Slide 1: Teleperformance Press Conference November 22nd, 2006
Teleperformance Press Conference November 22nd, 2006
Slide 2: The Contact Center Market
The Contact Center Market In 2006, the outsourced contact center market has continued to expand. • +9% in terms of business volumes in 2006 vs. 2005 (+/- 7.5% in terms of value = €40 billion) • Customer Care and Technical Assistance are still the major growth drivers in the contact center industry.
Slide 3: Market Trends
Market Trends ¾ Contact centers are now considered as a strategic activity* • Key objectives: customer satisfaction and profitability (35% of in-house contact centers are centers deeply in deficit) – Optimization of productivity and methods: • At the center level (through performance indicators, cus
Slide 4: Growth Prospects
Growth Prospects* ¾ An approximate 10% increase in business volumes in 2007 and in the next 4 years • Consistent increase in customer care services until 2010; they will remain a major market driver. • Development of the technical assistance segment will slow down in 2010, but will still represent n
Slide 5: Teleperformance on its market
Teleperformance on its market 2004 IDC Leadership Grid: Worldwide Customer Care BPO Last two years 2005 2006 2005 Rating Objective N GAI 2004 Rating SRT 5
Slide 6: Teleperformance in 2006
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Slide 7: Worldwide CRM Outsourcer
Worldwide CRM Outsourcer 42 countries, 38 domestic or mixed and 4 offshore 263 contact centers, 172 owned by TP / 91 F. M. centers 60 languages and dialects 56,482 workstations & 67,000 FTEs Over 1,000 clients, including 196 clients > €1 million Industry leading geographic footprint 7
Slide 8: The Market Leader in Europe
The Market Leader in Europe 28 years of expertise and leadership in the European marketplace 140 contact centers and over 21,000 workstations 26 countries in Europe and in the Middle East Northern Europe: Sweden, Denmark, Finland, Norway, England, Northern Ireland Central & Eastern Europe: Austria,
Slide 9: Consolidated footprint in Americas
Consolidated footprint in Americas In 13 years, Teleperformance became a key player in Americas. Headquarters for Americas and Asia-Pacific in Miami 111 contact centers and more than 29,500 workstations 8 countries North & Central America: Canada, United States and Mexico Central America and
Slide 10: Growing Footprint in Asia-Pacific
Growing Footprint in Asia-Pacific Teleperformance is preparing its future growth in Asia 11 contact centers More than 4,500 workstations 8 countries: Korea, Singapore, Indonesia, Philippines, Australia, India, Japan, China 10 owned contact centers and 1 Facilities Management center 10
Slide 11: A Wide and Diversified Offshore Network
A Wide and Diversified Offshore Network With 12,090 workstations, our offshore capacities increased by 27% in 2006 versus 2005 and represent 21% of the Group’s global capacities. Philippines: 2,506 Tunisia: 2,450 2004 2005 2006 Mexico: 2,353 Argentina: 1,350 Offshore Canada: 945 Workstatio
Slide 12: Teleperformance Offshore Network
Teleperformance Offshore Network: Network 12 offshore locations worldwide 12
Slide 13: Split of Revenues per Region
Split of Revenues per Region The ROW (Rest of the world) region now represents 13% of the Group’s total revenues (9% in 2005). Such increase mainly results from the transaction finalized in Brazil at the end of 2004. 13
Slide 14: The Group keeps focusing on Inbound activities
The Group keeps focusing on Inbound activities • +1 pt increase in Inbound business in 2006 versus 2005 +1 pt increase compared to 2003 (47%) • 4 pt decrease in Outbound business in 2006 versus 2006 22 pt decrease compared to 2003 (51%) 14
Slide 15: Customer Care-Oriented End-to-End Offer
Customer Care-Oriented End-to-End Offer • Customer Care increased by 5 pt compared to 2005. • Technical Assistance increased by 1 pt (+5 pt in France). • Customer Acquisition decreased by 7 pt, mainly as a consequence of lower Outbound business volumes. 15
Slide 16: Split of Activities per Region
Split of Activities per Region: Customer Care and Customer Value Growth are still the main activities managed by the Group across all regions. 16
