Thus upbeat despite £104m loss

TELECOMS group Thus unveiled a £104m full-year pre-tax loss but said that, for the first time, it had become cashflow positive before interest costs in the fourth quarter.

Chief executive William Allan said Thus, which wiped out its crippling £260m debt as a result of its recent demerger from ScottishPower, was on track to hit its goal of being cashflow positive on a conventional basis by 2004-2005.

The results for the year to 31 March revealed Thus had cash of £9m at the year-end with debt of £4.8m relating to leases. Allan said undrawn debt facilities of £90m would be enough to carry the group through until 2005.

He said Thus' improved operating performance was reflected in gross margin growth of five percentage points to 38% in the year. But the market drew little comfort from the figures, marking up the shares only 1/2p to 20p.

Thus has also adopted a more conservative accounting policy, which involved it booking contracted revenue from network capacity sales below the operating profit line, meaning it would not be reflected in the revenue figures. On this basis, turnover from continuing operations rose 22% to £246.4m.