5m); this reflects the ongoing investment we make in

supplying broadband routers to customers and increased

trade debtors. Capital expenditure of £9.9m (2021: £10.0m)

related primarily to our continuing digital transformation

programme.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Dividend

The final dividend of 30p per share (2021: 30p) will be

paid on 5 August 2022 to shareholders on the register at

the close of business on 15 July 2022 and is subject to

approval by shareholders at the Company’s Annual General

Meeting which will be held on 26 July 2022. This makes

a total dividend payable for the year of 57p (2021: 57p).

Our medium-term intention remains to gradually return to

a dividend pay-out ratio of around 85% of adjusted EPS,

whilst maintaining our long-standing progressive dividend

policy with reference to profit evolution.

Share incentive scheme charges

Operating profit is stated after share incentive scheme

charges of £1.0m (2021: £1.4m). These relate to an

accounting charge under IFRS 2 Share Based Payments

(‘IFRS 2’).

As a result of the relative size of share incentive scheme

charges as a proportion of our pre-tax profits, and the

fluctuations in the amount of this charge from one year to

another, we are separately disclosing this amount within

the Consolidated Statement of Comprehensive Income

for the period (and excluding these charges from our

calculation of adjusted profits and earnings) so that the

underlying performance of the business can be clearly

identified. Our current adjusted earnings per share have

also therefore been adjusted to eliminate these share

incentive scheme charges.

Taxation

A full analysis of the taxation charge for the year is set

out in note 5 to the financial statements. The tax charge

for the year is £12.2m (2021: £11.0m).

The effective tax rate for the year was 25.9% (2021: 25.2%),

this remains higher than the underlying rate of corporation

tax due mainly to the ongoing amortisation charge on our

energy supply contract intangible asset (which is not an

allowable deduction for tax purposes).

Nick Schoenfeld

Chief Financial Officer

21 June 2022

Telecom Plus Plc Report and Accounts 2022 /

Financial Review

continued

Background

The Group faces various risk factors, both internal and

external, which could have a material impact on long term

performance. However, the Group’s underlying business

model is considered relatively low-risk, with no need for

management to take any disproportionate risks in order

to preserve or generate shareholder value.

The Group continues to develop and operate a consistent

and systematic risk management process, which involves

risk ranking, prioritisation and subsequent evaluation,

with a view to ensuring all significant risks have been

identified, prioritised and (where possible) eliminated,

and that systems of control are in place to manage any

remaining risks.

The directors have carried out a robust assessment of

the Company’s emerging and principal risks. A formal

document is prepared by the executive directors and

senior management team on a regular basis detailing

the key risks faced by the Group and the operational

controls in place to mitigate those risks; this document is

then reviewed by the Audit Committee. A risk relating to

climate change has been added during the period. Save

as set out below, the magnitude of any risks previously

identified has not significantly changed during the period.

Business model

The principal risks outlined below should be viewed in

the context of the Group’s business model as a reseller

of utility services (gas, electricity, fixed line telephony,

mobile telephony, broadband and insurance services)

under the Utility Warehouse and TML brands. As a reseller,

the Group does not own any of the network infrastructure

required to deliver these services to its customer base.

This means that while the Group is heavily reliant on third

party providers, it is insulated from all the direct risks

associated with owning and/or operating such capital-

intensive infrastructure itself.

The Group is able to secure the wholesale supply of

all the services it offers at competitive rates, enabling

it to generate a consistently fair level of profitability

from delivering a great value bundled proposition to its

customers. There is an alignment of interests between

the Group and its wholesale suppliers which means

that it is in the interests of the suppliers to ensure

that the Group remains competitive, driving growth

and maximising their benefit from our complementary

route to market. Furthermore, the group benefits from

a structural cost advantage, due to the multiple revenue

streams it receives from customers who take more than

one service-type, and only having one set of overheads.

The Group has alternative sources of wholesale supply

should an existing supplier become uncompetitive or

no longer available.

In relation to energy specifically, the Group’s wholesale

costs are calculated by reference to a discount to the

prevailing standard variable retail tariffs offered by

the ‘Big 6’ to their domestic customers (effectively

the Government price cap), which gives the Group

considerable visibility over profit margins.

The Group’s services are promoted using ‘word-of-mouth’

by a large network of independent Partners, who are paid

predominantly on a commission basis. This means that the

Group has limited fixed costs associated with acquiring

new customers.The principal specific risks arising from

the Group’s business model, and the measures taken to

mitigate those risks, are set out below.

Reputational risk

The Group’s reputation amongst its customers, suppliers

and Partners is believed to be fundamental to the future

success of the Group. Failure to meet expectations in

terms of the services provided by the Group, the way

the Group does business or in the Group’s financial

performance could have a material negative impact on

the Group’s performance.

In developing new services, and in enhancing current ones,

careful consideration is given to the likely impact of such

changes on existing customers.

In relation to the service provided to its customer base,

reputational risk is principally mitigated through the Group’s

recruitment processes, a focus on closely monitoring staff

performance, including the use of direct feedback surveys

from customers (Net Promoter Score), and through the

provision of rigorous staff training.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Principal Risks and Uncertainties

Responsibility for maintaining effective relationships

with suppliers and Partners rests primarily with the

appropriate member of the Group’s senior management

team with responsibility for the relevant area. Any material

changes to supplier agreements and Partner commission

arrangements which could impact the Group’s relationships

are generally negotiated by the executive directors and

ultimately approved by the full Board.

Information technology risk

The Group is reliant on its in-house developed and

supported systems for the successful operation of its

business model. Any failure in the operation of these

systems could negatively impact service to customers,

undermine Partner confidence, and potentially be damaging

to the Group’s brand. Application software is developed

and maintained by the Group’s Technology team to support

the changing needs of the business using the best ’fit for

purpose’ tools and infrastructure. The Technology team

is made up of highly-skilled, motivated and experienced

individuals.

Changes made to the systems are prioritised by business,

Product Managers work with their stakeholders to refine

application and systems requirements. They work with

the Technology teams undertaking the change to ensure a

proper understanding and successful outcome. Changes

are tested as extensively as reasonably practicable before

deployment. Review and testing are carried out at various

stages of the development by both the Technology team

and the operational department who ultimately take

ownership of the system.

The Group has strategic control over the core customer

and Partner platforms including the software development

frameworks and source code behind these key applica-

tions. The Group also uses strategic third-party vendors

to deliver solutions outside of our core competency. This

largely restricts our counterparty risks to services that

can be replaced with alternative vendors if required, albeit

this could lead to temporary disruption to the day-to-day

operations of the business.

Monitoring, backing up and restoring of the software and

underlying data are made on a regular basis. Backups are

securely stored or replicated to different locations. Disaster

recovery facilities are either provided through cloud-based

infrastructure as a service, and in critical cases maintained

in a warm standby or active-active state to mitigate risk

in the event of a failure of the production systems.

Data security risk

The Group processes sensitive personal and commercial

data and in doing so is required by law to protect

customer and corporate information and data, as well

as to keep its infrastructure secure. A breach of security

could result in the Group facing prosecution and fines

as well as loss of business from damage to the Group’s

reputation. Recovery could be hampered due to any

extended period necessary to identify and recover a loss

of sensitive information and financial losses could arise

from fraud and theft. Unplanned costs could be incurred

to restore the Group’s security.

The Group has deployed a robust and industry-appropriate

Group-wide layered security strategy, providing effective

control to mitigate the relevant threats and risks. The Group

is PCI compliant and external consultants conduct regular

penetration testing of the Group’s internal and external

systems and network infrastructure.

The Information Commissioner’s Office (‘ICO’) upholds

information rights in the public interest and, where

required, companies within the Group are registered as

data controllers with the ICO. If the Group fails to comply

with all the relevant legislation and industry specific

regulations concerning data protection and information

security, it could be subject to enforcement action, signif-

icant fines and the potential loss of its operating licence.

Information security risks are overseen by the Group’s

Information Security and Legal & Compliance teams.

Legislative and regulatory risk

The Group is subject to various laws and regulations.

The energy, communications and financial services

markets in the UK are subject to comprehensive operating

requirements as defined by the relevant sector regulators

and/or government departments.

Amendments to the regulatory regime could have an

impact on the Group’s ability to achieve its financial

goals and any material failure to comply may result in the

Group being fined and lead to reputational damage which

could impact the Group’s brand and ability to attract and

retain customers. Furthermore, the Group is obliged to

comply with retail supply procedures, amendments to

which could have an impact on operating costs.

Telecom Plus Plc Report and Accounts 2022 /

Principal Risks and Uncertainties

continued

The Group is a licensed gas and electricity supplier, and

therefore has a direct regulatory relationship with Ofgem.

If the Group fails to comply with its licence obligations,

it could be subject to fines or to the removal of its

respective licences.

The regulatory framework for the UK’s energy retail

market, as overseen by Ofgem, is subject to continuous

development. Any regulatory change decision could

potentially lead to a significant impact on the sector,

and the net profit margins available to energy suppliers.

The current pace and extent of regulatory change is more

substantial than in previous years. In addition to the

industry-wide programmes of work, such as the rollout

of smart meters, and a growing range of environmental

and social obligations, Ofgem has been implementing

a special package of reform measures. These special

reforms have arisen in response to the ‘energy crisis’,

which emerged in the autumn of 2021 and is associated

with high wholesale energy costs and a consolidation of

competition, with many new-entrant suppliers having

ceased trading. The reforms cover the future of the

price cap, assessing suppliers’ financial resilience and

compliance performance, and temporary interventions, in

part, to protect suppliers from their financial exposures

to the wholesale market. The Group tracks this changing

landscape closely, to identify risks and opportunities, to

prepare for any subsequent operational changes, and

also to input directly into Ofgem’s work.

The Group is also a supplier of telecoms services and

therefore has a direct regulatory relationship with Ofcom.

If the Group fails to comply with its obligations, it could be

subject to fines or lose its ability to operate. The imple-

mentation of the European Electronic Communications

Code will result in an increased regulatory burden and an

even stronger Ofcom focus on compliance monitoring.

Regulatory changes to the fixed line and broadband

switching processes for next year are substantial and

require cooperation from all fixed telecom providers.

The Group is closely engaged in the relevant forums

and industry groups to both influence and prepare for

the changes.

The Group is authorised and regulated as an insurance

broker for the purposes of providing insurance services

to customers by the Financial Conduct Authority (“FCA”).

In addition, the Group holds consumer credit permissions

related to the provision of staff and Partner loans and

hire purchases. If the Group fails to comply with FCA

regulations, it could be exposed to fines and risk losing

its authorised status, severely restricting its ability to

offer insurance services to customers and consumer

credit services to staff and Partners.

Recent regulatory changes relating to insurance pricing

and future expected changes around increased consumer

protections could have a significant impact on the

financial services sector as a whole and will need to be

implemented across the business. The Group is closely

monitoring and keeping abreast of these regulatory

developments in order to prepare the business for the

upcoming changes in this sector.

In general, the majority of the Group’s services are supplied

to consumers in highly regulated markets, and this could

restrict the operational flexibility of the Group’s business.

In order to mitigate this risk, the Group seeks to maintain

appropriate relations with both Ofgem and Ofcom (the UK

regulators for the energy and telecommunications markets

respectively), the Department for Business, Energy and

Industrial Strategy (‘BEIS’), and the FCA. The Group engages

with officials from all these organisations on a periodic

basis to ensure they are aware of the Group’s views when

they are consulting on proposed regulatory changes.

Political and consumer concern over energy prices,

broadband availability and affordability, vulnerable

customers and fuel poverty may lead to further reviews

of the energy and telecoms markets which could result in

further consumer protection legislation being introduced.

Political and regulatory developments affecting the energy

and telecoms markets within which the Group operates

may have a material adverse effect on the Group’s business,

results of operations and overall financial condition.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

The Group is also aware of and managing the impact of

a developing regulatory landscape in relation to climate

change and the Net Zero transition. We have recently

appointed a new Head of Sustainability role to support

us in implementing developments in relation to the

environment and climate change.

To mitigate the risks from failure to comply with legislative

requirements in an increasingly active regulatory

landscape, the Group’s Legal & Compliance team has

developed and rolled out robust policies and procedures,

undertakes regular training across the business,

continually monitors legal and regulatory developments

and has recently recruited additional members into the

Legal & Compliance team in order to increase available

capacity and expertise.

Financing risk

The Group has debt service obligations which may place

operating and financial restrictions on the Group. This

debt could have adverse consequences insofar as it: (a)

requires the Group to dedicate a proportion of its cash

flows from operations to fund payments in respect of

the debt, thereby reducing the flexibility of the Group

to utilise its cash to invest in and/or grow the business;

(b) increases the Group’s vulnerability to adverse general

economic and/or industry conditions; (c) may limit the

Group’s flexibility in planning for, or reacting to, changes in

its business or the industry in which it operates; (d) may

limit the Group’s ability to raise additional debt in the long

term; and (e) could restrict the Group from making larger

strategic acquisitions or exploiting business opportunities.

Each of these prospective adverse consequences (or a

combination of some or all of them) could result in the

potential growth of the Group being at a slower rate than

may otherwise be achieved.

Bad debt risk

The Group has a universal supply obligation in relation

to the provision of energy to domestic customers. This

means that although the Group is entitled to request a

reasonable deposit from potential new customers who

are not considered creditworthy, the Group is obliged

to supply domestic energy to everyone who submits a

properly completed application form. Where customers

subsequently fail to pay for the energy they have used,

there is likely to be a considerable delay before the Group is

able to control its exposure to future bad debt from them

by either switching their smart meters to pre-payment

mode, installing a pre-payment meter or disconnecting

their supply, and the costs associated with preventing

such customers from increasing their indebtedness are

not always fully recovered.

Bad debt within the telephony industry may arise from

customers using the services, or being provided with a

mobile handset, without intending to pay their supplier.

The amounts involved are generally relatively small as the

Group has sophisticated call traffic monitoring systems to

identify material occurrences of usage fraud. The Group

is able to immediately eliminate any further usage bad

debt exposure by disconnecting any telephony service

that demonstrates a suspicious usage profile, or falls into

arrears on payments.

Wholesale price risk

Whilst the Group acts as principal in most of the services

it supplies to customers, the Group does not own or

operate any utility network infrastructure itself, choosing

instead to purchase the capacity needed from third

parties. The advantage of this approach is that the Group

is largely protected from technological risk, capacity

risk or the risk of obsolescence, as it can purchase the

precise amount of each service required to meet its

customers’ needs.

Whilst there is a theoretical risk that in some of the areas

in which the Group operates it may be unable to secure

access to the necessary infrastructure on commercially

attractive terms, in practice the pricing of access to

such infrastructure is typically either regulated (as in

the energy market) or subject to significant competitive

pressures (as in telephony and broadband). The profile

of the Group’s customers, the significant quantities of

each service they consume in aggregate, and the Group’s

clearly differentiated route to market has historically

proven attractive to infrastructure owners, who compete

aggressively to secure a share of the Group’s growing

business.

Telecom Plus Plc Report and Accounts 2022 /

Principal Risks and Uncertainties

continued

The supply of energy has different risks associated with

it. The wholesale price can be extremely volatile, and

customer demand can be subject to considerable short-

term fluctuations depending on the weather. The Group

has a long-standing supply relationship with Eon (formerly

npower) under which the latter assumes the substantive

risks and rewards of buying and hedging energy for the

Group’s customers, and where the price paid by the Group

to cover commodity, balancing, transportation, distribution,

agreed metering, regulatory and certain other associated

supply costs is set by reference to the average of the

standard variable tariffs charged by the ‘Big 6’ to their

domestic customers less an agreed discount, which is set

at the start of each quarter; this may not be competitive

against the equivalent supply costs incurred by new and/

or other independent suppliers. However, if the Group did

not have the benefit of this long term supply agreement it

would need to find alternative means of protecting itself

from the pricing risk of securing access to the necessary

energy on the open market and the costs of balancing.

Competitive risk

The Group operates in highly competitive markets and

significant service innovations by others or increased price

competition, could impact future profit margins and growth

rates. In order to maintain its competitive position, there

is a consistent focus on improving operational efficiency.

New service innovations are monitored closely by senior

management and the Group is generally able to respond

within an acceptable timeframe where it is considered

desirable to do so, by sourcing comparable features and

benefits using the infrastructure of its existing suppliers.

The increasing proportion of customers who are benefiting

from the genuinely unique multi-utility solution that is

offered by the Group, and which is unavailable from any

other known supplier, further reduces any competitive

threat.

The Directors anticipate that the Group will face continued

competition in the future as new companies enter

the market and alternative technologies and services

become available. The Group’s services and expertise may

be rendered obsolete or uneconomic by technological

advances or novel approaches developed by one or more

of the Group’s competitors. The existing approaches of the

Group’s competitors or new approaches or technologies

developed by such competitors may be more effective or

affordable than those available to the Group. There can

be no assurance that the Group will be able to compete

successfully with existing or potential competitors or

that competitive factors will not have a material adverse

effect on the Group’s business, financial condition or

results of operations. However, as the Group’s customer

base continues to rise, competition amongst suppliers

of services to the Group is expected to increase. This

has already been evidenced by various volume-related

growth incentives which have been agreed with some

of the Group’s largest wholesale suppliers. This should

also ensure that the Group has direct access to new

technologies and services available to the market.

Infrastructure risk

The provision of services to the Group’s customers is

reliant on the efficient operation of third party physical

infrastructure. There is a risk of disruption to the supply

of services to customers through any failure in the

infrastructure e.g. gas shortages, power cuts or damage to

communications networks. However, as the infrastructure

is generally shared with other suppliers, any material

disruption to the supply of services is likely to impact a

large part of the market as a whole and it is unlikely that

the Group would be disproportionately affected. In the

event of any prolonged disruption isolated to the Group’s

principal supplier within a particular market, services

required by customers could in due course be sourced

from another provider.

The development of localised energy generation and

distribution technology may lead to increased peer-to-

peer energy trading, thereby reducing the volume of energy

provided by nationwide suppliers. As a nationwide retail

supplier, the Group’s results from the sale of energy could

therefore be adversely affected.

Similarly, the construction of ‘local monopoly’ fibre

telephony networks to which the Group’s access may be

limited as a reseller could restrict the Group’s ability to

compete effectively for customers in certain areas.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Smart meter rollout risk

The Group is in part reliant on third party suppliers to

fully deliver its smart meter rollout programme effectively.

In the event that the Group suffers delays to its smart

meter rollout programme the Group may be in breach of

its regulatory obligations and therefore become subject to

fines from Ofgem. In order to mitigate this risk the Group

dual-sources (where practicable) the third party metering

and related equipment they use.

The Group may also be indirectly exposed to reputational

damage and litigation from the risk of technical compli-

cations arising from the installation of smart meters or

other acts or omissions of meter operators, e.g. the escape

of gas in a customer’s property causing injury or death.

The Group mitigates this risk through using established

reputable third party suppliers.

Energy industry estimation risk

A significant degree of estimation is required in order to

determine the actual level of energy used by customers

and hence that should be recognised by the Group as

sales. There is an inherent risk that the estimation routines

used by the Group do not in all instances fully reflect the

actual usage of customers. However, this risk is mitigated

by the relatively high proportion of customers who provide

meter readings on a periodic basis, and the high level of

penetration the Group has achieved in its installed base

of smart meters.

Gas leakage within the national gas

distribution network

The operational management of the national gas

distribution network is outside the control of the Group,

and in common with all other licensed domestic gas

suppliers the Group is responsible for meeting its pro-rata

share of the total leakage cost. There is a risk that the

level of leakage in future could be higher than historically

experienced, and above the level currently expected.

Acquisition risk

The Group may invest in other businesses, taking a

minority, majority or 100% equity shareholding, or through

a joint venture partnership. Such investments may not

deliver the anticipated returns, and may require additional

funding in future. This risk is mitigated through conducting

appropriate pre-acquisition due diligence where relevant.

Virus outbreak risk

In the event of a disease or virus outbreak (or different

variants of an existing disease or virus emerging) which

are resistant to vaccinations and/or treatments, and which

causes serious incapacity amongst those infected, the

Company faces a number of risks including: (i) staff may

be unable to attend their normal place of work and fulfil

their normal duties due to falling ill or being required to

self-isolate (either due to exposure to carriers of the virus/

disease, or to reduce the likelihood of being so exposed);

(ii) the Company may be required to shut Network HQ to

prevent transmission of the virus/disease in the workplace;

(iii) the efficiency of our operations may be reduced; (iv)

we may be unable to recruit and train new members of

staff; (v) customers may find it more difficult to contact

the company; (vi) we may be unable to resolve faults and

challenges faced by customers which require a visit to

their home or other engineering works to be carried out;

(vii) customers may stop paying their bills, or we may be

required by the Government to offer payment holidays to

customers in respect of their utilities (in a similar fashion

to the mortgage payment provisions), putting pressure on

the Company’s working capital; (viii) we may be restricted

from carrying out normal debt enforcement procedures

including suspension of telephony services and installation

of smart meters; (ix) the Company’s Partners may find it

more difficult to grow their businesses during a period

when restrictions on movement are imposed by the

Government; (x) we may be unable to visit customers’

homes to install smart meters; (xi) the various providers

of third party infrastructure used to supply our services

may be unable to cope with the increased demands placed

upon them; and (xii) churn could increase during periods

when customers are isolated at home.

Telecom Plus Plc Report and Accounts 2022 /

Principal Risks and Uncertainties

continued

These are mitigated by: (i) the Company has proven

technology to enable most employees to carry out their

duties remotely; (ii) the demographic mix of our customer

base is heavily skewed towards homeowners and older/

retired customers; this means we are significantly less

exposed to payment issues than most other providers of

similar services; (iii) the Company has a strong balance

sheet with modest gearing, and access to significant,

recently refinanced, additional debt facilities (if required)

to cover any temporary pressure on working capital;

in extremis, these could be enhanced by a temporary

suspension of the dividend; (iv) the Company has developed

tools which are now in widespread use, enabling Partners

to sign-up new customers, recruit new Partners, and to

help existing Partners support new Partners remotely

to teach them how to build their own successful UW

business; and (v) the wide range of services provided to

customers gives us significant resilience from a revenue

and profit perspective against an external event which

affects any individual revenue stream.

Climate change risk

Climate change has the potential to significantly impact the

future of our planet. Everyone has a role to play in reducing

the effects of harmful GHG emissions in our atmosphere

and ensuring that we meet a 1.5°C target in line with the

Paris Agreement. No business is immune from the risks

associated with climate change as it acts as a driver of

other risks and affects government decision-making,

consumer demand and supply chains. In recognition of this,

the Group has designated climate change as a standalone

principal risk for our business and has assigned the Legal

& Compliance Director as the owner for managing climate

change risk.

We are committed to implementing the recommendations

of the Task Force on Climate-related Financial Disclosures

(TCFD) and this year, we have made our first set of

disclosures consistent with the TCFD framework. Our

TCFD disclosures can be found on pages 43 to 46 and

includes our considerations of the specific risk implications

to the Group arising from climate change.

We are developing our metrics and planning our targets

to achieve Net Zero by 2040 in line with SBTi. To assist

with this, we are working with third parties and have

invested in software to develop and manage progress

against our targets.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Our people

Our 1,800 employees are at the heart of our business

and vital to UW’s success, supporting our self-employed

Partners and providing award winning customer service.

Although we have 1,800 employees, we aim to treat

everyone as an individual and as a valuable part of the

UW community. We strive to create a sense of belonging

and for everyone to feel welcome and included wherever

they may work.

We offer fully remote working as well as smarter working

(spending 2-3 days in the office and the rest at home)

enabling our teams to work more flexibly and focus on

outcomes.

Recruitment

Recruitment is any potential candidate’s first ‘window’ into

the company, so this is a critical focus for us. We ensure

that we recruit, train and retain people who have the

right skills, and care about making a positive contribution

to the business. We continue to recruit new employees

through our own in-house assessment process, which

provides a high level of control over recruitment and

quality, avoiding bias, and focusing on identifying the

very best candidates for each available position. We also

partner with external providers to ensure we can deal

with the demand in hiring more customer service advisors

and specialist roles to the business due to our increasing

customer base and commercial growth ambitions.

Onboarding

All of UW’s new employees attend welcome events on

their first day to get excited about UW and our products.

They also have a dedicated IT support session to confirm

their equipment and system set-up has gone to plan and

to ensure any issues can be ironed out on their first day.

These welcome events are now possible to join remotely

or in person to support the varied base locations of

our new colleagues. In future we hope to offer several

locations across the UK that remote employees can travel

to more easily than our Colindale office if they’d like an

in-person experience.

The majority of UW’s new employees join our customer

service teams. They attend a structured onboarding

programme, designed to help them better understand

UW and their role with us, and to equip them with the

skills, knowledge and relationships they need to deliver a

high standard of service to our customers and Partners.

After meeting other new starters and participating in

UW welcome events on day one, our Customer Service

Advisors begin product and service specific learning

with their trainers in their teams. This Academy style

approach to job specific learning ‘in-role’ includes some

context and instruction on a topic upfront, observation

of established colleagues handling that task and then

some practice with feedback. Activities might include call

listening and pairing up with colleagues to ask questions.

This approach has allowed us to craft more individual

learning journeys and better accommodate a wider variety

of hours / shifts than we had previously.

Telecom Plus Plc Report and Accounts 2022 /

People and Organisation

Learning and development

We’re changing our Learning & Development (“L&D”)

offering. Last year we implemented our learning

management experience platform (“Looop”), giving us

greater flexibility in developing learning products, running

campaigns and the ability to provide fully remote learning.

This year we have significantly increased our L&D team to

accelerate our ability to support the full breadth of the

business in this phase of our growth.

We aim to offer a better holistic employee experience

and help connect our people with who we are. We plan

to launch a new L&D proposition designed to support

everyone at UW and to help them connect, learn and grow.

Leadership and talent

We have recognised that with a significantly increased

workforce comes a much larger people leader community.

We are investing in creating new development journeys

for all our leaders, with a focus on new leaders and the

basics of leading a team.

In order to be much more proactive in our employee

experience we are working to define how we view ‘talent’

at UW. Reviewing where critical people and critical roles

exist so we can mitigate the risk of losing these people. We

are also working to define how we attract, retain and grow

talent faster, for people with very high levels of potential

to progress.

Engagement

Engagement with our people includes formal and

informal meetings. We have an employee forum (“The

Purple Forum”) which was formalised into a workforce

advisory panel in accordance with the requirements of

the Corporate Governance Code. The Purple Forum is

sponsored by Co-CEO Stuart Burnett. The aim of The

Purple Forum is to encourage transparent discussion,

understand any challenges employees may face and

identify areas for improvement. This forum is comprised

of twelve nominated employees from across the business.

Minutes of the meetings are kept with any action points

followed up at the following meeting.

This is supplemented by a number of less formal channels

of communication with our employees. During the year,

we hold monthly townhalls, quarterly all hands, breakfast

sessions, listening groups and Q&As with members of

the executive leadership team. These are important

vehicles for ensuring employees feel valued and listened

to, whilst bridging the gap between employees and senior

management.

We continue celebrating, bringing people together and

recognising our achievements. This year we held summer/

Christmas parties as well as birthday events, celebrating

our Which? Awards and many more. In addition, each

team receives a ‘fun fund’ monthly allowance of £5 per

person to be used towards team bonding activities that

they can enjoy together.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Health and wellbeing

Our employees’ mental and physical wellbeing is equally

a key priority. Everyone has access to our Employee

Assistance Helpline, offering them and their families

access to information, advice and professional counselling

on a variety of personal and workplace issues. We provide

mindfulness sessions, Pilates, yoga and meditation courses

as well as keep-fit classes. We also offer appointments

with our mental health nurses. We have three nurses

who have continued to provide remote appointments, a

benefit that is highly valued by our workforce. Employees

can book appointments with them anonymously for free

mental and physical health checks. We have added access

to a Digital GP for all our employees as well as a health

and wellbeing tool on our new My Benefits platform. The

focus is to provide proactive, protective support for mental

health and wellbeing.

Pay and reward

We review pay and benefits annually and employees

benefit from an annual bonus. We remain committed

to paying the Real Living Wage and London Living Wage

whilst also awarding a standard 5.5% pay increase on

the 1st April 2022.

In April 2022 we implemented a new ‘My Benefits’

platform with the aim to further promote our current

offer and add additional benefits.

The Company operates an HMRC-approved employee

share option plan, under which employees are granted

options to purchase shares in the Company which are

exercisable between three and ten years from the date of

grant. The exercise price is the market price at the time

of granting the option. Our policy is to issue options to

all employees after the satisfactory completion of their

probationary period, and additional options when 10 years’

service has been completed and in other appropriate

circumstances (e.g. promotion).

The Company also operates a Save As You Earn (“SAYE”)

share scheme.

As at 31 March 2022, there were outstanding options

over 2.6m shares which had been granted to employees,

representing approximately 3.2% of the issued share

capital of the Company.

We encourage all employees to participate in a pension

scheme operated by Scottish Widows. Participants can

choose their own contribution level, which is matched

by the Company up to a limit which varies according to

length of service. As a result of pension auto-enrolment,

the Company is contributing to the pension funds of

virtually all employees, on a monthly basis.

We actively facilitate ‘Access to Work’ grants for employees

who have a disability, physical health or mental health

condition, seeking to provide practical support which

enables them to continue working effectively.

Telecom Plus Plc Report and Accounts 2022 /

People and Organisation

continued

Diversity and inclusion

Full and fair consideration is given to opportunities for

employment, training, career progression and promotion

on the basis of each individual’s ability, attitude and

track record, irrespective of their gender, ethnic origin,

nationality, age, religion, sexual orientation or disability.

We consider it important for us as a business to have

a diverse and inclusive workforce. We take actions to

create an environment where we highlight, educate,

inform, support and celebrate uniqueness – irrespective

of our religious beliefs, cultural background, age, ethnicity,

gender, disabilities or sexual orientation. We encourage

talented people of different backgrounds, beliefs or

any form of personal identity to be involved, respected

and inspired to develop to their full potential. We are

committed to creating an inclusive environment where

everyone can bring their whole self to work, contribute

their best work and develop to their full potential. We

want to maintain an environment that reflects the

diversity and characteristics of the customers and

communities we operate in and which is free from any

form of harassment, bullying and discrimination. The

focus we have on creating an inclusive environment is

also supported by our Diversity and Inclusion Forum.

We’re proud to have signed up to the Race at Work charter

and its commitments. We’ve appointed an Executive

Sponsor to make sure we have visible leadership on

diversity and inclusion and help drive our culture

and commitments forward. We have a board-level

commitment to zero tolerance of harassment and

bullying and we’re against all forms of unlawful and unfair

discrimination, whether that is verbal or written. We’ll take

appropriate action with those that don’t follow this policy.

We have updated our Diversity & Inclusion (“D&I”) policy

and we’ve added a summary to our website. We’ll continue

to develop our D&I initiatives to support our goals over

the coming year.

The table below sets out a breakdown of the gender

diversity at various levels within the Group:

2022 2021

Male Female Male Female

Board 8 2 8 2

Senior Managers 31 24 29 10

Employees 818 668 1,250

695

*includes UWHS & Glow Green, UWHS left the Group on 31 March 2022

and Glow Green will be leaving once FCA change of control approval

has been received

The Board’s position in relation to the Corporate

Governance Code requirement to set out any existing

measurable objectives in relation to Board diversity is

set out in the Corporate Governance Statement on pages

52 to 53.

The Company publishes its Gender Pay Gap report

each year in accordance with the requirements of

The Equality Act 2010 (Gender Pay Gap Information)

Regulations 2017; a copy of the latest report available is

at: www.telecomplus.co.uk/legal/corporate-information/

gender-pay-gap-report.

We encourage

talented people of

different backgrounds,

beliefs or any form of

personal identity to be

involved, respected

and inspired to

develop to their full

potential.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Introduction

Fulfilling our Environmental, Social and Goverance (ESG)

responsibilities is integral to the Company. We do this by

being a responsible and resilient business that delivers

returns to investors over the long term, minimises negative

impact on the environment and has a positive impact on

the people we interact with.

The last year has been unprecedented - particularly in the

energy sector which saw the implosion of the retail energy

market following the sustained and unforeseen increases

in wholesale gas prices with 30 energy suppliers exiting the

market and energy regulator Ofgem having to step in to avoid

further industry turmoil. However, with our differentiated

business model, structural cost advantage and focus on

long term sustainability, the Company has emerged from

the energy crisis stronger than ever. We continue to be a

trusted and reliable energy and home services provider for

our customers and the strength of our business means

that we can offer a secure and sustainable income for our

Partners and continue to attract and retain talent.

We recognise that the current economic climate is causing

a significant cost-of-living challenge for many people,

including our customers, employees and Partners. To

address this, we have increased our focus on financially

vulnerable customers and are looking at additional ways to

support them. For our employees, we remain committed to

paying above the Real National Living Wage and the London

Living Wage for those eligible and in March this year we

announced a salary increase of 5.5% (above inflation) for

all permanent employees with effect from 1 April 2022.

We also continue to promote our Partner opportunity

which offers a unique way to earn a flexible and reliable

income by recommending the Company’s multiservice

proposition to others.

We are also acutely aware of the harmful effects of

climate change on our environment and the potential

impact on our business - which is why we are focussed

on moving towards a low carbon future and hitting our

target of Net Zero

by 2040 with a credible transition

plan. We also want to support our customers in reducing

their own carbon footprint whether that’s through our

green Renewable Energy Guarantees of Origin (“REGO”)-

backed tariff, our new Smart Export Guarantee (“SEG”)

tariff or by helping them become more energy efficient

by installing a smart meter.

The Board has ultimate responsibility for our ESG strategy

and will be tracking our progress towards our goals. Our

Legal & Compliance Director has overall responsibility for

ESG, including defining, managing and delivering on our

ESG strategy and is supported closely by our new Head of

Sustainability who has day-to-day ownership of the ESG

agenda and manages the cross-functional ESG Working

Group. The Company also has an ESG Strategy Committee

comprising the Executive Leadership Team, the Company

Secretary, Head of PR & Communications and Head of

Sustainability. This group meets quarterly to discuss our

ESG strategy, goals, initiatives and progress thus ensuring

a robust governance framework and tracking of progress

against targets.

Our ESG strategy is underpinned by the views of our

stakeholders, namely our customers, employees, Partners,

investors, suppliers, Board and government/regulators.

We seek to engage with all of these stakeholders on a

regular basis to better understand the issues which are

important to them and that are relevant to our business.

In doing so, we have refreshed our materiality assessment

which has provided us with a clear understanding of

where our priorities should be and has informed our key

ESG commitments for the year ahead. More detail on the

materiality assessment and our overall approach can be

found in our ESG Report, available at telecomplus.co.uk.

For FY22, we have therefore evolved our ESG strategy to

focus on three key pillars:

Helping our

communities thrive

Supporting a more

sustainable future

Doing business

responsibly

Telecom Plus Plc Report and Accounts 2022 /

Sustainability Report

Helping our communities thrive

People are at the heart of our business, whether they

are our customers, employees or Partners. The past year

has been a difficult one for many people who are part

of our wider community. The energy crisis, more recently

the cost-of-living crisis and a second year of covid have

all had significant and varying impacts on people’s lives.

As people try and cope with the difficult economic and

social climate, we have continued to provide support to

the different communities within the Company, including

our customers, our employees, our Partners and our local

communities.

Our goals and progress

Our customers

Our aim is to reliably serve our customers and provide

them with high quality products and services. We help

customers get on with life by providing all their essential

home services under the UW brand, in one single monthly

bill. We achieve this by enabling our customers to bundle

together whichever services they want (energy, broadband,

mobile and insurance), and benefit from a unique

multiservice proposition that offers them simplicity,

savings and award-winning service.

