Chairman’s statement

In a challenging and eventful year, in which TalkTalk was the victim of a major cyber attack, the business has continued to make operational and financial headway, ending the year strongly and well placed for the future.

We ended the year with nearly a fifth of our phone and broadband customers taking mobile and fibre, and over a third taking TV, all of which is a testament to our growing credentials as a true value for money quad play operator. In our B2B business, we saw continued strong growth in revenues from high speed data connectivity as well as good growth in our wholesale channel. As a result, we reported Group revenue growth of 2.4%.

Equally, whilst there is much more to do here, our Making TalkTalk Simpler programmes delivered significant improvements to customer experience, and reduced costs. As a result, we delivered profit growth of over 6% across the year and a strong improvement in margins during the second half.

I am pleased to report therefore that the Board has declared a final dividend of 10.58p which, in addition to our interim dividend of 5.29p, gives a total pay-out for the year of 15.87p or 15% higher year on year.

I am enormously proud of how TalkTalk responded to the cyber attack. By communicating honestly with our customers to help them protect themselves, we not only set a new standard of openness and transparency for large businesses dealing with such challenges, we also demonstrated that TalkTalk is a business brave enough to put our customers’ interests first. Our customers responded positively to this, and have rewarded us with greater trust and loyalty, helping us deliver our best ever quarter of customer loyalty and much improved trust in our brands.

The impact on the business has clearly been considerable, and we have been determined to use this experience as an opportunity to take a comprehensive look at our organisation. As a result, we have made many positive changes to reinforce governance processes, especially around risk assessment and security – not just in technology and operations, but across our entire corporate culture. These changes will drive clearer priorities and strengthen our processes as we build a scale quad play business that consistently delivers great value and service to consumers and businesses. Crucially, they will also help to ensure TalkTalk, and our customers, are as well defended as we can be against future threats.

There has never been a clearer space in the market for a trusted value champion that puts its customers first and is truly affordable, reliable, simple and fair. Our employees are excited about delivering this mission and the Board and I would like to thank them for their efforts and their continuing commitment to TalkTalk and our customers.

 

Annual Report 2016