Telecoms firm TalkTalk said it lost 95,000 customers and revealed a hit of up to £60 million from last October's cyber attack against the company.

The group saw swathes of customers quit and was left taking on fewer new customers as it temporarily shut down its online sales channels in the wake of the attack, which resulted in the personal data of nearly 160,000 people being accessed.

TalkTalk said it lost 101,000 subscribers in the three months to the end of the year, with the hack directly responsible for 95,000 leaving.

It added the attack would knock trading revenues by £15 million and force it to take a further £40 million to £45 million in costs.

The group now expects annual underlying earnings of between £255 million to £265 million - this is against the £290 million to £300 million it pencilled in last November.

Analysts had already trimmed their expectations to around £264 million.

But TalkTalk chief executive Dido Harding insisted business is "returning to normal" following the attack and said nearly 500,000 customers took up its free upgrade offer, which the group announced in November to help soothe concerned customers.

She said: "Both churn and new connections recovered during December and January and independent external research has revealed that customers believe that we acted in their best interest."

She said the group is expecting a significant "step up" in profits over the second-half of its year to the end of March.

The cyber attack on TalkTalk was recently branded a "car crash" by Information Commissioner Christopher Graham, who said it should send a warning shot to the industry.

TalkTalk told MPs the total number of customers whose personal details were accessed was 156,959, some 4% of its customer base, and the data could not be used alone to cause financial loss.

Five people, including four teenagers, have been arrested in connection with the attack on October 21.

The group said despite the impact of the attack, revenues grew by 1.8% in its third quarter to December 31, but this marks a sharp slowdown on the 5.9% growth in the previous three months.

Shares in TalkTalk rebounded by 6%, although equities analyst Steve Clayton at Hargreaves Lansdown warned the group is "not out of the woods".

"Clearly the company's systems were tested and found wanting, and TalkTalk has a job to do rebuilding customers' confidence in the integrity of their systems," he added.