PARIS--(BUSINESS WIRE)--Regulatory News:
The Board of Directors of Teleperformance (Paris:RCF) met on February 27, 2012 and reviewed the consolidated financial statements for the year ended December 31, 2011.
| € millions | 2011 | 2010 | ||
|
€1 = US$1.39 |
€1 = US$1.33 |
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| Revenue | 2,126.2 |
2,058.5 |
||
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Growth as reported |
+3.3% |
|
||
|
EBITDA before non-recurring items* |
269.0 | 257.8 | ||
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EBITDA margin before non-recurring items |
12.6% |
12.5% |
||
|
EBITA before non-recurring items*** |
181.4 | 174.5 | ||
|
EBITA margin before non-recurring items |
8.5% |
8.5% |
||
| Net operating profit | 152.9 | 118.7 | ||
|
Net profit – attributable to shareholders |
92.3 | 71.6 | ||
| Free cash flow | 86.5 | 74.5 | ||
| € millions | December 31, 2011 | December 31, 2010 | ||
| Equity | 1,277.8 | 1,230.5 | ||
| Net cash surplus | +25.1 | +1.1 | ||
|
Statements of Income – 2011: €1 = US$1.39 – 2010: €1 = US$1.33 |
Balance Sheets – 2011: €1 = US$1.29 – 2010: €1 = US$1.34 |
|
| *Before provisions for restructuring operations (2010: €47 million in France – 2011: €12.3 million in Argentina, Spain and Italy) | ||
| ** EBITA before non-recurring items: Net operating profit before amortization of acquired intangible assets and non-recurring items | ||
REVENUE
Revenue amounted to €2,126.2 million in 2011 compared with €2,058.5 million in 2010, up 3.3% as reported and 3.5% like-for-like, within the target range announced at the beginning of the year.
The improvement in revenue was almost exclusively attributable to organic growth, as the positive and negative effects of changes in the scope of consolidation and exchange rates were mutually offsetting.
Changes in the scope of consolidation, representing a contribution of €36.1 million, resulted from the acquisition of beCogent in the United Kingdom and US Solutions Group Inc. (USSG) in the United States. Both companies were consolidated as of August 1, 2010.
The currency effect was negative, trimming €41 million from revenue for the year. Teleperformance was particularly affected by the fall of the US dollar against the euro, which accounted for €29.7 million of the adverse impact.
REVENUE PERFORMANCE BY REGION
| € millions | 2011 | 2010 | Change | |||||
| Reported | Like-for-like* | |||||||
| English-speaking market & Asia-Pacific | 819.6 | 761.9 | + 7.6% | + 6.5% | ||||
| Ibero-LATAM | 628.1 | 581.9 | + 7.9% | + 10.5% | ||||
| Continental Europe & MEA | 678.5 | 714.6 | -5.1% | - 5.2% | ||||
| TOTAL | 2,126.2 | 2,058.5 | + 3.3% | + 3.5% | ||||
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* at constant exchange rates and comparable scope of consolidation |
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- English-speaking market & Asia-Pacific
Revenue generated in this region advanced 7.6% as reported and 6.5% like-for-like, representing roughly 38% of the Group total in 2011. In the United States, revenue levels were very satisfactory, despite the unexpected non materialization of volumes for a major contract signed in fourth-quarter 2010. The 2010 acquisition of UK-based beCogent and US-based US Solutions Group Inc. also contributed to the region’s performance.
- Ibero-LATAM
This region also delivered solid growth for the year, with gains of 7.9% as reported and 10.5% like-for-like. The increase mainly stemmed from the robust expansion of operations in Brazil. At the same time, most of the other countries in the region saw an improvement in business during the year, except for Argentina, where exports became uncompetitive, and Spain, where the Group reduced its exposure in a weakened economic environment.
- Continental Europe & MEA
Revenue in the Continental Europe & MEA region contracted by 5.1% as reported and 5.2% at constant scope of consolidation. The region’s contribution to total revenue continued to shrink, representing 31.9% of the total in 2011 versus 34.7% the previous year.
In France, which led the decline, operations were concentrated at 14 centers and the industrial restructuring plan was completed in the third quarter of 2011. Having streamlined its organization and slimmed down its cost structure, the French subsidiary can now focus on building new sales momentum.
In Italy, the market remained fragile throughout the year and the Group deployed a program to gradually adjust its operations base to the new conditions.
Other regions enjoyed satisfactory growth, with the vitality of the “Europe-Mediterranean-South East” region, the Scandinavian countries, Benelux and Eastern Europe confirming the strategic importance of the Group's operations in continental Europe.
RESULTS
EBITA before non-recurring items (net operating profit before amortization of acquired intangible assets and non-recurring items) stood at €181.4 million compared with €174.5 million in 2010. EBITA margin before non-recurring items was stable at 8.5%, in line with the target set by the Group in June 2011. Profitability increased significantly in the second half of the year, with EBITA before non-recurring items representing 10.6% of revenue versus 6.5% in the first half.
The improvement partly reflected seasonal effects on business, but it was also the result of disciplined management throughout the year.
