• Q3 revenue growth of 1.8%; On-net net adds -101k
  • Business returning to normal - positive RGU growth in January
  • Free upgrade offer more successful than expected
  • Cyber attack – trading impact £15m; exceptional costs £40m-£45m
  • FY16 EBITDA guidance £255m-£265m; expect to grow final dividend by 15%
  • FY17 EBITDA guidance £320m - £360m, with dividend no lower than in FY16

Q3 Highlights

  • Good on-net revenue performance despite impact of cyber attack
  • On-net revenue +4.5%; On-net ARPU + 6.3% and RGU penetration (+9.2%)
  • On-net net adds -101k (of which estimated cyber attack impact of 95k)  
  • On-net churn 2.1% (of which estimated cyber attack impact of 0.6%)

Dido Harding, CEO commented:

It is encouraging to see the business returning to normal after a challenging quarter that was dominated by the cyber attack.  Our customers have responded well, with almost half a million customers choosing to take up our unconditional offer of a free upgrade.  Both churn and new connections recovered during December and January and independent external research has revealed that customers believe that we acted in their best interest.  In fact trust in the TalkTalk brand has improved since just after the attack and consideration is higher now than it was before the incident.

Looking forward, we expect to deliver a material step up in profits in H2, with full year results in line with market consensus.  With a renewed focus on our existing customers and the benefits of our transformation programme, we expect to deliver a further material improvement in profits in FY17.  As the value for money telecoms provider we are well placed to benefit from the current regulatory reviews in the sector and expect to see quad play driving sustainable long term growth.