Slide 17: Clients
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Slide 18: Our Clients
Our Clients Our top client represents 10.5% of our revenues. 100% of our clients ranked in the Top 10 have been loyal to the Group for more than 3 years. 18
Slide 19: Partnership Diversity
Partnership Diversity Our presence increased by 5 pt in the Telecommunications / ISP sectors as Internet / ADSL / Mobile Telephony services boosted. Stronger presence in the Insurance industry (2 pt) 19
Slide 20: Our International Clients
Our International Clients Revenues generated with our international clients strongly increased (+32%), compared to 2005. The number of international clients in our client portfolio has increased by 5.5%. 25 international clients operate in more than 4 countries. 20
Slide 21: Key Highlights for 2006
Key Highlights for 2006 Change of legal name • SR.Teleperformance became Launch of strategic “start-up” companies • TP Chile and TP Nearshore (Mexico + Central America), TP China • Creation of debt collection operations in all European countries Acquisitions and consolidations • TP USA merged with C
Slide 22: Key Highlights for 2006
Key Highlights for 2006 A two-digit organic growth rate • Growth rate exceeding competition – Implementation of the new business contract signed in 2005 – Very good renewal rate in terms of client business volumes Successful new business activities • Major contracts signed in Energy, IT and Automoti
Slide 23: The Major Highlight
The Major Highlight At the end of 2006, Teleperformance will end up as the Co-Leader on the Customer Care market, matching the level of revenues achieved by Convergys (CMG), and will also benefit from: •The most dynamic growth trend •The only real worldwide network •The most diversified client base
Slide 24: Objectives for 2006
Objectives for 2006 24
Slide 25: Updated Objectives for 2006 (€1 = US$1.25)
Updated Objectives for 2006 (€1 = US$1.25) Revenues Revenue forecast: €1,385 million, i.e.: +16%, based on published data +11.5% on a comparable basis Operating Margin(*) EBITA forecast: €129 million, vs. €106.1 millions i.e.: +22% compared to 2005 Net Income, Group Share(**) Forecast > €70 million,
Slide 26: Changes in the scope of consolidation in 2006
Changes in the scope of consolidation in 2006 External Growth Date of 1st Scope of Transactions Consolidation Consolidation Effect in 2006 (M€) Acquisitions in 2006 EUROPE 13.0 .Direct Star (Russia) January 1st, 2006 .Photel (Hungary) July 1st, 2006 .LibertyCall / Extratel (Switzerland) Dec. 1st, 20
Slide 27: Changes in the scope of consolidation in 2006: Discontinued Operations
Changes in the scope of consolidation in 2006 Date of Scope of Discontinued Consolidation Deconsolidation Operations Effect in 2006 (M€) Year 2006 Marketing Services 5 France / Belgium End of Q1 2006 Market Research 10 France End of Q3 2006 Italy / Germany End of Q3 2006 Total 15 27
Slide 28: Objectives in 2006: Activity
Objectives in 2006 Activity (in Millions of Euros) 2006 2005 % Published Data €1 = US$1.25 €1 = US$1.2428 +0.6 Europe 651 580.9 +12 NAFTA 572 480.2 +19 Rest of the World 162 134.7 +20 Total 1,385 1,195.9 +16 On a comparable basis €1 = US$1.2428 €1 = US$1.2428 Pro Forma Europe 651.0 580.9 +12.0 NAFTA
Slide 29: Free Stock Option Plan
Free Stock Option Plan Date of grant: August 2nd, 2006 Date of acquisition: August 2nd, 2006 Number of shares granted: 776,600 Current Share Value: €28.40 Global amount of the benefits granted to be recognized as payroll expenses as of August 2nd, 2006: €22.1 million -Year 2006: (5/24): €4.6 million
Slide 30: Objectives in 2006: Profitability
Objectives in 2006 Profitability (in Millions of Euros) 2006 2005 % Revenues 1,385 1,196 +16 EBITDA 183 158.6 Income from Operations 129 106.1 +22 Incl. IFRS (stock option plans) [5.2] [0.6] Rate 9.4% 8.9% Financial Result -15 -12.2 Incl. IAS 32-39 [-4.9] [-4.2] Income before tax and discontinued op
Slide 31: Income from Operations