We recognise that cost-of-living pressures are increasing,

and we have signed up to the Energy UK Vulnerability

Commitment and are continuing to invest in our dedicated

Ability to Pay team which provides specific and targeted

support to customers who are struggling to pay their bills.

In addition, our partnership with Citizens Advice Plymouth

helps customers by reviewing their income and expenditure,

offering advice on budgeting and available benefits, and

helping them prioritise spending in order to maximise their

income available to pay for important household bills.

One of our other key priorities last year was protecting

our customers’ safety both online and offline, through

the delivery of safe products and services and protecting

our customers’ data and privacy.

In terms of online security, we offer our fixed broadband

customers eero routers which allow them to put in

place parental controls to keep their families safe.

Approximately 20% of our new fixed broadband customers

bundle eeros with their broadband service.

To help inform our customers about security risks, we

have created a “Stay Safe Online” page on our website.

This page is designed to help our customers recognise

scams; give tips on how to keep personal information

safe whilst browsing online; and provide useful links to

further guidance on this topic.

Protecting our customers’ data and privacy is critical

to our business. We have robust information security

and data privacy policies and have introduced more

controls around the appointment of authorised third

parties (individuals who have authority to deal with

certain aspects of an account on behalf of the customer).

In addition, we have made improvements to our ID

verification process, to ensure that customers are not

sending confidential documentation through the post.

During the course of FY22, we have also made good

progress on supporting deaf or hard of hearing customers

to engage and communicate with us. Last year we

implemented our SignVideo service, allowing customers

using British Sign Language to communicate with our

advisors via a video interpreter. We have also made

content on our website available in a machine-readable

format, allowing customers with sight issues to use

screen readers.

New targets for FY23: Increase our efforts to support

our vulnerable customers through the cost-of-living

crisis, including:

1. Extending the scope of our Citizens Advice Plymouth

initiative by increasing resource and committing more

funding to the scheme.

2. Simplifying the process of identifying and tracking

vulnerable customers, for example, by providing

Customer Services Advisors with a template to help

them capture vulnerable customer data, as well as

giving customers a new self-service option to make it

easier for them to self-certify as vulnerable.

3. Exploring charitable initiatives to help provide financial

support for those in fuel poverty.

"Net Zero" as used herein means the Science-Based Targets Initiative (“SBTi”) Net Zero definition, from the SBTi Net Zero Standard (https://

sciencebasedtargets.org/resources/files/Net-Zero-Standard.pdf) pursuant to which we are committed to (a) reducing our scope 1, 2 and 3

greenhouse gas (GHG) emissions to zero or a residual level consistent with a 1.5°C pathway and (b) will neutralise the impact of any residual

emissions by permanently removing an equivalent volume of GHG emissions.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Our employees

Our aim is to attract and retain the best talent and make

UW a great place to work. Our top priority business objective

for FY23 is to build a great culture and environment for

our people to grow. Inspiring and developing our people

is critical to our business and enabling future growth.

Last year we set out a target to achieve a Glassdoor rating

of over 4 and a ‘recommended to a friend’ measure of

80% by the end of FY23. As of 31 March 2022, we had

achieved 3.8 and 67%. We hope to improve these ratings

during FY23 and will be rolling out at least two more

employee engagement surveys during the year to gain

enhanced insights and feedback from employees and then

respond with new initiatives that will further enhance our

employee experience.

Having a diverse employee community and creating an

inclusive culture for all employees to thrive is a key focus

for UW. We have set targets for female and ethnically

diverse representation. Our gender diversity target is that at

least 40% of all management roles will be held by female

employees by the end of FY25. As of 31 March 2022, 37.5%

of all management roles were held by women, up from

30% the previous year.

On ethnicity, our target is that at least 30% of all

management roles will be held by ethnically diverse

employees by the end of FY25. We are taking the first

step to achieve this by gathering data to understand where

we are currently and the gap we need to fill. We have

increased the extent of data we have on ethnicity from 3%

to 40% and continue to build better insights. We still have

work to do and aim to be in a position to track against

our target over the course of the year.

We will continue to focus on improving diversity and

inclusion and developing our people and culture to build

employee satisfaction and loyalty, thereby reducing

employee turnover.

New target for FY23: In addition to the targets above, our

new target for next year is to increase our Employee Net

Promoter Score (“eNPS”) from -3 to +10 by the end of FY23.

Our Partners

We provide everyone across the UK, regardless of their

education and experience, with the opportunity to earn a

flexible income, as well as tools and learning to help them

start and grow their own business by recommending UW’s

multiservice proposition to others. Our Partner opportunity

is accessible to all and supports people to develop

themselves professionally in a way that may not have

been accessible to them before. Whilst earning an income

is important to Partners, the benefits and social impact

of being a Partner are much wider. For many Partners it

increases their sense of self-worth, independence, and

confidence.

We want to transform the lives of more people than

ever before with the UW Partner opportunity. Our aim is

for many more families across the UK to benefit from a

reliable UW Partner income in order to supplement their

household incomes. This is even more relevant as we see

so many families struggle to make ends meet during the

cost-of-living crisis.

Throughout the covid pandemic and now during the cost-

of-living crisis we have continued to support our Partners

with the following events and tools:

• Providing opportunities for Partner teams to collaborate

and build their networks through online and in-person

events such as our large-scale ‘Power Up’ and ‘Amplify’

events, Leading Lights events, Buzz events, Leadership

days and Head Office days;

• Ensuring that Partners can continue to learn and

develop their expertise by offering targeted learning and

development sessions such as Power Zones, Breakout

Sessions, and Find Out More spaces at our Power Up and

Amplify events, as well as regular events with keynote

speakers focused on learning and self-improvement; and

• Improving our Partner Portal and App which contains

tools that enable Partners to learn more and develop

their business.

Over the last year we have seen a strong increase in the

number of Partners joining UW and continue to encourage

new Partners to join us with more tools to help them build

and maintain their business, thus supporting sustainable

growth and Partner engagement.

Telecom Plus Plc Report and Accounts 2022 /

Sustainability Report

continued

Our local communities

Supporting local communities is very important to the

Company. Through our UW Foundation, we encourage

our employees and Partners to give back and raise

money for charitable initiatives. We are pleased to have

donated over £51,000 to charities during FY22 through the

fundraising efforts of our employees and Partners, as well

as through matched funding and charitable contributions

from the UW Foundation. Examples of charities and local

communities we have supported include:

• Plastic Oceans (now Oceans Generation), our partner

charity for FY22, which aims to reduce plastic pollution

in our oceans and waterways.

• The Childhood Trust which aims to support children in

London who are living in poverty.

• The Felix Project which collects and delivers surplus

food to local charities and schools in London so they

can provide healthy meals to those most vulnerable.

• Great Ormond Street Hospital which treats seriously ill

children and supports families through difficult times.

• Domestic Violence UK which provides frontline support

for those suffering from domestic abuse.

• Alzheimer’s Society which addresses the growing

dementia crisis.

• Unitas which supports young people to get back into

the workplace.

Supporting a more sustainable future

We are committed to working towards a more sustainable,

low-carbon future. Climate change is a challenge we all

must face and we want to play our part in the UK’s path to

net zero. We remain focused on providing our customers

with energy-saving technology and reducing our own

emissions.

Our goals and progress

Last year, we committed to becoming a Net Zero business

by 2040 and to developing detailed Net Zero carbon target

plans by the end of FY23. We recognise that over the

past year, especially with COP26, focus on Net Zero has

increased. For example, the UK Government published its

UK Net Zero strategy in which it sets out that the UK will fully

decarbonise its power system by 2035 and will be powered

entirely by clean electricity, subject to security of supply.

We remain committed to Net Zero and during the year

ahead we will develop our Net Zero transition plans

including establishing science-based targets for emissions

reductions. Our new Head of Sustainability (a new role

created in recognition of our focus on climate change

initiatives and sustainability) will take this forward,

utilising the Achilles carbon management platform that

we invested in earlier this year.

Over the past year, we focused on initiatives which

would directly reduce the carbon emissions of our

operations. Last year we set out a target to switch the

electricity supply of all Company operations (including our

headquarters in Colindale) to 100% zero carbon renewable

electricity and are pleased to report that this target has

been achieved. From 1 April 2022, the Company’s own

electricity supply is 100% renewable through deep-green

(wind, solar and hydro only) REGOs and will reduce our

Scope 2 emissions by 1,086 tonnes of C0

per year.

Last year we set out our commitment to electrify the

majority of our fleet of vehicles by 2026. During the course

of FY22, we sold our fleet of 61 vans that were being used

to operate our historic LED light bulb installation service.

On 1 April 2022, we announced that we had completed

the sale of our wholly-owned meter operator, UW Home

Services Ltd (“UWHS”) and that we had also agreed to

sell, subject to the necessary FCA change of control

approval, our 75% shareholding in Glow Green Limited

(“Glow Green”). The sale of UWHS and proposed sale of

our stake in Glow Green mean that going forward we

will only own a very small fleet, some of which are in

the EV category. These changes will be reflected in our

Scope 1 carbon footprint reporting for FY23. As part of our

commitment to develop our Net Zero transition plan we

will also consider where we can influence and support

the transition to low carbon transportation beyond our

direct control.

We recognise the need to prioritise investment in

de-carbonisation, and understand that while offsetting

emissions is not a solution, in the short term it allows

some contribution to the transition to Net Zero. With this

in mind where it is not possible to reduce our scope 1 and

2 emissions we will continue to use appropriate, Verified

Carbon Standard (“VCS”) accredited, offsetting projects.

To offset our FY22 Scope 1 and 2 emissions, we worked

with our offsetting partner Abatable to purchase 2,840

tonnes of carbon credits from Rimba Raya, our preferred

VCS-accredited carbon reduction project in Indonesia.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

The Rimba Raya Project, on the island of Borneo, aims to

preserve carbon-dense tropical peat swamp by halting the

deforestation of roughly 47,000 hectares of forest which

were originally due to be converted to palm oil plantations.

The Project works with and supports local communities

to protect biodiversity conservation. It focuses on both

community development for the 2,500 households living

in the area, and biodiversity conservation, particularly

protection of 105,000 endangered Borneo Orangutans.

It actively engages local communities to improve food

security, income, healthcare, and education, all with the

support of carbon finance. It is the first project to have

been validated by SD VISta as contributing to all 17 SDGs.

As a reseller of home services, the majority of our carbon

emissions are Scope 3. Given that we do not make or

generate the services we offer, our influencing of Scope 3

emissions depends on the choice of wholesale suppliers,

the contracts we have with them and our continued

engagement with them in order to seek to reduce Scope

3 emissions through a lower carbon product and service

offering. Reducing Scope 3 emissions also depends on

our ability to influence customer choice and behaviour.

We recognise that we have a lot more to do in order to

effect a meaningful reduction of our Scope 3 and will be

committing to a roadmap for decarbonising our Scope

3 emissions in our Net Zero transition plan. We will also

continue to work closely with our key suppliers, including

E.ON - our wholesale energy supplier - to minimise our

Scope 3 emissions wherever possible.

We remained fully committed to offering our multiservice

customers our Green (REGO-backed) Tariff. Our Green

Tariffs are REGO (Renewable Energy Guarantees of Origin)

backed, so for every unit of electricity our customers use,

we buy a REGO certificate to match. Over the last year, the

volume of REGO-backed tariffs we sold increased by 89%.

To support low-carbon energy generation, our Smart

Export Guarantee (“SEG”) tariff pays self-generating

households for any excess renewable electricity they

don't use themselves and export to the grid. We recognise

that we should do more to support self-generation

and therefore we are committing to roll out a new and

increased SEG tariff for multiservice customers during

FY2023. We are pleased to report that from 1 May 2022,

new and existing generators who take a three or four

service bundle from us will benefit from one of the

most competitive export rates available on the market

today - at 5.6p/kWh compared to 2p/kWh for our current

standard export tariff. By raising the SEG tariff rate we

pay, self-generating households can increase the benefit

they get from investing in renewable electricity.

Last year we also committed to installing smart meters

in 70% of our customers’ homes by the end of FY2022

and 85% by the end of FY2023. While we have made good

progress, we did not quite reach our target for this year

and had a smart meter penetration of 64% at the end of

FY22. This shortfall was partly driven by the challenges of

the covid pandemic on home installation and partly due

to the strong influx of new energy customers from other

suppliers during H2 where there was lower smart meter

penetration. We will continue to focus on rolling out smart

meters, including encouraging new customers to take up

smart meters. We have updated our target and are now

aiming for 68% of our customers to be benefiting from

smart meters in their home by the end of FY23.

Last year we committed to providing our Partner with low

carbon incentives. We already give Partners the option

to select low carbon incentives, such as: a Tesla, electric

Mini, electric bike, holiday break at an eco-hotel. We will

continue to provide low carbon incentives to Partners in

the future.

UW Foundation

We will continue to contribute 1% of our reported annual

profits to the UW Foundation which will cover our ongoing

commitment to tree planting at Bryn Arw (see below for

more information on the UW Woodland), as well as our

charitable giving initiatives. For FY23, we will support the

following two charities that fulfil the UW Foundation’s

stated objectives of supporting disadvantaged groups and

having a positive impact on the environment:

• The UK’s Disaster Emergency Committee Ukraine

Humanitarian Appeal, supporting those in Ukraine in

need of humanitarian aid due to the war.

• The Wildlife Trust, our new partner charity of the year,

which aims to save wildlife and wild places to ensure

30% of the UK’s land and seas are protected for nature’s

recovery by 2030.

In FY22, staff and Partners raised a total of £20,000

for charities and the UW Foundation paid out a total

of £225,000, of which £193,500 went to support the

UW Woodland at Bryn Arw and £31,500 was donated

to charities.

Telecom Plus Plc Report and Accounts 2022 /

Sustainability Report

continued

UW Woodland

Since 2020, the UW Foundation has also been supporting

a tree planting project at Bryn Arw in the Brecon Beacons

National Park. Bryn Arw is the first significant tree-planting

project on common land in Wales. It lies on a steep eastern

slope which has become infested with bracken, greatly

reducing its value for sheep farming and wildlife and

preventing the regeneration of native trees.

The project is working to the Woodland Carbon Code,

the quality assurance standard for woodland creation

projects in the UK. The Code ensures that high standards of

sustainable forest management and carbon management

are followed alongside assurance of carbon units generated

by the project. Extensive consultation was also carried

out involving the local community and environmental

organisations including the South Wales Wildlife Trust,

Buglife and the Reptile Society.

After initial bracken removal the woodland was planted

with a mix of broadleaf native hardwood species, including

oak, birch, hazel, wild cherry and goat willow. An intensive

5-year annual bracken removal programme is being

undertaken to ensure the early growth of the trees. The

species mix is designed to reflect the remnant ancient

semi-natural woods in the area. The saplings are all

sustainably sourced and grown in Shropshire under the ‘UK

and Ireland Sourced and Grown’ (“UKISG”) scheme. As well

as future carbon capture, the UW Woodland will become

a valuable natural asset and vital habitat linkage between

other remnant woodlands in Bryn Arw. It is also creating

jobs and training opportunities for the local community.

A tree is planted in the UW Woodland every time a

multiservice customer joins the Company and every

time a member of staff achieves their 5-year anniversary

with us. Since commencing the project in 2020, we have

planted 117,400 trees and in November 2021, we agreed

with Stump Up for Trees to support the next phase of

woodland planting.

We are proud of what we have achieved at Bryn Arw to

date and remain committed to continuing to work through

the UW Foundation to plant additional native broadleaf

woodlands in the UK.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Sustainability Report

continued

Carbon reporting - Greenhouse gas

(“GHG”) emissions statement

Our GHG reporting year is the same as our financial

year. Our reporting covers our UK-based Scope 1 (direct

emissions from our own operations), Scope 2 (indirect

emissions from the generation of purchased energy), as

well as several Scope 3 emission sources (primarily our

customers’ energy usage). We do not have any non-UK

operations. This year we were able to increase the scope

of our reporting to include the operational electricity use

of 1p Mobile, UWHS, Glow Green Limited and Cofield

Limited, as well as Glow Green’s fleet emissions. We

have not rebased the FY21 reported data due to data

availability, and we plan to use FY22 as our baseline for

any emissions targets we set as part of our Net Zero

transition plan.

Overall GHG efficiency (Scopes 1, 2, and 3) per unit of

revenue has improved by 4.2%. Absolute Scope 1 and

2 emissions decreased by 1.4%. Our Scope 1 reported

emissions saw a small increase of 0.8%. This was due to

gas use for heating in our offices increasing from FY21

due to increased office use following the covid pandemic.

Whilst emissions from our fleet of vans decreased due

to the sale of the fleet part way through the year, this

reduction was offset by the inclusion of the Glow Green

fleet in reporting for the first time. Scope 2 emissions

decreased by 4.6% overall, partly from a reduction in

absolute electricity use in our offices and partly from

the reduction in carbon intensity of UK grid electricity

emissions factors.

Our Scope 3 emissions have increased 7.6%, due to the

increase in volume of energy sold. Given our reseller

business model and in particular, the nature of our

wholesale energy supply arrangements, we will continue

to work closely with E.ON in order to seek to influence

and reduce our Scope 3 emissions. Decarbonising our

Scope 3 emissions will be included in the scope of our

Net Zero transition plan that will be developed over the

coming year.

Our Streamlined Energy & Carbon Report framework

has been prepared and verified in accordance with the

requirements of the measure-step of the Toitū carbon

marks, which is based on the Greenhouse Gas Protocol:

A Corporate Accounting and Reporting Standard (2004)

and ISO 14064-1:2018 Specification with Guidance at the

Organization Level for Quantification and Reporting of

Greenhouse Gas Emissions and Removals.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

FY22

1 April 2021 to 31 March 2022

FY21

1 April 2020 to 31 March 2021

UK and

offshore

Global

(excluding UK

and offshore)

UK and

offshore

Global

(excluding UK

and offshore)

Emissions from activities for which the company

own or control including combustion of fuel &

operation of facilities tCO

e (Scope 1)

1,755 N/A 1,742 N/A

Emissions from purchase of electricity, heat, steam

and cooling purchased for own use tCO

e (Scope 2,

location-based)

1,086 N/A 1,138 N/A

Total gross Scope 1 & Scope 2 emissions tCO

e 2,840 N/A 2,880 N/A

Total gross Scope 1 & Scope 2 emissions tCO

e (all) 2,840 2,880

Energy consumption used to calculate above

emissions (kWh)

11,489,879 N/A 11,496,817 N/A

Gas (kWh) 275,432 N/A 195,009 N/A

Electricity (kWh) 5,112,893 N/A 4,882,710 N/A

Transport fuels (kWh) 6,101,554 N/A 6,419,099 N/A

Other energy sources (Scope 1 & 2) kWh N/A N/A N/A N/A

Total gross Scope 1 & Scope 2 emissions by unit

turnover/revenue (tCO

e/£M)

2.94 3.34

Methodology

ISO14064 Part 1 2018 and

Carbon Reduce

GHG protocol

Emissions from business travel in rental cars

or employee-owned vehicles where company

is responsible for purchasing of the fuel

tCO

e (Scope 3)

N/A N/A

Emissions from other activities tCO

e (Scope 3) 1,856,462 1,725,129

Total gross Scope 3 emissions tCO

e 1,856,462 1,725,129

Total gross Scope 1, Scope 2 & Scope 3 emissions

tCO

1,859,302 1,728,009

Total gross GHG emissions per unit turnover/

revenue (tCO

e/£M)

1,921 2,007

Third Party verification

Scope 1 and 2 verified to

ISO14064 Part 1 2018 and

Carbon Reduce

Data not third party verified

Energy efficiency initiatives

The building layout of our headquarters at Colindale

allows for individual floors to be isolated when not in use.

This allows the zoning of the LED lighting control to mirror

how teams use the space with local sensor control to

avoid wastage. The Company has implemented a number

of the recommendations outlined in both the ESOS Phase

I & II audit reports, for example increasing the temperature

set point in the large server rooms with monitoring of

temperature in the event of failure, upgrading warehouse

lighting to LED, ensuring air conditioning units are time-

controlled with appropriate temperature set points, and

dead band control strategy. During the course of FY22, the

Company sold its fleet of 61 vans that were being used to

operate our historical LED light bulb installation service.

New targets for FY23: As well as continuing to deliver

on the existing targets set out above, and developing a

detailed Net Zero transition plan by the end of FY23, we

will also look to support a more sustainable low-carbon

future by:

1. Rolling out a new Smart Export Guarantee tariff (for

multiservice customers) that offers a much more

competitive rate for self-generating households.

2. Installing smart meters in 68% of our customers’ homes

by the end of FY23.

Doing business responsibly

We aim to work with all our stakeholders in an ethical and

transparent way in order to inspire trust in our company.

Running our business in a fair, open and accountable

manner is critical as we look to the future and our

growth prospects. Our systems and processes are built

and developed to ensure the highest standards of data

security and business continuity.

Our goals and progress

A key focus over the last year has been on demonstrating

the strength and resilience of our business during the

energy crisis. Last year, we committed to ensuring reliability

of supply, service and product delivery through periods

of uncertainty. That commitment has never been more

relevant. To date, 30 energy suppliers have failed and

others are fighting to stay in the business. Many of these

providers had been offering unsustainably cheap tariffs,

were insufficiently hedged and were thus unable to absorb

the higher wholesale costs faced by all suppliers. However,

we are and always have been focussed on building a

sustainable business model that is underpinned by

sustainable pricing for our customers. During H2, we saw

an influx of customers from failed suppliers and were able

to offer them a sustainably priced product below the price

cap with guaranteed reliability of supply.

We have bolstered our Energy Compliance & Regulatory

team to ensure that we keep abreast of changes to energy

regulation. This includes the numerous Government

and Ofgem interventions being announced in order to

ameliorate the impacts of the energy crisis on suppliers

and consumers alike. We are now proactively sharing

our views with BEIS, Ofgem and industry bodies

whether through CEO round tables, technical working

groups, industry forums, regulator bilateral meetings or

consultation responses to advocate for a more fair and

transparent industry regulation model that focuses on

long term stability.

Telecom Plus Plc Report and Accounts 2022 /

Sustainability Report

continued

Last year, we also committed to introducing a new Supplier

Code of Conduct and ensuring that all new suppliers sign

up to it by the end of FY23. We are pleased to report that

we have met this target. A new Supplier Code of Conduct

was introduced in July 2021. All new suppliers are now

required to sign up to the Code and existing suppliers will

We are committed to respecting Human Rights across

our business and our supply chain and have a Human

Rights Policy which covers human rights, modern slavery

and forced labour. Our Board have approved a Modern

Slavery and Human Trafficking Statement in compliance

with section 54 of the Modern Slavery Act 2015, which is

available on our website.

Last year we committed to further develop our ESG

governance structure to help us and our Board assess

and manage ESG risks including supply chain and climate

risks. We have made excellent progress in this regard with

the hire earlier this year of our new Head of Sustainability.

This new role demonstrates our commitment to ESG

and sustainability and further enhances our governance

structure. The Head of Sustainability will have day-to-day

ownership of the ESG agenda, will manage the cross-

functional ESG Working Group and importantly will play a

key role in developing, managing and driving forward our

Net Zero transition plan.

The Company also has an ESG Strategy Committee

comprising the Executive Leadership Team, the Company

Secretary, Head of PR & Communications, and Head of

Sustainability. This group meets quarterly to discuss our

ESG strategy, goals, initiatives and progress thus ensuring

a robust governance framework and tracking of progress

against targets.

The Legal & Compliance Director also provides monthly

updates to the Board on ESG.

Moreover, we have developed and improved our climate

risk reporting consistent with TCFD recommendations.

Our TCFD disclosures can be found on pages 43 to 46

of this report.

New targets for FY23:

1. Enhancing Board independence and effectiveness

through changes to the composition of the Board.

2. Having at least 33% female representation on the Board

by the end of FY23.

Progress has already been made in this regard with the

Board changes announced on 14 March 2022, namely

that in order to redress the historical imbalance in the

proportion of independent non-executive directors, with

effect from the Company’s Annual General Meeting in

July 2022, Charles Wigoder will become Non-Executive

Chairman, and Melvin Lawson and Julian Schild will retire

from the Board.

We are also pleased to report that we have appointed a

new independent non-executive director, Carla Stent, who

will join the Board with effect from the Annual General

Meeting and will chair the Audit Committee. With Carla’s

appointment, our female representation on the Board

will be 37.5%.

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Section 172(1) statement

Background

The Companies Act 2006 (the “Companies Act”) sets

out a number of general duties which directors owe

to the Company. New legislation has been introduced

to help shareholders better understand how directors

have discharged their duty to promote the success of

the Company, while having regard to the matters set out

in section 172(1)(a) to (f) of the Companies Act. In the

current financial year, the directors continued to exercise

all their duties, while having regard to these and other

factors as they managed and governed the Company on

behalf of its shareholders.

Engaging with key stakeholders

The success of the Company is dependent on building

positive relationships with all of our key stakeholders to

deliver long term sustainable success.

The table below sets out details of engagement with key

stakeholders.

Stakeholder Details

Shareholders As owners of the Company we rely on the support of shareholders and their views are important to the

Board.

The executive directors have an open dialogue with our shareholders through one-to-one meetings,

group presentations with analysts, and at the Annual General Meeting. Discussions with shareholders

cover a wide range of topics including financial performance, strategy and outlook. The non-executive

directors engage with institutional shareholders on matters of governance and remuneration.

Shareholder feedback, along with details of significant movements in the shareholder base are

regularly reported to and discussed by the Board and, where appropriate, their views are sought as

part of certain decision-making processes.

Partners The Company relies on the Partners within its independent distribution network for gathering new

customers.

Communication with our Partners is a key focus for the business and is conducted through various

meetings, forums and large-scale conferences.

Where appropriate, Partner feedback is sought when significant changes are being considered to the

operation of the distribution network.

People Employees are key to the Company delivering award-winning services to customers.

There are many ways we engage with and listen to our employees including weekly email updates,

employee surveys, forums, face-to-face briefings, and an internal company magazine.

Key areas of focus include company development and strategy, health and well-being, development

opportunities, pay and benefits. Regular reports about what is important to our employees are made to

the Co-CEOs ensuring consideration is given to employee needs.

Customers We build long-lasting relationships with our customers as evidenced by our low levels of churn.

We devote considerable resources to understanding customer requirements and soliciting feedback from

them on ways to improve our offer and services. We use this knowledge to inform our strategy of helping

customers to “get on with their lives” by offering savings, simplicity and service across all the household

services we are providing to them.

Suppliers As a reseller we are required to work closely with our key suppliers to ensure that we are delivering

the best possible combination of value and service to our customers; our success in achieving this is

demonstrated by the numerous endorsements and consistent recommendations we receive from Which?

The interests of our suppliers are strongly aligned to our own as the number of customers we are able to

attract has a direct impact on their own financial performance and market share. This generates close and

supportive relationships with our key suppliers which are fostered through regular interaction at a senior

management level.

Telecom Plus Plc Report and Accounts 2022 /

Sustainability Report

continued

Community We are committed to building positive relationships within the communities where we operate.

We are a significant employer in the local community around our head office and support a number of

charitable activities. We have recently set up the UW Foundation to further these endeavours.

Our Partner business opportunity allows a range of people from communities across the UK to advance

their lives, driving our strategy to help Partners to “get on in life”.

Regulators We operate in highly regulated markets and understand the importance of maintaining a constructive

working relationship with Ofgem, Ofcom and the FCA, who between them are responsible for the

regulation of the diverse range of services we offer.

We engage with officials from these regulators as necessary to make them aware of the Company’s

views when they are consulting on proposed regulatory changes, or if there are competition issues that

need to be raised with them.

Further s172 factors

Further information as to how the Board has had regard to the s172 factors:

Section 172 factor Key examples Page

The likely consequences of any decisions in the long term Sustainability Report 31

The interests of the Company’s employees People & Organisation Report 27

Fostering business relationships with suppliers, customers and others Co-Chief Executives’ Review 8

The impact of the Company’s operations on the community

and the environment

Sustainability Report 31

Maintaining a reputation for high standards of business conduct

Sustainability Report

Corporate Governance Statement

The need to act fairly between members of the Company

Corporate Governance Statement

Directors’ Report

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Introduction

We recognise that climate change is the single biggest

environmental threat to the future of our planet and that

companies have an important role to play in reducing

the effects of harmful GHG emissions in our atmosphere

and ensuring that we meet a 1.5°C target in line with the

Paris Agreement. As a multiservice provider of home

services, we too must play our part and that is why we

are committed to implementing the recommendations of

the Task Force on Climate-related Financial Disclosures

(“TCFD”). We acknowledge the importance of TCFD in

helping us manage the impact of climate change on our

operations and advance towards our Net Zero target.

This is our first year of disclosure consistent with the

TCFD framework.

Governance

The Board has ultimate responsibility for climate-related

risks and opportunities. The Legal & Compliance Director

prepares regular board updates on ESG, including TCFD/

climate-related matters.

The ESG Strategy Committee supports the Board in its

strategic and operational oversight of climate change.

The Committee considers and monitors climate-related

goals and initiatives as well as associated risks. The

Committee is composed of the Executive Leadership Team,

Company Secretary, Head of PR & Communications, Head

of Sustainability and is chaired by the Legal & Compliance

Director who updates the Board. The Committee meets

quarterly and receives updates on TCFD and the wider

ESG programme from the ESG Working Group.

The ESG Working Group manages the day-to-day climate-

related risks and issues on behalf of the ESG Strategy

Committee, meeting and reporting back regularly as part of

the broader ESG agenda. The Working Group is headed up

by our Head of Sustainability and is supported by external

ESG consultants, as required.

Strategy

This year we engaged external climate experts from one of

the Big 4 consulting firms, alongside our ESG consultants,

to assist us with conducting qualitative climate scenario

analysis to identify the actual and potential impacts of

climate-related risks and opportunities on our business

and to understand the associated effects and mitigation

measures.

Given the potential impact of climate change on our

future strategy, it was important that we achieved full

engagement from senior stakeholders across the business.

Our Co-CEO, CFO, Vice President of Operations (Energy,

Sales & Service), Head of Product, Telecoms Director, Head

of Insurance and Legal & Compliance Director were among

those who participated in and actively engaged with our

climate scenario analysis - including at a key collaborative

workshop during which our risks and opportunities

were challenged, validated and prioritised. This multi-

functional participation as well as inputs from Board and

senior management level have helped us to build a solid

Strategic oversight

Implementation

& compliance

ESG Strategy Committee

Legal & Compliance Director

Head of

Sustainability

ESG Working

Group

Functional

Heads

Board

Telecom Plus Plc Report and Accounts 2022 /

Task Force on Climate-related

Financial Disclosures

understanding and appreciation of how climate change can

impact key aspects of our business and helped us to lay

the foundation for our TCFD journey over the coming years.

The qualitative scenario analysis undertaken is intended

to provide us with credible examples of potential

exposure. We considered physical and transitional risks

and opportunities which may arise in the short (less

than five years), medium (five to 10 years) and long term

(over 10 years). We used two plausible scenarios, one of a

world which warms by 1.5°C and one which warms by 4°C

compared to pre-industrial levels. Each of these scenarios

was rooted in the commonly used Shared Socio-economic

Pathway and Representative Concentration Pathway, in line

with leading practice and in common with the methodology

used by the Intergovernmental Panel on Climate Change.

The 4°C scenario focuses on systematic failure to address

climate change. It assumes limited policy or regulatory

support for decarbonisation and focuses on several

physical risks. The 1.5°C scenario focuses on a world which

rises to the challenge of tackling climate change and limits

global warming to below 1.5°C. This scenario focuses on

transition risks associated with the rapid changes needed

by 2030 to cut emissions in line with the Paris Agreement,

including: carbon pricing, increasing manufacturing and

raw-material costs; and changes in consumer behaviour

and consumption patterns, leading to potentially significant

changes in demand for certain goods and services.

Scenario analysis result and mitigation

A comprehensive list of risks and opportunities, both

physical and transitional, were identified through our

scenario analysis. In the tables below, we have set out

risks and opportunities which we analysed in greater

detail as part of a deep dive into our most material issues.

Risks

Adverse impact of

climate-related policy and

regulatory change

Failure to respond to shifting

consumer sentiment for

green products and services

Failure to demonstrate

credible transitional action

on climate change

Description The Company fails to

adequately prepare for and

adapt to the market-wide risk

of climate-related policy and

regulatory changes.

The Company’s reseller model

means that it may be less

able to adequately respond

to the growing demand for

green products and services,

stemming from shifting

consumer sentiment, investor

pressure and regulatory changes,

potentially resulting in the

Company’s offering becoming

less competitive for the growing

number of green-conscious

customers.

The Company transitions

to a low carbon model

more slowly than societal

expectations and is unable to

demonstrate credible action

on climate change, including

a comprehensive Net Zero

roadmap.

Risk priority High High High

Risk type Transition Transition Transition

Impacts Increase in costs, decrease in

profitability.

Decrease in revenue from non-

renewable energy tariffs which

may impact upon the demand for

our multiservice bundle offering

(driven by falling consumer

demand, lower demand for

multiservice bundling if one

or more services become less

attractive because of non-green

credentials, as well as churn of

existing customers due to their

evolving expectations).

Decrease in revenue from non-

renewable energy tariffs (driven

by lower consumer demand),

more difficult to attract and

retain employees (driven by

lower employee demand and

higher attrition), and reduction

in access to some forms of

financial capital (lower investor

demand / divestment).

Time period Medium term Short, medium and long term Medium term

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Management

response

Continue to perform horizon-

scanning, compliance

and regulatory monitoring

and regularly engage with

government and regulators

to keep ahead of upcoming

developments in the regulatory

landscape.

Continue to participate in

consultations and industry

forums.

Conduct market research

and continue to engage with

customers on a regular basis

through ESG surveys in order to

monitor any changes in consumer

sentiment and expectation to

inform future strategy.

Engage with our current energy,

telecommunications and

financial services suppliers on

climate-related issues, and green

products and services.

Embed climate considerations

into decisions on strategic

wholesale supply agreements.

Continue to encourage customer

take-up of green services such

as our green REGO-backed tariffs

and our Smart Export Guarantee

tariff (recently increased to a

more competitive rate).

Continue to research and

develop new greener products

and services to increase green

product offering.

Develop and implement a

credible climate transition plan

over the course of FY23 to

inform and plan our roadmap

to Net Zero by 2040.

Continue to engage key

stakeholders on climate

change to keep abreast of

shifting sentiment and evolving

expectations.

Opportunities

Build a credible low carbon service

proposition

Diversification of financial assets

Description The Company is able to support and harness the

low carbon transition through product and service

diversification and in doing so becomes a credible

low-carbon multiservice provider.

The Company is able to diversify its financial

assets and take on new forms of financing

linked to its sustainability performance.

Opportunity priority High Medium

Opportunity type Transition Transition

Impacts Increase in revenue and profitability (through higher

customer demand, customer loyalty and lower

churn), enhanced reputation, increased ability

to attract and retain employees, higher investor

demand.

Increase in access to and diversification of

financial capital.

Time period Short and medium term Short term

Management

response

Conduct market research and continue to engage

with customers on a regular basis through our

ESG surveys to understand customer demand and

importance of green utilities to them.

Consider how our services and products can be

further adapted to cater to an increasingly green

conscious consumer.

Demonstrate credible progress on climate change,

including a comprehensive Net Zero roadmap.

Consider viability and impact of new forms

of financing such as green bonds and / or

sustainability-linked loans.

Telecom Plus Plc Report and Accounts 2022 /

Task Force on Climate-related

Financial Disclosures continued

Risk management

Taking into account the impact of the climate scenarios

we analysed, we consider that we are resilient to the risks

assessed and the business is well placed to manage those

risks and take advantage of the opportunities presented

by climate change.

