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KCOM Group PLC (KCOM.L) Interim Management Statement 2010

KCOM Group PLC (“the Group”) today publishes its Interim Management Statement.

Current trading

Group performance continues to be in line with expectations, with continued good cash performance resulting in a stronger overall financial position at the end of December. This performance is underpinned by the continued resilience of our Kingston Communications business, and is benefiting increasingly from the improving performance of our managed communications business, Kcom.

Kcom has begun to benefit from its tightened focus, as we continue to strengthen customer relationships and margins, by exiting lower value-add activities. That progress is evidenced by our announcement today of a new managed service contract with Phones4U (see separate announcement).

Outlook

The Board remains confident that the actions it has undertaken over the past 18 months will see continued improvement in the overall quality of the Group’s activities.  The progress we have made will see us exit the year in a stronger financial position and with an improved competitive position from which to exploit the market opportunities now available to us.

The Group continues to make good progress, focusing on strengthening the profitability of the activities that we undertake and the delivery of higher value-added, recurring revenues. Our contract win with Phones4U is as an example of our strategy of focusing our managed communications services business direct sales efforts on higher value added services, contracted on a multi-year basis. The contract illustrates the new opportunities available to us following our agreement with BT.

Bill Halbert
Executive Chairman

The KCOM Group announces its preliminary results on 25 May 2010.

Forward-looking statements

Certain statements in this interim statement are forward-looking.  Although the Group believes that the expectations reflected in these forward-looking statements are reasonable, we can give no assurance that these expectations will prove to have been correct.  Because these statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements.

We undertake no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise.

About KCOM PLC

KCOM Group PLC is a leading provider of communications services to organisations and consumers, serving customers through four market focused brands.

KC provides a range of telephony and broadband services to consumers and businesses in Hull and East Yorkshire. Our other three brands serve organisations throughout the UK. Eclipse provides communications services to small and medium businesses across the UK, connecting them to customers, partners and suppliers and improving their productivity and flexibility, and helping them to grow. Kcom works with some of the UK’s biggest names, delivering communications services that enable them to be flexible, efficient and more responsive to their customers. Smart421 delivers high-end consultancy, integration and management of business-critical systems for enterprise customers.

We apply the collective knowledge and expertise of our people and our partners to help our customers harness the power of communications. Our focus is on the delivery of inspiring customer experiences, and finding new and better ways to connect people.

For further information please contact:

Cathy Phillips, Head of Corporate Communications 
KCOM Group PLC 
01482 602400

Brian Hudspith / Amanda Martyr 
Maitland 
0207 379 5151