Ailing telecoms firm TalkTalk swung into negative territory this morning, posting a £73m annual loss.
The firm confirmed overnight reports it was flogging its business-to-business operations and rang in the changes with a shake-up of its board.
But investors responded positively this morning, with shares rising 10 per cent.
TalkTalk's shares hit rock bottom earlier this year as it announced a £200m share placing. The firm has been rocked by poor trading for a number of months, but this morning's confirmation of overnight reports it would sell a large slice of its business to privately-owned Daisy Group for £175m buoyed markets.
The London-listed firm is targeting a 15 per cent growth in profit next year.
"When we reset TalkTalk a year ago, we said we would focus on delivering sustained customer growth whilst radically simplifying the business," said chief executive Tristia Harrison. "One year into the strategy, we are making good progress on both."
TalkTalk said it had grown its customer base by 192,000 and – buoyed by a campaign not to hike prices – boasted its lowest ever churn of 1.22 per cent over the last year and 1.16 per cent in the first three months of 2018. Churn is important to telecoms providers because it shows what proportion of customers it is losing at any given point.
"Boss Tristia Harrison and executive chairman Charles Dunstone certainly have the gift of the gab, but TalkTalk is accident prone and both are guilty of over-egging its potential," said Interative Investor head of equity strategy Lee Wild.
Heavy investment lost TalkTalk money last year and the skinny dividend means there’s no longer yield support. Focusing on core, fixed connectivity is sensible, the customer base is growing, and chiefs predict higher headline revenue in the current year and 15 per cent growth in profit.
But they’ve got it wrong in the past. Question for investors now is whether they believe the hype.