The identification, assessment and management of

climate-related risks are considered as part of our

wider risk management framework which is detailed on

page 20 of this Report. The Audit Committee has overall

responsibility for management and oversight of our risk

management framework.

Climate change risk has been identified, evaluated and

designated as a standalone risk on our internal risk register

and our Legal & Compliance Director has been assigned

as the owner. Climate change risk is set out on page 26

of this Report as one of our new principal risks.

This year we created a new Head of Sustainability role. Our

recently appointed Head of Sustainability will play a key

part in supporting our Legal & Compliance Director and

the ESG Strategy Committee in integrating climate-related

risks and opportunities into our overall strategy and risk

management framework.

Metrics and targets

Last year we announced our target to be Net Zero by 2040.

Over the coming financial year, we will set targets that align

with the Science Based Targets Initiative’s Corporate Net

Zero Standard. We have invested in software and engaged

a third-party to help us develop and set these targets.

We used our greenhouse gas emissions as the key metric

to identify and mitigate risks and assess our progress

against our commitment to be Net Zero. Our carbon

reporting follows the Greenhouse Gas Protocol and

this year our Scope 1 and Scope 2 emissions have been

externally verified through Achilles Information Limited’s

Carbon Reduce Programme. Our greenhouse gas emissions

statement is set out on page 37.

Next steps

As a priority for the year ahead, we will develop and

implement a credible climate transition plan as part of

our roadmap to achieving Net Zero by 2040. We will also

continue to engage our key stakeholders on climate change

to ensure that it is embedded into our wider strategy.

As we continue to develop our approach, we will look to

conduct quantitative modelling to inform the financial

impacts of our climate-related risks and opportunities.

Listing Rule 9.8.6R(8) Compliance

Statement

By including the climate-related financial disclosures

set out above which are consistent with TCFD

recommendations, Telecom Plus PLC has complied with

all of the requirements of LR 9.8.6R(8).

Strategic Report approval

The Strategic Report set out on pages 2 to 46, which

incorporates the Financial and Operating Highlights, the

Chairman’s Statement, the Co-Chief Executives’ Review,

the Financial Review, Principal Risks and Uncertainties,

People and Organisation, Sustainability Report and Task

Force on Climate Related Disclosures Report, has been

duly approved by the Board.

By order of the Board

David Baxter

Company Secretary

21 June 2022

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Board of Directors

The Hon. Charles Wigoder,

Executive Chairman

Appointed: 13 February 1998

Charles qualified as a Chartered Accountant with KPMG in 1984 and was

subsequently employed by Kleinwort Securities as an investment analyst

in the media and communication sectors. Between 1985 and 1988, he was

head of corporate finance and development at Carlton Communications

PLC and then Quadrant Group PLC. In March 1988 he left Quadrant Group

to set up The Peoples Phone Company PLC, where he served as CEO; it

was subsequently purchased by Vodafone in December 1996. He joined the

Company as CEO in February 1998, becoming Executive Chairman in 2010.

External appointments: None.

Beatrice Hollond,

Senior Independent Non-Executive Director

Appointed: 26 September 2016

Beatrice spent 16 years at Credit Suisse Asset Management in Global Fixed

Income and began her career as an equity analyst at Morgan Grenfell

Asset Management.

External appointments: Beatrice is a main board Director and Chair of

Remco (US) and Chair of the International Advisory Board (UK) of Brown

Advisory, senior independent non-executive director, member of the

Management Engagement; Nomination & Remuneration and Audit & Risk

Committees at Templeton Emerging Markets Investment Trust, Chair

at Millbank Financial Services Limited, Chair of F & C Investment Trust

PLC, and adviser to a private family office where Beatrice is also Chair of

the Investment Advisory Committee and a member of Remuneration &

Governance Committees. Beatrice is a main board director and Chair of

Oldfield & Co and a director of Smedvig AS.

Andrew Lindsay MBE,

Co-Chief Executive Officer

Appointed: 25 November 2008

Andrew joined the Company in April 2007 and was appointed to the Board

in November 2008. Before joining Telecom Plus, Andrew was Managing

Director of Ryness, an electrical retail chain based in London in which he

previously held a significant equity stake after performing a Management

Buyout in 2006. Prior to buying Ryness, he spent three years as an analyst

in the UK Mergers & Acquisitions team at Goldman Sachs. Andrew rowed

for Great Britain at the Sydney Olympic Games in 2000, where he won a

Gold medal.

External appointments: Andrew is a non-executive director at Mixergy

Limited.

Telecom Plus Plc Report and Accounts 2022 /

Stuart Burnett,

Co-Chief Executive Officer

Appointed: 23 July 2020

Stuart was promoted to Co-CEO in 2021, after two years as COO, and is

responsible for all operational activity across UW including day-to-day

management of UW’s Energy, Telecoms and Financial Services businesses.

He joined the Company in 2016 as Legal & Compliance Director and then

moved on to become Commercial Director, managing all commercial activity,

including our key commercial relationships and customer proposition, before

becoming COO in 2019. Stuart began his career as a corporate lawyer at

Slaughter & May after reading law at Oxford University. He then worked

in senior roles at RSA Insurance Group PLC and TSB Banking Group PLC,

prior to joining the Company.

External appointments: None.

Nick Schoenfeld,

Chief Financial Officer

Appointed: 7 January 2015

Nick joined the Company in January 2015 as Chief Financial Officer. Since

2006, Nick was Group Finance Director of Hanover Acceptances, a substantial

diversified private company with holdings in the food manufacturing, real

estate, and agribusiness sectors. He was previously employed at Kingfisher

plc, where he was responsible for the group’s financial planning and analysis

functions. Prior to this, he held senior strategic and development roles

within Castorama and the Walt Disney Company, having started his career

as a management consultant at the Boston Consulting Group. Nick also

has an MBA from the Harvard Business School.

External appointments: None.

Andrew Blowers OBE,

Non-Executive Director

Appointed: 22 November 2016

Andrew’s career spans over 30 years in the UK financial services industry.

He was the founder and CEO of Swiftcover.com and Chairman of IIC NV

from 2004 to 2009 and an executive director of Churchill Insurance before

this. He was also the senior independent non-executive director of AA

PLC, the UK’s leading provider of roadside assistance, and the Chairman

of ATEC Group Limited, a specialist digital insurance group.

External appointments: Andrew is the Chairman of AA’s Insurance holding

company (AAIHL).

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Melvin Lawson,

Non-Executive Director

Appointed: 27 September 2006

Melvin is an investor in a number of public and private companies in the real

estate and technology sectors. He was previously the Managing Director of

A Beckman PLC, a company formerly listed on the London Stock Exchange

which was taken private in 1995.

External appointments: Melvin is a non-executive director of Catalyst

Media Group PLC and a number of other private companies.

Julian Schild,

Non-Executive Director

Appointed: 25 May 2010

Julian qualified as a Chartered Accountant in 1986. He joined Huntleigh

Technology PLC in 1987 and was promoted to Group Finance Director that

year, and to Chairman in 2003. Julian was Chairman of the Association

of British Healthcare Industries from 2006 to 2007. Following the sale

of Huntleigh in 2007, he set up a company investing in start-ups. Julian

actively supports many charitable activities.

External appointments: Julian is a Director of the Hospital of St. John &

Elizabeth in London and is an Advisory Fellow of Pembroke College, Oxford.

Suzi Williams,

Non-Executive Director

Appointed: 23 July 2020

As Chief Brand & Marketing officer at BT, Suzi was part of the team who

transformed the business, prior to which she held senior leadership roles

at Capital Radio Group, Orange, the BBC, KPMG Consulting and Procter &

Gamble Europe. Suzi was an independent non-executive director at the

AA PLC until its successful sale to private equity in March 2021.

External appointments: Suzi is a senior board advisor on brand and

marketing. She is an independent non-executive at Zegona Communications

where she is Chair of the Remuneration and Nomination Committee, and

is also an independent non-executive director at JD Sports Fashion PLC.

Telecom Plus Plc Report and Accounts 2022 /

Board of Directors

continued

The Board is pleased to report that during the year and as

at the date of this Annual Report the Company has applied

the main principles and complied with the provisions of

the UK Corporate Governance Code (“the Code”) issued

by the Financial Reporting Council in July 2018, save in

the limited instances explained below. Copies of the Code

are available at www.frc.org.uk.

This report, together with the Director’s Report on pages 83

to 86 and the Directors’ Remuneration Report on pages 60

to 82, provides details of how the Company has applied the

principles and complied with the provisions of the Code

and where required explains the rationale for instances

where the Company has not been compliant, namely: (i)

the external facilitation of a Board evaluation exercise; (ii)

the extension of the term of the Chairman beyond nine

years; and (iii) the requirement to formally consult with

employees regarding the determination of the directors’

remuneration policy. Further detail in relation to the

Company’s position on formally consulting with employees

regarding the determination of the directors’ remuneration

policy is set out in the Directors’ Remuneration Report.

The Board of Directors

The Board meets regularly to review the progress of the

Company and to discuss the measures required for its

future development. Directors are provided in advance

with a formal agenda of matters to be discussed at each

meeting, and with the detailed information needed to

monitor the progress of the Company. Records of meetings

and the decisions of the Board are maintained by the

Company Secretary and are approved by the Board at the

following meeting. All directors have access to the advice

and services of the Company Secretary and, if required,

are able to take independent advice at the Company’s

expense in the furtherance of their duties. Any question of

the removal of the Company Secretary is a matter for the

Board as a whole. Whilst the members of the Board are all

experienced and well qualified, the opportunity to receive

further training at the Company’s expense is available to

them. The non-executive directors attended such formal,

externally facilitated courses as they considered relevant

to their roles and responsibilities during the year.

Board duties

The matters specifically reserved for decision by the Board

are fully documented and include the following principal

areas:

• reviewing and agreeing the Company’s strategy and long

term objectives;

• assessing performance in the light of the Company’s

strategy and objectives;

• ensuring an effective system of risk management and

internal controls is in place;

• approving changes to the structure, size and composition

of the Board and reviewing its performance on an annual

basis;

• reviewing the Company’s overall corporate governance

arrangements; and

• approval of the Company’s financial statements prior

to publication.

Matters that are specifically delegated to the committees

of the Board are documented in the various Terms of

Reference of each committee which are available on the

Company’s website (www.telecomplus.co.uk).

All Board and Committee meetings during the year were

held virtually through video conferencing.

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Corporate Governance Statement

Table of attendance at formal meetings during the year ended 31 March 2022

Name of Director Board Remuneration

Committee

Audit

Committee

Nomination

Committee

Number of meetings 11 4 3 1

Charles Wigoder 10 - - 1

Beatrice Hollond 11 4 3 1

Andrew Lindsay 11 - - -

Stuart Burnett 11 - - -

Nick Schoenfeld 11 - - -

Andrew Blowers 11 4 3 -

Julian Schild 11 - 3 -

Melvin Lawson 11 - - -

Suzi Williams 11 4 - 1

In accordance with provision 12 of the Code, led by the Senior Independent Non-Executive Director, the non-executive

directors also met without the executives present during the year.

Board evaluation

The directors recognise that the Code requires an external

evaluation of the boards of FTSE 350 companies to be

carried out at least every three years. However, the

directors considered the position in relation to the current

year and concluded that an external evaluation was not

necessary. In reaching this conclusion the directors were

mindful of the effective operation of the Board during

the year and the results of the internal Board evaluation

exercise detailed below. The Board considers it unlikely

that an external evaluation will be conducted in the

medium-term.

An internal evaluation of the Board for the current year

was conducted through the completion of formal detailed

board, and board committee evaluation questionnaires by

each director. A review of the results, led by the Company

Secretary, principally covered the following areas: specific

matters of concern arising from the questionnaires,

directors’ performances and any key objectives for the

coming year.

The evaluation questionnaires were focussed on assessing

effectiveness in the following key areas:

• the size and balance of the Board;

• the quality of board debates and its decision-making

processes;

• the individual contributions made by each director;

• the Chairman’s approach to leadership;

• the non-executive directors’ challenge of the executive

directors;

• the Board’s approach to identifying and mitigating key

business risks;

• the quality of the Company’s communications with key

stakeholders;

• the Board’s consideration of diversity and succession

planning; and

• the induction and training of board members.

In accordance with provision 12 of the Code and building

on the results of the evaluation questionnaires, a separate

evaluation of the performance of the Chairman was

conducted. This evaluation principally comprised a review

of the Chairman’s leadership style and tone in promoting

effective decision-making and ensuring constructive

and sufficient debate took place around key issues. The

results of this evaluation were entirely satisfactory. The

overall conclusion reached was that the Board and its

Committees had operated satisfactorily during the year,

with all directors making an effective contribution to

the Board commensurate with their experience and

responsibilities. Nonetheless, as part of the evaluation

it was duly noted that the Board changes described below

would address the historical imbalance in the proportion

of independent non-executive directors on the Board.

The process also highlighted that: (i) the terms of reference

for the Board committees should be updated and

reviewed annually; (ii) driving diversity within management

structures below Board level remained important; and

(iii) a more formal review of the key business risks and

controls will be undertaken at Board level following the

regular evaluation by the Audit Committee.

Telecom Plus Plc Report and Accounts 2022 /

Corporate Governance Statement

continued

Board balance

The Board comprised four executive directors and five

non-executive directors at the year-end. Beatrice Hollond

acted as the Company’s Senior Independent Non-Executive

Director. Stuart Burnett was promoted from Chief Operating

Officer to Co-CEO in November 2021.

Membership of each committee of the Board is set out

in the table below:

Name of Director Remuneration

Committee

Audit

Committee

Nomination

Committee

Charles Wigoder - -

Andrew Lindsay - - -

Stuart Burnett - - -

Nick Schoenfeld - - -

Andrew Blowers

Chair -

Beatrice Hollond

Chair

Melvin Lawson

- - -

Julian Schild

- Chair -

Suzi Williams

indicates independent non-executive directors

Melvin Lawson is not considered independent due to his significant shareholding in the Company.

The Code sets out circumstances which are likely to

impair, or could appear to impair, a non-executive

director’s independence. These circumstances include

serving on the board for more than nine years from the

date of appointment. Julian Schild was appointed to the

Board in May 2010 and has therefore served over nine

years as a director. Nonetheless, the Board considers that

the independence of Mr Schild has not been negatively

impacted by his long service on the Board and that he

continues to provide robust and constructive challenges

to the executive directors on a regular basis by using his

long-established knowledge of the Company and extensive

previous experience as an executive director of a listed

company. Furthermore, none of the other circumstances

listed in the Code as potentially impacting independence

apply to Mr Schild.

Nonetheless, during the period the Board decided to take

action to redress the historical imbalance in the proportion

of independent non-executive directors by announcing the

following boardroom changes which will apply from the

Company’s forthcoming AGM in July: (i) Charles Wigoder

will become Non-Executive Chairman; (ii) Julian Schild and

Melvin Lawson will retire from the Board; and (iii) Carla

Stent will be appointed to the Board as a new independent

non-executive director and Audit Committee Chair.

The Code also sets out that the Chair should not stay in post

beyond nine years from the date of their first appointment

to the Board. Charles Wigoder has been Executive Chairman

since 2010 and, as previously announced, will be moving

to non-executive Chairman following the Company’s AGM

in July. The Board has considered the extension of Mr

Wigoder’s term as Chairman, albeit in a non-executive

capacity, and is satisfied that this is in the best interests

of the Company given his extensive knowledge of the

business and the markets within which it operates. The

directors also noted the steps recently taken to improve

the balance of independent non-executive directors on

the Board.

Board diversity

The main objective of the Nomination Committee in

considering the appointment of new directors to the

Board remains to ensure that successful candidates are

of the highest calibre and demonstrate the best possible

combination of skills and experience. The Committee’s

Terms of Reference further stipulate that candidates from

a wide range of backgrounds shall be considered and

that due regard will be given to the benefits of diversity

on the Board.

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

The Code requires companies to set out any measurable

objectives that exist in relation to board diversity. However,

it remains the Committee’s strong view that it is not

appropriate to stipulate the characteristics of any future

directors, including gender, ahead of a full assessment

of the particular requirements of each role at the time a

candidate is being sought. The Committee will continue

to adhere to the principles set out above in identifying

and recruiting the best candidates for any future Board

roles in a non-discriminatory manner.

Nonetheless, the Nomination Committee was mindful of

the increasing focus on Board diversity and the formal

Government-led targets for FTSE 350 companies during

the recent recruitment process which resulted in Carla

Stent agreeing to join the Board following the AGM in July;

following this, the Company will be compliant with the

recommendations of the Hampton-Alexander Review to

have at least 33% female representation on the Board.

The Committee also notes the Parker Review of board

ethnic diversity, and the target of at least one director from

a minority ethnic group on each FTSE 250 board by 2024.

The Committee therefore intends to pay particular regard

to ethnic diversity in any future recruitment to the Board.

Further detail regarding the Company’s position in relation

to encouraging diversity within all layers of the organisation

is set out in the ‘People and Organisation’ section of the

Strategic Report on pages 27 to 30.

Supply of information

Information is supplied to the Board in a timely manner

with board papers and accounts being provided in

advance of meetings. When the Board requests additional

information it is provided.

Re-election

The Company’s Articles stipulate that one third of all

directors are required to retire by rotation at each

Annual General Meeting and all newly appointed

directors are required to offer themselves for election

by the shareholders at the next Annual General Meeting.

However, the Code requires that all directors of FTSE

350 companies be subject to annual re-election by

shareholders. Therefore, all the directors other than Julian

Schild and Melvin Lawson, will be submitted for re-election

at the forthcoming Annual General Meeting in July. The

Board has determined that all directors submitted for

re-election continue to make a valuable contribution to the

commercial success of the Company, with each bringing

a complementary range of skills to the team.

Remuneration Committee

The Board has a Remuneration Committee whose

responsibility is to ensure that the remuneration of

executive directors is sufficient to attract, retain and

motivate people of the highest calibre. The Remuneration

Committee comprises three independent non-executive

directors, namely Andrew Blowers (Chair of the

Committee), Beatrice Hollond and Suzi Williams. The

Directors’ Remuneration Report, provides the details of

the emoluments of each director, and this may be found

on pages 60 to 82.

The Remuneration Committee has written terms of

reference, available on the Company’s website (www.

telecomplus.co.uk), which describe the authority and

duties which have been delegated to it by the Board.

Audit Committee

The Audit Committee comprises three independent

non-executive directors, Julian Schild (Chair of the

Committee), Andrew Blowers and Beatrice Hollond in

compliance with the Code (provision 24). Julian Schild will

be retiring from the Board at the Company’s forthcoming

AGM in July and new non-executive director Carla Stent

will take on the Chair of the Audit Committee. The activities

of the Audit Committee are set out on pages 57 to 59.

The Audit Committee has written terms of reference,

available on the Company’s website (www.telecomplus.

co.uk), which describe the authority and duties which

have been delegated to it by the Board.

Nomination Committee

The Nomination Committee comprises Beatrice Hollond

(Chair of Committee), Suzi Williams and Charles Wigoder

and therefore has a majority of independent non-executive

directors in compliance with the Code (provision 17). Suzi

Williams will take over from Beatrice Hollond as Chair of

the Committee from the Company’s forthcoming AGM in

July. The main purpose of the Nomination Committee is to

make recommendations to the Board on the appointment

of new directors.

Telecom Plus Plc Report and Accounts 2022 /

Corporate Governance Statement

continued

The Nomination Committee has written terms of reference,

available on the Company’s website (www.telecomplus.

co.uk) which describe the authority and duties which have

been delegated to it by the Board.

The activities of the Nomination Committee are set out

on pages 55 to 56.

Relations with shareholders

It is the policy of the Company to maintain a dialogue with

institutional shareholders and to keep them informed

about the objectives of the business. The Board considers

that it is appropriate for the executive directors to discuss

any relevant matters regarding company performance

with major shareholders and this is undertaken primarily

by the Co-Chief Executives and Chief Financial Officer.

The Co-Chief Executives provide feedback from major

shareholders to the other directors, ensuring that Board

members, and in particular non-executive directors,

develop a balanced understanding of the views of major

investors. The executive directors met with a number of

the Company’s main shareholders during the year.

The Co-Chief Executives and Chief Financial Officer also

have periodic discussions with the Company’s brokers

and any issues are fed back to the Board as appropriate.

When reports are received from the Company’s brokers

following investor presentations, these are submitted to

the Board for review. Additionally, key representatives of

the Company’s brokers are periodically invited to present

at a full Board meeting.

Responsibility for communication with key shareholders in

relation to corporate governance and Board remuneration

matters lies primarily with the Senior Independent

Non-Executive Director and the Chair of the Remuneration

Committee who are assisted in this regard by the

Company Secretary. Individual invitations to engage with

the Senior Independent Non-Executive Director and Chair

of the Remuneration Committee have previously been

sent out to key shareholders.

Annual General Meeting

Notice of the Annual General Meeting and related papers

are sent to all shareholders at least 20 working days before

the meeting. Separate resolutions are proposed for each

matter including the adoption of the Report and Accounts,

the approval of the Company’s Remuneration Policy, the

Directors’ Remuneration Report and the appointment

of the Group’s external auditor. Proxy votes are counted

and the meeting is advised of the number of proxies

lodged for and against each resolution. The chairs of the

Audit, Remuneration and Nomination committees and the

remaining non-executive directors are normally available

to answer questions. Shareholders who attend are invited

to ask questions and take part in the meeting.

Internal control

The Board acknowledges its responsibility for the Group’s

systems of internal control and risk management. However,

it recognises that any system can only provide reasonable,

and not absolute, assurance against material misstatement

or loss. The principal risks faced by the Company and the

measures taken to address these risks are set out in the

Strategic Report on pages 20 to 26.

In conjunction with the Company’s senior management

team, the executive directors regularly identify, review

and evaluate the key risks faced by the Group and the

effectiveness of the internal controls in place to mitigate

these risks. The results of these reviews are recorded in a

formal document which sets out a detailed evaluation of

each risk and the associated internal control in place to

mitigate that risk. The document is reported to the Audit

Committee for review at least once per year. Following

review by the Audit Committee the document is reported

to the full Board.

The Board of directors has continued to review the internal

controls of the Company (including financial, operational

and compliance controls and risk management) and the

principal risks which the Company faces during the year.

No material weaknesses in internal controls were identified

during the year by the directors.

Share capital and voting rights

Details of the Company’s share capital and substantial

shareholdings can be found in the Directors’ Report under

the capital structure and substantial shareholders sections

on pages 84 to 85.

By Order of the Board

David Baxter

Company Secretary

21 June 2022

Shareholder Information

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Telecom Plus Plc Report and Accounts 2022 /

Introduction

The members of the Nomination Committee (“the

Committee”) are Beatrice Hollond (Chair), Suzi Williams

and Charles Wigoder; this means that the Committee

has a majority of independent non-executive directors

in compliance with the UK Corporate Governance Code

(“the Code”) (provision 17). Suzi Williams will take over

from Beatrice Hollond as the Chair of the Committee

from the Company’s forthcoming AGM in July.

The key responsibilities of the Nomination Committee

include:

• making recommendations to the Board on the

appointment of new non-executive and executive

directors, including making recommendations as to

the composition of the Board generally and the balance

between executive and non-executive directors;

• giving consideration to succession planning for directors

and other senior executives;

• reviewing on an annual basis the time required from

non-executive directors and assessing whether the

non-executive directors are spending enough time to

fulfil their duties;

• reviewing the re-election by shareholders of directors

under the annual re-election provisions of the Code; and

• evaluating any matters relating to the continuation

in office of any director including the suspension or

termination of service of an executive director.

The Committee’s general position in relation to diversity and

the Code requirement to set out any measurable objectives

that exist in this regard is included in the Corporate

Governance Statement on pages 52 to 53 of this document.

The Committee’s activities for the year

ended 31 March 2022

The Committee met once formally during the year and

Committee matters were discussed as part of certain

full Board meetings. The Committee’s principal activities

during the year related to the identification and evaluation

of a new independent non-executive director and Audit

Committee Chair, and reviewing the proposal to promote

Stuart Burnett from Chief Operating Officer to Co-CEO.

Appointment of new independent non-

executive director

The Committee was mindful of the increasing focus on

Board diversity and the formal Government-led targets

for FTSE 350 companies. As such, an external search

consultancy, Nurole, was instructed to draw up a diverse

shortlist of suitable candidates for consideration by

the Committee. From this shortlist, a small number of

candidates were invited to meet the members of the

Committee, acting on behalf of the Board, to evaluate

their suitability for this role.

From the potential candidates interviewed, Carla Stent

was identified as an extremely strong candidate by the

Committee and displayed a keen interest in joining the

Board. Carla has extensive executive and non-executive

international experience across financial services,

principally banking and private equity, as well as retail

and travel.

Her current Board roles include Marex Group, the Post

Office Limited, JP Morgan Elect plc, and the Tilney Smith

and Williamson Group. She has also served on the boards

of Power to Change, Savernake Group, Change Alliance

(India) Private Limited, Christian Aid, The Young Women’s

Trust, and various Virgin Group entity boards, amongst

others. From 2010 to 2013, Carla was Chief Operating

Officer and Partner at Virgin Group. She was previously

Deputy Chief Financial Officer and Chief Administrative

Officer of the Global Retail and Commercial Bank arm of

Barclays Bank. From 2000 to 2004, at Thomas Cook AG

Group, she held a variety of roles, including Operations

Director, as well as Director of Group Strategy & Corporate

Finance.

Carla is a qualified Chartered Accountant and has a Masters

in Advanced Accounting, Taxation, Business Administration

and Auditing from the University of South Africa, Cape

Town. Carla is also a full member of the ICAEW.

The members of the Committee formally interviewed

Ms Stent, benchmarking her experience and capabilities

against the key attributes previously discussed by the

Board. The Committee’s conclusions were reported to the

Board and her appointment was put forward for approval.

Telecom Plus Plc Report and Accounts 2022 /

Nomination Committee Report

Ms Stent’s extensive financial experience, including in

Chairing Audit and Risk Committees, was particularly

attractive to the Committee. Ms Stent will formally join

the Board immediately after the forthcoming AGM in July

and will become Chair of the Audit Committee.

Nurole does not have any other connection with the

Company.

Promotion of Stuart Burnett to Co-CEO

In reviewing the proposal to promote Stuart Burnett

to Co-CEO alongside Andrew Lindsay in November

2021, the Committee considered the acceleration

in the Company’s growth rate, and the positive

growth prospects for the business, in executing a

transition that had been planned for some time.

The Committee noted that Stuart and Andrew had

been working in close partnership since the start of the

pandemic, with Andrew focusing on the Partner community

and longer-term growth strategy, and Stuart on the

Customer proposition, the multiple regulated markets

the Company operates in, and running the day-to-day

operations of the business.

Having worked together for over five years, they also share

a united vision of how to deliver on the Board’s ambition

to add 1 million customers over the next four years. The

Committee therefore endorsed the proposal to promote

Stuart to Co-CEO.

Beatrice Hollond

Chair of the Nomination Committee

On behalf of the Board

21 June 2022

Shareholder Information

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Telecom Plus Plc Report and Accounts 2022 /

In accordance with the UK Corporate Governance Code

(“the Code”) (provision 24) the Committee comprises

three independent non-executive directors Julian Schild

(Chairman), Beatrice Hollond and Andrew Blowers. Julian

Schild is also identified as having recent and relevant

financial experience.

The Audit Committee

Attendance at Committee meetings during the current

year by Committee members is set out in the Corporate

Governance Report on page 51 of this document. In

accordance with best practice, the Committee has the

opportunity to meet with the external auditor of the

Company without the presence of any executive directors

and has done so during the current year. The Chairman

of the Committee has also had direct contact with the

Audit Partner during the year.

The key responsibilities of the Committee include:

• reviewing the appointment, re-appointment and removal

of the external auditor and the direction of the external

auditor to investigate any matters of particular concern;

• assessing the effectiveness of the Company’s external

auditor, including considering the scope and results of

the annual audit;

• reviewing the independence and objectivity of the

external auditor and assessing any potential impact

on objectivity resulting from the provision of non-audit

services by the external auditor;

• monitoring the integrity of the financial statements of

the Company and any formal announcements relating

to the Company’s performance;

• reviewing the impact of the application of new accounting

standards; and

• reviewing the Company’s internal financial controls and

other internal control and risk management processes.

The senior management team and executive directors

periodically review the effectiveness of key internal control

and risk management processes within the Company

and report any changes in such activities to the Audit

Committee and the external auditor for consideration. The

review covers all material controls, including financial,

operational and compliance controls.

The Committee’s activities for the year

ended 31 March 2022

The Committee’s main activities during the year included

a review of the financial statements involving a detailed

evaluation of the significant accounting issues therein.

The actions taken by the Committee in regard to these

issues are described in the table below:

Issue Action taken by the Committee

Operational accuracy of

billing system

Review of internal analysis.

Monitoring of regulator communications (Ofgem, BABT) and monthly monitoring

of detailed call centre statistics which would indicate significant billing issues.

Revenue recognition in relation to

energy services

Monitoring of key assumptions underlying the recognition of energy revenues

based on internal analysis.

Estimation related to Expected

Credit Losses

Review of key assumptions underlying the estimations related to

Expected Credit Losses.

Also, the Audit Committee has considered, amongst other

matters, compliance with the provisions of the Code

and accounting developments, the effectiveness of the

Company’s internal financial control environment and its

risk management and control processes. As part of this

process the Audit Committee has also considered the

need for any special projects or internal investigations

and concluded that no such additional projects or

investigations have been required.

In accordance with the Code (provision 25), the Audit

Committee has also considered the need for an internal

audit function at the Group. In the light of the simplicity of

the Group structure, its single country focus, its relatively

straightforward financial model, the internal controls

in place and the fact that management and the Board

conduct regular financial reviews, the Committee has

recommended to the Board that a financial internal audit

function is not currently appropriate for the business.

This decision will be kept under regular review and where

appropriate extended assurance will also be sought in

specific areas of concern.

Telecom Plus Plc Report and Accounts 2022 /

Audit Committee Report

During the year the Audit Committee reviewed and

approved the Company’s half year and annual financial

statements. The Committee has advised the Board that the

annual report and accounts taken as a whole provide a fair,

balanced and understandable picture of the Company’s

position and performance, business model and strategy.

External auditor effectiveness

The Company’s external auditor, KPMG, presented a

detailed audit report to the Audit Committee following a

review of the annual financial statements. Having regard

to its review of the work performed by the external auditor

during the year and its approach to key audit issues, the

Audit Committee was satisfied with the effectiveness of

KPMG as external auditor.

In reaching this conclusion, the Committee assessed:

• the efficiency with which the audit team was able to

understand the Company and its systems and processes;

• the experience and expertise of the audit team;

• the scope and eventual fulfilment of the detailed audit

plan;

• the robustness and perceptiveness of the audit team in

their handling of key accounting and audit judgements;

and

• the nature and quality of the content of the external

auditor’s report.

The Committee has therefore recommended to the Board,

for approval by shareholders at the AGM, the reappointment

of KPMG as the Company’s external auditor for the coming

year. KPMG LLP was first appointed as the Group’s auditor

with effect from February 2015, following a competitive

tender process.

External auditor independence

In order to guard against the objectivity and independence

of the external auditor being compromised, the provision

of any significant additional services remains subject to

the prior approval of the Audit Committee.

The Committee would prohibit the provision of the following

types of non-audit related work by the Company’s external

auditor:

• tax services relating to: (i) preparation of tax forms;

(ii) payroll tax; (iii) customs duties; (iv) identification

of public subsidies and tax incentives unless support

from the external auditor in respect of such services is

required by law; (v) support regarding tax inspections by

tax authorities unless support from the external auditor

in respect of such inspections is required by law; (vi)

calculation of direct and indirect tax and deferred tax;

and (vii) provision of tax advice;

• services that involve playing any part in the management

or decision-making of the Company;

• bookkeeping and preparing accounting records and

financial statements;

• payroll services;

• designing and implementing internal control or risk

management procedures related to the preparation

and/or control of financial information or designing and

implementing financial information technology systems;

• valuation services, including valuations performed in

connection with actuarial services or litigation support

services;

• legal services, with respect to: (i) the provision of general

counsel; (ii) negotiating on behalf of the Company; and (iii)

acting in an advocacy role in the resolution of litigation;

• services linked to the financing, capital structure and

allocation, and investment strategy of the Company,

except providing assurance services in relation to the

financial statements, such as the issuing of comfort

letters in connection with prospectuses issued by the

Company;

• promoting, dealing in, or underwriting shares in the

Company; and

• human resources services, with respect to: (i) manage-

ment in a position to exert significant influence over

the preparation of the accounting records or financial

statements which are the subject of the statutory audit,

where such services involve: searching for or seeking out

candidates for such position; or undertaking reference

checks of candidates for such positions; (ii) structuring

the organisation design; and (iii) cost control.

The Committee will also prohibit any other work where

mutual interests exist that could impair the independence

and objectivity of the external auditor.

Shareholder Information

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Telecom Plus Plc Report and Accounts 2022 /

Reporting of staff concerns

During the year the Company operated an independently-

facilitated whistleblowing system for staff of the Company

to raise, in confidence, concerns they may have over

possible improprieties, financial or otherwise. All employees

have been notified of this arrangement on the Company’s

intranet website (Code provision 6). No such matters were

raised by employees during the current year.

Conclusion

As set out in the Corporate Governance Statement, I will be

retiring from the Board at the Company’s AGM in July and

new independent non-executive director, Carla Stent, will

be taking over as Chair of the Audit Committee. I should

like to say how much I have enjoyed chairing the Audit

Committee and my time at Telecom Plus. I wish Carla

every success as she takes up her new role.

Julian Schild

Chairman of the Audit Committee

On behalf of the Board

21 June 2022

Telecom Plus Plc Report and Accounts 2022 /

Audit Committee Report

continued

Annual statement

Dear Shareholder,

As chair of the Remuneration Committee (“Committee”)

and on behalf of the Board, I am pleased to present our

report on Directors’ remuneration for the year ended 31

March 2022.

The report comprises three sections:

• This statement, which provides an overview of the

key decisions made on Directors’ remuneration during

the year.

• The Annual Report on Remuneration, which describes

how our Directors’ Remuneration Policy (“Policy”) was

applied for the year ended 31 March 2022.

• A summary of the Policy (pages 63 to 73) being submitted

for approval at the Company’s Annual General Meeting

(“AGM”) in July.

Policy approval

The Remuneration Policy (“Policy”) was originally approved

by shareholders at the July 2019 AGM. However, the

Committee were cognisant of concerns raised by some

shareholders. After completing a review of executive

remuneration during 2020, the current Policy was approved

at the December 2020 General Meeting with over 95%

of shareholders voting in favour of the resolution. In line

with the UK Directors’ remuneration regulations and best

practice, the Committee is required to submit the Policy

to shareholders for reapproval at the 2022 AGM, in line

with the original triennial review timeline.

However, the Committee is conscious that the existing

share incentive scheme for senior management and

executive directors is closed to new participants and is

approaching maturity in 2023, whereby the majority of

awards will have vested. The Committee intends to undergo

a comprehensive review our long term incentive provision

for senior management and executive directors during

2022/23. The Committee will consult with shareholders

where appropriate on any new scheme and any new

scheme will be subject to shareholder approval at the

2023 AGM, alongside any new Remuneration Policy.

For the financial year ending 31 March 2023, the Committee

is seeking approval for the continuation of the current

Policy at the 2022 AGM – until the completion of our

review and shareholder approval of any new Policy at the

2023 AGM. The only changes which have been made to

the Policy for approval at the 2022 AGM are housekeeping

changes to provide further alignment with best practice

and allow sufficient flexibility in its application (as outlined

on page 63).

Board changes

Stuart Burnett, the Group’s COO, was appointed as Co-CEO

in November 2021. On appointment, Stuart’s annual salary

was increased from £424,200 to £500,000 per annum.

