Thursday 12 May 2016 2:37 pm

TalkTalk profits show fallout from last year's cyber attack

TalkTalk shares ticked up 1.3 per cent to 275p per share this afternoon, as the telecoms group said it was starting to recover from last year's cyber attack.

The figures

TalkTalk's revenue was broadly flat at about £1.8bn in the 12 months to 31 March.

The cost of last year's cyber attack was laid bare in its pretax profits, which more than halved to £14m after exceptional items of £83m.

Why it's interesting

The cyber attack on TalkTalk's systems last year led ot 160,000 customers' credit card and bank card details being exposed.

As a result, TalkTalk lost 101,000 customers in the third quarter, but the figures remained flat in the following three months demonstrating "the speed with which customer sentiment towards TalkTalk has recovered".

TalkTalk will also change provider from O2 to Vodafone this year, but it lost out on the larger combined network of O2 and Three after Brussels blocked the deal.

"I have an MVNO (mobile virtual network operator) partner which is more focused on its existing customers rather than on integrating with another company," Dido Harding, TalkTalk's chief executive, said.

"Of course we'll look at everything that is happening, but we are very happy with our strategy as it stands."

What TalkTalk said

"The business bounced back strongly in the final quarter following the cyber attack in October," Harding said.

"We recorded our lowest ever churn and stabilised the broadband base, testimony to the speed with which customer sentiment towards TalkTalk has recovered, the success of our greater focus on existing customers, and the growing benefits of our simplification programme."

In short

TalkTalk's full-year profits demonstrate the havoc that can be wrought by a cyber attack, nevertheless it appears to have turned a corner with churn at its lowest level in the company's history.

Share: