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Plusnet boosts profits and dividends amid customer drop and market shifts

Plusnet has reported a rise in profits despite experiencing a significant drop in customer numbers after shutting down its mobile division and the discontinuation of John Lewis’s broadband service.

The company, headquartered in Sheffield and part of the BT Group, saw a 29% decrease in its customer base due to these closures, as reported by City AM.

Nevertheless, the impact on revenue was mitigated by annual contractual price increases, resulting in only a 5% decline in turnover.

According to the latest financial statements submitted to Companies House, Plusnet’s turnover for the year ending 31 March, 2024, fell from £423.3 million to £401.8 million.

However, there was a notable improvement in pre-tax profit, which rose from £60.6 million to £82.2 million during this period.

Reflecting this enhanced profitability, Plusnet declared a dividend of £80 million for the year, an increase from the previous £60 million.

The trend of working from home has been advantageous for Plusnet.

The board’s statement acknowledged: “The UK broadband market remains very competitive, with other providers offering discounted broadband and phone bundles in order to gain market share.”

It added: “Increase in demand for fibre optic broadband continued during the year with customers prioritising speed and reliability as they are increasingly reliant on their broadband connection for working from home and everyday life.”

In conclusion, the statement highlighted: “Plusnet continues to invest in marketing to enhance its brand awareness in response to competitive market pressures, prioritising customer value over volume growth.”

Plusnet commented: “The continued move to home working has highlighted the importance of home connectivity and reliably, high-speed broadband.”

“As a result, fibre optic broadband demand remained strong during the year, with 74 per cent of the company’s broadband customers now having a fibre product.”

“The mobile portion of the business was closed following management decision to focus on markets where the greatest returns can be achieved for the company and concentrate all future capital expenditure within the broadband area.”

During the period, Plusnet saw its workforce grow from 990 to 1,077, attributed to an uptick in sales advisers and a strategic shift towards utilising in-house rather than partner agents.

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Original artice – https://business-live.co.uk/all-about/yorkshire-humber

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