The Committee took into account his performance

and experience, the enhanced role, and increased

responsibilities as well as considering the salary packages

of similar roles within peer companies when determining

the increase. The Committee also increased the annual

bonus opportunity to 150% from November, aligned to

Andrew Lindsay’s bonus opportunity as Co-CEO. The new

roles and responsibilities and consequent positioning of

the Co-CEO remuneration also reflects the changes to

the board structure.

As announced on 14 March 2022, effective from the July

2022 AGM, Charles Wigoder will become Non-Executive

Chairman, and both Melvin Lawson and Julian Schild

will retire from the Board. Details of Charles Wigoder’s

remuneration arrangements for the year ending 31 March

2023 are set out below.

Performance outcomes for the year

ended 31 March 2022

The Group has delivered adjusted pre-tax profits in

line with expectations, showing strong growth in the

second half, and the business is well positioned to build

shareholder value over both the near and longer term.

Andrew Lindsay (Co-CEO) and Nick Schoenfeld (CFO) were

granted a maximum bonus opportunity equal to 150% and

67.5% of salary respectively for the year ended 31 March

2022. The CFO’s maximum bonus opportunity was set at

67.5% of salary to reflect his salary positioning compared

to other FTSE 250 companies of a similar size and scale

to the Company.

Shareholder Information

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Telecom Plus Plc Report and Accounts 2022 /

Directors’ Remuneration Report

Stuart Burnett was promoted from COO to Co-CEO

in November 2021. Stuart’s original maximum bonus

opportunity of 135% for the current financial year to 31

March 2022 was increased to 140% (being the weighted

average of 135% for 8 months as COO and 150% for 4

months as Co-CEO). Stuart’s weighted average salary

received of £449,467 (8 months at £424,200 per annum

plus 4 months at £500,000 per annum) has also been

used to determine the bonus.

70% of the bonus was subject to adjusted Profit Before

Tax (‘adjusted PBT’) performance and the remaining 30%

subject to certain strategic objectives.

The Group delivered adjusted PBT of £61.9m which resulted

in an outcome of 51.0% (against a maximum of 70%) for

the adjusted PBT element. Performance against strategic

objectives (which focussed on service growth, Partner

activity and a strategic development in financial services)

resulted in an outcome of 18.5% (against a maximum of

30%) for the strategic element. See pages 75 to 76 for

further details. The executives therefore earned a bonus

equal to 69.5% of the maximum opportunity. One-third of

the bonus earned will be deferred into shares for two years.

The Committee carefully considered the bonus outcome

and determined it to be appropriate taking into account

underlying business performance and the experience of

shareholders and employees during the year. In particular,

the following factors were noted:

• The Group delivered strong growth in the second half

and is well positioned to build shareholder value over

both the near and longer term.

• The final dividend for the year ended 31 March 2021 was

paid, resulting in a total dividend of 57p per share for the

year. A total dividend of 57p per share is also expected

for the year ended 31 March 2022.

No long term incentive growth shares awards were capable

of vesting during the year ended 31 March 2022.

Implementation of the Remuneration

Policy for the year ending 31 March 2023

Base salaries and fees

The Executive Chairman, Co-CEO Andrew Lindsay and CFO

received salary increases of 5.5% effective from 1 April

2022 in line with the average cost of living increases for

all employees. Stuart Burnett did not receive the standard

5.5% increase in the light of the increase in his salary in

November 2021 following promotion to Co-CEO.

Following Charles Wigoder’s appointment as Non-Executive

Chairman at the AGM in July 2022, his fees will be reduced

from £501,494 to £200,000 per annum to reflect the change

in his responsibilities.

The Committee carried out a benchmarking exercise during

March 2022 to determine the appropriate remuneration

for the non-executive directors using the “Deloitte Your

Guide – Directors’ remuneration in FTSE 250 companies”

report, October 2021. The exercise highlighted that fee

levels had fallen significantly behind market rates. The

Committee therefore determined that to appropriately

reflect the time commitment and responsibilities being

assumed by the non-executive directors, each of them

should receive a base salary of £55,000 per annum, with

an additional fee of £10,000 per annum for the Chairs of the

Audit and Remuneration Committees, and an additional fee

of £5,000 per annum for the Senior Non-Executive Director

and for the Chair of the Nomination Committee. The new

level of fees that will be received by the non-executive

directors from 1 April 2022 is as follows (the variation in

fees between non-executives reflecting the different roles

and responsibilities):

• Andrew Blowers £65,000 (2022: £45,450);

• Beatrice Hollond £60,000 (2022: £45,450); and

• Suzi Williams £60,000 (2022: £45,450).

Non-executive directors Julian Schild and Melvin Lawson

will be retiring from the Board at the AGM in July 2022 and

therefore they did not receive an increase in fees.

Telecom Plus Plc Report and Accounts 2022 /

Directors’ Remuneration Report

continued

Annual bonus

The maximum bonus opportunity remains at 150% of salary

for both Andrew Lindsay (Co-CEO) and Stuart Burnett

(Co-CEO) and 67.5% of salary for Nick Schoenfeld (CFO).

70% of the bonus is subject to adjusted PBT performance

and the remaining 30% subject to strategic objectives (based

on employee satisfaction, customer services performance

and customer growth). These objectives are directly aligned

with the FY23 strategic priorities set for the whole business.

The Committee has discretion to adjust the payment

outcome if it is not deemed to reflect the underlying

financial or non-financial performance of the business,

the performance of the individual or the experience of

shareholders and other stakeholders over the performance

period. In any case, the strategic element of the bonus

will only pay-out if a threshold level of adjusted PBT is

achieved. Full disclosure of the adjusted PBT targets

and strategic metrics will be included in next year’s

Directors’ Remuneration Report. One-third of any

bonus earned is deferred into shares for two years.

LTIP awards

No LTIP awards will be granted to executive directors during

the year ended 31 March 2023.

Conclusion

I trust the information presented in this report enables our

shareholders to understand both how we have operated

our Policy over the year and the rationale for our decision

making. We believe that the Policy operated as intended and

we consider that the remuneration received by executive

directors during the year was appropriate taking into account

Group and personal performance, and the experience of

shareholders and employees.

I look forward to receiving your support at the July 2022

Annual General Meeting, where I will be available to respond

to any questions shareholders may have on this report or

in relation to any of the Committee’s activities.

Andrew Blowers OBE

Chairman of the Remuneration Committee

21 June 2022

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Telecom Plus Plc Report and Accounts 2022 /

Remuneration Committee

The Committee is responsible for reviewing and making

recommendations to the Board regarding the policy relating

to the total remuneration paid to the executive directors and

senior management of the Company. It meets regularly to

review and set all elements of the remuneration paid to the

executive directors of the Company and monitors the level

and structure of remuneration for other senior management

of the Company. It also exercises all the powers of the

Board in relation to the operation of the Company’s share

incentive schemes, including the grant of options and the

terms of those grants.

The Committee met formally four times during the year and

details of attendance at these meetings are provided in the

Corporate Governance Statement on page 51.

The Committee’s principal activities during the year included:

• reviewing and approving executive director remuneration

packages;

• monitoring senior management remuneration packages;

and

• reviewing and approving the issue of share options to

certain employees.

Remuneration Policy introduction

The Company’s overall remuneration policy is to ensure

that the executive directors and other senior managers

are fairly and responsibly rewarded for their individual

contribution to the overall long term performance of the

Company, in a manner that ensures that the Company

is able to attract, motivate, and retain executives of

the quality necessary to ensure the successful long

term performance of the Company. The remuneration

policy continues to be based on the principle that the

fortunes of the directors and senior management should

be aligned with those of external shareholders. The

remuneration policy also takes into account the principles

of clarity, simplicity, risk, predictability, proportionality

and alignment to culture as set out in Provision 40 of

the UK Corporate Governance Code.

The Directors Remuneration Policy was originally approved

by the Company’s shareholders at the AGM on 25 July

2019, with amendments approved by shareholders at a

general meeting on 16 December 2020. As detailed on page

60, shareholder approval will be sought for the continuing

application of the existing Directors’ Remuneration Policy

until the 2023 AGM. The only changes which have been

made to the Policy for approval at the 2022 AGM are

housekeeping changes to provide further alignment

with best practice and allow sufficient flexibility in its

application. The Directors’ Remuneration Policy is set

out in full below on pages 63 to 73.

Remuneration policy table

How component

supports strategic

objectives

Operation of

component

Maximum potential

value of component

Performance metrics

used, weighting and

time periods

Base salary

To recognise status and

responsibility to deliver

operational strategy on a

day-to-day basis.

Base salary is paid in 12

equal monthly instalments

during the year.

Base salaries are reviewed

annually with any changes

effective from 1 April each

year, and also (where

relevant) to reflect changes

in the responsibilities of

each individual.

Whilst there is not a set

maximum, increases will

normally be in line with the

range of increases awarded

to other employees.

Salary increases above this

level may be awarded in

appropriate circumstances

including but not limited to:

• reflect any change in the

level of responsibility of

the individual (whether

through a change in role

or an increase in the

scale and/or scope of the

activities carried out by the

Company); or

• an increase in experience

and knowledge of the

Company and its markets.

None, although overall

performance of the

individual is considered by

the Committee when setting

and reviewing salaries.

Telecom Plus Plc Report and Accounts 2022 /

Remuneration Policy

How component

supports strategic

objectives

Operation of

component

Maximum potential

value of component

Performance metrics

used, weighting and

time periods

Benefits

To provide benefits

commensurate with the role

and market practice.

Executive Directors

receive benefits set at an

appropriate level taking into

account total remuneration,

market practice, the benefits

provided to other employees

in the Group and individual

circumstances.

The Company pays for

private healthcare for each

director and their immediate

family.

The Company provides

company cars for executive

directors where appropriate.

The Company provides death

in service benefits up to

a maximum of four times

annual base salary (subject

to prevailing policy caps).

The Committee reserves

the right to introduce other

benefits should this be

necessary to attract and/

or retain key executive

directors.

In relation to new directors

the Company will pay for

reasonable relocation

expenses where required.

Whilst the Committee

has not set an absolute

maximum on the level

of benefits Executive

Directors may receive,

the value of benefits is

set at a level which the

Committee considers to be

appropriately positioned

taking into account relevant

market levels based on

the nature and location

of the role, the level of

benefits provided for other

employees in the Group and

individual circumstances.

None.

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How component

supports strategic

objectives

Operation of

component

Maximum potential

value of component

Performance metrics

used, weighting and

time periods

Annual bonus

To incentivise the annual

delivery of financial and

strategic priorities.

Bonus payment is

dependent on the

achievement of performance

measures.

One-third of any bonus

earned is deferred into

shares for two years subject

to continued employment.

The Committee may decide

to pay the entire bonus in

cash where the amount

to be deferred into shares

would, in the opinion of the

Committee, be so small it is

administratively burdensome

to apply deferral.

Dividends will not accrue

on deferred shares prior to

vesting.

The Committee has

discretion to adjust the

payment outcome if it is

not deemed to reflect the

underlying financial or non-

financial performance of the

Company, the performance

of the individual or the

experience of shareholders

or other stakeholders over

the performance period.

Annual bonus payments

are subject to clawback

provisions for up to two

years following payment.

Deferred share awards

are subject to clawback

provisions during the

two-year deferral period.

Clawback may apply in the

following circumstances:

gross misconduct of the

participant; material error

or misstatement in the

accounts; grant or vesting

of annual bonus awards

being found to be incorrect

due to misleading or

inaccurate information;

serious reputational damage;

material corporate failure.

Maximum opportunity of up

to 150% of base salary may

be awarded in respect of a

financial year.

Targets are set annually

reflecting the Company’s

financial and strategic

priorities.

At least 70% of the annual

bonus is assessed against

financial performance

metrics. The balance is

assessed against non-

financial strategic/personal

objectives.

Financial metrics

Up to 25% of each bonus

element will vest for

threshold performance, with

full vesting for maximum

performance.

Non-financial metrics

vesting will apply on a scale

between 0% and 100%

based on the Committee’s

assessment of performance

against objectives.

Telecom Plus Plc Report and Accounts 2022 /

Remuneration Policy

continued

How component

supports strategic

objectives

Operation of

component

Maximum potential

value of component

Performance metrics

used, weighting and

time periods

Share incentive schemes

To directly align the

directors’ interests

with those of all other

shareholders.

Issue of share incentives at

market price on the date of

grant which provide direct

and transparent exposure

to the Company share price

for the director (“Share

Incentive Schemes”).

Share Incentive Schemes

include HMRC approved

share option awards, and

unapproved share option

awards.

Maximum grant value

equivalent to 200% of salary

per annum, assuming that no

annual cash bonus has been

awarded during that year.

Share Incentive Schemes

Grants made periodically,

with awards vesting over 3

to 7 years.

Grant value of share

incentives to be determined

in accordance with FRC

Reporting Lab guidance

issued in March 2013, i.e.

share options to be valued

at one third of the market

value of the shares under

option.

Vesting is dependent on

service and the achievement

of performance conditions.

30% vests at threshold

performance.

Share Incentive Schemes

Service and performance

conditions must be met over

the vesting period,

weighted average of three

performance measures

typically used for Chief

Executive and Chief

Financial Officer:

• Adjusted EPS growth

• TSR growth

• Service number growth

Weighting of each measure

to be determined by the

Committee and dependent

on each director’s role and

strategic responsibility.

The Committee also retains

the ability to amend the

performance conditions for

future grants to ensure that

they appropriately reflect

the strategic responsibilities

of the director concerned.

The Committee may

require forfeiture of shares

comprised in an award

in the event of a material

error or mis-statement in

the accounts, or a material

failure in risk management

(“Malus and Clawback”).

The Company has the right

to reduce or withhold the

value that would otherwise

accrue under the Share

Incentive Schemes prior to

exercise/ conversion (malus)

or after exercise/conversion

(clawback) in certain

circumstances including:

(i) Gross misconduct of the

participant;

(ii) Material error or

misstatement in the

accounts; or

(iii) Grant or vesting of

awards being found

to be incorrect due to

misleading or inaccurate

information.

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Telecom Plus Plc Report and Accounts 2022 /

How component

supports strategic

objectives

Operation of

component

Maximum potential

value of component

Performance metrics

used, weighting and

time periods

Pension

To provide funding for

retirement.

Defined contribution

pension scheme is open to

all employees and executive

directors.

In appropriate

circumstances, such as

where contributions exceed

the annual or lifetime

allowance, Executive

Directors may take a taxable

cash supplement instead of

contributions to a pension

plan.

The percentage level of

pension provision (or cash

allowance equivalent) for

executive directors will

not exceed the highest

percentage contribution rate

available to a majority of

employees.

None.

Shareholding requirement

To strengthen the long

term alignment of directors’

interests with those of all

shareholders.

Shareholding requirement

policy is primarily derived

from the issue of shares

resulting from the exercise

of awards made under the

Share Incentive Schemes,

the Deferred Share Bonus

Plan and existing awards

made under the LTIP 2016.

Executive directors are

expected to progressively

build and retain a

shareholding in the Company

worth 200% of basic salary

over a maximum of 10 years;

until such time as they have

achieved this level, they

are required to: (i) retain all

the shares vesting to them

under the Deferred Bonus

Plan (other than to settle

associated tax liabilities on

vesting); and (ii) retain not

less than 25% of any shares

issued to them under the

LTIP 2016 or any other long

term incentive plan operated

by the Company from time

to time.

Under LTIP 2016, in relation

to the 25% blocks of their

award which vest after 3,

5 or 7 years, participants

are required to retain 50%

of any shares they choose

to convert for at least 12

months. In relation to the

final 25% block which vests

after 10 years, they are

obliged to retain 75% for 12

months, 50% for 18 months,

and 25% for 24 months.

The above holding periods

continue to apply to

participants after they

cease to be employed by

the Company; shares issued

in future under any other

long term incentive plan

will be subject to similar

restrictions.

N/A

Telecom Plus Plc Report and Accounts 2022 /

Remuneration Policy

continued

How component

supports strategic

objectives

Operation of

component

Maximum potential

value of component

Performance metrics

used, weighting and

time periods

Shareholding requirement (continued)

Future share awards to

directors will be made subject

to a post-vest holding period.

Post-employment

Executive directors who

step down from the Board

following 16 December 2020

are required to retain a

holding in ‘guideline shares’

equal to:

• 200% of salary (or their

actual shareholding at the

point of departure if lower)

for the first 12 months

following stepping down as

executive director.

• 100% of salary (or their

actual shareholding at the

point of departure if lower)

for the subsequent 12

months.

‘Guideline shares’ do not

include shares that the

executive director has

purchased or which have

been acquired pursuant to

share awards which vested

before 16 December 2020.

Unless the Committee

determines otherwise, an

executive director or former

executive director shall be

deemed to have disposed

of shares which are not

‘guideline shares’ before

‘guideline shares’.

Choice of performance measures

The Committee chose the performance measures

described in the table above as they are deemed to directly

align the executive directors’ interests with those of all

shareholders in an easily understood and transparent

manner.

Annual bonus

The performance measures are set annually reflecting

the Company’s financial and strategic priorities. At least

70% of the annual bonus is assessed against financial

performance metrics. The balance is assessed against

non-financial strategic/personal objectives. In relation

to financial metrics, up to 25% of each bonus element

will vest for threshold performance, with full vesting

for maximum performance. In relation to non-financial

metrics, vesting will apply on a scale between 0% and 100%

based on the Committee’s assessment of performance

against objectives.

Share incentive schemes

The performance measures comprise a combination

of relative total shareholder return (‘TSR’), Adjusted

EPS (excluding share incentive scheme charges and

amortisation of intangible assets) and service number

growth measures. Adjusted EPS is considered appropriate

as a key strategic objective of the Company if it is to

drive profitable growth in each year. It also provides a

balance to relative TSR, which considers shareholder

value creation and reflects market expectations of future

performance, and absolute service number growth which,

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Telecom Plus Plc Report and Accounts 2022 /

when achieved responsibly, will also drive long term value

creation. The use of relative TSR and Adjusted EPS growth

measures provides a combined focus on the Company’s

financial performance and shareholder value creation.

Targets for Adjusted EPS are set by reference to internal

budgeting plans and external market expectations. TSR

targets are set on a standard practice, median to upper

quartile ranking range. Only 30% of share incentive awards

vest for threshold levels of performance. The Committee

wishes to retain the ability to change the composition

of performance conditions for future grants to directors

should this be required in-order to reflect appropriately

the strategic responsibilities of the particular director

concerned or if it considers it would be more likely to

more appropriately drive long term value creation within

the Company.

Illustrative application of

remuneration policy

The bar charts below seek to illustrate the potential

rewards available under the proposed remuneration

policy for the coming financial year under varying levels

of performance.

£0

Fixed pay

Minimum MinimumMinimumOn-target On-targetOn-targetMaximum MaximumMaximumMaximum

with 50%

share price

increase

Maximum

with 50%

share price

increase

Maximum

with 50%

share price

increase

£1.4m

£1.2m

£1.6m

£1.0m

£0.8m

£0.6m

£0.4m

£0.2m

£1,097,091

£884,000

£631,195

£840,848

£1,050,502 £1,050,502

£631,195

£509,000

£1,562,987

£1,259,000

£1,562,987

£1,259,000

60%

40%

40%60%

40%

40%60%

58%

58%42%

100%

42%

Andrew Lindsay Stuart Burnett Nick Schoenfeld

The bar charts have been prepared based on the following assumptions:

Executive directors will not be granted a long term

incentive award during the year ending 31 March 2023.

The scenario ‘maximum with 50% share price increase’

has been included in the bar charts for completeness.

Minimum performance Fixed remuneration

On-target performance Fixed remuneration

50% of maximum annual bonus opportunity is earned

Maximum performance Fixed remuneration

Maximum annual bonus opportunity is earned

Telecom Plus Plc Report and Accounts 2022 /

Remuneration Policy

continued

Non-executive directors’ fees policy

How component

supports strategic

objectives

Operation of

component

Maximum potential

value of component

Performance metrics

used, weighting and time

periods

To attract non-executive

directors who have

a broad range of

experience and skills to

support and oversee the

implementation of strategy

and ensure good corporate

governance.

Non-executive directors’

fees are set by the Board

as a whole and aligned

with the responsibilities of

each director.

Annual fees are paid in 12

equal monthly instalments

during the year.

Non-executive directors’

fees are periodically

reviewed by the Board in

the light of any changes in

role and prevailing market

rates for Non-executive

directors in other listed

companies of similar

size and with similar

characteristics.

Non-executive directors’

remuneration will not be

set outside the parameters

of prevailing market

rates for similarly-sized

companies of equal

complexity.

Non-executive directors are

not eligible to participate

in any performance-related

arrangements or share incentive

schemes.

Service contracts and policy for

payment for loss of office

The executive directors are each engaged under a

rolling contract of service requiring 12 months’ notice of

termination on either side for Mr Wigoder and 6 months’

notice of termination on either side for Messrs Lindsay,

Schoenfeld and Burnett. The dates of the executive

directors’ service agreements are as follows:

Date of service

agreement

Charles Wigoder 5 May 2011

Andrew Lindsay 5 May 2011

Nick Schoenfeld 9 October 2014

Stuart Burnett 23 July 2020

All non-executive directors are subject to re-election at

each AGM. The appointment of the non-executive directors

may be terminated on either side on three months’ notice.

The dates of each non-executive director’s appointment

are as follows:

Date of service

agreement

Expiry of

current term

Beatrice Hollond 26 September 2016 2022 AGM

Andrew Blowers 2 November 2016 2022 AGM

Melvin Lawson 27 September 2006 2022 AGM

Julian Schild 25 May 2010 2022 AGM

Suzi Williams 23 July 2020 2022 AGM

1. Non-executive directors Julian Schild and Melvin Lawson will be

retiring from the Board at the AGM in July 2022.

Copies of the service contracts and letters of appointment

are held at the Company’s Registered Office and will be

available for inspection within normal business hours / at

the Annual General Meeting, subject to any covid-related

restrictions.

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The table below sets out the Company’s policy regarding service contracts and payments for loss of office.

Standard provision Policy Details Other provisions in

service contracts

Notice periods in executive

directors’ service

contracts.

6 - 12 months’ notice from

the Company.

6 - 12 months’ notice from

the executive director.

Executive directors may be required

to work during notice period or may

be provided with pay in lieu of notice

if not required to work full notice.

All executive directors are subject to

annual re-election by shareholders.

N/A

Compensation for loss of

office in service contracts.

No more than base salary,

benefits and pension

contributions for the

period of the executive

director’s notice.

No contractual

provision for additional

compensation in the event

of loss of office resulting

from poor performance.

Any statutory entitlements or sums

to settle or compromise claims in

connection with any termination

of office would need to be paid as

necessary, subject to the fulfilment

of the director’s duty to mitigate

their loss.

N/A

Treatment of unvested

annual bonus awards

The payment of a bonus

will be at the discretion

of the Committee on an

individual basis and will be

dependent on a number

of factors, including the

circumstances of the

individual’s departure

and contribution to the

business during the

financial year.

Unless the Committee determines

otherwise, any bonus payment will

be paid at the usual time following

the determination of performance

metrics and be subject to a pro rata

reduction for time served during the

performance period.

N/A

Treatment of unvested

deferred share bonus

awards

The extent to which any

unvested award will vest

will be determined in

accordance with the rules

of the Deferred Bonus

Plan.

Unvested awards will

normally lapse on

cessation of employment.

However, if an executive

director leaves under

“good leaver” provisions

the awards will remain

capable of vesting.

For a “good leaver”, awards will

ordinarily vest at the normal vesting

date. In exceptional circumstances,

the Committee may decide that

the executive director’s deferred

share awards will vest at the date of

cessation of employment.

In either case, the extent of

vesting will be determined by the

Committee taking into account,

unless the Committee determines

otherwise, the period of time

elapsed from the grant date to the

date of cessation of employment

relative to the deferral period.

N/A

Telecom Plus Plc Report and Accounts 2022 /

Remuneration Policy

continued

Treatment of unvested

Share Incentive Scheme

and LTIP 2016.

Share Incentive Schemes

All awards lapse except

for “good leavers”: i.e.

death, injury, disability,

redundancy, retirement

or where the employing

company or the company

with which the office

is held ceases to be a

member of the Group or

the transfer of employment

out of the Group by

reason of the Transfer of

Undertakings (Protection of

Employment) Regulations

2006.

Legacy arrangement: LTIP

2016

All awards lapse except for

“good leavers”: i.e. death,

or where the employing

company or the company

with which the office

is held ceases to be a

member of the Group or

the transfer of employment

out of the Group by

reason of the Transfer of

Undertakings (Protection of

Employment) Regulations

2006.

In the event of injury,

disability, retirement or

redundancy, the Committee

may exercise its discretion

to classify the participant

as a “good leaver”.

Share Incentive Schemes

A “good leaver” may exercise any

subsisting share options within the

period of 6 months from the date of

cessation of employment.

If a participant ceases to be employed

within the Group otherwise than as

a “good leaver”, no unvested share

options held shall be exercisable after

the date of such cessation unless the

Committee in its absolute discretion

(provided that such discretion must

be exercised fairly and reasonably) so

decides but for a period of not more

than 12 months from the date of

cessation. The Committee considers

it unlikely that such discretion would

be used in the event of a participant

ceasing to be employed by the

Company as a “bad leaver”.

Legacy arrangement: LTIP 2016

If a participant in the LTIP 2016 ceases

to be employed within the Group

otherwise than as a “good leaver”, any

unvested awards will be forfeited.

Any growth shares which have vested

but not been converted, must be

converted within 14 days of the end

of their employment otherwise they

will be forfeited; the conversion

ratio shall be based on the average

share price for the 30 working days

immediately preceding the date on

which conversion takes place.

If a participant in the LTIP 2016 is a

“good leaver”, then he shall be entitled

to the benefit of any shares that

have become convertible prior to the

date of leaving, and such shares shall

be converted (at the option of the

employee) either within 14 days of the

termination of their employment (in

which case the conversion ratio shall

be based on the average share price

for the 30 working days immediately

preceding the date on which

conversion takes place), or during the

next annual vesting period using the

criteria which apply on that date.

N/A

Exercise of discretion. Discretion to be used

only in exceptional

circumstances.

The Committee will take into

account the recent performance of

the director and the Company, and

the nature of the circumstances

around the executive director’s

departure.

N/A

Non-executive Directors. Non-executive directors

are appointed for an initial

term of one year which

is then reviewed by the

Board on annual basis

thereafter.

Non-executive directors are all

subject to annual re-election by

shareholders at the Company’s AGM

each year.

Non-executive directors have a three

month notice period and there is

no provision for compensation if

required to stand down.

Non-executive directors

have the right to

seek independent

professional advice

at the expense of

the Company in the

pursuance of their

duties.

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Approach to recruitment remuneration

The Committee’s approach is to pay the amount necessary

to recruit the best candidate to each particular role.

In determining these amounts the Committee will be

mindful of, inter alia, prevailing market rates, the chosen

candidate’s skills, knowledge and experience, and their

existing location and position.

Where the candidate has variable remuneration

arrangements with a previous employer that will be lost

on leaving employment, the Company will consider offering

a sign-on award in compensation for the value foregone,

either as an award under an existing share incentive scheme

or a bespoke award under the Listing Rules exemption

available for this purpose. The face and/or expected values

of the award(s) offered will not materially exceed the value

ascribed to the award(s) foregone, and where practicable

would follow the same vesting timing and form (i.e. cash

or shares) save that the Committee may award the whole

of the value in shares, at its discretion. The application

of performance conditions would be considered and,

where appropriate, the awards could be made subject to

claw-back in certain circumstances. For material amounts

the Committee would, where practicable, consult with

key institutional shareholders ahead of committing to

make any such sign-on awards, and in any event a full

explanation of any amounts awarded, an explanation of

why it was necessary and a breakdown of the awards to

be made will be announced to the markets at the time

of granting. For the avoidance of doubt, should a new

director be internally promoted from the Company’s senior

management team they will not be expected to give up

or amend any element of remuneration granted to them

prior to becoming a director which is inconsistent with

the remuneration policy set out above.

Any new executive director’s remuneration package would

include similar elements, and be subject to the same

constraints, as those of the existing executive directors

as outlined in the above policy table.

Statement of consideration of

shareholder views

The Chairman of the Committee engages with

certain of the Company’s largest shareholders who

have expressed an interest in being consulted in

relation to remuneration matters to understand their

expectations and monitor any changes in their views.

Statement of consideration of employ-

ment conditions elsewhere in the group

The Committee considers pay levels across the

organisation when setting remuneration for all directors

(both executives and non-executives). However, this

review is undertaken against a background of ensuring

that the prevailing market rates for all levels of employee

in the organisation are taken into account in order to

attract, retain and motivate the best employees at each

level. In relation to directors, specific account is taken of

any change in the level of responsibility of the director

(whether through a change in role or the increased

size of the Company) or an increase in experience and

knowledge of the Company and its markets which may

not be relevant to roles elsewhere in the Company.

The Company does not deem it appropriate to formally

consult with employees regarding the determination of

the directors’ remuneration policy. However, employees

have the opportunity to make comments on any aspect

of the Company’s activities through an employee survey

and any comments made which are relevant to directors’

remuneration would be considered by the Committee.

Legacy arrangements

The Committee reserves the right to make remuneration

payments and payments for loss of office, to exercise any

discretion in relation to such payment, notwithstanding

that they are not in line with the Remuneration Policy

set out above where the terms of payment were agreed:

• Before this Policy came into effect (provided that the

terms of the payment were consistent with shareholder

approved Policy in force at the time they were agreed

or were agreed before the Company’s first shareholder

approved Policy came into force).

• At a time when the relevant individual was not a director

of the Company and, in the opinion of the Committee,

the payment was not in consideration of the individual

becoming a director of the Company.

For these purposes, ‘payments’ includes the satisfaction

of variable remuneration and, in relation to an award over

shares, the terms of the payment are ‘agreed’ no later

than the time the award is granted.

Telecom Plus Plc Report and Accounts 2022 /

Remuneration Policy

continued

Single total figure of remuneration

Year ended 31 March 2022 (audited)

Audited details of directors’ remuneration for the year are as follows:

Director Salary

& fees

£’000

Annual

bonus

£’000

Taxable

benefits

£’000

Pension

contributions

£’000

Tot al

£’000

Total

fixed

£’000

Total

variable

£’000

Charles Wigoder 475 - - - 475 475 -

Andrew Lindsay 589 614 7 4 1,214 600 614

Stuart Burnett

449 438 5 4 896 458 438

Nick Schoenfeld 589 276 6 4 875 599 276

Andrew Blowers 45 - - - 45 45 -

Beatrice Hollond 45 - - - 45 45 -

Melvin Lawson 12 - - - 12 12 -

Julian Schild 45 - - - 45 45 -

Suzi Williams 45 - - - 45 45 -

Tot al 2,294 1,328 18 12 3,652 2,324 1,328

1. One third of the bonus is deferred into shares in accordance with the rules of the DBP (see page 65)

2. As detailed on page 60, Stuart Burnett was appointed as Co-CEO in November 2021.

Year ended 31 March 2021 (audited)

Audited details of directors’ remuneration for the year are as follows:

Director Salary

& fees

£’000

Annual

bonus

£’000

Taxable

benefits

£’000

Pension

contributions

£’000

Tot al

£’000

Total

fixed

£’000

Total

variable

£’000

Charles Wigoder 471 - - - 471 471 -

Andrew Lindsay 583 548 6 4 1,141 593 548

Nick Schoenfeld 583 246 6 4 839 593 246

Stuart Burnett

288 355 5 3 651 296 355

Andrew Blowers 45 - 2 - 47 47 -

Beatrice Hollond 45 - - - 45 45 -

Melvin Lawson 12 - - - 12 12 -

Julian Schild 45 - - - 45 45 -

Suzi Williams

31 - - - 31 31 -

Tot al 2,103 1,149 19 11 3,282 2,133 1,149

1. Appointed to the Board on 23 July 2020.

2. One third of the bonus is deferred into shares in accordance with the rules of the DBP (see page 65)

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Annual Report on Remuneration

Salary and benefits (audited)

The Committee awarded increases to the annual base

salaries of the Executive Chairman, Chief Executive and

Chief Financial Officer with effect from 1 April 2021 as

follows:

• Charles Wigoder - increased from £470,644 to £475,350;

• Andrew Lindsay - increased from £582,980 to £588,810;

• Stuart Burnett – increased from £420,000 to £424,200

from 1 April 2021 and then to £500,000 from November

2021 following promotion to Co-CEO; and

• Nick Schoenfeld - increased from £582,980 to £588,810.

The underlying increases were set taking into account the

Company’s average cost of living increase for all employees

of 1.0%.

The amounts relating to taxable benefits received mainly

include the provision of private health insurance and motor

vehicles to the directors.

Annual bonus (audited)

The maximum bonus opportunities for each executive

director for the year ended 31 March 2022 were as follows:

Andrew Lindsay 150% of base salary

Stuart Burnett 140% of base salary

Nick Schoenfeld 67.5% of base salary

Stuart Burnett’s bonus entitlement for the current financial

year to 31 March 2022 has been calculated based on the

weighted average salary received of £449,467 (8 months

at £424,200 per annum plus 4 months at £500,000 per

annum) and a maximum bonus entitlement of 140% (being

the weighted average of 135% for 8 months and 150% for

4 months).

The maximum opportunity for Nick Schoenfeld was set

at 67.5% to reflect his salary positioning compared to

other FTSE 250 companies of a similar size and scale to

the Company.

Telecom Plus Plc Report and Accounts 2022 /

Annual Report on Remuneration

continued

The awards were granted subject to financial and

non-financial strategic objectives. 70% of the bonus was

based on adjusted PBT performance. The PBT targets

were set by reference to multiple factors, including

internal budgeting and broker forecasts. The threshold

and maximum targets are set out in the table below, with

vesting on a sliding scale between these targets:

Weighting

% of bonus

Threshold (20%

of maximum) Maximum Actual

Payable (% of

maximum)

FY22 Adjusted PBT 70% £50.0m £70.0m £62.9m 51.0%

The Company’s headline adjusted profit before tax of

£61.9m has been adjusted to £62.9m for the purposes

of determining the payable percentage. This reflects

the structure of the calculation of adjusted PBT for

the purposes of the bonus after adjusting for a certain

pre-agreed commercially sensitive item.

The remaining 30% of the bonus was subject to strategic

objectives and any pay-out under this element was subject

to achieving the threshold PBT target.

Strategic

objective Detail

Weighting

% of bonus Threshold Maximum Actual

Payable

(% of

maximum)

Service

number growth

Annual growth in core

services

10% 1% 12% 9.2% 8.5%

Partner

productivity

Monthly number

of active Partners

(average)

% Partners getting 6+

customers in 90 days

<4,472

<7.4%

>5,000

>10%

<4,472

<7.4%

0.0%

Strategic

development

of financial

services

Application to the

Gibraltar Financial

Services Commission

to set up an insurance

captive corporate

vehicle to have been

formally submitted by

31 March 2022

10% N/A Submitted

by 31 March

2022

Submitted

by 31 March

2022

10%

Tot al 18.5%

The executives therefore earned a bonus equal to 69.5%

of the maximum opportunity. The Committee carefully

considered the bonus outcome and determined it to

be appropriate taking into account underlying business

performance and the experience of shareholders and

employees during the year (as noted in the Annual

Statement on page 61).

One-third of the bonuses earned will be deferred into

shares for two years under the rules of the Deferred Share

Bonus Plan.

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Long term incentives (audited)

Vesting of long term incentive awards

No long term incentive awards were capable of vesting

during the year ended 31 March 2022.

Long term incentive awards granted during the year

(audited)

No long term incentive awards were granted during the

year ended 31 March 2022.

