The City breathed a sigh of relief as TalkTalk revealed that the cost of last month’s cyber-attack may not be as bad as it was first feared.
Dido Harding, TalkTalk’s chief executive, said there will be a one-off cost of between £30m and £35m but that she believed: “What we did was exactly right and the responsible thing to do. If you do what is right for the customer the business is better for it.”
Half-year figures from TalkTalk showed its profits were already falling before the cyber-attack. In the six months to the end of September – before the attack in October – headline earnings fell from £110m to £90m and the bottom line swung from a pre-tax profit of £20m to an £8m loss.
The interim dividend, which analysts had feared could be cut, was raised from 4.6p a year ago to 5.29p.
Ms Harding said the move into the red was due to higher spending on the “Make TalkTalk Simpler” programme, aimed at removing lots of confusing different deals across its broadband, TV, mobile and fixed-line offers.
TalkTalk revealed its 4 million customers could have had their personal details, including bank account and credit card information, stolen on 21 October, shortly after the hacking attack.
Police have arrested three teenagers and a 20-year-old. It later emerged that only 157,000 customers were affected.
Ms Harding said that while there had been “an initial spike of customers cancelling direct debits” after the attack, the “early signs from customers in the last three weeks have been encouraging”.
TalkTalk shares rose 28.7p or 13 per cent to 246p. They were worth 316p a month ago.
