- A new expanded leading global business services Group with the
acquisition of Majorel: sales up +26.7% on a reported basis
- Pro forma growth* within the upper range of Group expectations:
+0.9%
- Majorel integration plan on track
- 2024 financial objectives confirmed, with momentum improving in
the second half
- Continued cash generation and shareholder returns
Regulatory News:
Teleperformance (Paris:TEP), a global leader in digital business
services, today released its quarterly revenue figures for the
three months ended March 31, 2024.
First-quarter 2024 revenue
€2,542 million
- A new expanded global business services Group following the
integration of Majorel's operations since November 1, 2023
- +26.7% as reported
- +0.9% on a pro forma basis*
First-quarter growth within the upper range of Group
expectations
- As expected, revenue growth shaped by an unfavorable comparison
with the prior-year period (+11% pro forma growth in Q3 2023) and a
persistently uncertain macroeconomic environment
- Continued active development of offshore solutions,
particularly in India for the US market
- Good momentum in financial services and the automotive
sector
- Further robust growth in Specialized Services, in particular
LanguageLine Solutions in the US market and TLSContact
Outlook
- Improved performance expected in the second half due to a more
favorable basis for comparison and additional new business signed
in the recent months.
- 2024 financial objectives confirmed: pro forma revenue growth*
of between +2% and +4%, and an increase in the EBITA margin before
non-recurring items of between +10 bps and +20 bps on a pro forma
basis
- Majorel integration plan on track and cost synergies confirmed
at around €150 million on a run-rate basis by 2025
- Increase in net free cash flow and ongoing return to
shareholders of up to two-thirds of net free cash flow, including
share buy-backs and dividends paid
* 2023 pro forma at constant exchange rates including
Majorel
Commenting on this performance, Teleperformance Chairman and
Chief Executive Officer Daniel Julien said: “The start of the
year shows we are on track to achieve our annual targets,
delivering pro forma growth of nearly +1%, within the upper range
of our forecasts, along with continued operational excellence,
particularly in Specialized Services and in offshore activities in
India for the US market.
Amid persistent uncertainties in the macroeconomic environment,
our first-quarter performance confirms the strength of
Teleperformance's business model: a solid and diversified portfolio
of clients and services, a strong AI innovation drive with more
than 250 projects – including projects based on GenAI – for our
clients, and an agile multilingual operating model combining
offshore services and flexible cloud-based work-from-home
solutions.
We're also continuing to successfully integrate Majorel's
operations into Teleperformance. Our cost synergy plan is now well
underway, enabling us to confirm our target of €150 million in cost
synergies by 2025.
Our performance is expected to improve in the second half due to
a more favorable basis for comparison and additional new business
signed in the recent months. We confirm our annual financial
objectives for growth and margin expansion for 2024. Increase in
net free cash flow and ongoing shareholder returns remain a
priority, while maintaining a robust balance sheet and a BBB
Investment Grade credit rating from S&P”.
------------------------
CONSOLIDATED REVENUE
€ millions
2024
2023
% change
Reported
Pro forma*
Average exchange rate
€1 = US$1.09
€1 = US$1.07
First quarter
2,542
2,006
+26.7%
+0.9%
* 2023 pro forma including Majorel
Consolidated revenue came in at €2,542 million for the first
quarter of 2024, representing a year-on-year increase of +26.7% as
reported and of +0.9% based on pro forma figures*. The
unfavorable currency effect, which had a -€28 million impact on
revenue, stemmed primarily from declines in the Argentine peso,
Turkish lira, US dollar and Egyptian pound against the euro. There
was no significant effect over the quarter from the adjustment for
the impact of high volatility of exchange rates in countries with
hyperinflationary (Turkey and Argentina).
In line with expectations, pro forma growth* for the first
quarter was shaped by a persistently uncertain macroeconomic
environment and a strongly unfavorable basis for comparison (+11%
pro forma growth in Q1 2023). The first half should represent the
low point of fiscal 2024.