SAYE awards (audited)

During the year Charles Wigoder was granted an SAYE

award on 18 August 2021, of 1,737 options at an option

price of 1,036 pence per share. The awards are exercisable

on 1 November 2024.

On 23 November 2021, Charles Wigoder exercised his SAYE

award of 1,727 shares granted on 23 August 2018 at an

exercise price of 1,042 pence per share. The gain on the

day of exercise was £7,875 although Mr Wigoder retained

the shares acquired.

Payments to past directors (audited)

There were no payments to past directors during the year.

Payment for loss of office (audited)

There were no payments for loss of office made to

directors during the year.

Statement of Directors’ Shareholding

and Share Interests (audited)

The interests of the directors and their connected persons in the Company’s ordinary shares as at 31 March 2022 were

as set out below. There have been no changes to those interests between 31 March 2022 and the date of this report.

Beneficially

held

LTIP 2016

– growth

Deferred

Shares Bonus

Plan

SAYE Scheme Share options Shareholding

(as a % of

salary)

Charles Wigoder 7,421,486 - - 1,737 - 23,905%

Andrew Lindsay 359,149 15,000 17,383 - - 933%

Nick Schoenfeld 7,951 15,000 7,822 - - 21%

Stuart Burnett - 7,500 11,271 - 75,000 0%

Andrew Blowers - - - - - N/A

Beatrice Hollond 1,800 - - - - N/A

Melvin Lawson 1,436,744 - - - - N/A

Julian Schild 38,698 - - - - N/A

Suzi Williams - - - - - N/A

1. Based on a share price of 1,530p being the closing mid-market share price on 31 March 2022. The Committee has adopted a shareholding guideline

which requires the executive directors to build up and maintain a shareholding of at least 200% of salary. See page 67 for further details.

Telecom Plus Plc Report and Accounts 2022 /

Annual Report on Remuneration

continued

Share interests (audited)

Details of the share awards held by or granted to directors during the year are set out in the table below (further

details on the estimated cost of these awards are set out in note 21 to the financial statements):

1 April

2021

Granted Lapsed Exercised 31 March

2022

Exercise

price per

Exercisa-

ble from

Expiry

date

Charles Wigoder

SAYE Scheme

23 August 2018 1,727 - - (1,727) - 1042p 1 Nov 21 30 Apr 22

18 August 2021 - 1,737 - - - 1036p 1 Nov 24 30 Apr 25

Andrew Lindsay

LTIP 2016 – growth shares

4 April 2017 3,750 - - - 3,750 n/a 1 Aug 19 31 Aug 26

4 April 2017 3,750 - - - 3,750 n/a 1 Aug 21 31 Aug 26

4 April 2017 3,750 - - - 3,750 n/a 1 Aug 23 31 Aug 26

4 April 2017 3,750 - - - 3,750 n/a 1 Aug 26 31 Aug 26

Deferred Shares Bonus Plan

22 Jul 2021 - 17,383 - - 17,383 5p 22 Jul 23 22 Jul 31

Nick Schoenfeld

LTIP 2016 – growth shares

4 April 2017 3,750 - - - 3,750 n/a 1 Aug 19 31 Aug 26

4 April 2017 3,750 - - - 3,750 n/a 1 Aug 21 31 Aug 26

4 April 2017 3,750 - - - 3,750 n/a 1 Aug 23 31 Aug 26

4 April 2017 3,750 - - - 3,750 n/a 1 Aug 26 31 Aug 26

Deferred Shares Bonus Plan

22 Jul 2021 - 7,822 - - 7,822 5p 22 Jul 23 22 Jul 31

Stuart Burnett

LTIP 2016 – growth shares

4 April 2017 1,875 - - - 1,875 n/a 1 Aug 19 31 Aug 26

4 April 2017 1,875 - - - 1,875 n/a 1 Aug 21 31 Aug 26

4 April 2017 1,875 - - - 1,875 n/a 1 Aug 23 31 Aug 26

4 April 2017 1,875 - - - 1,875 n/a 1 Aug 26 31 Aug 26

Deferred Shares Bonus Plan

22 Jul 2021 - 11,271 - - 11,271 5p 22 Jul 23 22 Jul 31

Share options

22 July 2016 50,000 - - - 50,000 1047p 22 Jul 19 21 Jul 26

25 July 2019 8,334 - - - 8,334 1342p 25 Jul 22 24 Jul 29

25 July 2019 8,333 - - - 8,333 1342p 25 Jul 24 24 Jul 29

25 July 2019 8,333 - - - 8,333 1342p 25 Jul 26 24 Jul 29

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

LTIP 2016

Performance measures and targets for the LTIP 2016 Award are detailed in the 2019 Annual Report and Accounts on

page 69.

Performance Graph showing

Total Shareholder Return

The following graph shows the Company’s performance measured by total shareholder return compared with the

FTSE 350 Index for the period 1 April 2012 to 31 March 2022. The FTSE 350 Index has been chosen as the Company is

a comparator of this Index.

Table of historical data

The following table sets out the total remuneration and the amount vesting under the annual bonus and share incentive

schemes as a percentage of the maximum that could have been achieved, in respect of the Chief Executive. The Chief

Executive was Mr Andrew Lindsay in all years shown in the table.

Year ended 31 March 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

Single figure of total remuneration

£’000

399 432 2,175 2,017 523 555 581 594 1,141 1,214

Annual bonus (%) N/A N/A N/A N/A N/A N/A N/A N/A 62.6 69.5

Share incentives vesting (%) N/A N/A 100% N/A N/A N/A N/A N/A

N/A N/A

1. Although 3,750 growth shares under the LTIP 2016 vested to the Chief Executive during 2020 and a further 3,750 in 2021, the minimum share price

at which these are convertible into ordinary shares in the Company is £20 and this was not achieved during the period.

300

250

400

350

200

150

100

2022

Telecom Plus Plc

FTSE350

Source: Thompson Reuters Datastream

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Telecom Plus Plc Report and Accounts 2022 /

Annual Report on Remuneration

continued

Annual Percentage Change in Remuneration of directors and employees

The table below sets out the percentage change in each director’s salary/fees, benefits and bonus between the years

ended 31 March 2020 and 31 March 2021, and 31 March 2021 and 31 March 2022 compared to the average employee

remuneration of the Company for each of these elements of pay, calculated on a full-time equivalent basis. The average

employee change has been calculated by reference to the mean of employee pay.

Year Salary & fees Benefits Bonus

Charles Wigoder 2021/2022

2020/2021

1.0%

2.0%

N/A

Andrew Lindsay 2021/2022

2020/2021

1.0%

3.1%

16.7%

(66.7)%

12.0%

N/A

Nick Schoenfeld 2021/2022

2020/2021

1.0%

3.1%

0.0%

12.2%

N/A

Stuart Burnett 2021/2022

2020/2021

19.0%

N/A

0.0%

N/A

23.4%

N/A

Andrew Blowers 2021/2022

2020/2021

1.0%

0.0%

N/A

0.0%

N/A

Beatrice Holland 2021/2022

2020/2021

1.0%

0.0%

N/A

Melvin Lawson 2021/2022

2020/2021

1.0%

0.0%

N/A

Julian Schild 2021/2022

2020/2021

1.0%

0.0%

N/A

Suzi Williams

2021/2022

2020/2021

1.0%

N/A

Average employee

2021/2022

2020/2021

(9.0)%

4.5%

(24.6)%

(0.1)%

41.2%

(1.5)%

1. Increases due to his promotion to Co-CEO in November 2021 and subsequent changes to his remuneration package as detailed on page 60.

2. For comparative purposes Suzi Williams’ remuneration for the year ended 31 March 2021 has been annualised.

The fall in average employee salary in 2021/2022 shown in

the table above is mainly due to the increase in the number

of entry-level employees taken on by the Company during

the year to manage the significant increase in customer

growth. Employees who were employed by the Company as

at 31 March 2021 received the same 1.0% annual increase

as the directors.

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Chief Executive pay ratio

The table below sets out the Chief Executive pay ratio, using

the Chief Executive’s single total remuneration as disclosed

on page 74 to the comparable full-time equivalent total

remuneration of the UK employees whose pay is ranked

at the 25th percentile, median and 75th percentile.

The Company used Option A to calculate the ratios as this

is the approach typically preferred by shareholders and

proxy voting agencies. The remuneration figures for the

employee at each quartile were calculated as at that the

last day of the relevant financial year. Sensitivity analysis

has been performed to ensure that the median and quartile

employees are reasonably representative.

Year Method 25th

percentile

pay ratio

Median

pay

ratio

75th

percentile

pay ratio

2020 A 38:1 22:1 16:1

2021 A 59:1 41:1 33:1

2022 A 79:1 44:1 35:1

Pay details for the individuals in 2022 are set out below:

CEO 25th

percentile

(lower

quartile)

50th

percentile

(median)

75th

percentile

(upper

quartile)

Salary £589,000 £15,125 £26,916 £32,790

Total

remun-

eration

£1,214,000 £15,305 £27,752 £35,029

The significant increase in the 25

percentile pay ratio

shown in the table above is mainly due to the increase

in the number of entry-level employees taken on by

the Company during the year to manage the significant

increase in customer growth.

The result of the median pay ratio is in line with the

Company’s general policy to provide a competitive

remuneration package so as to enable the attraction and

retention of high calibre individuals at each level.

Relative importance of the spend on pay

Set out below is a summary of the Company’s levels of

expenditure on pay and other significant cash outflows to

key stakeholders. No share buybacks were made during

the years ended 31 March 2021 or 31 March 2022.

Year ended 31

March

2022

£’000

2021

£’000

Change

Wages and

salaries

75,294 69,860 7.8%

Dividends 44,787 44,708 0.2%

Statement of Implementation of

Remuneration Policy for the financial

year commencing 1 April 2022

Information on how the Company intends to implement

the Remuneration Policy for the financial year commencing

1 April 2022 is set out in the Annual Statement on page 61.

Advisers to the Committee

Wholly independent and objective advice on executive

remuneration is received from the Committee’s external

advisers.

Deloitte were appointed as Remuneration Committee

advisors in October 2020. Deloitte is one of the founding

members of the Remuneration Consultants Group and is

a signatory to its Code of Conduct.

Fees paid to Deloitte for their services to the Remuneration

Committee during the year, based on time and expenses,

amounted to £10,750 (excluding VAT) Deloitte also provided

advice to the Company during the year in relation to

taxation, climate-related financial disclosures and

employee share plan matters.

Telecom Plus Plc Report and Accounts 2022 /

Annual Report on Remuneration

continued

Shareholder vote and shareholder

engagement

Details of the votes cast in relation to the main

remuneration resolutions the 2021 AGM and 2020 General

Meeting are set out below:

2021 AGM %

To approve the 2021 Remuneration Report

Votes cast in favour &

Chairman discretion

42,309,735 76.50

Votes cast against 12,999,838 23.50

Tot al 55,309,573 100.00

Withheld 338,078

2020 GM %

To approve the Directors’ Remuneration Policy

Votes cast in favour &

Chairman discretion

51,620,500 95.56

Votes cast against 2,398,981 4.44

Tot al 54,019,481 100.00

Withheld 8,558

The Board of the Company notes that the level of votes

against the 2021 Directors’ Remuneration Report put to

the 2021 AGM exceeded 20%. The Company understands

that this has been driven mainly by concerns raised by

certain shareholders around Board diversity and historical

directors' remuneration policy issues.

The Board engaged with its shareholders and used the

feedback from this engagement to amend the Policy in

a way that achieved better alignment with shareholders.

The Board is committed to continuing its dialogue with

shareholders on remuneration matters. As disclosed

on page 60 the Committee intends to undergo a

comprehensive review of our long term incentive provision

for senior management and executive directors during

2022/23. The Committee will consult with shareholders

where appropriate on any new scheme and any new

scheme will be subject to shareholder approval at the

2023 AGM, alongside any new Remuneration Policy.

Andrew Blowers OBE

Chairman of the Remuneration Committee

On behalf of the Board

21 June 2022

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

The directors have pleasure in presenting their report

and the audited financial statements for the year to 31

March 2022.

Principal activities and business review

The Company’s principal activity is to act as a holding

company. The Company is incorporated and domiciled in

England and Wales. The list of its subsidiaries is set out on

page 118. A full review of the development of the business

is contained in the Strategic Report on pages 2 to 46. A

summary of the financial risk management objectives and

policies is contained in note 22 to the financial statements.

Environmental matters, including greenhouse house gas

emissions are set out in the Sustainability Report on pages

31 to 42.

This Directors’ Report, together with the information in

the Strategic Report forms the management report for

the purposes of DTR 4.1.8R.

Results and dividends

The profit for the year after tax of £35,003,000 (2021:

£32,559,000) has been transferred to reserves. An interim

dividend of 27p per share (2021: 27p) was paid during

the year. A final dividend of 30p per share (2021: 30p per

share) is proposed. The adjusted profit before tax for the

year ended 31 March 2022 was £61.9 million (see Financial

Review page 17).

Directors

The names of directors who served during the year and

their interests, including those of their connected persons,

in the share capital of the Company at the start and end

of the year are set out in the table below. Details of the

directors’ share incentive awards are disclosed in the

Directors’ Remuneration Report on page 78.

Director Ordinary 5p shares held at

31 March 2022 31 March 2021

Charles Wigoder 11,014,169 13,512,442

Julian Schild

38,698 189,932

Andrew Lindsay 359,149 359,149

Nick Schoenfeld 7,951 7,951

Stuart Burnett - -

Andrew Blowers

- -

Beatrice Hollond

1,800 1,800

Melvin Lawson

1,436,744 1,436,744

Suzi Williams

- -

indicates non-executive directors

In respect of the above shareholdings, Mr Wigoder has

a non-beneficial interest in 3,592,683 shares (2021:

4,092,683).

The powers of directors are set out in the Company’s

Articles of Association (the “Articles”). The Articles may be

amended by way of a special resolution of the members of

the Company. The Board may exercise all powers conferred

on it by the Articles and in accordance with the Companies

Act 2006, and other applicable legislation.

The Board has established a formal, rigorous and

transparent process for the selection and subsequent

appointment of new directors to the Board. The rules

relating to the appointment and replacement of directors

are contained within the Articles. The Articles provide that

Directors may be appointed by an ordinary resolution of

the members or by a resolution of the Directors, provided

that, in the latter instance, a director appointed in that

way retires at the first Annual General Meeting following

their appointment. In addition, shareholders with in excess

of 20% of the shares in the Company are entitled under

the Articles to appoint a director and remove any such

director appointed.

In accordance with current best practice, all Board

directors will be retiring at the forthcoming AGM and will

then offer themselves for re-election.

Telecom Plus Plc Report and Accounts 2022 /

Directors’ Report

Directors’ conflicts of interest

The Directors have a statutory duty to avoid situations

where they have, or could have, a direct or indirect interest

that conflicts, or possibly may conflict, with the Company’s

interests. The Companies Act 2006 and the Company’s

Articles allow the Board to authorise such conflicts of

interest should this be deemed to be appropriate.

The Board has put in place effective procedures for

managing and, where appropriate, approving conflicts or

potential conflicts of interest. Under these procedures,

the Directors are required to declare all directorships or

other appointments to companies which are not part of

the Group, as well as other situations which could give rise

to a potential conflict. The Board will, where appropriate,

authorise a conflict or potential conflict, and will impose

all necessary restrictions and/or conditions where it sees

fit. The Company maintains a register of directors’ interests

which is reviewed regularly by the Board.

Political donations

The Company did not contribute in cash or in kind to any

political party, whether by gift or loan. It will, however,

ensure that the Group continues to act within the

provisions of the Companies Act 2006 requiring companies

to obtain shareholder authority before they make donations

to political parties and/or political organisations as defined

in the Companies Act 2006.

Directors’ and Officers’ liability

insurance

The Company maintains appropriate insurance to cover

directors’ and officers’ liability and has provided an

indemnity, as permitted by the Companies Act 2006, in

respect of all of the Company’s directors which was in

force throughout the financial year and remains in force.

Neither the insurance nor the indemnity provides cover

where a director has acted fraudulently or dishonestly.

Employees

The requirements of the Companies Act 2006 in respect

of employees are set out in the Strategic Report on pages

27 to 30.

Stakeholder engagement

More information on stakeholder engagement, including

our relationships with our Partners, suppliers, customers

and our community can be found in the Strategic Report

on pages 41 to 42.

Substantial shareholders

As at 21 June 2022, in addition to the directors, the

following have notified the Company of their substantial

shareholdings as detailed below:

Shareholder Number of

Percentage of

issued share

capital

Abdrn PLC 10,339,634 13.0%

Schroders

Investment

Management PLC

3,173,693 4.0%

Primestone

Capital

2,708,539 3.4%

JP Morgan Asset

Management

2,466,268 3.1%

Capital structure

Restrictions on the transfer of shares

The Company only has ordinary shares in issue. Other than

as set out below, there are no restrictions on the transfer

of the ordinary shares, except where a holder refuses to

comply with a statutory notice requesting details of those

who have an interest and the extent of their interest in

a particular holding of shares. In such cases, where the

identified shares make up 0.25% or more of the ordinary

shares in issue, the directors may refuse to register a

transfer of any of the identified shares in certificated form

and, so far as permitted by the Uncertificated Securities

Regulations 2001, a transfer of any of the identified shares

which are held in the electronic share dealing system

CREST, unless the directors are satisfied that they have

been sold outright to an independent third party.

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

Other than as set out below and so far as the directors are

aware, there were no arrangements at 31 March 2022 by

which, with the Company’s co-operation, financial rights

carried by securities are held by a person other than a

holder of securities, or any arrangements between holders

of securities that are known to the Company and which

may result in restrictions on the transfer of securities or

on voting rights.

Executive Chairman Charles Wigoder entered into an

agreement to charge 325,000 of his shares in the Company

as security for a loan from Barclays Bank Plc (“Barclays”)

on 3 December 2013. The loan enabled him to apply for

57,142 ordinary shares as part of his open offer entitlement

which resulted from funding the Company’s entering into

of the new energy supply arrangements with npower on

20 December 2013. Under the terms of the charge, title to

the 325,000 shares can be transferred, sold or otherwise

dealt with by Barclays following the occurrence of a failure

to pay any amount due and payable under the loan.

On 22 March 2018 Charles Wigoder notified the Company

that he had entered into an agreement to charge 1,404,000

of his shares in the Company as security for a loan from

the Julius Baer Group (“Julius Baer”). Under the terms of

the charge, title to the 1,404,000 shares can be transferred,

sold or otherwise dealt with by Julius Baer following an

event of default under the security agreement.

On 23 March 2018 Charles Wigoder notified the Company

that he had deposited a further 350,000 of his shares

in the Company into a collateral account at Barclays as

partial security for an increase to his existing loan facility.

Under the terms of his agreement with Barclays, title to

the 350,000 shares can be transferred, sold or otherwise

dealt with by them following an event of default under

the security agreement.

The Company established a Joint Share Ownership Plan

(“the JSOP”) on 30 March 2011. As part of the JSOP an

employee benefit trust was established to jointly hold

shares with the participants in the plan (“the JSOP Share

Trust”). As at 31 March 2022 the JSOP Share Trust held

252,638 shares. All voting and dividend rights attached to

these shares have been waived.

Takeovers

There are no significant arrangements to which the

Company is party that take effect, alter or terminate upon a

change of control of the Company following a takeover bid,

save in relation to the arrangements with E.ON (formerly

npower) and EE/BT for the supply of energy and mobile

telephony respectively, or any agreements between the

Company and its directors or employees providing for

compensation for loss of office or employment (whether

through resignation, purported redundancy or otherwise)

that occurs because of a takeover bid.

Authority for purchase of own shares

At the last AGM held on 22 July 2021, the Company

obtained authority to purchase up to 7,877,831 ordinary

shares representing approximately 10% of the issued

ordinary share capital (excluding treasury shares) as at

18 June 2021. The Company intends to renew this authority

at this year’s AGM.

Treasury shares

The Company held 482,276 ordinary shares in treasury as

at 31 March 2022 (2021: 482,276).

Disclosure of information

Each of the directors has confirmed that so far as they are

aware, there is no relevant audit information of which the

Company’s auditor is unaware, and that they have taken

all the steps that they ought to have taken as a director

in order to make themselves aware of any relevant audit

information and to establish that the Company’s auditor

is aware of that information.

Corporate governance

The Company’s position in relation to compliance with

the requirements of the UK Corporate Governance Code

issued by the Financial Reporting Council is set out mainly

in the Corporate Governance Statement on pages 51 to 54.

Telecom Plus Plc Report and Accounts 2022 /

Directors’ Report

continued

Risk, control and viability

In accordance with the UK Corporate Governance Code,

the Directors have assessed the viability of the Group

over a three year period, taking into account the Group’s

current position and the potential impact of the principal

risks and uncertainties set out on pages 20 to 26. Based

on this assessment, the Directors confirm that they have

a reasonable expectation that the Company will be able

to continue in operation and meet its liabilities as they

fall due over the period to March 2025.

The directors have determined that a three-year period

to 31 March 2025 constitutes an appropriate period over

which to provide its viability statement. This is the period

focussed on by the Board during the strategic planning

process.

Whilst the directors have no reason to believe the Group

will not be viable over a longer period, given the inherent

uncertainty involved we believe this presents users of the

Annual Report with a reasonable degree of confidence

while still providing a longer-term perspective.

In making this statement, the Board carried out a robust

assessment of the principal risks facing the Group,

including those that would threaten its business model,

future performance, solvency or liquidity.

The Board considers at least annually, a three-year

strategic plan. The output of this plan is used to perform

central debt and headroom profile analysis, which

includes a review of sensitivity to ‘business as usual’

risks, such as bad debt in severe but plausible events.

The Board also considers the ability of the Group to raise

finance and deploy capital. The results take account of

the availability and likely effectiveness of the mitigating

actions that could be taken to avoid or reduce the impact

or occurrence of the underlying risks.

Under the revised energy supply arrangements which

were effective from 1 December 2013, EON continues to

be responsible for funding the principal working capital

requirements relating to the supply of energy to the

Company’s customers. This includes funding the Budget

Plans of customers who pay for their energy in equal

monthly instalments.

The Group has from Barclays Bank PLC, Lloyds Bank PLC

and Bank of Ireland total revolving credit facilities of

£175.0 million for the period to 30 June 2024, of which

only £100 million was drawn down as at 31 March 2022,

with cash balances of £29.6m on deposit. In light of the

track record of the Company and its continued prospects,

successful refinancing beyond 2024 is anticipated by

the directors.

The Company has considerable financial resources

together with a large and diverse retail and small business

customer base and long term contracts with a number of

key suppliers. As a consequence, the directors believe that

the Company is well placed to manage its business risks.

Whilst this review does not consider all of the risks

that the Group may face, the directors consider that

this stress-testing based assessment of the Group’s

prospects is reasonable in the circumstances of the

inherent uncertainty involved.

For and on behalf of the Board

David Baxter

Company Secretary

21 June 2022

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc Report and Accounts 2022 /

The directors are responsible for preparing the Report

and Accounts and the Group and parent Company

financial statements in accordance with applicable law

and regulations.

Company law requires the directors to prepare Group

and parent Company financial statements for each

financial year. Under that law they are required to

prepare the Group financial statements in accordance

with UK-adopted international accounting standards and

applicable law and have elected to prepare the parent

Company financial statements on the same basis.

Under company law the directors must not approve the

financial statements unless they are satisfied that they

give a true and fair view of the state of affairs of the

Group and parent Company and of the Group’s profit or

loss for that period. In preparing each of the Group and

parent Company financial statements, the directors are

required to:

• select suitable accounting policies and then apply

them consistently;

• make judgements and estimates that are reasonable,

relevant, reliable and prudent;

• whether they have been prepared in accordance with

international accounting standards in conformity with

the requirements of the Companies Act 2006 and, as

regards the Group financial statements, UK-adopted

international accounting standards;

• assess the Group and parent Company’s ability to

continue as a going concern, disclosing, as applicable,

matters related to going concern; and

• use the going concern basis of accounting unless they

either intend to liquidate the Group or the parent

Company or to cease operations, or have no realistic

alternative but to do so.

The directors are responsible for keeping adequate

accounting records that are sufficient to show and explain

the parent Company’s transactions and disclose with

reasonable accuracy at any time the financial position of the

parent Company and enable them to ensure that its financial

statements comply with the Companies Act 2006. They are

responsible for such internal control as they determine is

necessary to enable the preparation of financial statements

that are free from material misstatement, whether due to

fraud or error, and have general responsibility for taking

such steps as are reasonably open to them to safeguard

the assets of the Group and to prevent and detect fraud

and other irregularities.

Under applicable law and regulations, the directors are

also responsible for preparing a Strategic Report, Directors’

Report, Directors’ Remuneration Report and Corporate

Governance Statement that complies with that law and

those regulations.

The directors are responsible for the maintenance and

integrity of the corporate and financial information included

on the company’s website. Legislation in the UK governing

the preparation and dissemination of financial statements

may differ from legislation in other jurisdictions.

In accordance with Disclosure Guidance and Transparency

Rule 4.1.14R, the financial statements will form part of the

annual financial report prepared using the single electronic

reporting format under the TD ESEF Regulation. The auditor’s

report on these financial statements provides no assurance

over the ESEF format.

Responsibility statement of the

directors in respect of the annual

financial report

We confirm that to the best of our knowledge:

• the financial statements, prepared in accordance with

the applicable set of accounting standards, give a true

and fair view of the assets, liabilities, financial position

and profit or loss of the company and the undertakings

included in the consolidation taken as a whole; and

• the strategic report includes a fair review of the

development and performance of the business and

the position of the issuer and the undertakings included

in the consolidation taken as a whole, together with

a description of the principal risks and uncertainties

that they face.

We consider the annual report and accounts, taken as a

whole, is fair, balanced and understandable and provides

the information necessary for shareholders to assess

the Group’s position and performance, business model

and strategy.

Charles Wigoder

Executive Chairman

21 June 2022

Nick Schoenfeld

Chief Financial Officer

21 June 2022

Telecom Plus Plc Report and Accounts 2022 /

Statement of Directors’ Responsibilities in Respect of

the Report and Accounts and the Financial Statements

1. Our opinion is unmodified

We have audited the financial statements of Telecom

Plus PLC (“the Company”) for the year ended 31 March

2022 which comprise the Consolidated Statement of

Comprehensive Income, Consolidated Balance Sheet,

Company Balance Sheet, Consolidated and Company

Cashflow Statements and Consolidated Statement of

Changes in Equity, Company Statement of Changes in

Equity and the related notes, including the accounting

policies in note 1.

In our opinion:

• the financial statements give a true and fair view of the

state of the Group’s and of the parent Company’s affairs

as at 31 March 2022 and of the Group’s profit for the

year then ended;

• the Group financial statements have been properly

prepared in accordance with UK - adopted international

accounting standards;

• the parent Company financial statements have been

properly prepared in accordance with UK – adopted

international accounting standards and as applied in

accordance with the provisions of the Companies Act

2006; and

• the financial statements have been prepared in

accordance with the requirements of the Companies

Act 2006.

Basis for Opinion

We conducted our audit in accordance with International

Standards on Auditing (UK) (“ISAs (UK)”) and applicable

law. Our responsibilities are described below. We believe

that the audit evidence we have obtained is a sufficient

and appropriate basis for our opinion. Our audit opinion is

consistent with our report to the audit committee.

We were first appointed as auditor by the directors on 15

February 2015. The period of total uninterrupted engagement

is for the eight financial years ended 31 March 2022. We

have fulfilled our ethical responsibilities under, and we

remain independent of the Group in accordance with, UK

ethical requirements including the FRC Ethical Standard

as applied to listed public interest entities. No non-audit

services prohibited by that standard were provided.

Overview

Materiality: group financial statements as a whole £2.36m (2021: £2.2m)

4.7% (2021: 5.0%) of profit before tax

Coverage 98% (2021: 100%) of group profit before tax

Key audit matters vs 2021

Recurring risks Expected Credit Losses on Trade

Receivables and Accrued Income

Non-Smart Meter Energy revenue

recognition

Recoverability of parent company’s

investment in subsidiaries (Parent)

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Independent Auditor’s Report

to the Members of Telecom Plus PLC

2. Key audit matters: our assessment

of risks of material misstatement

Key audit matters are those matters that, in our professional

judgment, were of most significance in the audit of the

financial statements and include the most significant

assessed risks of material misstatement (whether or

not due to fraud) identified by us, including those which

had the greatest effect on: the overall audit strategy;

the allocation of resources in the audit; and directing

the efforts of the engagement team. We summarise

below the key audit matters (unchanged from 2021), in

decreasing order of significance, in arriving at our audit

opinion above, together with our key audit procedures to

address those matters and, as required for public interest

entities, our results from those procedures. These matters

were addressed, and our results are based on procedures

undertaken, in the context of, and solely for the purpose

of, our audit of the financial statements as a whole, and

in forming our opinion thereon, and consequently are

incidental to that opinion, and we do not provide a separate

opinion on these matters.

The risk Our response

Expected Credit Losses on

Accrued Income and Trade

Receivables

Subjective Estimate Our procedures included:

(Loss allowance £25.0m; 2021:

£23.2m)

Refer to page 57

(Audit Committee Report),

page 108 (accounting policy)

and page 123 (financial

disclosures).

Significant estimation uncertainty

is associated with the expected

credit loss provision over trade

receivables and accrued income

at each reporting date. In the

current period this uncertainty is

heightened by the impact of the

ongoing cost of living crisis.

The allowance for expected credit

loss is recognised based on an

estimate of future cashflows. In

arriving at this estimate, the Group

considers whether the customer

is live or closed (live being an

ongoing customer; closed being

a former customer), the current

ageing profile of debt, historical

collections experience by payment

plan, and an assessment of

current economic conditions.

The effect of these matters is that,

as part of our risk assessment,

we determined that the expected

credit losses for trade receivables

has a high degree of estimation

uncertainty, with a potential

range of reasonable outcomes

greater than our materiality for the

financial statements as a whole,

the financial statements disclose

the sensitivity estimated by the

Group.

• Test of Detail, Re-calculation: Validate the

segmentation of debt (principally by age, and

between live and closed accounts), by selecting a

sample of receivables and agreeing to supporting

documents. Assess whether the expected credit

loss was accurately and consistently calculated in

accordance with the Group’s methodology.

• Historical comparisons: Evaluate the

appropriateness of the Group’s estimate based on

historical cash collections and write off information

to the actual outcome.

• Sector experience: Evaluate the assessment of

how current and future economic scenarios are

incorporated into the expected credit loss, based

on our knowledge of the entity and experience of

the industry in which it operates.

• Assessing transparency: Considering whether

the disclosures properly reflect the expected

credit loss accounting policy and related

critical accounting estimates, judgements and

assumptions therein.

We performed the tests above rather than seeking

to rely on any of the Group’s controls because the

nature of the balance is such that we would expect

to obtain audit evidence primarily through the

detailed procedures described.

Our results

• We found the group’s assessment of the expected

credit losses on trade receivables and accrued

income to be acceptable (2021: acceptable).

Telecom Plus Plc Report and Accounts 2022 /

Independent Auditor’s Report

to the Members of Telecom Plus PLC continued

The risk Our response

Non-Smart Meter Energy

revenue recognition

Use of estimates Our procedures included:

(£94.7m; 2021: £110.1m)

Refer to page 57

(Audit Committee Report),

page 103 (accounting policy),

and page 110 (financial

disclosures).

A significant element of Revenue

recognised in relation to the supply

of gas and electricity includes

making an estimate of the volume

of energy supplied to customers

between the date of the last meter

reading and the year end for non-

smart meters.

The method of estimating usage

is reliant on historical data, and

is subject to volatility in weather

patterns. The risk of misstatement

is that the estimated non-smart

meter energy revenue does not

reflect the gas and electricity

actually delivered as at 31 March

2022. The quantum of the revenue

subject to an estimate is such that

even a relatively small percentage

error could result in a materially

misstated outcome.

The effect of these matters is that,

as part of our risk assessment,

we determined that non-smart

meter energy revenue has a high

degree of estimation uncertainty,

with a potential range of

reasonable outcomes greater than

our materiality for the financial

statements as a whole. The

financial statements disclose the

sensitivity estimated by the Group.

• Test of detail: Obtaining all meter readings

received within a period two days either side of

the year end and comparing against the estimated

usage derived from the billing system. A sample

of the actual meter readings were validated to

source documentation. The accuracy of non-smart

meter energy revenue for which no meter readings

were received at year end, was then assessed by

utilising the average difference between actual

and estimated meter readings, applied across the

non-smart meter population.

• Test of detail: Assessing the volume and nature

of customer complaints received in relation to

estimated meter readings in order to identify

whether any indicators exist of an underlying issue

with the Group’s estimation of energy usage; and

• Assessing transparency: Considering whether the

critical accounting estimates, judgements and

assumptions, and accounting policy disclosures

properly reflect the judgements and estimates

inherent in recognising non-smart meter revenue.

We performed the tests above rather than seeking

to rely on any of the group’s controls because the

nature of the balance is such that we would expect

to obtain audit evidence primarily through the

detailed procedures described.

Our results

• We found the resulting estimate of non-smart

meter energy revenue to be acceptable (2021

result: acceptable).

Recoverability of parent

Company’s investment in

subsidiaries

Low risk, high value Our procedures included:

(£262.0m; 2021: £262.0m)

Refer to page 108

(accounting policy),

and page 118 (financial

disclosures).

The carrying amount of the

parent company’s investment

in subsidiary represents 99%

(2021: 99%) of the company’s

total assets. Their recoverability

is not at a high risk of significant

misstatement or subject to

significant judgement. However,

due to their materiality in the

context of the parent company

financial statements, this is

considered to be the area that

had the greatest effect on our

overall parent company audit.

• Tests of detail: Comparing the carrying amount

of the investment value within the subsidiary’s

draft balance sheet to identify whether the net

assets, being an approximation of their minimum

recoverable amount, were in excess of their

carrying amount and assessing whether the

subsidiary has historically been profit-making.

• Assessing subsidiary audit: Assessing the work

performed by the Group audit team on that

subsidiary and considering the results of that

work on that subsidiary’s profits and net assets.

We performed the tests above rather than seeking

to rely on the Group’s controls because the nature

of the balance is such that we would expect to

obtain audit evidence primarily through the detailed

procedures described.

Our results

• We found the group’s assessment of the

recoverability of the investment in its subsidiary

to be acceptable. (2021 result: acceptable).

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

3. Our application of materiality and an

overview of the scope of our audit

Materiality for the group financial statements as a whole

was set at £2.36m (2021: £2.2m), determined with reference

to a benchmark of Group profit before tax of £49.8m (2021:

£43.5m) of which it represents 4.7% (2021: 5%).

Materiality for the parent company financial statements

as a whole was set at £2.0m (2021: £1.4m), determined

with reference to a benchmark of Company total assets,

of which it represents 0.8% (2021: 0.5%).

In line with our audit methodology, our procedures

on individual account balances and disclosures were

performed to a lower threshold, performance materiality,

so as to reduce to an acceptable level the risk that

individually immaterial misstatements in individual account

balances add up to a material amount across the financial

statements as a whole.

Performance materiality was set at 75% (2021: 75%) of

materiality for the financial statements as a whole, which

equates to £1.77m (2021: £1.65m) for the group and £1.5m

(2021: £1.05m) for the parent Company. We applied this

percentage in our determination of performance materiality

because we did not identify any factors indicating an

elevated level of risk.

We agreed to report to the Audit Committee any corrected

or uncorrected identified misstatements exceeding

£118,000 (2021: £110,000), in addition to other identified

misstatements that warranted reporting on qualitative

grounds.