Income from Operations Operating Margin – Objective Achievements Comparative Analysis in 2006 in 2005 Operating Margin - Published 129 106.1 9.4% 8.9% Adjustments +2 +0.6 - Profit from operations sold(*) -3.2 - - Share-based payments +5.2 +0.6 . Stock options -0.6 -0.6 . Free shares -4.6 - Operating
Slide 32: Objectives in 2006: Cash Flow Statement
Objectives in 2006 Cash Flow Statement - Year 2006 (in Millions of Euros) 2006 2005 Cash Flow 140 120.5 Changes in Working Capital Requirements -22 -17.8 CAPEX -59 -47.5 Rate / Revenues 4.3% 4.0% Free Cash Flow 59 55.2 Changes in the Scope of Consolidation -11 -10.0 Distribution (*) -15 -5.6 Financi
Slide 33: Variation in net financial indebtedness - Year 2006
Objectives in 2006 Variation in net financial indebtedness - Year 2006 (in Millions of Euros) Net Financial Indebtedness at January 1st, 2006 -178.6 Capital Increase +252.0 Free Cash Flow +59.0 Changes in the Scope of Consolidation -11.0 Dividends -15.0 IFRS Impact (OCEANE & commitments to minority
Slide 34: Evolution of the Group's Shareholding after Capital Increase
Evolution of the Group’s Shareholding after Capital Increase with preferential subscription rights dated November 3rd, 2006 Breakdown Before Capital Increase After Issue of Rights Issue of Rights Number of shares issued 35,322,446 +11,774,148 47,096,594 Maximum number of 9,822,646 +629,799 10,452,44
Slide 35: New Shareholding Structure
New Shareholding Structure ¾ Intended Subscriptions: ¾ GIMD: exercise of rights on a non-reducible basis ¾ Jacques Berrebi: up to 11% of current shareholding ¾ Daniel Julien, Oliver & Sylvie Douce: no subscription October 4th, 2006 Post-issue GIMD GIMD 6.5% Olivier Douce 6.5% Olivier Douce 4.3% Jacq
Slide 36: Shareholding after Call for Capital
Shareholding after Call for Capital Breakdown Capital Voting Rights of Shareholding Founders 9.1% 11.8% GIM Dassault 6.5% 9.2% Subtotal 15.6% 21.0% Public 84.4% 79.0% Total 100.0% 100.0% 36
Slide 37: Strategy and Priorities for 2007
Strategy and Priorities for 2007 37
Slide 38: Objectives for 2007
Objectives for 2007 1. Maintaining an organic growth rate exceeding the market average 2. Achieving significant results in terms of acquisitions as of the first semester 3. Stabilizing our operating profitability around 10% Making Teleperformance a worldwide reference in the Contact Center industry
Slide 39: Strategy for 2007
Strategy for 2007 On a comparable basis Teleperformance benefits from an excellent growth dynamics sustained by its high quality client portfolio. In 2007, we will focus on: Making the offer more consistent in all countries, especially for technical assistance and debt collection services Accele
Slide 40: Strategy for 2007: External Growth
Strategy for 2007 External Growth Our successful capital increase of €260 million provides us with all means required to carry out an ambitious acquisition policy. The initial results are expected in the first semester 2007. Current potential targets are mainly operations exceeding €/$100 million
Slide 41: Strategy for 2007: The Group's Financial Strategy
Strategy for 2007 The Group’s Financial Strategy Complying with the basic financial standards is still the Teleperformance Group’s priority: Use of indebtedness, if required, but always under control (Gearing < 30%, if possible) Achieving a specific operating profit level on a long-term basis EB
Slide 42: Strategy for 2007: Summary
Strategy for 2007 Summary Considering the current business trend, in 2007 we may expect the following: Maintaining a sustained global growth rate Consolidating, at least, our co-leading position on the global market Gaining the leadership position in specific local markets. 42
Slide 43: Outlook for 2007
Outlook for 2007 On a comparable basis / (€1 = US$1.25) Assumption: Implementation of the OCEANE anticipated amortization clause in January 2007 Conversion of all outstanding bonds Revenues: €1,490 million +7.5% Income from operations(*): €145 / 150 million Margin Rate(*): 10% Net Income, Grou
Slide 44: Teleperformance could gain worldwide leadership position in 2007
As a result of a strategy combining external and internal growth, Teleperformance could gain the worldwide leadership position in 2007. 44
Slide 45: Thanks for your attention!
Thanks for your attention! 45