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Interim Results for the 6 months to 30 September 2012

13/11/2012
  • Strong on-net additions and best quarter for total net adds in two years
  • Continued strong take-up of broadening range of additional products
  • Next phase of simplifying business to deliver incremental savings of £30m-£50m
  • On track to deliver all FY13 financial guidance

Financial Highlights

  • Total revenue £828m (H1 FY12: £844m); Corporate revenue £160m (H1 FY12: £158m)
  • On-net revenue £573m (H1 FY12: £524m); Q2 on-net ARPU £25.37 (Q2 FY12: £23.99)
  • 320bps improvement in gross margin to 54.7% (H1 FY12: 51.5%)
  • Underlying EBITDA1 £155m, margin 18.7% (H1 FY12: £146m, margin 17.3%)
  • Operating Free Cashflow2 £104m (H1 FY12: £97m)
  • Headline2 EPS 7.8p (H1 FY12: 7.6p); Interim Dividend raised to 3.45p (H1 FY12: 2.6p)

Q2 Operating Highlights

  • 66,000 fully unbundled net adds; total net customer loss of 4,000
  • 44% year on year growth in Plus customers, now 29% of on-net base
  • 32,000 Mobile customers added, base now 117,000
  • Data products trending strongly in TalkTalk Business

1 Excluding exceptional items and one-off TV launch costs

2 Excluding exceptional items

Dido Harding, Chief Executive of TalkTalk commented:

These results show real trading momentum and are a strong platform from which to build towards our medium term growth targets.  We have successfully launched our TV proposition and have installed 29,000 customers to date. Customer feedback has been positive and we are growing the base according to plan, at 1,000 per day.  Meanwhile, our mobile handset proposition is growing meaningfully in the contract handset market. The demand we are seeing for additional products from our increasingly profitable and stable customer base, the progress we are making in TalkTalk Business, and the savings we expect from the next phase of simplifying the business, underpin our confidence in delivering our targeted 2% CAGR in revenues and 25% EBITDA margin in the medium term.

Analyst and investor presentation: The Lincoln Centre, 18 Lincoln’s Inn Fields, WC2A 3ED at 10.30am
 
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