Of the Group’s 9 (2021: 9) reporting components, we

subjected 4 (2021: 4) to full scope audits for group

purposes. All audits, including the audit of the parent

company, were conducted by the group team, with a

component materiality ranging from £0.93m to £2m (2021:

£0.77m to £1.4m).

The components within the scope of our work accounted

for the percentages illustrated opposite.

For these residual components, we performed analysis at an

aggregated group level to re-examine our assessment that

there were no significant risks of material misstatement

within these.

The scope of the audit work performed was predominantly

substantive as we placed limited reliance upon the Group’s

internal control over financial reporting.

£2.36m

Whole financial statements materiality (2021: £2.2m)

£1.77m

Whole financial statements performance

materiality (2021: £1.65m)

£2.0m

Range of materiality at 4 components

(£0.93m to £1.65m) (2021: £0.8m to £1.4m)

£0.1m

Misstatements reported to the audit committee

(2021: £0.1m)

Group Profit before tax

£49.8m (2021: £43.5m)

Group materiality

£2.36m (2021: £2.2m)

Profit before tax Group materiality

Group

revenue

Group profit

before tax

Group total

assets

98%

(2021: 98%)

98%

(2021: 100%)

98%

(2021: 96%)

9898

Full scope for group audit purposes 2021

Full scope for group audit purposes 2020

Residual components

100

Telecom Plus Plc Report and Accounts 2022 /

Independent Auditor’s Report

to the Members of Telecom Plus PLC continued

4. Going concern

The Directors have prepared the financial statements on

the going concern basis as they do not intend to liquidate

the Group or the Company or to cease their operations,

and as they have concluded that the Group’s and the

Company’s financial position means that this is realistic.

They have also concluded that there are no material

uncertainties that could have cast significant doubt over

their ability to continue as a going concern for at least a

year from the date of approval of the financial statements

(“the going concern period”).

We used our knowledge of the Group, its industry, and

the general economic environment to identify the inherent

risks to its business model and analysed how those

risks might affect the Group’s and Company’s financial

resources or ability to continue operations over the going

concern period. The risks that we considered most likely

to adversely affect the Group’s and Company’s available

financial resources over this period were:

• The ability of the customer base to pay for the services

they are using as a result of impacts from the “cost of

living crisis”.

We considered whether these risks could plausibly

affect the liquidity and covenant compliance in the

going concern period by comparing severe, but plausible

downside scenarios that could arise from these risks

individually and collectively against the level of available

financial resources and covenants indicated by the

Group’s financial forecasts.

We considered whether the going concern disclosure

in note 1 to the financial statements gives a full and

accurate description of the Directors’ assessment of

going concern.

Our conclusions based on this work:

• we consider that the directors’ use of the going concern

basis of accounting in the preparation of the financial

statements is appropriate;

• we have not identified, and concur with the directors’

assessment that there is not, a material uncertainty

related to events or conditions that, individually or

collectively, may cast significant doubt on the Group’s

or Company’s ability to continue as a going concern for

the going concern period;

• we have nothing material to add or draw attention to in

relation to the directors’ statement on page 102 to the

financial statements on the use of the going concern

basis of accounting with no material uncertainties that

may cast significant doubt over the Group and Company’s

use of that basis for the going concern period, and we

found the going concern disclosure in note 1 to be

acceptable; and

• the related statement under the Listing Rules set out

on page 86 is materially consistent with the financial

statements and our audit knowledge.

However, as we cannot predict all future events or

conditions and as subsequent events may result in

outcomes that are inconsistent with judgements that

were reasonable at the time they were made, the above

conclusions are not a guarantee that the Group or the

Company will continue in operation.

5. The impact of climate change on our

audit

We have considered the potential impacts of climate

change on the financial statements as part of the planning

and risk assessment of our audit, and we held discussions

with our climate change professionals to challenge our risk

assessment. The key factor relevant to this consideration

being that the principal activity of the company is as a

resell of utility services as opposed to power generation

within the energy sector. This limits any direct short term

impacts and therefore no specific areas of focus were

identified. We have read the disclosure of climate related

information in the front half of the annual report and

considered consistency with the financial statements and

our audit knowledge.

6. Fraud and breaches of laws and

regulations – ability to detect

Identifying and responding to risks of material

misstatement due to fraud

To identify risks of material misstatement due to fraud

(“fraud risks”) we assessed events or conditions that

could indicate an incentive or pressure to commit fraud

or provide an opportunity to commit fraud. Our risk

assessment procedures included:

• Enquiring of directors, the audit committee, and

inspection of policy documentation as to the Group’s

high-level policies and procedures to prevent and detect

fraud, including the Group’s channel for “whistleblowing”,

as well as whether they have knowledge of any actual,

suspected or alleged fraud.

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

• Reading Board and audit committee meeting minutes.

• Considering remuneration incentive schemes and

performance targets for management and directors.

• Using analytical procedures to identify any unusual or

unexpected relationships.

We communicated identified fraud risks throughout the

audit team and remained alert to any indications of fraud

throughout the audit.

As required by auditing standards, and taking into account

possible pressures to meet profit targets we perform

procedures to address the risk of management override

of controls, in particular the risk that Group management

may be in a position to make inappropriate accounting

entries and the risk of bias in accounting estimates such

as energy estimation and expected credit loss provisions.

On this audit we do not believe there is a fraud risk related

to revenue recognition because revenue constitutes a

high volume of individually small transactions with little

complexity or judgement, and estimates are based on

data obtained from third parties, with limited opportunity

for bias.

We identified a fraud risk related to expected credit losses

on trade receivables and accrued income because of

the significant estimates and judgements required and

potential pressures to meet profit targets. Further details

are set out in the key audit matter discussion disclosure

in section 2 of this report.

We also performed procedures including:

• Identifying journal entries to test for all full scope

components based on risk criteria and comparing the

identified entries to supporting documentation. These

included revenue and cash entries posted to unusual

accounts.

Identifying and responding to risks of material

misstatement related to compliance with laws

and regulations

We identified areas of laws and regulations that could

reasonably be expected to have a material effect on the

financial statements from our general commercial and

sector experience, through discussion with the directors

and other management (as required by auditing standards),

and from inspection of the Group’s regulatory and legal

correspondence and discussed with the directors and

other management the policies and procedures regarding

compliance with laws and regulations.

We communicated identified laws and regulations

throughout our team and remained alert to any indications

of non-compliance throughout the audit.

The potential effect of these laws and regulations on the

financial statements varies considerably.

Firstly, the Group is subject to laws and regulations

that directly affect the financial statements including

financial reporting legislation (including related companies

legislation), distributable profits legislation and taxation

legislation and we assessed the extent of compliance with

these laws and regulations as part of our procedures on

the related financial statement items.

Secondly, the Group is subject to many other laws and

regulations where the consequences of non-compliance

could have a material effect on amounts or disclosures

in the financial statements, for instance through the

imposition of fines or litigation. We identified the following

areas as those most likely to have such an effect:

compliance with its licence obligations set by Ofgem,

Ofcom, FCA and certain aspects of company legislation

recognising the regulated nature of the Group’s activities

and its legal form. Auditing standards limit the required

audit procedures to identify non-compliance with these

laws and regulations to enquiry of the directors and

other management and inspection of regulatory and legal

correspondence, if any. Therefore if a breach of operational

regulations is not disclosed to us or evident from relevant

correspondence, an audit will not detect that breach.

We discussed with the audit committee matters related

to actual or suspected breaches of laws or regulations,

for which disclosure is not necessary, and considered any

implications for our audit.

Context of the ability of the audit to detect

fraud or breaches of law or regulation

Owing to the inherent limitations of an audit, there is an

unavoidable risk that we may not have detected some

material misstatements in the financial statements, even

though we have properly planned and performed our audit

in accordance with auditing standards. For example, the

further removed non-compliance with laws and regulations

is from the events and transactions reflected in the

financial statements, the less likely the inherently limited

procedures required by auditing standards would identify it.

Telecom Plus Plc Report and Accounts 2022 /

Independent Auditor’s Report

to the Members of Telecom Plus PLC continued

In addition, as with any audit, there remained a higher risk

of non-detection of fraud, as these may involve collusion,

forgery, intentional omissions, misrepresentations, or the

override of internal controls. Our audit procedures are

designed to detect material misstatement. We are not

responsible for preventing non-compliance or fraud and

cannot be expected to detect non-compliance with all

laws and regulations.

7. We have nothing to report on the

other information in the Annual Report

The directors are responsible for the other information

presented in the Annual Report together with the financial

statements. Our opinion on the financial statements does

not cover the other information and, accordingly, we do

not express an audit opinion or, except as explicitly stated

below, any form of assurance conclusion thereon.

Our responsibility is to read the other information and,

in doing so, consider whether, based on our financial

statements audit work, the information therein is materially

misstated or inconsistent with the financial statements

or our audit knowledge. Based solely on that work we

have not identified material misstatements in the other

information.

Strategic report and directors’ report

Based solely on our work on the other information:

• we have not identified material misstatements in the

strategic report and the directors’ report;

• in our opinion the information given in those reports

for the financial year is consistent with the financial

statements; and

• in our opinion those reports have been prepared in

accordance with the Companies Act 2006.

Directors’ remuneration report

In our opinion the part of the Directors’ Remuneration

Report to be audited has been properly prepared in

accordance with the Companies Act 2006.

Disclosures of principal risks and uncertainties

and longer-term viability

We are required to perform procedures to identify whether

there is a material inconsistency between the directors’

disclosures in respect of emerging and principal risks and

the viability statement, and the financial statements and

our audit knowledge.

Based on those procedures, we have nothing material to

add or draw attention to in relation to:

• the directors’ confirmation within the Risk, Control and

Viability Statement, page 86 that they have carried out a

robust assessment of the principal risks and uncertainties

facing the Group, including those that would threaten

its business model, future performance, solvency and

liquidity;

• the Principal Risks and Uncertainties disclosures

describing these risks and how emerging risks are

identified, and explaining how they are being managed

and mitigated; and

• the directors’ explanation in the Risk, Control and Viability

Statement how they have assessed the prospects of

the Group, over what period they have done so and

why they considered that period to be appropriate, and

their statement as to whether they have a reasonable

expectation that the Group will be able to continue

in operation and meet its liabilities as they fall due

over the period of their assessment, including any

related disclosures drawing attention to any necessary

qualifications or assumptions.

We are also required to review the Risk, Control and

Viability Statement, set out on page 86 under the Listing

Rules. Based on the above procedures, we have concluded

that the above disclosures are materially consistent with

the financial statements and our audit knowledge.

Our work is limited to assessing these matters in the

context of only the knowledge acquired during our financial

statements audit. As we cannot predict all future events

or conditions and as subsequent events may result in

outcomes that are inconsistent with judgements that were

reasonable at the time they were made, the absence of

anything to report on these statements is not a guarantee

as to the Group’s and Company’s longer-term viability.

Corporate governance disclosures

We are required to perform procedures to identify whether

there is a material inconsistency between the directors’

corporate governance disclosures and the financial

statements and our audit knowledge.

Based on those procedures, we have concluded that each

of the following is materially consistent with the financial

statements and our audit knowledge:

• the directors’ statement that they consider that the

annual report and financial statements taken as a whole

is fair, balanced and understandable, and provides the

information necessary for shareholders to assess the

Group’s position and performance, business model and

strategy;

• the section of the annual report describing the work of

the Audit Committee, including the significant issues

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

that the audit committee considered in relation to

the financial statements, and how these issues were

addressed; and

• the section of the annual report that describes the review

of the effectiveness of the Group’s risk management and

internal control systems.

We are required to review the part of the Corporate

Governance Statement relating to the Group’s compliance

with the provisions of the UK Corporate Governance Code

specified by the Listing Rules for our review.

We have nothing to report in this respect.

8. We have nothing to report on the

other matters on which we are required

to report by exception

Under the Companies Act 2006, we are required to report

to you if, in our opinion:

• adequate accounting records have not been kept by the

parent Company, or returns adequate for our audit have

not been received from branches not visited by us; or

• the parent Company financial statements and the part

of the Directors’ Remuneration Report to be audited

are not in agreement with the accounting records and

returns; or

• certain disclosures of directors’ remuneration specified

by law are not made; or

• we have not received all the information and explanations

we require for our audit.

We have nothing to report in these respects.

9. Respective responsibilities

Directors’ responsibilities

As explained more fully in their statement set out on page

87, the directors are responsible for: the preparation of

the financial statements including being satisfied that

they give a true and fair view; such internal control as

they determine is necessary to enable the preparation

of financial statements that are free from material

misstatement, whether due to fraud or error; assessing

the Group and parent Company’s ability to continue as a

going concern, disclosing, as applicable, matters related

to going concern; and using the going concern basis of

accounting unless they either intend to liquidate the Group

or the parent Company or to cease operations, or have

no realistic alternative but to do so.

Auditor’s responsibilities

Our objectives are to obtain reasonable assurance about

whether the financial statements as a whole are free

from material misstatement, whether due to fraud or

error, and to issue our opinion in an auditor’s report.

Reasonable assurance is a high level of assurance, but

does not guarantee that an audit conducted in accordance

with ISAs (UK) will always detect a material misstatement

when it exists. Misstatements can arise from fraud or

error and are considered material if, individually or in

aggregate, they could reasonably be expected to influence

the economic decisions of users taken on the basis of the

financial statements.

A fuller description of our responsibilities is provided on the

FRC’s website at www.frc.org.uk/auditorsresponsibilities.

The Company is required to include these financial

statements in an annual financial report prepared using

the single electronic reporting format specified in the

TD ESEF Regulation. The auditor’s report provides no

assurance over whether the annual financial report has

been prepared in accordance with that format.

10. The purpose of our audit work and

to whom we owe our responsibilities

This report is made solely to the Company’s members,

as a body, in accordance with Chapter 3 of Part 16 of the

Companies Act 2006. Our audit work has been undertaken

so that we might state to the Company’s members

those matters we are required to state to them in an

auditor’s report and for no other purpose. To the fullest

extent permitted by law, we do not accept or assume

responsibility to anyone other than the Company and the

Company’s members, as a body, for our audit work, for

this report, or for the opinions we have formed.

Robert Seale (Senior Statutory Auditor)

for and on behalf of KPMG LLP, Statutory Auditor

Chartered Accountants

15 Canada Square

London E14 5GL

21 June 2022

Telecom Plus Plc Report and Accounts 2022 /

Independent Auditor’s Report

to the Members of Telecom Plus PLC continued

Note 2022

£’000

2021

£’000

Revenue 1 967 ,433 861,204

Cost of sales (778,958) (688, 104)

Gross profit 188,4 75 173, 100

Distribution expenses (29,686) (27 ,849)

Administrative expenses (84,423) (76,820)

Share incentive scheme charges (960) (1,3 77)

Amortisation of energy supply contract intangible (11,228) (11,228)

Total administrative expenses (96,6 11) (89 ,425)

Impairment loss on trade receivables 13 (11,566) (11,213)

Impairment of goodwill 8 (1,536) -

Other income 1 1,844 1, 175

Operating profit 2 50,920 45, 788

Financial income 136 84

Financial expenses 3 (2, 709) (2,358)

Net financial expense (2,573) (2,2 7 4)

Loss on disposal of subsidiary (1, 139) -

Profit before taxation 47 ,208 43,514

Taxation 5 (12,205) (10,955)

Profit for the period 35,003 32,559

Profit and other comprehensive income for the year attributable

to owners of the parent

35,467 32,577

Loss for the year attributable to non-controlling interest (464) (1 8)

Profit for the period 35,003 32,559

Basic earnings per share 19 45. 1p 41.5p

Diluted earnings per share 19 45.0p 41.4p

The accompanying notes form part of these financial statements.

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Consolidated Statement of Comprehensive Income

for the year ended 31 March 2022

Note 2022

£’000

2021*

£’000

Assets

Non-current assets

Property, plant and equipment 6 26, 180 34,865

Investment property 6 8,345 8,575

Intangible assets 7 152,4 18 160,626

Goodwill 8 3 ,7 4 2 5,32 4

Other non-current assets 12 32,855 28,595

Total non-current assets 223,540 237 ,985

Current assets

Inventories 4, 152 6,325

Trade and other receivables 13 50, 463 51,666

Current tax receivable - 726

Accrued income 13 134,917 120,395

Prepayments 4,07 7 4,809

Costs to obtain contracts

15, 151 15, 702

Cash 29,647 25, 056

Assets classified as held for sale 3,838 -

Total current assets 242,2 45 224, 679

Total assets 465, 785 462,664

Current liabilities

Trade and other payables 16 (38, 101) (3 0, 374)

Accrued expenses and deferred income 17 (113,493) (122,295)

Current tax payable (8) -

Liabilities classified as held for sale (7 ,551) -

Total current liabilities (159, 153) (152,669)

Non-current liabilities

Long term borrowings 15 (99,215) (89 ,3 76)

Lease liabilities 15 (766) (7 ,096)

Deferred tax 10 (1, 078) (1, 145)

Total non-current liabilities (101,059) (97 ,617)

Total assets less total liabilities 205,573 212,3 7 8

Equity attributable to equity holders of the parent

Share capital 18 3,982 3 , 970

Share premium 147 , 112 145,094

Capital redemption reserve 107 107

Treasury shares 18 (5,502) (5,502)

JSOP reserve (1, 150) (1, 150)

Retained earnings 61,935 70 ,306

206,484 212,825

Non-controlling interest (911) (44 7)

Total equity 205,573 212,3 7 8

*The presentation of the Consolidated Balance Sheet has been re-stated to reclassify the Costs to obtain contracts on the face of the statement,

previously these were included in Trade and other receivables and Prepayments (refer to the Presentation of financial statements section of the

Notes to the consolidated financial statements). The accompanying notes form part of these financial statements.

These accounts were approved and authorised for issue by the Board on 21 June 2022

Andrew Lindsay, Director

Nick Schoenfeld, Director

Telecom Plus Plc Report and Accounts 2022 /

Consolidated Balance Sheet

as at 31 March 2022

Note 2022

£’000

2021

£’000

Assets

Non-current assets

Investments in subsidiary undertakings 9 262,037 262,037

Other non-current assets 12 2,956 2,956

Total non-current assets 264,993 264,993

Current assets

Trade and other receivables 13 50 30

Prepayments and accrued income 207 203

Cash 678 297

Total current assets 935 530

Total assets 265,928 265,523

Current liabilities

Trade and other payables 16 (55,325) (61,227)

Accrued expenses and deferred income 17 (68) (64)

Total current liabilities (55,393) (61,291)

Non-current liabilities - -

Total assets less total liabilities 210,535 204,232

Equity

Share capital 18 3,976 3,962

Share premium 147,112 145,094

Capital redemption reserve 107 107

Treasury shares 18 (5,502) (5,502)

Retained earnings 64,842 60,571

Total equity 210,535 204,232

By virtue of section 408 of the Companies Act 2006 the Company is exempt from presenting a statement of comprehensive income. The Company

made a loss for the year of £942,000 before the receipt of distributions from subsidiary companies of £50,000,000 (2021: loss of £827,000 before

receipt of distributions from subsidiary companies of £50,000,000).

These accounts were approved and authorised for issue by the Board on 21 June 2022

Andrew Lindsay, Director

Nick Schoenfeld, Director

The accompanying notes form part of these financial statements.

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Company Balance Sheet

as at 31 March 2022

Group Company

2022

£’000

2021

£’000

2022

£’000

2021

£’000

Operating activities

Profit before taxation 47 ,208 43,514 49,058 49,173

Adjustments for:

Distributions from subsidiary companies

- - (50,000) (50,000)

Net financial expense 2,573 2,27 4 - -

Impairment of goodwill 1,536 - - -

Loss on disposal of subsidiary 1, 139 - - -

Depreciation of property, plant and equipment 4,558 4, 731 - -

Profit on disposal of fixed assets (940) (47) - -

Amortisation of intangible assets 15, 786 14,550 - -

Amortisation of debt arrangement fees 436 356 - -

Decrease/(increase) in inventories 2, 173 (1, 694) - -

Increase in trade and other receivables (including Costs to

obtain contracts)

(18, 750) (6, 713) (24) (140)

(Decrease)/increase in trade and other payables 6, 144 (4,04 6) 48 22

Decrease in inter-company payable - - (5,946) (6,144)

Share incentive scheme charges 960 1,3 77 - -

Corporation tax paid (11,528) (10,945) - -

Net cash flow from operating activities 51,295 43,357 (6,864) (7,089)

Investing activities

Purchase of property, plant and equipment (2, 196) (2,582) - -

Purchase of intangible assets (7 , 7 47) (7 ,457) - -

Disposal of property, plant and equipment 1,56 7 100 - -

Distributions from subsidiary companies - - 50,000 50,000

Interest received 136 98 - -

Cash flow from investing activities (8,2 40) (9,84 1) 50,000 50,000

Financing activities

Dividends paid (44 , 78 7) (44, 708) (44,787) (44,708)

Interest paid (2,630) (2,002) - -

Interest paid on lease liabilities (238) (24 6) - -

Drawdown of long term borrowing facilities 65,000 30, 000 - -

Repayment of long term borrowing facilities (55,000) (35, 000) - -

Fees associated with borrowing facilities (59 7) - - -

Repayment of lease liabilities (1,530) (1,321) - -

Issue of new ordinary shares 2,032 1,206 2,032 1,206

Cancellation of B shares in subsidiary (2) - - -

Cash flow from financing activities ( 3 7,7 5 2) (52,0 71) (42,755) (43,502)

(Decrease)/increase in cash and cash equivalents 5,303 (18,555) 381 (591)

Net cash and cash equivalents at the beginning of the year 25,056 43,611 297 888

Net cash and cash equivalents at the year end 30,359 25, 056 678 297

Cash and cash equivalents per balance sheet 29,647 25,056 678 297

Cash and cash equivalents included within assets

classified as held for sale

712 - - -

Net cash and cash equivalents at the year end 30,359 25, 056 678 297

The accompanying notes form part of these financial statements.

Telecom Plus Plc Report and Accounts 2022 /

Consolidated and Company Cash Flow Statements

for the year ended 31 March 2022

Consolidated Share

capital

£’000

premium

£’000

Capital

redemption

reserve

£’000

Treasury

£’000

JSOP

reserve

£’000

Retained

earnings

£’000

Non-

controlling

interest

£’000

Tot al

£’000

Balance at

1 April 2020

3,962 143,896 1 07 (5,502) (1, 150) 81,068 (429) 221,952

Profit and total

comprehensive

income

- - - - -

32,577 (1 8) 32,559

Dividends - - - - - (44, 708) - (44, 708)

Credit arising on

share options

- - - - - 1,377 - 1,3 77

Deferred tax on

share options

- - - - - (8) - (8)

Issue of new

ordinary shares

8 1, 198 - - - - - 1,206

Balance at

31 March 2021

3, 970 145, 094 1 07 (5,502) (1, 150) 70 ,306 (44 7) 212,3 78

Balance at

1 April 2021

3, 970 145, 094 1 07 (5,502) (1, 150) 70 ,306 (44 7) 212,3 78

Profit and total

comprehensive

income

- - - - - 35,467 (464) 35,003

Dividends - - - - - (44, 787) - (44, 787)

Credit arising on

share options

- - - - - 960 - 960

Deferred tax on

share options

- - - - - (11) - (11)

Issue of new

ordinary shares

14 2,018 - - - - - 2,032

Cancellation

of B shares in

subsidiary

(2) - - - - - - (2)

Balance at

31 March 2022

3,982 147 , 112 107 (5,502) (1, 150) 61,935 (911) 205,573

The accompanying notes form part of these financial statements.

100

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Consolidated Statement of Changes in Equity

for the year ended 31 March 2022

Company Share

capital

£’000

premium

£’000

Capital

redemption

reserve

£’000

Treasury

£’000

Retained

earnings

£’000

Tot al

£’000

Balance at 1 April 2020 3,954 143,896 107 (5,502) 56,106 198,561

Profit and total comprehensive income/(loss) - - - -

(827) (827)

Distributions from subsidiary companies - - - - 50,000 50,000

Dividends - - - - (44,708) (44,708)

Issue of new ordinary shares

8 1,198 - - - 1,206

Balance at 31 March 2021 3,962 145,094 107 (5,502) 60,571 204,232

Profit and total comprehensive income/(loss) - - - -

(942) (942)

Distributions from subsidiary companies - - - - 50,000 50,000

Dividends - - - - (44,787) (44,787)

Issue of new ordinary shares 14 2,018 - - - 2,032

Balance at 31 March 2022 3,976 147,112 107 (5,502) 64,842 210,535

The accompanying notes form part of these financial statements.

101

Telecom Plus Plc Report and Accounts 2022 /

Company Statement of Changes in Equity

for the year ended 31 March 2022

General information

Telecom Plus PLC (the ‘Company’) is a company domiciled in

the United Kingdom. The consolidated financial statements

of the Company for the year ended 31 March 2022 comprise

the Company and its subsidiaries (together referred to as

the ‘Group’) and the Group’s interest in associates.

The financial statements were authorised for issue by the

directors on 21 June 2022.

Presentation of financial statements

As a result of the relative size and historical volatility

of share incentive scheme charges it has been decided

to separately disclose the amounts on the face of the

Consolidated Statement of Comprehensive Income.

In view of the size and nature of the charge as a non-cash

item, the amortisation of energy supply contract intangible

asset has also been separately disclosed on the face of

the Consolidated Statement of Comprehensive Income

for the period. More information regarding the intangible

asset is set out in note 7 of these financial statements.

Prior year reclassification

In order to provide greater clarity, the presentation of the

Balance Sheet as at 31 March 2021 has been changed to

reclassify the costs to obtain contracts with customers.

Previously the elements comprising the costs to obtain

contracts with customers were included in Trade and other

receivables (£10,040,000) and Prepayments (£5,662,000),

which have now decreased by the corresponding amounts

to £51,666,000 and £4,809,000 respectively. There has

been no impact on the income statement or net assets

for the prior year or on the opening balances as at 1 April

2020. See note 14 to the financial statements.

Significant accounting policies

(a) Statement of compliance

These Group and parent company financial statements

were prepared in accordance with UK-adopted international

accounting standards in conformity with the requirements

of the Companies Act 2006.

(b) Basis of preparation

The Company’s business activities, together with the

factors likely to affect its future development, performance

and position are set out in the Strategic Report on pages 2

to 46. The financial position of the Company, its cash flows,

liquidity position and borrowing facilities are described in

the Financial Review on pages 17 to 19 and within notes

15 and 22 to the financial statements. In addition, notes

15 and 22 include the Company’s objectives, policies

and processes for managing its capital; its financial risk

management objectives; details of its financial instruments;

and its exposures to credit risk and liquidity risk.

Under the revised energy supply arrangements which were

effective from 1 December 2013, E.ON (formerly npower)

continues to be responsible for funding the principal

working capital requirements relating to the supply of

energy to the Company’s customers. This includes funding

the Budget Plans of customers who pay for their energy

in equal monthly instalments.

Going concern

Since September 2021, increases in wholesale costs have

resulted in suppliers across the energy retail market

collapsing. However, as a result of its wholesale supply

agreement with E.ON the Group is not directly exposed to

short-term fluctuations in the energy wholesale markets

with E.ON undertaking the required hedging.

The Group has total revolving credit facilities of £175.0

million with Barclays Bank PLC, Lloyds Bank PLC and Bank

of Ireland Group PLC for the period to 30 June 2024, of

which £100 million was drawn down as at 31 March 2022

(2021: £90m drawn down). Further detail regarding the

maturity and applicable covenants is disclosed in note 15.

The directors have prepared base and sensitised forecasts

for a period of at least 12 months from the date of

authorisation of these financial statements, including

the effect of severe, but plausible, downside scenarios

(including reductions in the collectability of customer

debts). Those forecasts indicate that the Group can

continue to operate within the terms of its existing bank

facilities. Furthermore, the directors have considered

the possibility of taking mitigating action, such as the

temporary reduction or cancellation of the annual dividend,

in the event of any extreme scenarios.

102

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Notes to the Consolidated Financial Statements

Consequently, the directors have a reasonable expectation

that the Group and Company will have sufficient funds to

continue to meet its liabilities as they fall due for at least

twelve months from the date of approval of the financial

statements and therefore have prepared the financial

statements on a going concern basis.

The accounting policies set out below have been con-

sistently applied to both years presented, unless otherwise

stated. The financial statements have been prepared on

a historical costs basis.

Critical accounting estimates, judgements

and assumptions

In the process of applying the Group’s accounting policies,

which are described below, the Directors have made

judgements, estimations and assumptions regarding the

future. The judgements, estimations, and assumptions

that have the most significant impact on the amounts

recognised in the financial statements are detailed below.

Estimates and judgements are evaluated based on historical

experience and other factors, including expectations of

future events that are believed to be reasonable under the

circumstances. In future, actual results may differ from

these estimates and assumptions.

Significant estimates

Estimates and underlying assumptions are reviewed on

an ongoing basis, with revisions recognised in the year in

which the estimates are revised and in any future years

affected. The areas involving significant risk resulting in

a material adjustment to the carrying amounts of assets

and liabilities within the next financial year are as follows:

(i) Revenue recognition

The Group recognises energy revenues on an individual

meter-by-meter basis. These revenues are recognised on

the basis of actual meter readings where these are available

at each month end, and estimation for each meter where

meter readings are not available. Each month customers

are sent a bill setting out the amount of energy that they

have used, based either on actual or estimated meter

readings. These amounts of individual customer billed

usage form the basis of the recognition of energy revenues.

The Group is among the leaders in the energy industry for

smart meter installations and has a very high penetration

of smart meters within its customer base of approximately

65% at the year end. Smart meters are able to remotely

feedback actual meter readings at period ends to suppliers.

Actual meter readings received from smart meters at each

period end are therefore used to recognise a large portion

of energy revenues.

In relation to the estimation of revenues from non-smart

meter customers, where meter readings have not been

communicated through a manual meter reading, the

Group estimates the amount of energy consumed by each

meter. These estimations are based on observed historical

seasonal meter-by-meter consumption patterns which are

adjusted for the actual impact on usage of weather (using

third-party information provided by the energy industry

and information from smart meters).

Whilst these estimation routines are currently considered

appropriate, a significant change in historical consumption

patterns and/or a failure to maintain the accuracy of the

estimation routines could materially impact the amount

of revenue recognised for non-smart meters. However, the

Group’s estimation routines are predominantly driven by

empirical meter-by-meter industry data and monitored

for accuracy on a monthly basis.

The amount of estimated energy revenue recognised from

non-smart meters in the year ended 31 March 2022 was

£94.7m (2021: £110.1m). The range of reasonable outcomes

for the estimated energy revenue is considered to be

significant, if the estimation routines used were impacted

by an indicative sensitivity of +/-1.0% accuracy overall, the

difference in energy revenues recognised in the period

would be +/-£0.9m (2021: £1.1m).

(ii) Recoverability of trade receivables

At each reporting date, the Group evaluates the estimated

recoverability of trade receivables and records allowances

for expected credit losses based on experience. Estimates

associated with these allowances are based on, among

other things, the historical collection experience of those

categories (principally whether the indebted customer

remains with the Group or not, and the age of the debt).

The Group also makes an assessment of the expected

future losses where appropriate. The actual level of trade

receivables collected may differ from the estimated levels

of recovery, which could impact operating results positively

or negatively.

At 31 March 2022, the allowance for expected credit losses

relating to customer invoicing was £25.0m. If the collection

experience was to improve/decline by an indicative

sensitivity of +/- 5% this would increase / decrease the

provision by +/- £1.5m accordingly.

103

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

Significant judgements

There are no key judgements made by management in

the process of applying the Group’s accounting policies.

(i) Subsidiaries

The Group’s financial statements consolidate the financial

statements of Telecom Plus PLC and its subsidiaries.

Subsidiaries are consolidated from the date on which

control transfers to the Group and are included until

the date on which the Group ceases to control them.

Control is recognised where an investor is expected to

receive, or has rights to, variable returns from its investment

in the investee and has the ability to affect these returns

through its power over the relevant activities of the investee.

Transactions between Group companies are eliminated on

consolidation.

(ii) Assets and liabilities classified as held for sale

A non-current asset or a group of assets containing a

non-current asset (a disposal group) is classified as held

for sale if its carrying amount will be recovered principally

through sale rather than through continuing use, it is

available for immediate sale and sale is highly probable

within one year.

On initial classification as held for sale, non-current assets

and disposal groups are measured at the lower of previous

carrying amount and fair value less costs to sell with any

adjustments taken to profit or loss. The same applies to

gains and losses on subsequent remeasurement although

gains are not recognised in excess of any cumulative

impairment loss. Any impairment loss on a disposal group

first is allocated to goodwill, and then to remaining assets

and liabilities on pro rata basis, except that no loss is

allocated to inventories, financial assets, deferred tax

assets, employee benefit assets and investment property,

which continue to be measured in accordance with the

Group’s accounting policies. Intangible assets and property,

plant and equipment once classified as held for sale or

distribution are not amortised or depreciated.

(iii) Employee benefit trusts

In accordance with IFRS 10 Consolidated Financial

Statements, the assets and liabilities of employee benefit

trusts are consolidated in the Group financial statements.

Employee benefit trusts are treated as a legal entity

separate from the Company but as subsidiaries of the

Company.

Any loans made by the Company to employee benefit

trusts are accounted for as loans in accordance with

the relevant terms. When the trust transfers shares to

employees to satisfy share incentive scheme awards,

this is considered to be, in substance, two transactions:

a distribution of the shares from the employee benefit

trust back to the Company as treasury shares, followed

by a distribution of those shares to the employees.

(d) Revenue

Overview

Revenue is the value of goods and services supplied to

external customers and Partners excluding value added

tax and other sales related taxes. For each of the Group’s

main income streams from the provision of fixed line

telephony, broadband, mobile telephony, gas and electricity

services, transactions are recorded as sales in the month

when the transfer of those services or the supply of goods

takes place. The Group’s customers are invoiced in the

month following that in which the services are provided.

Tariffs are set by customer, by service, and these can

vary depending on the number of services provided. Each

element of any package is considered independently for

the purposes of a performance obligation to determine

how the price is derived.

The Group also generates revenue as a result of providing

bill payment protection and accidental death cover to

customers for a monthly fee. The Group also offers home

insurance and boiler cover services to customers. The

Group does not retain the insurance risk for these services.

Revenue recognition - agent versus principal

Management assesses the revenue recognition of each

of the Group’s service offerings on either an agent or

principal basis. The identification of the principal in the

contract is not always clear, specifically whether the Group

controls the service prior to transfer to the customer. The

determination of whether the Group is a principal or an

agent for each service offering is evaluated by establishing

which entity is responsible for providing the specified

goods or services against a list of indicators that could

indicate an agency relationship. These include:

(i) Evaluating which entity is primarily responsible for

providing the specified goods or services.

(ii) Evaluating whether the Group has inventory risk.

(iii) Evaluating whether the Group has the discretion to

establish the pricing structure.

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The Group primarily acts as a reseller of utilities and in

supplying the majority of these services to customers

the Group is considered to be primarily responsible for

fulfilment of the service and has the discretion to establish

pricing and key terms. Revenue for these services is

therefore recognised as a principal.

For services where the Group offers home insurance, boiler

and home emergency cover, and bill protection, revenue

is recognised on an agency basis as the Group does not

retain any underwriting risk and acts as an agent to the

underlying insurer. During the period the Group recognised

£5.3m (2021: £5.9m) of revenue on an agency basis.

Revenue recognition – Energy services

The recognition of revenue associated with the provision

of gas and electricity services to customers on non-smart

meters by the Group relies on estimates of usage where

meter readings are not available. These estimations are

based on observed historical seasonal meter-by-meter

consumption patterns which are adjusted for the actual

impact on usage of weather (using third-party information

provided by the energy industry and information from

smart meters). Revenue is recognised over time during

the period in which the Group transfers control of the

services to the customer as the customer simultaneously

receives and consumes the benefits provided by the entity

performance. Any unbilled revenue is accrued at each

period end.

