Teleperformance Se · EURONEXT:TEP
Teleperformance — H1 2019 Earnings Presentation
31 slides from Teleperformance's earnings presentation, Jul 25, 2019
Slide 1: 2019 First-Half Results
2019 FIRST-HALF RESULTS (January 1, 2019 – June 30, 2019) July 25, 2019
Slide 2: Disclaimer
DISCLAIMER The financial statements for the six months ended June 30, 2018 and June 30, 2019 have been subject to a review by the auditors. The accounting policies applied in the condensed consolidated interim financial statements as of June 30, 2019 are the same as those at June 30, 2018, with the
Slide 3: Contents
CONTENTS 1. 2019 FIRST-HALF KEY FIGURES AND FACTS 2. 2019 FIRST-HALF RESULTS 3. 2019 OUTLOOK 4. APPENDICES 3
Slide 4: 2019 First-Half Key Figures and Facts
1 2019 FIRST-HALF KEY FIGURES AND FACTS
Slide 5: Key figures: sustained growth in results
2019 FIRST-HALF KEY FIGURES AND FACTS Key figures: sustained growth in results Revenue (€ M) EBITA (€ M) 2,564 % of revenue 327* ▪ Solid revenue growth in H1 2019: + 23.9% on a reported 2,070 basis and + 10.4% lfl, with an + 10.4% lfl 246 12.8% acceleration in Q2 (+10.9% lfl) 11.9% ▪ Increase in EBI
Slide 6: Key facts: execution of the strategy
2019 FIRST-HALF KEY FIGURES AND FACTS Key facts: execution of the strategy ▪ Confirming Teleperformance’s unique worldwide leadership in its market with a continued increase in its operational footprint, with 12,600 new workstations opened in H1, notably in: ▪ For new sites ▪ For expanded sites ▪ US
Slide 7: 2019 First-Half Results
2 2019 FIRST-HALF RESULTS
Slide 8: P&L summary
2019 FIRST-HALF RESULTS P&L summary IFRS 16: New lease standard effective as of January 1, 2019 The Group rarely owns its premises: most of its 400+ contact centers are held on operating leases. All premises leases have been restated: ▪ Right-of-use asset recognised in the balance sheet and deprecia
Slide 9: Revenue growth analysis
2019 FIRST-HALF RESULTS Revenue growth analysis ▪ Revenue growth: + 23.9% as reported and + 10.4% like-for-like ▪ Change in scope: consolidation of Intelenet since October 2018 ▪ Positive foreign exchange impact mainly from the strengthening of the US dollar against the euro +226 2,564 + 10.4% lfl +
Slide 10: Expertise in many industries
2019 FIRST-HALF RESULTS Revenue growth by industry vertical 47% Expertise in many 5% 14% 10% 9% industries 18% 14% 13% 4% 4% 3% 2% 2% 15% 11% 7% 7% 6% 5% 4% % Revenue by vertical – details H1 2019 vs. 2013 Healthcare, Financial Technology, Retail, Travel Public Transportation Media & Other Insurance
Slide 11: The Digital Economy: a powerful growth engine
2019 FIRST-HALF RESULTS Revenue growth by industry vertical Teleperformance revenue generation with e-clients (2013-2019 - %) The Digital Economy: a 95% 81% 78% powerful growth engine for Teleperformance + 3 ppt + 14 ppt 22% 19% 5% 2013 2018 H1 2019 % revenue generated with pure e-clients among Top
Slide 12: Revenue by activity
2019 FIRST-HALF RESULTS Revenue by activity ▪ Core Services like-for-like growth in H1: + 11.4%, driven by Ibero-LATAM and CEMEA and acceleration in EWAP ▪ Specialized Services H1 like-for-like growth: + 5.0%, back to normative growth with acceleration in Q2 2019 2018 Change (%) Revenue (€ M) Like-f
Slide 13: Margin by activity
2019 FIRST-HALF RESULTS Margin by activity ▪ Increase in margin in both activities, Core Services & D.I.B.S. and Specialized Services, including and excluding first positive impact of applying IFRS 16 in H1 2019 ▪ Increase in all regions for Core Services & D.I.B.S., except for Ibero-LATAM due to ra
Slide 14: Core Services – English-speaking market & Asia-Pacific (EWAP)
2019 FIRST-HALF RESULTS Core Services – English-speaking market & Asia-Pacific (EWAP) Revenue (€ M) o LFL revenue growth accelerated sharply in Q2 to + 6.1% + 4.4% lfl 801 o Continued recovery in North America: most dynamic segments 695 were e-tailing, healthcare, transportation services and logisti
Slide 15: Core Services – Ibero-LATAM
2019 FIRST-HALF RESULTS Core Services – Ibero-LATAM Revenue (€ M) o Nearshore, pan-American solutions in Mexico and + 16.1% lfl Colombia were the main growth drivers, supported by 645 financial services and logistics in Mexico and 563 transportation services in Colombia + 16.2% lfl 329 o Multilingua
Slide 16: Core Services – Continental Europe & MEA (CEMEA)
2019 FIRST-HALF RESULTS Core Services – Continental Europe & MEA (CEMEA) Revenue (€ M) o Strong growth driven once again by a very solid sales + 14.5% lfl performance among multinational clients and fast- 519 454 growing local market leaders + 13.8% lfl 257 o Further significant increase in revenue
