- Gamma Communications' directors expect to propose an interim dividend in line with the group's stated progressive policy after it continued to perform well through the first six months of the year.

Gamma said there had been continued strong growth in its SIP Trunking, Cloud PBX and data services, with margins consistent with the prior period and continued good progress with its direct business, with significant new contracts including Macmillan Cancer Support and Savills.

It said that in the Public Sector, prior investment in this market was delivering success with several new contracts in health and education including the Central Manchester University Hospitals NHS Foundation Trust.

It said network investment and strategic partnerships with other carriers was accelerating data growth, while its Manchester venture 'The Loop' had been selected by euNetworks for the provision of a significant network extension.

It also successfully launched an online marketing platform together with supporting programme - 'Gamma Accelerate' - to help Channel Partners drive new business opportunities for Gamma products and launched Cloud Compute and Backup, which provided packaged server applications for small to medium businesses.

It said the Horizon Cloud PBX service had been extended to provide increased integration with specific vertical CRM applications in areas such as health.

And Gama said it remained on target for the launch of its fixed/mobile converged product later this year. With the migration from the previous Vodafone Thin MVNO now complete, Gamma's own Full MVNO service was now showing sound underlying growth.

Gamma said it continued to have a very robust balance sheet, with strong cash generation from its trading activities.

It said: "Cash conversion from adjusted EBITDA* will be slightly lower than originally guided because Gamma has taken the opportunity to pay some suppliers in advance in return for improved commercial terms.

"Consequently, the closing cash balance for the half year is approximately £28.7m compared to £28.2m at the end of the previous year.

"The directors expect to propose an interim dividend in line with the stated progressive policy." The board expects to announce results for the half year ended 30 June on 5 September.

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