Revenue recognition – Telephony services

The Group principally generates revenue from providing

the following telecommunications services where it is

responsible to the customer for rendering the underlying

services: (i) fixed telephony line rental, call and broadband

data charges; (ii) mobile telephony call and data charges;

and (iii) mobile handset sales. Both the handset and service

are priced on the relative standalone selling prices of each

distinct performance obligation. The contract terms for

certain fibre broadband services are 18 months and for

mobile handsets 24 months. In relation to items (i) and (ii),

revenue is recognised over time during the period in which

the Group transfers control of the services to the customer

as the customer simultaneously receives and consumes

the benefits provided by the entity performance. Any

unbilled revenue is accrued at each period end. Revenue

for mobile handset sales are considered a separate

performance obligation recognised at the point in time

when the Group transfers control of the devices to the

end user.

In the provision of broadband services, the Group provides

customers with a broadband router at the start of their

contract. The terms and conditions under which broadband

routers are supplied to customers mean that routers are

accounted for as finance leases. The Group therefore

recognises the sale of the router at the retail price and

creates a finance lease asset on the balance sheet for

the routers shipped to customers at the point in time in

a given month. Over the average customer lifetime of 7

years, the Group accrues finance income on the asset at

the rate of interest that causes the present value of the

future lease payments to equal the sum of the fair value of

the asset. Part of the receipts under the service contract

are then allocated between reducing the net asset and

recognising finance income, resulting in the derecognition

of the asset at the end of the 7 year life.

Revenue recognition – Cashback card services

In relation to Cashback cards, the following revenue streams

are recognised by the Group at the time the services are

supplied and charged to customers: (i) a small fixed monthly

fee to cover provision of card management services; and

(ii) transaction fees to cover the facilitation of the top-up

of customer cards. The majority of the Cashback received

from the Cashback card programme manager is passed

to customers to reduce the payment they are required

to make to the Group for their monthly utilities. Revenue

is recognised over time during the period in which the

Group transfers control of the services to the customer as

the customer simultaneously receives and consumes the

benefits provided by the entity performance. Any unbilled

revenue is accrued at each period end.

In addition, the Group charges a small administrative fee

for facilitating the issue of each Cashback card. Under

IFRS 15, as the initial application fee is considered to be

a non-refundable upfront fee that does not relate to the

transfer of a promised good or services, the associated fee is

therefore recognised over the expected life of the customer.

Revenue recognition – Bill protection and life cover,

home insurance and boiler cover services

The Group charges customers a small monthly fee for

bill payment protection in the event of redundancy and

for a small amount of monthly life insurance cover. The

Group also offers home insurance services to customers.

In relation to the provision of bill protection and life cover,

home insurance and boiler cover the Group does not retain

any underwriting risk and therefore acts as an agent of

the underlying insurer. The Group therefore recognises

revenues on a commission income basis over time each

month as the services are supplied and billed.

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Notes to the Consolidated Financial Statements

continued

Revenue recognition – Other services

The Group also generates revenues from providing

customers with paper bills and from charging customers

late payment fees. In addition, the Group generates

revenues from providing services to its network of Partners.

Revenue is recognised over time during the period in

which the Group transfers control of the services to the

customer, or the late payment fees are incurred, and any

unbilled revenue is accrued at each period end.

In marketing the sale of bundled services, the Group

formerly offered most “Double Gold” and certain “Gold”

customers the provision and installation of LED light

bulbs throughout their homes (the ‘Daffodil’ scheme).

The provision of Daffodil light bulbs was distinct from the

provision of the other bundled goods and services. This

resulted in an allocation of revenue to the light bulbs,

which was being recognised at the point in time that

control of the light bulbs was passed to the customer – i.e.

at the point of installation by a Utility Warehouse fitter.

There was a corresponding reduction in revenues from

services over the remaining contractual term. The Group

ceased these activities during the current year.

The Group also recognises revenue from the installation

of central heating boilers. Revenue is recognised at the

point in time when the Group transfers control of the

boiler to the customer.

(e) Distributor commissions

The Group’s Partners earn commissions mainly on the

introduction of new customers to the Group (‘upfront

commissions’) and on the ongoing monthly use of the

Group’s services by the customers they have introduced

(‘trailing commissions’). Trailing commissions are recognised

in the Statement of Comprehensive Income as they are

earned by distributors on an accruals basis. Under IFRS

15, upfront commissions are capitalised and amortised

over the expected life of the customer.

In relation to certain multiservice customers, distributors

are able to bring forward the payment of a limited number

of future monthly trailing commission payments expected

to be due on the usage of customers they have introduced.

These advanced commission payments are held on the

Balance Sheet and are amortised on a straight-line basis

through the Statement of Comprehensive Income over the

period during which they are earned and would otherwise

have been paid had the payment not been brought forward.

(f) Financial income and expenses

Financial income comprises interest income and is

recognised in the Statement of Comprehensive Income as it

accrues, using the effective interest rate method. Financial

expenses comprise bank interest and non-utilisation fees

associates with the Company’s debt facilities.

(g) Leases

As a lessee

Recognition of a lease

The contracts are assessed by the Group to determine

whether a contract is, or contains, a lease. In general

contracts are deemed to contain a lease when the

following apply:

• Conveys the right to control the use of an identified

asset for a certain period in exchange for consideration;

• The Group has substantially all economic benefits from

the use of the asset; and

• The Group can direct the use of the identified asset.

This policy is applied to contracts entered into, or changed,

on or after 1 April 2019.

At commencement or on modification of a contract

that contains a lease component, the Group recognises

a right-of-use asset and a lease liability at the lease

commencement date.

As a lessor

Where the Group is a lessor, it determines at inception

whether the lease is a finance or an operating lease. When

a lease transfers substantially all the risks and rewards

of ownership of the underlying asset then the lease is a

finance lease; otherwise the lease is an operating lease.

Income from operating leases is recognised on a straight-

line basis over the lease term. Income from finance leases

is recognised at lease commencement with interest

income recognised over the lease term.

Right-of-use asset

The right-of-use asset is initially measured at cost,

which comprises the initial amount of the lease liability

adjusted for any lease payments made at or before the

commencement date, plus any initial direct costs incurred,

less any lease incentives received. The right-of-use asset is

subsequently depreciated using the straight-line method

from the commencement date to the end of the lease term,

unless the lease transfers ownership of the underlying asset

to the Group by the end of the lease term, or the cost of

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Strategic Report Governance Report Financial Statements Shareholder Information

the right-of-use asset reflects that the Group will exercise

a purchase option. In that case the right-of-use asset

will be depreciated over the useful life of the underlying

asset, which is determined on the same basis as those of

property and equipment. In addition, the right-of-use asset

is periodically reduced by impairment losses, if any, and

adjusted for certain remeasurements of the lease liability.

Lease Liability

The lease liability is initially measured at the present

value of the lease payments that are not paid at the

commencement date, discounted using the interest

rate implicit in the lease or, if that rate cannot be readily

determined, the Group’s incremental borrowing rate.

The Group includes right-of-use assets within property,

plant and equipment and the corresponding lease liabilities

in ‘lease liabilities’ on the balance sheet.

Short-term leases and leases of low-value assets

The Group has elected not to recognise right-of-use

assets and lease liabilities for lease of low-value assets

and short-term leases. The Group recognises the lease

payments associated with these leases as an expense on

a straight-line basis over the lease term.

(h) Hire purchase agreements

Hire purchase agreements relate to leases of assets where

the Group has passed on substantially all the risks and

rewards of ownership and are therefore classified as

finance leases. When assets are leased out under finance

leases, the present value of the minimum lease payments

is recognised as a receivable.

(i) Taxation

The tax charge for the year comprises current and

deferred tax. Taxation is recognised in the Statement of

Comprehensive Income except to the extent that it relates

to items recognised directly in equity, in which case it is

recognised in equity.

Current tax is the expected tax payable on the taxable

income for the year, using tax rates enacted or substantially

enacted at the balance sheet date, and any adjustment

to tax payable in respect of previous years.

Deferred tax is recognised, based on the balance sheet

liability method, on temporary differences between the

carrying amounts of assets and liabilities for financial

reporting purposes and the amounts used for taxation

purposes. The amount of deferred tax provided is based

on the expected manner of realisation or settlement of

the carrying amount of assets and liabilities, using tax

rates enacted or substantively enacted at the balance

sheet date.

A deferred tax asset is recognised only to the extent that

it is probable that future taxable profits will be available

against which the asset can be utilised. Deferred tax assets

are reduced to the extent that it is no longer probable

that the related tax benefit will be realised.

(j) Property, plant and equipment

Property, plant and equipment is stated at cost less a

provision for depreciation. Depreciation is calculated

so as to write off the cost less estimated residual value

of the assets in equal instalments over their expected

useful lives. No depreciation is provided on freehold

land. Depreciation is provided on other assets at the

following rates:

Freehold buildings 50 years

Freehold and leasehold improvements 3 to 25 years

Plant and machinery 15 years

Fixtures, fittings and office equipment

- Fixtures and fittings 7 to 10 years

- Computer and office equipment 3 to 5 years

Motor vehicles 3 to 4 years

The carrying amounts of property, plant and equipment

are reviewed for impairment when there is an indication

that they may be impaired.

(k) Investment properties

Investment properties are properties which are held either

to earn rental income or for capital appreciation or for both.

Investment properties are stated at cost less accumulated

depreciation. Rental income from investment properties

is accounted for on an accruals basis.

(l) Intangible assets

Intangible assets which arise (e.g. on the entering into

of significant commercial contractual arrangements) are

capitalised and amortised over the shorter of their useful

life and the term of any contractual arrangement.

IT, software and web development costs are capitalised

as intangible assets to the extent that certain projects

can be separately identified and involve the production

of new and/or enhanced systems that the Company will

use over the medium-term. It must also be considered

probable that the asset will generate future economic

benefits, and the development cost can be measured

reliably. Where these conditions are not met, development

expenditure is recognised as an expense in the year in

which it is incurred.

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Notes to the Consolidated Financial Statements

continued

Directly attributable costs that are capitalised include

employee and external costs specifically incurred in the

development of the intangible asset. These costs are

amortised on a straight-line basis over their estimated

useful economic lives of up to 10 years when each system

is brought into use by the Company.

(m) Goodwill

Goodwill arising on the acquisition of a business,

representing the difference between the fair value of

consideration and the fair value of the separable net assets

acquired is capitalised and is subject to impairment review,

both annually and when there are indications that the

carrying amount may not be recoverable.

(n) Impairment

The carrying amounts of the Group’s assets, other than

inventories, are reviewed at each balance sheet date to

determine whether there is any indication of impairment.

If any such indication exists, the asset’s recoverable

amount is estimated. The recoverable amount of assets

is the greater of their fair value less costs to sell and

value in use.

An impairment loss is recognised whenever the carrying

amount of an asset or its cash-generating unit exceeds

its recoverable amount. Impairment losses are recognised

in the Statement of Comprehensive Income.

An impairment loss is reversed if there has been a change

in the estimates used to determine the recoverable

amount. An impairment loss is reversed only to the extent

that the asset’s carrying amount does not exceed the

carrying amount that would have been determined, net of

depreciation, if no impairment loss had been recognised.

(o) Investments

In the Company’s accounts, investments in subsidiary

and associated undertakings are initially stated at cost.

Provision is made for any impairment in the value of

these investments. In the Group accounts investments

in associated undertakings are shown at cost plus

accumulated profits less any dividends received from

the associated undertakings.

(p) Inventories

Inventories principally include mobile telephones, LED

light bulbs and other electronic equipment and are valued

at the lower of cost and net realisable value. Cost is

measured on a first in, first out basis. Net realisable value

represents the estimated selling price less all costs to

be incurred in marketing, selling and distribution.

(q) Financial instruments

The Group classifies financial instruments, or their

component parts, on initial recognition as a financial asset,

a financial liability or an equity instrument in accordance

with the substance of the contractual arrangement.

Financial instruments are recognised on the trade date

when the Group becomes a party to the contractual

provisions of the instrument. Financial instruments are

recognised initially at fair value plus, in the case of a

financial instrument not at fair value through profit and

loss, transactions costs that are directly attributable to

the acquisition or issue of the financial instrument.

Financial instruments are derecognised on the trade date

when the Group is no longer a party to the contractual

provisions of the instrument.

(r) Trade receivables

Trade receivables are stated at their nominal value as

reduced by expected lifetime credit losses in accordance

with IFRS 9. Trade receivables are not considered to

contain a significant financing component and therefore

the simplified approach for Expected Credit Losses is

applied.

(s) Cash and cash equivalents

Cash and cash equivalents comprise cash in hand and

deposits with banks and, for the purposes of the Cash

Flow Statement, short term revolving credit facilities.

(t) Borrowings

Short and long term borrowings comprise revolving credit

facilities and bank loans. The fees associated with entering

into borrowing facilities are capitalised and netted off

against borrowings and amortised over the term of the

borrowings.

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(u) Trade payables

Trade payables are stated at their nominal value, as the

interest that would be recognised from discounting future

cash payments over the short payment period is not

considered to be material.

(v) Share based payments

The fair value at the date of grant of share-based

remuneration, principally share options, is calculated

using a binomial pricing model (LTIP 2016: Monte-Carlo

model) and is charged to the Statement of Comprehensive

Income on a straight-line basis over the vesting period of

the award. The charge to the Statement of Comprehensive

Income takes account of the estimated number of shares

that will vest. All share option-based remuneration is

equity settled.

(w) Segmental reporting

During the period, following a review of the financial

information regularly reviewed by the chief operating

decision makers, the executive directors of the Board,

it was decided to present the Group as one operating

segment. This reflects the fact that the chief operating

decision makers consider the performance of the Group

as a whole, particularly given the nature of the Group’s

bundled service offering.

(x) Provisions

Provisions are recognised when the Group has a present

obligation as a result of a past event, and it is probable

that the Group will be required to settle that obligation.

Provisions are measured at the directors’ best estimate

of the expenditure required to settle the obligation at the

balance sheet date, and are discounted to present value

where the effect is material.

(y) Pensions

The Group makes contributions to certain employees’

personal pension plans. These are charged to the

Statement of Comprehensive Income in the year in which

they become payable.

(z) Dividends

Final dividend distributions to the Company’s shareholders

are recognised as a liability in the Group’s financial

statements in the period in which the dividends are

approved by the Company’s shareholders. Interim dividends

are recognised when paid.

(aa) New standards issued but not yet effective

No new standards, interpretations and amendments not

yet effective are expected to have a material effect on

the Group’s future financial statements.

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Notes to the Consolidated Financial Statements

continued

1. Revenue and Alternative Performance Measures disclosure

Revenue by service

2022

£’000

2021

£’000

Electricity 450,544 391,813

Gas 295,696 248,008

Landline and broadband 129,703 132,241

Mobile 44,673 40,580

Other 46,817 48,562

967,433 861,204

The Group operates solely in the United Kingdom. Other income in the Consolidated Statement of Comprehensive

Income primarily relates to rental income from the Group’s former head office building (see note 11) and the profit on

disposal of a property during the current period.

Contract balances

The following table provides the information about contract assets and contract liabilities from contracts with customers.

Group

2022

£’000

2021

£’000

Contract assets, which are included in accrued income - -

Contract liabilities, which are included in deferred income 561 1,612

The Group has implemented an expected credit loss impairment model with respect to contract assets. This and any

significant changes in contract assets and liabilities are disclosed in note 13. There are no contract balances from

contracts with customers in the Company.

Alternative Performance Measures disclosure

In order to provide a clearer presentation of the underlying performance of the group, adjusted profit before tax and

adjusted basic EPS exclude share incentive scheme charges and the amortisation of the intangible asset arising from

entering into the energy supply arrangements with npower in December 2013; this decision reflects both the relative

size and non-cash nature of these charges. The loss for the period attributable to the non-controlling interest is

excluded as these losses are not attributable to shareholders of the Company. In FY22 adjusted profit before tax also

excludes: (i) the loss on the disposal of UWHS, (ii) the write-off of goodwill associated with the conditional disposal

of Glow Green; and (iii) the profit on disposal of a freehold property; this decision reflects the one-off non-operating

nature of these items.

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Strategic Report Governance Report Financial Statements Shareholder Information

Group

2022

£’000

2021

£’000

Statutory profit before tax 47,208 43,514

Adjusted for:

Loss for period attributable to non-controlling interest 464 18

Amortisation of energy supply contract intangible assets 11,228 11,228

Share incentive scheme charges 960 1,377

Loss on disposal of subsidiary – UWHS 1,139 -

Impairment of goodwill – Glow Green 1,536 -

Profit on sale of freehold property (603) -

Adjusted profit before tax 61,932 56,137

2. Operating profit

Operating profit is stated after charging/(crediting):

2022

£’000

2021

£’000

Depreciation and amortisation 20,344 19,281

Profit on disposal of fixed assets (940) (47)

Auditor’s remuneration - audit of Company and consolidated accounts 231 215

- audit of subsidiaries of the Company 83 77

- audit related assurance services 31 38

Inventories expensed 15,313 17,585

Trade receivables and accrued income impairment loss 11,566 11,213

Rental income (864) (1,045)

Total fees paid to the auditor KPMG LLP during the year were £345,000 (2021: £330,000), including non-audit services

of £31,000 (2021: £38,000).

3. Financial expenses

An analysis of financial expenses included in the Statement of Comprehensive Income is set out below:

2022

£’000

2021

£’000

Interest costs on bank loans and overdrafts 2,187 1,644

Interest costs on lease liabilities 238 246

Other financial expenses 284 468

Total financial expenses 2,709 2,358

Notes to the Consolidated Financial Statements

continued

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4. Personnel expenses

The total charge in the Statement of Comprehensive Income comprised the following:

2022

£’000

2021

£’000

Wages and salaries 75,294 69,860

Social security costs 7,649 6,694

Pension contributions 2,577 2,373

85,520 78,927

Share incentive scheme charges 960 1,377

86,480 80,304

Average number employed by the Group during the year (excluding directors):

2022 2021

Employees 1,987 2,058

5. Taxation

(i) Recognised in the Income Statement

2022

£’000

2021

£’000

Current tax charge

Current year 12,354 10,913

Adjustments in respect of prior years (104) 9

12,250 10,922

Deferred tax charge

Decelerated capital allowances 87 202

Other timing differences (480) 58

Effect of tax rate change on opening balance 376 17

Adjustment in respect of prior years (28) (244)

(45) 33

Total tax charge 12,205 10,955

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Strategic Report Governance Report Financial Statements Shareholder Information

(ii) Reconciliation of total tax charge

2022

£’000

2021

£’000

Profit before tax 47,208 43,514

Impairment of goodwill 1,536 -

Loss on disposal of subsidiary 1,139 -

Profit subject to corporation tax 49,883 43,514

Corporation tax using the UK corporation tax rate of 19% (2021: 19%) 9,478 8,268

Expenses not deductible for taxation purposes 2,680 2,944

Assets ineligible for capital allowances 264 -

Adjustment in respect of share options (394) (59)

Adjustments in respect of prior years - current tax (104) 9

- deferred tax (28) (244)

Remeasurement of deferred tax for changes in rates 285 -

Deferred tax not recognised 402 -

Other deferred tax adjustments (378) 37

Total tax charge 12,205 10,955

The UK corporation tax rate is currently 19%. Section 6 of

the Finance Act 2021 (FA 2021) increases the main rate of

corporation tax by six percentage points, from 19 per cent

to 25 per cent, with effect from the financial year beginning

1 April 2023. The Company’s future current tax charge will

therefore increase accordingly. The deferred tax balance

at 31 March 2022 has been calculated at 25%, (2021: 19%)

which reflects that the rate increase from 1 April 2023.

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Notes to the Consolidated Financial Statements

continued

6. Property, plant and equipment

Group

2022

Investment

property

£’000

Freehold

land &

buildings

£’000

Leasehold

land &

buildings

£’000

Freehold &

leasehold

improvements

£’000

Plant &

machinery

£’000

Fixtures,

fittings

& office

equipment

£’000

Motor

vehicles

£’000

Total

£’000

Cost

At 1 April 2021 13,862 27,383 3,817 1,420 1,205 16,925 7,522 72,134

Additions 61 190 - 31 28 1,716 170 2,196

Disposals - (426) - (498) - - (991) (1,915)

Disposals -

UWHS

- - (2,057) (679) (475) (244) (5,475) (8,930)

Transfer to

current assets

held for sale

- - (674) (8) (17) (219) (247) (1,165)

At 31 March 2022 13,923 27,1 47 1,086 266 741 18,178 979 62,320

Depreciation

At 1 April 2021 (5,287) (5,259) (869) (873) (566) (13,087) (2,753) (28,694)

Charge for the

year

(291) (862) (427) (82) (187) (1,665) (1,044) (4,558)

Disposals - 103 - 498 - 3 686 1,290

Disposals -

UWHS

- - 644 183 415 125 2,310 3,677

Transfer to

current assets

held for sale

- - 308 8 6 120 48 490

At 31 March 2022 (5,578) (6,018) (344) (266) (332) (14,504) (753) (27,795)

Net book amounts

At 31 March 2022 8,345 21,129 742 - 409 3,674 226 34,525

Motor vehicles include right of use assets held under

finance leases with a net book value as at 31 March 2022

of £Nil (2021: £4.0m). The balances in leasehold land &

buildings comprise right of use assets with a net book

value of £0.7m (2021: £2.9m). The Company no longer holds

any property, plant and equipment following the Group

reorganisation in April 2017. Disposals – UWHS relate to

the fixed assets of UW Home Services Limited which was

disposed by the Group on 31 March 2022.

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Strategic Report Governance Report Financial Statements Shareholder Information

Group

2021

Investment

property

£’000

Freehold

land &

buildings

£’000

Leasehold

land &

buildings

£’000

Freehold &

leasehold

improvements

£’000

Plant &

machinery

£’000

Fixtures,

fittings

& office

equipment

£’000

Motor

vehicles

£’000

Total

£’000

Cost

At 1 April 2020 13,425 27,383 3,817 1,361 1,168 15,102 8,582 70,838

Additions 437 - - 59 37 1,853 196 2,582

Disposals - - - - - (30) (1,256) (1,286)

At 31 March 2021 13,862 27,383 3,817 1,420 1,205 16,925 7,522 72,134

Depreciation

At 1 April 2020 (4,993) (4,404) (442) (794) (313) (11,449) (2,244) (24,639)

Charge for the

year

(294) (855) (427) (79) (253) (1,638) (1,185) (4,731)

Disposals - - - - - - 676 676

At 31 March 2021 (5,287) (5,259) (869) (873) (566) (13,087) (2,753) (28,694)

Net book amounts

At 31 March 2021 8,575 22,124 2,948 547 639 3,838 4,769 43,440

At 31 March 2020 8,432 22,979 3,375 567 855 3,653 6,338 46,199

The operations of the Company were transferred into new

head offices at Merit House in 2015 and the former head

office building, Southon House, was vacated. Southon

House is held as an investment property and separately

disclosed on the balance sheet of the Company.

An independent valuation of Southon House was conducted

on 4 June 2021 in accordance with RICS Valuation –

Professional Standards UK January 2014 (revised April

2015) guidelines. The independent market value of Southon

House was determined to be £11.9 million and has been

categorised as a Level 3 fair value based on the inputs to the

valuation technique used. The valuation was prepared on a

Market Value basis as defined in the Valuation Standards

and was primarily derived from using comparable market

transactions carried out on an arm’s length basis. These

inputs are deemed unobservable. The directors believe that

there have not been any material changes in circumstances

that would lead to a significant reduction in the market

valuation of Southon House from £11.9m.

115

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

7. Intangible assets

Group

2022

Energy Supply

Contract

£’000

IT Software &

Web Development

£’000

Tot al

£’000

Cost

At 1 April 2021 224,563 28,270 252,833

Additions - 7,747 7,747

Disposals - UWHS - (273) (273)

At 31 March 2022 224,563 35,744 260,307

Amortisation

At 1 April 2021 (82,339) (9,868) (92,207)

Charge for the period (11,228) (4,558) (15,786)

Disposals - UWHS - 104 104

At 31 March 2022 (93,567) (14,322) (107,889)

Net book amounts

At 31 March 2022 130,996 21,422 152,418

Group

2021

Energy Supply

Contract

£’000

IT Software &

Web Development

£’000

Tot al

£’000

Cost

At 1 April 2020 224,563 20,813 245,376

Additions - 7,457 7,457

At 31 March 2021 224,563 28,270 252,833

Amortisation

At 1 April 2020 (71,111) (6,546) (77,657)

Charge for the period (11,228) (3,322) (14,550)

At 31 March 2021 (82,339) (9,868) (92,207)

Net book amounts

At 31 March 2021 142,224 18,402 160,626

At 31 March 2020 153,452 14,267 167,719

The Energy Supply Contract intangible asset relates to

the entering into of the energy supply arrangements

with npower on improved commercial terms through

the acquisition by the Company of Electricity Plus Supply

Limited and Gas Plus Supply Limited (‘the Companies’)

from npower Limited having effect from 1 December 2013

(‘the Transaction’).

116

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Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

The total consideration for the Transaction comprised a

payment to npower of £196.5 million on 20 December 2013,

a deferred amount of £21.5 million paid in December 2016

and a payment of £2.5 million made in January 2014 for the

net assets acquired in the Companies which comprised

cash and short term working capital balances.

The addition to intangible assets of £221.6 million in 2014

therefore represented the total consideration paid and

payable to npower, excluding the payment for net assets

acquired in the Companies, plus certain transaction costs

of £3.6 million which in accordance with the relevant

accounting standards were recognised as a cost of

acquisition.

The intangible asset is being amortised evenly over the

20-year life of the new energy supply agreement reflecting

the period over which the Company will benefit from the

agreement.

The IT Software and Web Development intangible asset

relates to the capitalisation of certain costs associated

with the development of new IT and web systems.

Approximately £2.0 million (2021: £7.1m) of the additions

during the year relate to IT systems which remain under

construction.

Following the Group re-organisation there are no intangible

assets held by the Company.

8. Goodwill

Group

2022 £’000

Cost

At 1 April 2021 6,140

Disposals - UWHS (46)

At 31 March 2022 6,094

Impairment

At 1 April 2021 (816)

Impairment (1,536)

At 31 March 2022 (2,352)

Carrying amounts

At 31 March 2022 3,742

Group

2021 £’000

Cost

At 1 April 2020 and 31 March 2021 6,140

Impairment

At 1 April 2020 and 31 March 2021 (816)

Carrying amounts

At 31 March 2021 5,324

At 31 March 2020 5,324

Goodwill now relates to the Company’s subsidiary Tele-

communications Management Limited (‘TML’) cash

generating unit.

In the light of the transaction detailed in note 24, the

goodwill associated with Glow Green Limited and Cofield

Limited (‘Glow Green’) of £1.5m has been fully impaired

during the period. The Group’s interest in Glow Green

was sold, subject to the necessary FCA change of control

approval, for cash consideration of £1.

The disposal amount relates to goodwill previously held

in UW Home Services Limited which was disposed of by

the Group prior to the year end.

The Group regularly monitors the carrying amount of

its goodwill. A review was undertaken at 31 March 2022,

to assess whether the carrying amount of assets was

supported by their value in use determined by the net

present value of the future cash flows derived from the

assets using cash flow projections based on current levels

of profitability.

In relation to TML, a pre-tax discount rate of 12.1% into

perpetuity was used based on a premium to the Group

WACC of 8.4%. This was considered appropriate given

the relatively small size and maturity of the business,

offset by the growth opportunity in mobile telephony, and

the expectation that, for the foreseeable future, TML will

continue to operate as a going concern. A growth rate of

2.0% (2021: 2.0%) into perpetuity was also used. The result

of the review undertaken at 31 March 2022 indicated that

no impairment was necessary. No reasonably possible

change in the assumptions used in the impairment

calculation would give rise to an impairment of goodwill.

117

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

9. Investments

Investment in subsidiary companies

On 1 April 2017 the trading activities, the majority of the

assets and liabilities, and the employees of Telecom Plus

PLC, as well as all its subsidiaries, were transferred to Utility

Warehouse Limited a 100% subsidiary of Telecom Plus PLC

under a group reorganisation. The reorganisation was

designed to provide the Group with a more conventional

legal structure in line with other large publicly-listed

entities. The reorganisation has not had any impact on

the consolidated trading results of the Group.

The cost of investment in subsidiary undertakings on

the Company balance sheet of £262.0 million as at 31

March 2022 represents the transfer of the majority of the

assets, liabilities and subsidiaries of Telecom Plus PLC

to Utility Warehouse Limited in exchange for shares in

Utility Warehouse Limited under the group reorganisation

on 1 April 2017.

Following the group reorganisation the Company retained

its investment in the JSOP Share Trust. Included within

Company Trade and other receivables is a loan receivable

from the JSOP Share Trust of £2,275,000 (2021: £2,275,000),

which represents the maximum exposure to loss from its

interest in the JSOP Share Trust.

Utility Warehouse Limited owns 100% of the ordinary

share capital of Telecommunications Management Limited

(‘TML’), being two £1 shares. The principal activity of TML

is the supply of fixed wire and mobile telecommunication

services to business and public sector customers.

Utility Warehouse Limited also owns 100% of the ordinary

share capital of Utilities Plus Limited (‘Utilities Plus’), being

two £1 shares. Utilities Plus is an FCA Consumer Credit Act

licensed entity which provides loans and hire purchase

agreements to employees and Partners.

Utility Warehouse Limited also owns 100% of the ordinary

share capital of Electricity Plus Supply Limited (‘Electricity

Plus’) and Gas Plus Supply Limited (‘Gas Plus’), being

one £1 share in each company. The principal activity of

Electricity Plus and Gas Plus is to hold the licences for

the supply of energy services to residential and business

customers in the UK.

Utility Warehouse Limited owns 75% of the share capital

of Glow Green Limited, being 2,502 £0.001 shares, and

75% of the share capital of Cofield Limited, being 6,000

£0.001 shares. Glow Green Limited is a small supplier/

installer of domestic gas boilers and warranty/care plans.

Cofield Limited is a small online retailer of central heating

equipment to the plumbing industry.

As at 31 March 2022, Utility Warehouse Limited also

owned 100% of the ordinary share capital of eight dormant

non-trading subsidiaries as listed below:

Freetalk Limited Utility House Limited

Mobile Xtra Limited Value Group Limited

Savings Plus Limited Value Plus Limited

The Peoples

Champion Limited

Utility Debt

Collectors Limited

As at 31 March 2022, TML owned 100% of the ordinary

share capital of the following eight dormant non-trading

subsidiaries:

1p Mobile Limited Penny Telecom Limited

One Penny Mobile Limited 1p Broadband Limited

One Penny

Telecoms Limited

One Penny

Broadband Limited

Penny Mobile Limited Penny Broadband Limited

The registered office of each company referred to in this

note (other than Glow Green Limited and Cofield Limited)

is: Network HQ, 508 Edgware Road, London, NW9 5AB. The

registered office of Glow Green Limited is: 26-32 Oxford

Road, Avalon, Bournemouth, England, BH8 8EZ, and the

registered office of Cofield Limited is: Unit 5 20 Airfield

Way, Christchurch, England, BH23 3PE. All companies

referred to above are registered in England and Wales.

118

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Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

10. Deferred tax

The deferred tax liability recognised in the financial statements is as follows:

Group Company

2022

£’000

2021

£’000

2022

£’000

2021

£’000

Tax effect of temporary differences:

Accelerated capital allowances (2,222) (1,625) - -

Other short term temporary differences 35 104 - -

Transitional tax adjustments relating to IFRS 9 65 - - -

Employee benefits expected in excess of amount vested 1,051 404 - -

Transfers from acquisitions (37) (28) - -

Transfers to liabilities classified as held for sale 30 - - -

(1,078) (1,145) - -

Group Company

2022

£’000

2021

£’000

2022

£’000

2021

£’000

At 1 April (1,145) (1,104) - -

Transfers to liabilities classified as held for sale 30 - - -

Charged to the Statement of Comprehensive Income 45 (33) - -

Taken to equity (11) (8) - -

Other differences 3 - - -

At 31 March (1,078) (1,145) - -

119

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

11. Leases as lessor

Finance leases

In the provision of broadband services, the Group provides

customers with a broadband router at the start of their

contract. The terms and conditions under which broadband

routers are supplied to customers mean that routers are

accounted for as finance leases.

Interest income of £1.5m (2021: £0.9m) has been recog-

nised in profit or loss in respect of finance leases.

The following table sets out a maturity analysis of lease

receivables, showing the undiscounted lease payments

to be received after the reporting date:

2022

£’000

2021

£’000

Less than one year 3,962 3,066

Between one and two years 3,962 3,066

Between two and three years 3,962 3,066

Between three and four years 3,962 3,066

Between four and five years 3,149 2,922

More than five years 2,547 2,616

Total undiscounted lease receivable 21,544 17,802

Unearned finance lease income (6,201) (6,381)

Net investment in finance leases 15,343 11,421

Hire purchase agreements

The following table sets out a maturity analysis of

hire purchase agreements receivables, showing the

undiscounted payments to be received after the reporting

date:

2022

£’000

2021

£’000

Less than one year 1,356 1,132

Between one and two years 982 1,274

Between two and three years 766 906

Between three and four years

548 714

Between four and five years 522 391

More than five years 171 249

Total undiscounted hire purchase agreement receivable 4,345 4,666

Operating leases

The operations of the Company were transferred into newly

refurbished head offices at Merit House in 2015 and the

former head office building, Southon House, was vacated.

Southon House is therefore now held as an investment

property and rented to third-party tenants. During the

year £0.9m (2021: £1.0m) was recognised as rental income

by the Group.

The following table sets out a maturity analysis of the

lease payments due to be received from the tenants of

Southon House, showing the undiscounted lease payments

to be received after the reporting date.

120

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

2022

£’000

2021

£’000

Less than one year 878 852

Between one and two years 878 852

Between two and three years 878 852

Between three and four years

878 852

Between four and five years 878 852

More than five years 3,283 3,257

7,673 7,517

12. Other non-current assets

Group Company

2022

£’000

2021

£’000

2022

£’000

2021

£’000

Hire purchase agreements receivable 2,989 3,534 - -

Finance lease assets 14,875 11,286 - -

Loan to JSOP Share Trust - - 2,275 2,275

Trade receivables 11,303 9,609 - -

Other non-current receivables 3,688 4,166 681 681

Total other non-current assets 32,855 28,595 2,956 2,956

The loan receivable from the JSOP Share Trust does

not bear interest and is repayable on demand. There is

no current expectation that the loan will be recalled by

the Company within the next 12 months. Finance lease

assets represent assets where the Company is the lessor.

Non-current assets include Expected Credit Losses of

£5.7m against trade receivables. The Expected Credit

Losses on all other non-current assets are not material.

13. Receivables and accrued income

Group Company

2022

£’000

2021*

£’000

2022

£’000

2021

£’000

Trade receivables 31,103 26,826 - -

Other receivables 18,004 23,708 50 30

Hire purchase agreements receivable 1,356 1,132 - -

Trade and other receivables 50,463 51,666 50 30

Accrued income 134,917 120,395 - -

Trade and other receivables 50,463 51,666 50 30

Accrued income 134,917 120,395 - -

Receivables and accrued income (net) 185,380 172,061 50 30

*The presentation of this note has been changed to remove the Costs to obtain contracts from Other receivables (refer to the Presentation of

financial statements section of the Notes to the consolidated financial statements).

121

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

Accrued income represents unbilled receivables. Gross

accrued income of £136,439,000 (2021: £121,707,000)

includes March revenue invoiced in April of £82,724,000

(2021: £62,923,000) and unbilled energy debtors of

£53,715,000 (2021: £58,784,000). Offset against this

figure is an allowance for bad debts of £1,522,000 (2021:

£1,312,000).