Slide 17: Core Services – India & Middle East
2019 FIRST-HALF RESULTS Core Services – India & Middle East Revenue (€ M) o Fast-paced expansion in India (TP India), particularly in the 255 transportation services and travel agencies segments + 23.7% lfl + 32.7% lfl o Fast-paced growth of ex-Intelenet operation on a pro forma basis, particularly
Slide 18: Specialized Services
2019 FIRST-HALF RESULTS Specialized Services Revenue (€ M) + 5.0% lfl o Much faster pace of LFL growth in Q2 (+ 6.3%) than in Q1 344 (+ 3.7%) 309 + 6.3% lfl o As expected, LanguageLine Solutions returned to normal 178 growth in the first half of 2019 160 o TLScontact notably picked up in Q2 thanks t
Slide 19: Operating profitability
2019 FIRST-HALF RESULTS Operating profitability ▪ Increase in EBITA margin ▪ Strong increase in operating profit, in-line with the improvement in EBITA before non-recurring items €M H1 2019 H1 2018 Change Revenue 2,564 2,070 + 23.9% EBITA before non-recurring items 327* 246 + 33.3% % revenue 12.8% 1
Slide 20: Earnings performance
2019 FIRST-HALF RESULTS Earnings performance ▪ Higher effective tax rate reflects the contribution from ex-Intelenet activities in India ▪ Lower financial result reflects implementation of IFRS 16 (€21 million charge), while cost of debt is flat with higher debt ▪ Net profit – Group share: €145 mill
Slide 21: Cash flow
2019 FIRST-HALF RESULTS Cash flow ▪ Net free cash flow: €172 million, up from €156 million last year ▪ Strong improvement in cash flow from operations ▪ Controlled expansion and optimized allocation of financial resources, with a stable capex ratio: 3.9% of revenue €M H1 2019 H1 2018 Cash flow* 286
Slide 22: Balance sheet summary
2019 FIRST-HALF RESULTS Balance sheet summary €M 06/30/2019 12/31/2018 €1 = US$1.14 €1 = US$1.15 Non-current assets 4,748 4,126 o/w Intangible assets 3,512 3,535 Working capital* 660 618 Total net assets 5,408 4,744 Equity 2,285 2,225 Provisions and deferred tax liabilities 348 418 Net financial deb
Slide 23: Financial position
2019 FIRST-HALF RESULTS Financial position ▪ Solid financial structure and quick deleveraging ▪ Low average cost of gross debt: 1.7% ▪ Free cash-flow generation to bring net debt / EBITDA ratio to around 2x in 2019, excluding IFRS 16 impacts ▪ BBB- rating and stable outlook confirmed by S&P in May 2
Slide 24: 2019 Outlook
3 2019 OUTLOOK
Slide 25: Outlook: increasing full-year targets
2019 OUTLOOK Increasing full-year targets ▪ Annual like-for-like revenue growth of at least + 8.5% ▪ An increase of at least + 20 basis points in the EBITA margin before non-recurring items* ▪ Continued strong net free cash flow * Excluding IFRS 16 impacts 25
Slide 26: Appendices
4 APPENDICES
Slide 27: H1 2019 Revenue
H1 2019 REVENUE 29th straight quarter of like-for-like growth of at least + 5% Quarterly like-for-like growth (vs. same period of prior year) since January 2012 14% + 13% + 13% 12% + 12% + 12% + 12% 11% 11% + 10% 10% 10% + 10% + 9% + 9% + 8% + 8% 10% Average quarterly + 8% 8% + 9% + 7% + 7% like-for
Slide 28: New presentation by region
NEW PRESENTATION BY REGION Bridge between the former and current business reporting presentation Former presentation Entities deleted (-) Entities added (+) New presentation by activity vs. former presentation vs. former presentation by activity CORE SERVICES CORE SERVICES & D.I.B.S. English World &
Slide 29: New presentation by region: restated 2018 revenue
NEW PRESENTATION BY REGION Restated breakdown of 2018 revenue by quarter and activity Q1 2018 Q2 2018 H1 2018 Q3 2018 Q4 2018 H2 2018 FY 2018 Revenue (€M) CORE SERVICES & D.I.B.S.* 877 884 1,761 919 1,135 2,054 3,815 - English-speaking & Asia-Pacific (EWAP) 349 345 694 369 434 803 1,498 - Ibero-LATA
Slide 30: Alternative performance measures
ALTERNATIVE PERFORMANCE MEASURES Change in like-for-like revenue: Change in revenue at constant exchange rates and scope of consolidation = (current-year revenue - last-year revenue at current-year rates - revenue from acquisitions at current-year rates) / last-year revenue at current-year rates. EB
Slide 31: Thanks!
Thanks! Follow us /company/teleperformance /teleperformanceglobal @teleperformance @Teleperformance_group INVESTOR RELATIONS CONTACT investor@teleperformance.com /teleperformance +33 1 53 83 59 87 / 59 15 blog.Teleperformance.com www.teleperformanceinvestorrelations.com