Against this backdrop, business was resilient and reflected the
diversity of the Group’s client and service lines portfolio, as
well as its unrivaled global geographic footprint in nearly 100
countries.
Core Services & D.I.B.S. activities delivered strong
pro forma growth*, led by India (offshore for the US market),
Asia-Pacific and certain European countries. However, the momentum
in offshore solutions exerted deflationary pressure on the Group’s
revenue growth over the quarter, particularly for the Americas.
Growth remained particularly varied by industry vertical. The
financial services and automotive sectors enjoyed vigorous growth,
and the retail and technology sectors showed the first signs of
recovery. In contrast, the healthcare, telecoms, and social media
verticals slowed down.
The Specialized Services business continued to deliver
fast-paced revenue growth. This was driven by sustained growth
in the interpreting business (LanguageLine Solutions in the US) and
the continuing post-Covid upsurge in the visa application
management business (TLSContact).
- Analysis of first-quarter 2024 revenue
growth
* 2023 pro forma at constant exchange rates including
Majorel
REVENUE BY ACTIVITY
Q1 2024
Q1 2023
% change
€ millions
Reported
Pro
forma**
CORE SERVICES & D.I.B.S.*
2,184
1,685
+29.7%
-0.9%
Americas
1,046
986
+6.1%
-3.1%
Europe, MEA & Asia-Pacific
1,138
699
+62.9%
+1.3%
SPECIALIZED SERVICES
358
321
+11.3%
+13.7%
TOTAL
2,542
2,006
+26.7%
+0.9%
* Digital Integrated Business Services ** 2023 pro forma at
constant exchange rates including Majorel
- Core Services & Digital Integrated
Business Services (D.I.B.S.)
Core Services & D.I.B.S. revenue amounted to €2,184 million
in first-quarter 2024. Revenue was up +29.7% as reported, and
remained virtually stable year-on-year on a pro forma basis
(-0.9%). The unfavorable currency effect stemmed primarily from
declines in the Argentine peso, Turkish lira, US dollar and
Egyptian pound against the euro. There was no significant effect
during the quarter from the adjustment for the impact of high
volatility of exchange rates in countries with hyperinflationary
(Turkey and Argentina).
The resilient performance in a volatile economic environment
reflected the diversity of Teleperformance's client and business
lines portfolio. Business growth was particularly strong in the
financial services and automotive sectors, as well as in
back-office services.
Revenue in the Americas region amounted to €1,046 million in the
first three months of 2024, a year-on-year increase of +6.1% as
reported. On a pro forma basis, revenue was down -3.1%. The
currency effect was fairly neutral, as declines in the Argentine
peso, US dollar and Egyptian pound against the euro were offset by
gains in the Colombian peso against the European currency.
In a challenging environment, highly competitive offshore
solutions continued to enjoy fast growth, particularly in India for
the US market, where the business also benefited from demand
shifting away from nearshore operations, especially in Mexico and
Colombia, which proved less attractive owing to gains in their
local currencies against the US dollar. These trends had a
deflationary effect that weighed on revenue for the region as a
whole.
In Latin America, domestic business grew at a satisfactory
pace.
The financial services and automotive sectors reported brisk
growth, driven by the ramp-up of major new contracts. However, this
momentum was offset by softer performance in the social media and
healthcare verticals.
- Europe, MEA & Asia-Pacific
Revenue for the region amounted to €1,138 million in the first
three months of 2024, a year-on-year increase of +62.9% as reported
and of +1.3% on a pro forma basis. The currency effect was
unfavorable, mainly due to the decline in the Turkish lira and
Egyptian pound against the euro.
Asia-Pacific delivered the region’s best performance, supported
in particular by the swift ramp-up of contracts in the social media
and travel verticals.
Multilingual activities, which are the primary contributors to
the region’s revenue stream and mainly serve the large global
leaders in their industries, reported satisfactory growth. In
Greece, business benefited in particular from the fast-paced
development of the automotive sector.
