TalkTalk talks up higher on-net subscriber base, as FY12 revenue drops 4.4%

18 May 2012

Alternative British broadband and fixed voice provider TalkTalk has released results for its financial year ended 31 March 2012, and while the operator saw a drop in its total number of broadband subscribers it highlighted an increase in those customers signed up for more profitable on-net services.

As at end-March 2012 TalkTalk’s broadband subscriber base stood at 4.066 million, down from 4.199 million a year earlier, although on-net subscribers rose by 4.1% year-on-year to reach 3.755 million, and now account for more than 92% of the total base, compared to around 86% a year earlier. Sign-ups for the telco’s fibre-based upgrade option, which increases downlink speeds up to 40Mbps for an extra GBP10 (USD16) per month, continued to grow meanwhile, with 9,000 customers now having taken up the add-on.

Keen to point out its network developments, TalkTalk also noted that over the year it had unbundled a further 501 exchanges, a move which it said cemented its position as owning the UK’s largest unbundled network, with 2,508 exchanges now unbundled, covering around 91% of the country’s population. Looking ahead the telco noted that it has plans to install its own equipment in a further 200 exchanges by the end of FY2013.

Despite average revenue per user (ARPU) having risen to GBP25.6 in the last quarter of the fiscal year, up from GBP25.0 in the corresponding period a year earlier, in part bolstered by increased uptake of value added services (VAS) such as security service ‘HomeSafe’, total revenues for FY2012 stood at GBP1.687 billion, down from GBP1.765 billion in FY2011. Turnover from broadband services was GBP1.242 billion, flat against the GBP1.247 billion generated a year earlier, with increased ARPU offsetting the decline in customer numbers. Non-broadband revenues meanwhile were GBP129 million, while turnover from corporate services declined by 4% y-o-y to GBP316 million; the fall in the former was the result of ‘the [continued] decline in both traditional voice minutes services and mobile termination rates (MTRs)’. Earnings before interest, tax, depreciation and amortisation (EBITDA) for the twelve-month period was GBP326 million, up 18.1% against the year ago period, while TalkTalk’s EBITDA margin rose to 19.3%, up from 15.6%.

United Kingdom, TalkTalk (incl. FibreNation)