Slide 1: SFAF Analysts Meeting
SFAF Analysts Meeting November 21, 2007 1
Slide 2: Contents
Contents I. The Contact Center Market II. Teleperformance footprint III. Key highlights IV. Operating results V. Financial results VI. Strategy and Outlook for 2008 2
Slide 3: A booming market
I. The Contact Center Market A booming market €254 billion- this is the worldwide customer service market value expected by the end of 2007, i.e., a 7.36% increase compared to 2006. 84% of this market is controlled by contact centers, which represents €213 billion revenues, i.e., a 7.5% increase c
Slide 4: The service offer of outsourcing companies
I. The Contact Center Market The service offer of outsourcing companies Technical support continues to grow: fewer support services for product installation, but more developments related to product use. Telesales operations have dropped but they are still significant in emerging countries, in the
Slide 5: Industries served
I. The Contact Center Market Industries served Telcos, financial services, media and mail-order selling are the main sectors using outsourcing companies*. Customer retention is companies’ main focus in the telco and media industries. With the increase of online selling, consumers now turn towards
Slide 6: Best-shore strategies keep on diversifying
I. The Contact Center Market Best-shore strategies keep on diversifying Companies work with outsourcers in order to benefit from their investments and improve their business model. Offshoring: Optimal business models Consistent IT performance Differentiator: Quality of Service Homeshoring: Ho
Slide 7: A dynamic market in the coming years
I. The Contact Center Market A dynamic market in the coming years The contact center market growth will be supported by: Increased call volumes Companies showing increased interest in outsourcing and offshoring solutions A diversified offer Strong demand from specific sectors: pharmaceuticals,
Slide 8: Strong geographical presence, but still expanding in 2007
II. Teleperformance footprint Strong geographical presence, but still expanding in 2007 Europe: Covering 29 countries with the launch of operations in Egypt, South Africa and the creation of a new contact center in Tunisia Americas: Jamaica (Alliance One) - a new option in the delocalized network fo
Slide 9: Teleperformance, the worldwide leader, described in figures
II. Teleperformance footprint Teleperformance, the worldwide leader, described in figures 45 countries, 38 domestic or mixed, 7 offshore 281 contact centers (including 83 F. M. centers) 66 languages and dialects over 75,000 workstations and over 83,000 FTEs 1,000 clients, including 190 representing
Slide 10: Offshore locations
II. Teleperformance footprint Offshore locations With 17,692 workstations, our offshore capacities increased by 46.3% in 2007 versus 2006 and now represent 23.4% of the Group’s overall capacities. Philippines: 4,826 Mexico: 2,790 Tunisia: 2,700 Argentina: 1,856 Canada: 1,483 2006 2007 N.
Slide 11: External Growth Transactions
III. Key Highlights External Growth Transactions March 2007: Acquisition of Twenty4help, the European leading company in technical support May 2007: Acquisition of TPH Services Telecom Sale of Noble Systems August 2007: Acquisition of Alliance One, a U.S. leading company in the debt collectio
Slide 12: Key highlights within the Group in 2007
III. Key Highlights Key highlights within the Group in 2007 March 2007: Launch of Teleperformance Vietnam May 2007: Take-over of 2 SFR customer service contact centers in France (about 1,300 employees) August 2007: Termination of the contract with Brasil Telecom October 2007: Launch of Tele
Slide 13: Teleperformance sponsorship
III. Key highlights Teleperformance sponsorship + de Vie ("More Life") For the 2nd consecutive year, Teleperformance supported the Fondation des Hôpitaux de Paris-Hôpitaux de France presided over by Bernadette Chirac, which comes to the aid of elderly people in hospital. 750 volunteers across six Te
Slide 14: Split of Revenues per Region
IV. Operating results Split of Revenues per Region Europe: +4% compared to 2006 as a result of the acquisition of Twenty4help 14
Slide 15: Inbound remains our main activity
IV. Operating results Inbound remains our main activity Inbound: +2% compared to 2006 15
Slide 16: Technical support and debt collection services have significantly increased
IV. Operating results Technical support and debt collection services have significantly increased Technical support: +6% compared to 2006 Debt Collection: +2% compared to 2006 Customer acquisition: -1% compared to 2006 Customer service is still our main activity 16
Slide 17: Split of activities per region
IV. Operating results Split of activities per region 17
Slide 18: Our client portfolio
IV. Operating results Our client portfolio Our Top client now only represents 9.7% of the Group's revenues. Most clients have been loyal to the Group for more than 2 years. 18
Slide 19: Our presence in the various business segments