Business in the United Kingdom saw solid growth over the period,
reflecting the ramp-up of new contracts in financial services and
retail.
Revenue from Specialized Services was specifically strong and
stood at €358 million in first-quarter 2024, a year-on-year
increase of +13.7% based on pro forma figures and of +11.3% as
reported. The difference between pro forma and reported figures is
due to a slightly negative currency effect resulting from the
decline in the US dollar against the euro.
LanguageLine Solutions, the main contributor to Specialized
Services revenue, saw robust growth driven by market share gains in
the US fast-growing market. This excellent performance was
attributable to the ongoing development of video and telephone
interpreting solutions and the growth in digital platforms.
TLSContact continued to enjoy fast business growth, buoyed by
the post-Covid upsurge in visa application management activities,
which nevertheless slowed year-on-year owing to an unfavorable
basis for comparison.
OUTLOOK
In 2024, Teleperformance is taking a conservative approach to
its outlook and adjusting its business model to the volatile
economic environment. On the strength of a resilient first quarter,
the Group confirms its annual financial targets:
- Pro forma revenue growth* of +2% to +4% ;
- Increase in the EBITA margin before non-recurring items of
between +10 bps and +20 bps on a pro forma basis (vs. 14.9% in
2023), excluding Majorel integration costs ;
- Increase in net free cash flow and ongoing return to
shareholders of up to two-thirds of net free cash flow, including
share buy-backs and dividends paid.
We expect to see improved business growth in the second half of
2024 due to a more favorable basis for comparison and additional
new business signed in the recent months.
* 2023 pro forma
-----------------
DISCLAIMER
All forward-looking statements are based on Teleperformance
management’s present expectations of future events and are subject
to a number of factors and uncertainties that could cause actual
results to differ materially from those described in the
forward-looking statements. For a detailed description of these
factors and uncertainties, please refer to the “Risk Factors”
section of our Universal Registration Document, available at
www.teleperformance.com. Teleperformance undertakes no obligation
to publicly update or revise any of these forward-looking
statements.
WEBCAST/CONFERENCE CALL WITH ANALYSTS AND INVESTORS
Thursday, April 30, 2024 at 6:15 pm CET time: A conference
call and webcast will be held today at 6:15 PM CEST. The webcast
will be available live or for delayed viewing at:
https://channel.royalcast.com/landingpage/teleperformance/20240430_1/
All the documentation related to First-Quarter 2024 Revenue is
available on http://www.teleperformance.com at:
https://www.teleperformance.com/en-us/investors/publications-and-events/financial-publications/
INDICATIVE INVESTOR CALENDAR
Annual shareholders’ meeting: May 23, 2024 Ex-dividend date: May
28, 2024 Dividend payment: May 30, 2024
First-half 2024 results: July 30, 2024 Thirst-quarter 2024
revenue: November 6, 2024
ABOUT TELEPERFORMANCE GROUP
Teleperformance (TEP – ISIN: FR0000051807 – Reuters: TEPRF.PA
- Bloomberg: TEP FP), is a global leader in digital business
services which consistently seeks to blend the best of advanced
technology with human empathy to deliver enhanced customer care
that is simpler, faster, and safer for the world’s biggest brands
and their customers. The Group’s comprehensive, AI-powered service
portfolio ranges from front-office customer care to back-office
functions, including operations consulting and high-value digital
transformation services. It also offers a range of specialized
services such as collections, interpreting and localization, visa
and consular services, and recruitment process outsourcing
services. The teams of multilingual, inspired, and passionate
experts and advisors, spread in close to 100 countries, as well as
the Group’s local presence allows it to be a force of good in
supporting communities, clients, and the environment. In 2023,
Teleperformance reported consolidated revenue of €8,345 million
(US$9 billion) and net profit of €602 million.
