Broadband provider Talktalk has cashed in on lower costs and customers switching to faster fibre products, narrowing its losses for the year.
The London-listed company said it had restructured its customer base in recent years, which led to a slight drop in revenue, as consumers switch to fibre broadband.
Talktalk made a small loss before tax of £5m for the year ending 31 March, compared to last year when it haemorrhaged £100m. Revenue fell one per cent to £1.63bn.
Earnings before interest, tax, depreciation and amortisation (EBITDA) rose 84 per cent to £203m, while net debt remained broadly flat at £781m, compared to £776m last year.
About 150,000 customers signed up to its broadband services in the last year, down from 192,000 last time around.
Shares rose 0.4 per cent this morning.
Why it’s interesting
Talktalk shares have been volatile over the last year, with the company regularly finding itself at the bottom of customer service polls, but its attempts to compete with giants such as Virgin, Sky and BT appear to be making progress.
This looks to be partly driven by its efforts to speed up its fibre broadband network. Around 71 per cent of its new customers bought high-speed fibre services this year.
The firm said it hoped to continue on the same tack next year, with growth underpinned by improvements to fibre services and lower operating costs. Talktalk’s move to its new Salford HQ is set to save about £18m next year, it added, as the firm moves to a leaner business model.
What Talktalk said
Chief executive Tristia Harrison said that two years after overhauling the company “the fundamentals of the business are much stronger”.
“We have grown our customer base in a disciplined way, accelerated fibre take-up, and reduced costs.”