IV. Operating results Our presence in the various business segments A +3% increase in the IT sector A +2% increase in the energy sector 19
Slide 20: Our international clients
IV. Operating results Our international clients 54.2% of the Group's revenues have been achieved through international clients in 2007. Revenues increased by 22.7% compared to 2006 The number of international clients increased by 5.2% compared to 2006 20
Slide 21: New update of 2007 objectives
V. Financial results New update of 2007 objectives in Millions Objectives in 2007 New 2007 of Euros Objectives Achievem. SFAF SFAF Publication Analysts Analysts of half-year SFAF in 2006 Meeting financial Analysts Meeting May 2007 statements - Meeting Nov. 2006 August 2007 Nov. 2007 €/$ parity €1=$1
Slide 22: Business Distribution per Region (in Millions of Euros)
V. Financial results Business Distribution per Region Scope of consolidation effect (in Millions of Euros) 2007 2006 % Acquisitions +163 based on published data €1 = US$1.37 €1 = US$1.256 Europe: +124 Europe 823 654.8 +25.5 NAFTA: +39 NAFTA 585 567.2 +3.1 Sales -44 Other 162 163.2 -0.7 Europe: -19 T
Slide 23: Changes in the scope of consolidation in 2007
V. Financial results Changes in the scope of consolidation in 2007 External Growth Transactions Date of Impact on the 1st Consolidation scope of consolidation in 2007 (M€) Acquisitions in 2006 20 EUROPE 20 .Photel (Hungary) July 1st, 2006 .LibertyCall / Extratel (Switzerland) Dec. 1st, 2006 Acquisit
Slide 24: Changes in the scope of consolidation in 2007 Discontinued Operations
V. Financial results Changes in the scope of consolidation in 2007 Deconsolidation Impact on the Discontinued scope of Date Operations consolidation in 2007 (M€) Year 2006 15 Market Research operations September 30th 15 Year 2007 29 Marketing Services May 1st 4 NAFTA 25 Noble Systems January 1st Tot
Slide 25: Income statement
V. Financial results Income statement (in Millions of Euros) 2007 2006 % Revenues 1,570 1,385.2 +13.3 EBITDA 216.0 186.9 Net operating profit before financing costs 156 131.3 +19 IFRS impact (stock option plans) [-12.1] [-5.2] Rate 9.9% 9.5% Financial result 1 -15.4 IAS 32-39 impact [-2.0] [-5.9] Co
Slide 26: Net operating profit before financing costs
V. Financial results Net operating profit before financing costs Operating Margin – Financial Financial Comparative Analysis Year 2007 Year 2006 Objective Results Operating Margin - Published 156 131.3 9.9% 9.5% Adjustments - +1.0 - Profit from operations sold(*) -13.3 -4.2 - Share-based payments +1
Slide 27: Objectives for 2007
V. Financial results Objectives for 2007 Cash Flow Statement (in Millions of Euros) 2007 2006 Internally generated funds from operations 175 141.7 Changes in Working Capital Requirements -25 +0.5 CAPEX -65 -59.5 Rate / Revenues 4.1% 4.3% Free Cash Flow 85.0 82.7 Changes in consolidation scope -235.0
Slide 28: Objectives in 2007
V. Financial results Objectives in 2007 Change in Net Cash Flow (in Millions of Euros) Net Cash Flow at January 1st, 2007 +128.0 Conversion of the OCEANE bonds in February 2007 +153.0 Free Cash Flow +85.0 Changes in consolidation scope -235.0 Dividends -20.0 Translation differences -5.0 Capital incr
Slide 29: Internal Growth
VI. Strategy and Outlook for 2008 Internal Growth Teleperformance benefits from a strong growth trend, supported by the quality and loyalty of its client portfolio. In 2008, we will focus on: The development of new partnerships with our key accounts, especially in business transformation operations
Slide 30: External growth
VI. Strategy and Outlook for 2008 External growth Teleperformance's cash resources (net cash flow / €100M + credit facilities / €300M) will enable the Group to support an aggressive external growth policy in 2008 as we did in 2007: Our Priorities: Gaining the leadership position or at least ranking
Slide 31: Financial Strategy
VI. Strategy and Outlook for 2008 Financial Strategy Complying with the basic financial standards is still the Teleperformance Group’s priority: Controlled use of credit facilities (< 30% Gearing) Stabilizing our operating profitability (EBITA) close to 10% Maintaining the WCR between 10% and 12%
Slide 32: Summary
VI. Strategy and Outlook for 2008 Summary Teleperformance continues its rapid expansion in a fast-growing market Our leading position has been confirmed and consolidated in 2007 The Group has been growing without prejudicing our client portfolio diversity Our offer and added value make the differ
Slide 33: 2008 Outlook
VI. Strategy and Outlook for 2008 2008 Outlook Excluding new acquisitions / (€1 = USD1.47) Revenues: €1,755 million +11.5% Net Operating Profit(*): €176 million Margin Rate(*): 10% Net Profit, Group Share(*): €107 million (+13%) Earnings per share (diluted): €1.88 (+13%) (*) including the al
Slide 34: Breakdown of capital at November 21, 2007
VI. Strategy and Outlook for 2008 Breakdown of capital at November 21, 2007 Number of shares 55,383,511 issued Maximum number 1,595,316 of shares to be issued Share options 745,250 Bonus shares 850,066 Total Potential Capital 56,978,827 34