TalkTalk CEO: Investors ‘obsessed’ with numbers

TalkTalk has has quite a rough year in 2011. From April to June, the operator was revealed to have topped Ofcom’s complaints list, with customers complaining about issues from their billing and unexpected charges to customer service. TalkTalk was said to have had the most complaints correspondence in the period as well.

A few months later, TalkTalk was reprimanded by Ofcom over silent calls that have hassled their customers much earlier in the year. The firm was served with a warning and was given a mid-November deadline to answer to the issues raised. If TalkTalk is unable to address the silent calls issue satisfactorily, they might be fined £2 million by the regulator.

On to further bad news, it was reported just late last month that the firm was continuing to lose subscribers, which reached a number of 43,000 in the last quarter. The loss of subscribers was attributed partially to the disruption that ensued after TalkTalk bought the Tiscali’s UK business. However, TalkTalk CEO Dido Harding said that the firm’s turnaround strategy was “well on track”, stating: “We are pleased that we are delivering a better experience for our customers, demonstrated by the continuing reduction in calls into our contact centres and a significant increase in the number of customers’ queries being resolved first time.”

Now Harding is addressing investors and calling them far too “obsessed” with the numbers posted by TalkTalk, particularly the figure on the number of lost subscribers. Harding stated: “The market obsesses about total net adds. It’s just going to take a few months longer than we were expecting to get to a positive number.” Harding tried to downplay the significance of the user tally of TalkTalk as well by saying that it didn’t “drive the financials at all.”

To Harding’s comments, an analyst responded with the following statement: “It’s wrong to be so dismissive of the market about a number that is dragging down the top line.”

TalkTalk’s shares dropped by nearly 5 percent when the interim results were revealed. The shares sell-off came despite the fact that TalkTalk was able to improve its interim dividend drastically after cost-cutting measures were able to boost profits in the six months to September’s end.

Harding argued that TalkTalk had improved the “customer experience” but that it might take a bit longer for consumers to believe in the progress that the company has made. “We’re not planning on trying to con them with lots of extra marketing. What we’re doing is systemically improving the experience they get.”