TalkTalk has reported Q1 revenues were flat year-on-year (-0.4 per cent). On-net revenues were down 2 per cent as anticipated, reflecting the smaller average on-net base in the quarter. Corporate revenue grew strongly by 7.5 per cent with continuing growth in Data (+38.5 per cent) and further growth in Carrier revenues (+40 per cent) helping offset a legacy voice decline of 31 per cent. Off-net revenues (2.7 per cent of total revenues) declined by 14.3 per cent
The broadband base was 9,000 lower during the quarter, with Mobile net adds strong at 48,000 and Fibre net adds of 36,000. The TV base was 23,000 lower at the end of Q1.
On-net churn was down year on year and stable quarter on quarter at 1.36 per cent (Q4FY16: 1.34 per cent), driven by RGU penetration (up 6.8 per cent year on year at 1.72) and ongoing improvements in customer service delivered through Making TalkTalk Simpler (MTTS). Key programmes such as improved dynamic line management (DLM), backhaul upgrades, fault diagnostics and simpler billing are gaining real traction in driving an improved customer experience. MTTS savings are being realised in line with our plan and we are on track to deliver £35 (€42m) -£40 million of savings by the end of the year.
Dido Harding, CEO of TalkTalk, said: “We are very pleased with how the year has begun. Revenue growth was level year on year despite a smaller customer base and churn was down year on year as we drove growth in mobile and fibre, and delivered real improvements in our customers’ experience. As a result we are reiterating all of the financial guidance we gave in May, with revenue expected to show modest growth and EBITDA to reach £320 million – £360 million.
“We have continued to make good progress with our fibre to the premise trial in York. Nearly 11,000 homes have now been passed by the build, with total penetration circa 12 per cent after just over three months. TalkTalk connections have been strong, with nearly half of those signing up new to TalkTalk and we are excited about the potential this demonstrates to build a scale network across the country in the future.”