16 Dec 2015 07:00
The People's Operator plc
("TPO" or the "Company")
Update on US Operations and Announcement of New Forecasts
The People's Operator (AIM: TPOP), the cause-based commercial mobile virtual network operator, provides the following update on its operations.
The Company is pleased to announce that it has launched a number of new marketing initiatives in the US this month. These have been well received and there has been a marked increase in subscriber enquiries and successful subscriber conversions. The Company is confident that the technical difficulties highlighted in its statement of 20 November have been overcome and its technical structure is sufficiently sophisticated and robust to handle a considerable number of ongoing subscriber enquiries.
The Company is mindful of the need to ensure the best possible user experience and consequently intends to continue a cautious expansion in the US as set out in previous announcements. The Company intends to build to approximately 75,000 subscribers in the US by 31 December 2016 and it is intended that this will be achieved whilst maintaining a low cost of customer acquisition and competitive tariffs.
The Company's UK operations continue to perform in line with the subscriber expectations set out at the time of the IPO and it expects to achieve its stated target of 69,000 subscribers before year end. The Company intends to grow subscribers to approximately 140,000 in the UK by 31 December 2016.
Based on these subscriber numbers and the expected mix of pay as you go and pay monthly subscribers the Company expects revenues to be in the region of £8.1m for the year ending 31 December 2016.
The large scale investment required to establish the US operation has come to an end and the Company is experiencing revenue growth in both the UK and US. The Company maintains adequate financial resources to maintain its strategy and associated activities for the foreseeable future.
While the pace of growth is slower than expected a year ago, the Company is making steady progress and the Directors remain confident of the long-term prospects for the Company. The Directors remain committed to achieving 2% market share across the US and UK by 2021.
For further information
The People's Operator plc Nick Dashwood Brown, Head of Investor Relations
| 020 7251 6648 |
finnCap Ltd Stuart Andrews / Christopher Raggett / Simon Hicks
| 020 7220 0500 |
About The People's Operator
The Company was founded in 2012 and currently offers customers pay monthly ("PAYM") and pay-as-you-go ("PAYG") mobile contracts. These contracts are competitively priced and allow users to direct 10% of their monthly bill to a cause of their choosing at no additional cost to themselves. In addition, The TPO Foundation, a UK registered charity, will receive 25% of the UK trading profits generated by The People's Operator LLP. A similar structure is proposed to be adopted in other countries.
The strategy of the Group is to maintain a low fixed-cost base, small staff numbers and lower levels of advertising and marketing expenditure than its competitors. In addition, as TPO operates as an MVNO, the Group is not expected to be exposed to the high infrastructure costs and large capital investment charges that traditional mobile operators can incur. This strategy is expected to enable the Group to offer customers a highly competitive pricing model with a high quality of service, whilst generating an attractive return to shareholders after donations to causes.
TPO has developed partnerships with community organisations and causes who promote TPO's products to their supporters. Under the direction of Jimmy Wales, the founder of the online encyclopaedia Wikipedia, the Company is also developing an online viral community to expand the global network of mobile phone customers who share in the common belief of supporting causes.
The Directors believe that this strategy is scalable into new markets around the world which offer competitive wholesale mobile network bandwidth prices and where subscriber acquisition and revenue growth can be driven quickly at a low incremental cost once network agreements have been concluded with local network operators.
For more information, visit: https://www.thepeoplesoperator.com.