The hire purchase agreements receivable shown

separately in the above table relates to the provision

of branded vehicles to Partners. The majority of the

vehicles are supplied on interest-free hire purchase

agreements and therefore there are no reconciling items

to disclose between the present value of the minimum

lease payments and gross investment in the leases.

Allowance for credit losses on trade receivables

and accrued income from customer invoicing

In accordance with note (r) of the Significant Accounting

Policies, trade receivables are stated at their nominal value

as reduced by the expected lifetime credit losses. The

Expected Credit Loss model is applied to trade receivables

from customer invoicing with credit losses measured using

a provisioning metric, adjusted where required, to take into

account current macro-economic factors. The Group do

not consider any current or non-current assets to contain a

significant financing component and therefore have applied

the simplified approach for Expected Credit Losses.

The Group assesses the expected recoverability of trade

receivables based on a categorisation matrix and applies

a provision against such trade receivables based on

the historical collection experience of those categories

(principally whether the indebted customer remains with

the Group or not, and the age of the debt). The Group also

assesses the latest information it has available on customer

collections post the balance sheet date in order to evaluate

whether there has been any impact on its customers

from changes in the prevailing macroeconomic situation

Group Company

2022

£’000

2021

£’000

2022

£’000

2021

£’000

Allowances as at 1 April 23,152 20,964 - -

Additions – charged to consolidated income statement 11,566 11,213 - -

Allowances used on fully written down receivables (9,692) (9,025) - -

Allowances as at 31 March 25,026 23,152 - -

122

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Analysis of trade receivables and accrued

income from customer invoicing

The tables below show an aged debt analysis between

debts owed by customers who are still supplied by the

Group (“Live”) and customers who are no longer supplied

by the group (“Closed”).

Live Closed Tot al

As at

31 March 2022

Gross

£’000

Allowance

£’000

Gross

£’000

Allowance

£’000

Gross

£’000

Allowance

£’000

Net

£’000

Accrued income -

not past due

136,439 (1,522) - - 136,439 (1,522) 134,917

Trade receivables - past due

0-30 days 4,523 (879) 441 (300) 4,964 (1,179) 3,785

31-90 days 7,516 (1,654) 1,049 (912) 8,565 (2,566) 6,000

>91 days 30,049 (9,194) 5,362 (4,900) 35,412 (14,094) 21,318

Total past due 42,088 (11,727) 6,852 (6,112) 48,941 (17,839) 31,103

Trade receivables

Total due in over 1 year 16,969 (5,665) - - 16,969 (5,665) 11,303

Total trade receivables 59,057 (17,392) 6,852 (6,112) 65,910 (23,504) 42,406

Tot al 195,496 (18,914) 6,852 (6,112) 202,349 (25,026) 177,323

Live Closed Tot al

As at

31 March 2021

Gross

£’000

Allowance

£’000

Gross

£’000

Allowance

£’000

Gross

£’000

Allowance

£’000

Net

£’000

Accrued income -

not past due

121,707 (1,312) - - 121,707 (1,312) 120,395

Trade receivables - past due

0-30 days 4,321 (696) 584 (384) 4,905 (1,080) 3,825

31-90 days 5,803 (1,218) 1,224 (1,042) 7,027 (2,260) 4,767

>91 days 26,392 (8,594) 5,022 (4,586) 31,414 (13,180) 18,234

Total past due 36,516 (10,508) 6,830 (6,012) 43,346 (16,520) 26,826

Trade receivables

Total due in over 1 year 14,928 (5,319) - - 14,928 (5,319) 9,609

Total trade receivables 51,444 (15,827) 6,830 (6,012) 58,274 (21,839) 36,435

Tot al 173,151 (17,139) 6,830 (6,012) 179,982 (23,152) 156,830

As at 31 March 2022 and 31 March 2021 the Group had made provision for past due debts and therefore has no material exposure

to trade receivables that were passed due and not individually impaired.

123

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

14. Costs to obtain contracts

The Group has the following assets at the reporting date in relation to contract costs:

2022

£’000

2021

£’000

Commissions paid to acquire contracts 4,350 5,662

Commissions paid in advance 10,801 10,040

15,151 15,702

Commissions paid to acquire contracts represent up-front

commissions paid to Partners for introducing customers

to the Group and are amortised when the related

revenues are recognised over the average lifetime of the

Group's customers. In the current period the amount of

amortisation was £1.4m (2021: £1.5m). Partners also earn

commission on the ongoing monthly use of the Group’s

services by customers they have introduced (“trailing

commissions”). Trailing commissions are recognised in

the Statement of Comprehensive Income as they are

earned by Partners on an accruals basis. In the current

period the amount of trailing commissions was £16.2m

(2021: £16.7m). Commissions paid in advance represent

the bringing forward of certain future trailing commission

payments expected to be due on customers Partners have

introduced. These advance commission payments are

amortised on a straight-line basis through the Statement of

Comprehensive Income over the period during which they

are earned and would otherwise have been paid had the

payment not been brought forward. In the current period

the amount of amortisation was £4.1m (2021: £3.6m). See

accounting policies note (e).

15. Interest bearing loans and borrowings

Bank loans – changes in liabilities from financing activities

Group 2022

£’000

2021

£’000

As at 1 April 89,376 94,020

Changes from financing cashflows

Drawdown of bank loans 65,000 30,000

Repayment of bank loans (55,000) (35,000)

Total changes from financing cashflows 10,000 (5,000)

Other changes - arrangement fees

Additions (597) -

Amortisation 436 356

Total other changes (161) 356

Total long term borrowings as at 31 March 99,215 89,376

Due within one year - -

Due after one year 100,000 90,000

100,000 90,000

124

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Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

The bank loans, when drawn down, are stated net

of unamortised arrangement fees of £785,000 (2021:

£624,000) on the face of the Balance sheet. These costs

have been capitalised and are being amortised over the

term of the bank loans.

In November 2021 the Group agreed to extend its revolving

debt facilities to £175,000,000 with Barclays Bank PLC,

Lloyds Bank PLC and Bank of Ireland Group PLC (‘the

Revolving Debt Facilities’) for the period to 30 June 2024.

The Revolving Debt Facilities are subject to two financial

covenants: (i) Net debt/EBITDA of not more than 3.0:1;

and (ii) EBITDA/net finance charges of not less than 3.0:1.

The covenants are tested twice per year and the Group

has significant headroom to the covenant limits under

both these measures. The Group draws down on the

Revolving Debt Facilities in tranches as funds are required.

The interest period on the drawn tranches is typically

one month and the tranches automatically rollover at

the end of each interest period unless the Group, at its

discretion, decides to repay the tranche.

In addition, as at 31 March 2022 the Group had letters

of credit in place relating to certain energy distribution

charges with a total value covered of £2,800,000 (2021:

£18,030,500).

All bank loans are secured through a floating charge on

the assets of the Group.

Maturity analysis

Group 2022

£’000

2021

£’000

Due in one year or less - -

Due in more than one year but not more than two years - 92,178

Due in more than two years but not more than five years 107,046 -

107,046 92,178

The analysis of maturity above includes interest to be paid during the term of the loans in accordance with IFRS 7

Financial Instruments: Disclosures.

Lease liabilities - changes in liabilities from financing activities

Group 2022

£’000

2021

£’000

As at 1 April 7,096 8,969

Changes from financing cashflows

Payment of lease liabilities (1,768) (1,567)

Interest relating to lease liabilities 238 246

Total changes from financing cashflows (1,530) (1,321)

Other changes

Disposals (280) (552)

Disposals - UWHS (4,133) -

Transfers to liabilities classified as held for sale (387) -

Total other changes (4,800) (552)

As at 31 March 766 7,096

125

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

Maturity analysis

Group 2022

£’000

2021

£’000

Due in one year or less 121 1,760

Due in more than one year but not more than two years 506 4,894

Due in more than two years but not more than five years 201 677

828 7,331

The analysis of maturity above shows the contractual undiscounted cashflows associated with lease liabilities. There

are no lease liabilities in the Company.

16. Trade and other payables

Group Company

2022

£’000

2021

£’000

2022

£’000

2021

£’000

Current

Trade payables 28,644 22,944 68 23

Inter-company payables - - 55,257 61,204

Other taxation and social security 9,457 7,430 - -

38,101 30,374 55,325 61,227

The contractual maturities for trade payables fall within one year.

17. Accrued expenses and deferred income

Group Company

2022

£’000

2021

£’000

2022

£’000

2021

£’000

Accrued expenses 112,932 120,683 68 64

Deferred income 561 1,612 - -

113,493 122,295 68 64

The contractual maturities of accrued expenses fall within one year.

126

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

18. Capital and reserves

Issued share capital 2022 2021

Number

(’000) £’000

Number

(’000) £’000

Authorised ordinary shares of 5p each in the Company 160,000 8,000 160,000 8,000

Allotted, called up and fully paid ordinary share capital:

At 1 April 79,236 3,962 79,070 3,954

Issue of new ordinary shares 272 14 166 8

At 31 March 79,508 3,976 79,236 3,962

Authorised ‘B’ shares of 2p each in subsidiary 650 13 650 13

Allotted and fully paid ‘B’ share capital:

At 1 April 405 8 405 8

Issue of new ‘B’ shares - - - -

Cancellation of ‘B’ shares (75) (2) - -

At 31 March 330 6 405 8

Total Group share capital at 31 March 3,982 3,970

At the year end the Company’s share price was 1,520p and

the range during the financial year was 1,010p to 1,612p.

At 31 March 2022, the Company had 79,508,132 (2021:

79,236,568) shares in issue. The total number of voting

rights of 5p ordinary shares in the Company was 79,025,856

(2021: 78,754,292), excluding shares held in treasury. Since

the year end, a further 47,890 shares have been issued

to satisfy the exercise of employee and distributor share

options, increasing the total number of voting rights of 5p

ordinary shares in the Company to 79,073,746.

As at 31 March 2022 there were 482,276 ordinary shares

held in treasury (2021: 482,276).

There are 252,638 ordinary shares held in the JSOP Share

Trust, representing approximately 0.3% of issued share

capital, on which voting and dividend rights have been

waived. These shares are included in the above total voting

rights figure of 79,025,856. The JSOP reserve in the Group

accounts represents ordinary shares in the Company held

by the JSOP Share Trust.

As at 31 March 2022, the total ‘B’ share capital in Utility

Warehouse Limited was £6,500 (2021: £8,090) and

therefore the total Group share capital is £3,982,000

(2021: £3,970,000).

Capital management

The Group’s overall objective when managing capital is

to continue to provide attractive returns to shareholders.

Total shareholder equity at 31 March 2022 was £205.6

million (2021: £212.4 million).

The Group’s current capital management strategy is to

retain sufficient working capital for day-to-day operating

requirements. The Group’s capital management strategy

is also to ensure that interest costs are minimised.

Under the Group’s energy supply arrangements, E.ON

(formerly npower) is responsible for funding the principal

working capital requirements relating to the supply of

energy to the Company’s customers. This includes funding

the Budget Plans of customers who pay for their energy

in equal monthly instalments.

Notes to the Consolidated Financial Statements

continued

127

Telecom Plus Plc Report and Accounts 2022 /

Dividends

2022

£’000

2021

£’000

Prior year final paid 30p (2021: 30p) per share 23,559 23,524

Interim paid 27p (2021: 27p) per share 21,228 21,184

The Directors have proposed a final dividend of 30p per

ordinary share totalling approximately £23.6 million,

payable on 5 August 2022, to shareholders on the register

at the close of business on 15 July 2022. In accordance

with the Group’s accounting policies the dividend has

not been included as a liability as at 31 March 2022. This

dividend will be subject to income tax at each recipient’s

individual marginal income tax rate.

19. Earnings per share

The calculation of basic and diluted earnings per share (“EPS”) is based on the following data:

2022

£’000

2021

£’000

Earnings for the purpose of basic and diluted EPS 35,467 32,577

Share incentive scheme charges (net of tax) 793 1,194

Amortisation of energy supply contract intangible assets 11,228 11,228

Loss on disposal of subsidiary - UWHS 1,139 -

Impairment of goodwill - Glow Green 1,536 -

Profit on disposal of freehold office building (net of tax) (488) -

Earnings excluding share incentive scheme charges and amortisation

of intangibles for the purpose of adjusted basic and diluted EPS

49,675 44,999

Number

(’000s)

Number

(’000s)

Weighted average number of ordinary shares for the purpose of basic EPS 78,601 78,433

Effect of dilutive potential ordinary shares (share incentive awards) 286 273

Weighted average number of ordinary shares for the purpose of diluted EPS 78,887 78,706

Adjusted basic EPS

63.2p 57.4p

Basic EPS 45.1p 41.5p

Adjusted diluted EPS

63.0p 57.2p

Diluted EPS 45.0p 41.4p

1. Adjusted basic and diluted EPS exclude share incentive scheme charges and the amortisation of the intangible asset recognised as a result of the

new energy supply arrangements entered into with npower in December 2013.

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Strategic Report Governance Report Financial Statements Shareholder Information

It has been deemed appropriate to present the analysis of

adjusted EPS excluding share incentive scheme charges

due to the relative size and historical volatility of the

charges. In view of the size and nature of the charge as a

non-cash item the amortisation of intangible assets arising

from the energy supply agreement with npower has also

been adjusted. It has also been deemed appropriate to

exclude the impact of the disposal of UW Home Services

Limited (“UWHS”), the impairment of the goodwill

associated with Glow Green Limited and Cofield Limited

(“Glow Green”) and the profit on the disposal of a freehold

office building due to the one-off non-operational nature

of these items.

The amortisation of the energy supply contract intangible

assets, the loss on the disposal of UWHS and the

impairment of goodwill relating to Glow Green have not

been adjusted for taxation as these items do not impact

the amount of corporation tax paid by the Group.

20. Commitments

Capital commitments

At 31 March 2022 the Company had no significant capital

commitments (2021: £Nil).

Energy supply arrangements

The Group entered into a 20-year energy supply agreement

with npower (‘the SSA’) on 20 December 2013. Following

the merger between npower and E.ON’s UK operations the

supply contract was novated to E.ON in 2021. The terms

of the supply agreement were not changed as a result of

this novation.

In the event that the SSA is terminated by E.ON in certain

circumstances, including on a material breach by the

Group or on the insolvency of the Company, additional

consideration of up to £154 million may become payable

by the Company to E.ON. Full details of the termination

provisions of the SSA were set out in paragraph 4 of Part

VIII on page 38 of the prospectus issued to shareholders

on 20 November 2013.

However, given the energy supply agreement termination

rights are either, in the directors’ view, very unlikely to occur

or entirely within the control of the Group, the directors

believe the likelihood of this type of termination event

is remote.

The amount of the additional consideration reduces

from £154 million to £11 million over the remaining life

of the supply agreement. Furthermore, depending on

the circumstances giving rise to a termination event, the

additional consideration (if payable) may be spread over

the unexpired term of the supply agreement. Following

any such termination event, the Group would have

direct access to the wholesale energy markets and the

opportunity to earn additional margin from sourcing energy

directly for the Group’s customer base.

21. Share-based payments

Share options

The Company has two share option plans, one of which

is available to employees, the other to distributors of the

Company. The Company also has a Save As You Earn share

option plan (‘the 2015 Employee SAYE Share Option Plan’)

for employees. As set out in the previous year’s Directors’

Remuneration Report a new Deferred Share Bonus Plan

was put in place for the executive directors. The first

awards under this scheme were made in July 2021.

All new employees who have passed the requisite

probationary period are issued with market price options

over shares in the Company, further options are also

granted to existing employees depending on their

seniority and length of service (‘The Telecom Plus PLC

2017 Employee Share Option Plan’). The 2015 Employee

SAYE Share Option Plan enables employees of the group

to acquire shares in the Company in a tax efficient

manner using monies saved from salary over a three

or five-year period.

The distributor scheme (‘The Telecom Plus PLC 2017

Networkers and Consultants Share Option Plan’)

exists to provide incentives to the people who are

most successful in gathering new customers for the

Company. As it is not possible to measure directly the

benefit received from these activities, the fair value of

the benefit received has been measured by reference

to the fair value of the equity instruments granted.

129

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

A reconciliation of movements in the numbers of share options for the Group can be summarised as follows:

2022 2021

Number Weighted

average

exercise

price

Number Weighted

average

exercise

price

At 1 April 2,662,415 1,240p 2,267,881 1,125p

Options granted 1,157,927 1,277p 890,299 1,420p

Options exercised (450,988) 1,039p (203,211) 846p

Options lapsed/expired (729,853) 1,348p (292,554) 1,170p

At 31 March 2,639,501 1,261p 2,662,415 1,240p

The weighted average share price at the date of exercise

for the options exercised during the year was 1,474.8p

(2021: 1,425.5p).

During the current year ended 31 March 2022 and prior

year ended 31 March 2021, the Group issued share options

to employees on the occasions set out below. No share

options were issued to distributors during these periods.

Grant date Share price

at grant date

(pence)

Exercise

price

(pence)

Expected

volatility

(%)

Option

life

(years)

Risk free

rate

(%)

Dividend

yield

(%)

Fair value

per option

(pence)

2017 Employee Share Option Plan

23/07/2020 1,394 1,382 43.69 10 (0.08) 4 .1 2 372

16/12/2020 1,480 1,474 41.77 10 0.05 3.87 396

22/07/2021 1,030 1,045 30.12 10 0.1 8 5.45 128

16/12/2021 1,520 1,526 33.64 10 1.73 3.75 361

Deferred Shares Bonus Plan

22/07/2021 1,030 5 n/a 10 n/a n/a n/a

2015 Employee SAYE Share Option Plan

19/08/2020 1,400 1,382 43.77 3.5 (0.08) 4 .1 2 326

18/08/2021 1,036 1,040 29.72 2.5 0.1 8 5.50 123

The Group has used a binomial model to value its share

options, with account being taken of vesting conditions

where these were considered material. The expected

volatility for the share option arrangements is based on

historical volatility determined by the analysis of daily

share price movements over the previous 12 months.

There was no significant incremental cost of issuing the

nil cost options on 22 July 2021 under the Deferred Shares

Bonus Plan given the reduction in existing share incentives

held by the directors as a result of the implementation

of the new plan (further detail on these reductions was

set out in the Directors’ Remuneration Report in the 2021

annual report).

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Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

The options outstanding at the end of the year relating to employees are as follows:

Number

1 April

2021

Number

31 March

2022

Exercise

price per

Exercisable

from

Expiry date

2007 Employee Share Option Plan

14 Jun 2011 18,710 - 603p 14 Jun 2014 11 Jun 2021

15 Dec 2011 5,750 - 774p 15 Dec 2014 14 Dec 2021

26 Jun 2012 33,000 22,800 828p 26 Jun 2015 25 Jun 2022

10 Dec 2012 15,600 9,200 878p 10 Dec 2015 9 Dec 2022

17 Jun 2013 5,947 5,147 1,219p 17 Jun 2016 16 Jun 2023

16 Dec 2013 6,500 6,000 1,739p 16 Dec 2016 15 Dec 2023

1 Jul 2014 4,450 4,450 1,337p 1 Jul 2017 30 Jun 2024

16 Dec 2014 2,350 2,350 1,254p 16 Dec 2017 15 Dec 2024

13 Jul 2015 291,090 221,705 985p 13 Jul 2018 12 Jul 2025

10 Dec 2015 14,800 5,850 1,074p 10 Dec 2018 9 Dec 2025

22 Jul 2016 209,150 68,764 1,047p 22 Jul 2019 21 Jul 2026

8 Dec 2016 90,570 47,738 1,209p 8 Dec 2019 7 Dec 2026

20 Jul 2017 100,190 65,755 1,117p 20 Jul 2020 19 Jul 2027

2017 Employee Share Option Plan

12 Dec 2017 76,252 43,449 1,181p 12 Dec 2020 11 Dec 2027

26 Jul 2018 164,750 86,119 1,057p 26 Jul 2021 25 Jul 2028

13 Dec 2018 93,000 68,000 1,370p 13 Dec 2021 12 Dec 2028

25 Jul 2019 354,200 202,450 1,342p 25 Jul 2022 24 Jul 2029

16 Dec 2019 237,000 160,500 1,383p 16 Dec 2022 15 Dec 2029

23 Jul 2020 390,373 287,950 1,382p 23 Jul 2023 22 Jul 2030

16 Dec 2020 347,960 230,710 1,474p 16 Dec 2023 15 Dec 2030

22 Jul 2021 - 311,500 1,045p 22 Jul 2024 21 Jul 2031

16 Dec 2021 - 555,000 1,520p 16 Dec 2024 15 Dec 2031

Deferred Shares Bonus Plan

22 Jul 2021 - 42,437 5p 22 Jul 2023 22 Jul 2031

2015 Employee SAYE Share Option Plan

14 Aug 2017 3,106 - 1,128p 1 Nov 2020 30 Apr 2021

23 Aug 2018 26,533 2,072 1,042p 1 Nov 2021 30 Apr 2022

21 Aug 2019 28,187 17,325 1,349p 1 Nov 2022 30 Apr 2023

19 Aug 2020 49,197 31,415 1,382p 1 Nov 2023 30 Apr 2024

18 Aug 2021 - 59,815 1,036p 1 Nov 2024 30 Apr 2025

Total employees 2,568,665 2,558,501

Weighted average

exercise price

1,250.3p 1,269.4p

131

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

The options outstanding at the end of the year relating to distributors are as follows:

Number

1 April

2021

Number

31 March

2022

Exercise

price per

Exercisable from Expiry date

2007 Networkers and Consultants Share Option Plan

14 Jun 2011 2,000 - 603p 14 Jun 2014 11 Jun 2021

15 Dec 2011 4,000 - 774p 15 Dec 2014 14 Dec 2021

1 Jun 2012 20,000 16,000 721p 1 Jun 2015 31 May 2022

26 Jun 2012 5,000 5,000 828p 26 Jun 2015 25 Jun 2022

20 Nov 2012 16,000 14,000 854.5p 20 Nov 2015 19 Nov 2022

10 Dec 2012 1,000 1,000 878p 10 Dec 2015 9 Dec 2022

17 Jun 2013 4,000 4,000 1,219p 17 Jun 2016 16 Jun 2023

16 Dec 2013 2,000 2,000 1,739p 16 Dec 2016 15 Dec 2023

1 Jul 2014 7,900 7,900 1,337p 1 Jul 2017 30 Jun 2024

16 Dec 2014 4,500 4,500 1,254p 16 Dec 2017 15 Dec 2024

13 Jul 2015 22,100 22,100 985p 13 Jul 2018 12 Jul 2025

10 Dec 2015 1,500 1,500 1,074p 10 Dec 2018 9 Dec 2025

22 Jul 2016 3,750 3,000 1,047p 22 Jul 2019 21 Jul 2026

20 Jul 2017 - - 1,117p 20 Jul 2020 19 Jul 2027

Total distributors 93,750 81,000

Weighted average

exercise price

952.3p 982.7p

At 31 March 2022, a total of 738,327 share options were exercisable (2021: 971,215) at a weighted average exercise price of

1,055.5p (2021: 1,040.0p). The average remaining contractual life of the outstanding options was 7.3 years (2021: 7.0 years).

LTIP 2016 – growth shares

The LTIP 2016 comprises the issue to participants of a

class of ‘growth’ shares in Utility Warehouse Limited

(“B shares”), which potentially become convertible into

ordinary shares in the Company over a period of typically

3-10 years following the achievement of stretching targets.

If these targets are not achieved, then the growth shares

lapse with no value to participants.

The first awards of growth shares (“B1 shares”) were made

to initial participants in the scheme on 4 April 2017; these

included the Chief Executive Officer and Chief Financial

Officer of the Company. In total 325,000 growth shares

were issued to the directors and certain senior employees

on 4 April 2017, of which 115,000 have lapsed due to leavers.

As set out in the Directors’ Remuneration Report for the

year ended 31 March 2021, a further 37,500 held by directors

have lapsed due to the introduction of the new Deferred

Share Bonus Plan.

On 30 July 2018 and 20 November 2018, further awards

of growth shares were made to certain senior employees

(“B2 shares”). In total 61,500 and 18,000 growth shares

were issued respectively on these dates, of those issued

on 30 July 2018 38,500 have lapsed due to leavers and

of those issued on 20 November 2018 8,000 have lapsed.

No further awards will be made under the LTIP 2016.

The fair value of the growth shares issued for the purposes

of IFRS 2 has been based on a Monte-Carlo model and

the key assumptions are set out below:

B1 shares – April 2017 Tranche 1 Tranche 2 Tranche 3 Tranche 4

Fair value (per share granted) £16.51 £17.71 £18.07 £17.08

Number of awards granted 81,250 81,250 81,250 81,250

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Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Key assumptions

Share price at grant £12.10

Exercise price Nil

Dividend yield 4.5%

Expected term 2.3 to 9.3 years

Risk free rate 0.11% to 0.99%

Share price volatility of the Company 33.2%

Discount for post vesting transfer restrictions for Tranches 1, 2 and 3 awards 6.3%

Discount for post vesting transfer restrictions for Tranche 4 awards 11.2%

B2 shares – July 2018 Tranche 1 Tranche 2 Tranche 3 Tranche 4

Fair value (per share granted) £10.14 £10.70 £10.79 £9.68

Number of awards granted 15,375 15,375 15,375 15,375

Key assumptions

Share price at grant £10.36

Exercise price Nil

Dividend yield 4.9%

Expected term 3 to 10 years

Risk free rate 0.86% to 1.48%

Share price volatility of the Company 30.9%

Discount for post vesting transfer restrictions for Tranches 1, 2 and 3 awards 5.9%

Discount for post vesting transfer restrictions for Tranche 4 awards 10.3%

B2 shares – November 2018 Tranche 1 Tranche 2 Tranche 3 Tranche 4

Fair value (per share granted) £18.23 £19.39 £19.17 £17.39

Number of awards granted 4,500 4,500 4,500 4,500

Key assumptions

Share price at grant £13.24

Exercise price Nil

Dividend yield 4.5%

Expected term 2.7 to 9.7 years

Risk free rate 0.78% to 1.35%

Share price volatility of the Company 29.9%

Discount for post vesting transfer restrictions for Tranches 1, 2 and 3 awards 5.7%

Discount for post vesting transfer restrictions for Tranche 4 awards 10.1%

133

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

22. Financial instruments

Treasury activities take place under procedures and policies

approved and monitored by the Board. They are designed

to minimise the financial risks faced by the Group which

primarily arise from credit, interest rate and liquidity risks.

Carrying amounts of financial instruments

All financial assets, which include cash, trade and other

receivables and accrued income, are classified as loans and

receivables with a total value for the Group of £258,682,000

(2021: £234,204,000) and for the Company of £3,684,000

(2021: £3,283,000).

All financial liabilities, which include trade and other

payables and accrued expenditure, are held at amortised

cost with a total value for the Group of £250,580,000

(2021: £234,245,000) and for the Company £55,420,000

(2021: £61,299,000).

Credit risk

All customers are invoiced monthly and approximately

90% pay by direct debit; accordingly credit risk in respect

of trade receivables is considered relatively low due to

the large number of customers supplied, each of whom

represents an insignificant proportion of total revenue.

The Company has a universal supply obligation in relation

to the provision of energy to domestic customers. This

means that although the Company is entitled to request

a reasonable deposit from a potential new customer who

is not considered creditworthy, the Company is obliged to

supply domestic energy to anyone who submits a properly

completed application form. Where such customers

subsequently fail to pay for the energy they have used,

there is likely to be a delay before the Company is able

to eliminate its exposure to future bad debt from them

by either installing a pre-payment meter or disconnecting

their supply, and the costs associated with preventing

such customers from increasing their indebtedness are

not always fully recoverable.

Trade receivables are stated at their nominal value as

reduced by the expected lifetime credit losses. The

Expected Credit Loss model is applied to trade receivables

from customer invoicing with credit losses measured

using a provisioning metric, adjusted where required, to

take into account current macro-economic factors. The

Group applies judgement to assess the expected credit

loss, taking into account historical collection patterns.

The maximum credit risk for the Group is £258,682,000

(2021: £234,204,000) and for the Company £3,684,000

(2021: £3,283,000).

Interest rate risk

The Group finances its day-to-day operations primarily

through cash generated within the business. Cash

surpluses are placed on deposit with Barclays Bank PLC

and Lloyds Bank PLC at money market rates to maximise

returns. As set out in note 15, the interest charged on

the Group’s borrowing facilities varies according to the

prevailing 3-month SONIA rate.

The Group’s profit and equity for the current year will not

be significantly affected by changes in the UK base rate

of +/- 1% from current levels.

Commodity price risk

The Group is not materially exposed to any fluctuations

in commodity prices due to the nature of the agreements

with wholesale providers of telephony and energy services

and its ability to pass the effect of any such fluctuations

through to its customers.

Liquidity risk

The Group’s treasury management policies are designed

to ensure continuity of funding.

Foreign currency risk

The Group does not have any significant foreign currency

exposure.

Interest rate and currency profile of financial

assets and liabilities

All financial assets and liabilities are denominated in

Sterling. Receivables due after one year include £3,297,000

(2021: £3,861,000) due mainly from distributors, elements

of which earn interest at varying rates above Base Rate.

Borrowing facilities

At 31 March 2022, the Group had total revolving credit

facilities of £175,000,000 (2021: £150,000,000). These

facilities are available to the Group until 30 June 2024.

As at 31 March 2022 £100,000,000 of the facilities was

drawn down (2021: £90,000,000 drawn down). As at 31

March 2022 the Group also had letters of credit in place

relating to certain energy distribution charges with a

total value covered of £2,800,000 (2021: £18,030,500).

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Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

The facilities are secured by fixed and floating charges

over the assets of the Group and through cross

guarantees with the subsidiaries Utility Warehouse

Limited, Electricity Plus Supply Limited, Gas Plus Supply

Limited, Utilities Plus Limited and Telecommunications

Management Limited. Further details of the facilities

are set out in note 15 of these financial statements.

Fair values

There is not considered to be any material difference

between the fair value of any financial instruments and

their net book amount due to the short-term maturity of

the instruments.

23. Related parties

Identity of related parties

The Company has related party relationships with its

subsidiaries (see note 9) and with its directors and

executive officers. Related party transactions are

conducted on an arm’s length basis.

Transactions with key management personnel

Directors of the Company and their immediate relatives

control approximately 16.3% of the voting shares of the

Company. No other employees are considered to meet

the definition of key management personnel other than

those disclosed in the Directors’ Remuneration Report.

Details of the total remuneration paid to the directors of the Company as key management personnel for qualifying

services are set out below:

2022

£’000

2021

£’000

Short-term employee

benefits

3,200 2,882

Deferred shares bonus 443 383

Social security costs 428 386

Post-employment

benefits

12 11

4,083 3,662

Share incentive

scheme charges

42 139

4,125 3,801

During the year, the Group acquired goods and services

worth £Nil (2021: £Nil) from companies in which directors

have a beneficial interest. No amounts were owed to

these companies by the Group as at 31 March 2022.

During the year, the Group sold goods and services worth

£Nil (2021: £Nil) to companies in which directors have a

beneficial interest.

During the year directors purchased goods and services on

behalf of the Group worth £306,000 (2021: £145,000). The

directors were fully reimbursed for the purchases and no

amounts were owing to the directors by the Group as at

31 March 2022. During the year the directors purchased

goods and services from the Group worth approximately

£28,000 (2021: £27,000) and persons closely connected

with the directors earned commissions as Partners for

the Group of approximately £6,000 (2021: £7,000).

As set out in note 24, the Group has agreed to sell, subject

to the necessary FCA change of control approval, its 75%

interests in Glow Green Limited and Cofield Limited to

Executive Chairman Charles Wigoder.

Subsidiary companies

During the year ended 31 March 2022, the Company

purchased goods and services from the subsidiaries in

the amount of £96,000 (2021: £153,000 purchased by the

Company from the subsidiaries).

During the year ended 31 March 2022 the Company also

received distributions from subsidiaries of £50,000,000

(2021: £50,000,000). At 31 March 2022 the Company owed

the subsidiaries £55,257,000 which is recognised within

trade payables (2021: £61,204,000 owed by the Company

to the subsidiaries).

135

Telecom Plus Plc Report and Accounts 2022 /

Notes to the Consolidated Financial Statements

continued

24. Disposals

The Group disposed of its shareholding in UW Home

Services Limited (“UWHS”) on 31 March 2022 for

consideration of £1 to Lowri Beck Holdings Limited, a

specialist meter operator owned by the Calisen Group.

The net assets of UWHS at the point of disposal were

£1.1m and the loss on disposal for the Group was £1.1m.

This has been shown in a separate line on the face of

the Consolidated Statement of Comprehensive Income.

The Group has also agreed to sell, subject to the necessary

FCA change of control approval, its 75% shareholdings in

Glow Green Limited and Cofield Limited (“Glow Green”)

for cash consideration of £1 to Charles Wigoder, Executive

Chairman of the Group.

Since acquiring Glow Green in 2018, the business has

been consistently loss-making; this has contributed to

a cumulative funding requirement of over £6m that will

remain with Glow Green as a debt to the Group and be

repaid over time. The repayment of the loan has been

personally guaranteed by Charles Wigoder. The Board

believe that the disposal of Glow Green is in the best

interests of the Group given the significant management

resource it would otherwise require, particularly at a time

when the growth opportunities within the core business

are so exciting.

As a smaller related party transaction, this disposal fell

within the requirements of section 11.1.10R of the Listing

Rules and the Board obtained written confirmation from

its sponsor that the terms of the proposed transaction

were fair and reasonable as far as the shareholders of

the Group are concerned. In the light of the consideration

level the goodwill associated with Glow Green of £1.5m

has been impaired in the current period. This has

been reflected in the goodwill impairment line in the

Consolidated Statement of Comprehensive Income.

The assets and liabilities of Glow Green have been

reclassified as held for sale on the balance sheet. A

summary of these assets and liabilities is shown below:

2022

£’000

2021

£’000

Assets classified as held for sale

Property, plant and equipment 673 -

Inventories 934 -

Trade and other receivables 1,519 -

Cash and cash equivalents 712

3,838 -

Liabilities classified as held for sale

Trade and other payables (7,064) -

Accrued expenses and deferred income (101) -

Finance lease liabilities (386) -

(7,551) -

136

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

Strategic Report Governance Report Financial Statements Shareholder Information

Telecom Plus Plc is a public

listed company incorporated

and domiciled in the United

Kingdom. It has a primary

listing on the London Stock

Exchange.

Corporate website

The Company’s corporate website

telecomplus.co.uk provides shareholders

with financial and governance information.

Registrar

Link Asset Services

10th Floor, Central Square

29 Wellington Street

Leeds

LS1 4DL

Registered office

508 Edgware Road

The Hyde, London

NW9 5AB

Company Secretary

David Baxter

Email: shareholders@uw.co.uk

Stockbrokers

Peel Hunt Ltd

Moor House

120 London Wall

London

EC2Y 5ET

Numis Securities Limited

The London Stock Exchange Building

10 Paternoster Square

London

EC4M 7LT

Auditors

KPMG LLP

15 Canada Square

Canary Wharf

London

E14 5GL

Bankers

Barclays Bank PLC

1 Churchill Place

London

E14 5HP

Bank of Ireland Group Plc

Bow Bells House

1 Bread Street

EC4M 9BE

Lloyds Bank PLC

25 Gresham Street

London

EC2V 7HN

Strategic Report Governance Report Financial Statements Shareholder Information

138

Telecom Plus Plc Report and Accounts 2022 /

Shareholder Information

508 Edgware Road

The Hyde, London

NW9 5AB

020 8955 5000

shareholders@uw.co.uk