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Gloucestershire Business News

TalkTalk shares plunge

Shares in TalkTalk have fallen more than 10 per cent, after the telecoms firm warned that profits would be significantly lower this year than previously thought.

The company now expects profits to be between £230m and £245m, much lower than the forecast of £270m and £300m made in November.

TalkTalk also slashed its dividend and announced plans to raise £200m by selling shares on the stock exchange, as reported by the BBC.

The firm is raising money to invest in a network of fibre cables that would allow much higher broadband speeds. Last month, TalkTalk was named as the most-complained-about UK broadband operator by regulator Ofcom.

TalkTalk plans to build a fibre network that will supply high-speed broadband to three million homes and businesses. In addition to the share sale, to help fund its investments TalkTalk said it would temporarily cut its dividend to 2.5p per annum, returning to a more normal dividend of 7.5p when its debt has been reduced.

The company's third quarter results showed it did have some success in attracting new business. Customer numbers rose by 37,000 in the three months to 31st December, compared with 26,000 in the quarter before.

The percentage of customers leaving fell to 1.3 per cent over the three-month period. It was 1.6 per cent in the previous quarter.

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