Teleperformance shares are traded on the Euronext Paris market,
Compartment A, and are eligible for the deferred settlement
service. They are included in the following indices: CAC 40, STOXX
600, S&P Europe 350, MSCI Global Standard and Euronext Tech
Leaders. In the area of corporate social responsibility,
Teleperformance shares are included in the CAC 40 ESG since
September 2022, the Euronext Vigeo Euro 120 index since 2015, the
MSCI Europe ESG Leaders index since 2019, the FTSE4Good index since
2018 and the S&P Global 1200 ESG index since 2017.
For more information: www.teleperformance.com Follow us on X
(Twitter): @teleperformance
APPENDIX 1
GLOSSARY - ALTERNATIVE PERFORMANCE MEASURES
Change in like-for-like revenue: Change in revenue at
constant exchange rates and scope of consolidation = [current year
revenue - prior year revenue at current year rates - revenue from
acquisitions at current year rates] / prior year revenue at current
year rates.
Pro forma revenue: The pro forma revenue reflects the
impact from the acquisition of 100% control of Majorel by
Teleperformance on the revenue of Teleperformance for the year
ended December 31, 2023, as if the transaction took place on
January 1, 2023.
Change in pro forma revenue (or pro forma growth): Change
in revenue at constant exchange rates and scope of consolidation,
as if the acquisition of 100% control of Majorel by Teleperformance
took place on January 1, 2023 = [2024 revenue – 2023 pro forma
revenue at 2024 exchange rates] / 2023 pro forma revenue at 2024
exchange rates.
EBITDA before non-recurring items or current EBITDA (Earnings
before Interest, Taxes, Depreciation and Amortization):
Operating profit before depreciation and amortization, amortization
of intangible assets acquired as part of a business combination,
goodwill impairment charges and non-recurring items.
EBITA before non-recurring items or current EBITA (Earnings
before Interest, Taxes and Amortization): Operating profit
before amortization of intangible assets acquired as part of a
business combination, goodwill impairment charges and non-recurring
items.
Non-recurring items: Principally comprised of
restructuring costs, incentive share award plan expense, costs of
closure of subsidiary companies, transaction costs for the
acquisition of companies, and all other expenses that are unusual
by reason of their nature or amount.
Net free cash flow: Cash flow generated by the business -
acquisitions of intangible assets and property, plant and equipment
net of disposals - financial income/expenses.
Net debt: Current and non-current financial liabilities -
cash and cash equivalents.
Diluted earnings per share (net profit attributable to
shareholders divided by the number of diluted shares and
adjusted): Diluted earnings per share is determined by
adjusting the net profit attributable to ordinary shareholders and
the weighted average number of ordinary shares outstanding by the
effects of all potentially dilutive ordinary shares. These include
convertible bonds, stock options and incentive share awards granted
to employees when the required performance conditions have been met
at the end of the financial year.
APPENDIX 2
QUARTERLY BREAKDOWN OF 2023 REVENUE (PRO FORMA)
€ millions
Q1 2023
Q2 2023
Q3 2023
Q4 2023
2023
Teleperformance
2,006
1,954
1,989
2,053*
8,002
Majorel
541
527
536
526
2,131
TOTAL PRO FORMA
2,547
2,481
2,525
2,579
10,132
* Teleperformance Q4 2023 reported revenue = €2,396 million,
including two months of Majorel’s operations
NB: The alternative performance
measures (APMs) are defined in the Appendix
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240430014394/en/
FINANCIAL ANALYSTS AND INVESTORS Investor relations and
financial communications department TELEPERFORMANCE Tel: +33 1 53
83 59 15 investor@teleperformance.com
PRESS RELATIONS Europe Karine Allouis – Laurent
Poinsot IMAGE7 Tel: +33 1 53 70 74 70 teleperformance@image7.fr
PRESS RELATIONS Americas and Asia-Pacific Nicole
Miller TELEPERFORMANCE Tel: + 1 629-899-0675
nicole.miller@teleperformance.com
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