Note that the 2011 results were achieved in an environment shaped by less favorable foreign exchange rates, the unanticipated “Arab Spring” events and the loss of expected volumes on a major contract in the United States.
By region, Continental Europe & MEA once again made a small positive contribution to EBITA, while the other two regions continued to report EBITA margin before non-recurring items in the double digits, at 10.3% of revenue in the English-speaking market & Asia-Pacific and 11.1% in the Ibero-LATAM.
Non-recurring expenses totaled €19.2 million, including €12.3 million in costs related to restructuring programs in Argentina, Spain and Italy (versus €47 million spent in 2010 on restructuring in France). The remaining €6.9 million concerned a non-compete indemnity payable to a former senior executive and recognition of the new performance share plan costs.
Net operating profit surged 28.8% to €152.9 million in 2011 from €118.7 million in 2010, representing 7.2% of revenue versus 5.8% the previous year.
Income tax expense came to €51.8 million in 2011, compared with €41.1 million in 2010. The increase was in line with the growth in net operating profit, as evidenced by the effective tax rate which stood at 35.2% versus 35.7% in 2010.
Net profit attributable to non-controlling interests climbed to €3.1 million from €2.5 million in 2010. The program to buy out minority shareholders deployed in second-half 2011 should reduce this figure by half in the future, all other things being equal.
Net profit attributable to shareholders amounted to €92.3 million, up 29% on the 2010 figure of €71.6 million.
FINANCIAL STRUCTURE
- Free cash flow
In 2011, Teleperformance was particularly vigilant about managing its cash flow. As a result, capital expenditure for the year was limited to €97.1 million, or 4.6% of revenue, compared with €103 million, or 5.0% of revenue in 2010. The outlay mainly concerned the development of six new campuses in six different countries and global license portfolio upgrades.
Free cash flow rose sharply to €86.5 million from €74.5 million in 2010. The increase mainly reflected measures to reduce working capital requirement and was achieved despite higher income taxes and the payment of €35.5 million in benefits under the voluntary separation plan in France.
- Financing
The Group optimized its financing policies in last year’s financial environment.
It stepped up its program to buy out minority shareholders, rather than making acquisitions that would be excessively dilutive, and dedicated €18 million to buying back 2% of the share capital at an average price of €15.32 per share, to cover rights granted under the performance share plan introduced during the year.
At December 31, 2011, the Group’s balance sheet was even stronger. Equity stood at €1,277.8 million compared with €1,230.5 million a year earlier, while the net cash surplus was very considerably higher, at €25.1 million, versus €1.1 million at end-2010.
Teleperformance ended the year with a robust liquidity position, thanks to its €240 million undrawn syndicated credit facility.
2011 DIVIDEND
In light of the improvement in net profit, at the Annual Meeting on May 29, 2012 the Board of Directors will recommend that shareholders raise the dividend to €0.46 per share, thereby maintaining the gradual increase in the payout ratio initiated two years ago.
STRATEGY AND OUTLOOK FOR 2012
The global leader in its segment, Teleperformance intends to pursue its strategy of value creation and balanced growth in 2012. The English-speaking market & Asia-Pacific region as well as the Ibero-LATAM region should continue to enjoy double-digit EBITA margins before non-recurring items, while the Continental Europe & MEA region, despite an uncertain economic situation, should begin showing signs of margin improvement.
In 2012, Teleperformance expects to achieve like-for-like growth of 2% to 4%.
The Group will focus on improving its profitability ratios, with the primary objective of generating overall EBITA margin before non-recurring items of between 8.6% and 9%.
CERTIFICATION OF THE ACCOUNTS BY THE AUDITORS
The consolidated financial statements have been audited. The auditors will issue their report once they have completed the procedures required for the publication of the annual financial report.
UPCOMING FINANCIAL ANNOUNCEMENT
First-quarter 2012 revenue: May 10, 2012
ABOUT TELEPERFORMANCE
Teleperformance, the world’s leading provider of outsourced CRM and contact center services, serves companies around the world with customer acquisition, customer care, technical support and debt collection programs. In 2011, it reported consolidated revenue of €2,126.2 million (US$2,955.4 million) based on €1 = US$1.39).
The Group operates 98,000 computerized workstations, with more than 130,000 full-time equivalent employees across 248 contact centers in 49 countries. It manages programs in more than 66 languages and dialects on behalf of major international companies operating in a wide variety of industries.
Teleperformance shares are traded on the NYSE Euronext Paris market, Compartment A, and are eligible for the deferred settlement service. Teleperformance is included in the following indices: SBF 120, STOXX 600 and France CAC Mid & Small.
Symbol: RCF - ISIN : FR0000051807 - Reuters: ROCH.PA - Bloomberg: RCF FP
Website: www.teleperformance.com
| STATEMENT OF INCOME | ||||
|
€ thousands |
||||
| 2011 | 2010 | |||
| Revenues | 2,126,222 | 2,058,473 | ||
| Other revenues | 7,348 | 9,099 | ||
| Personnel | (1,486,954) | (1,447,116) | ||
| Expense relating to share-based payments | (2,044) | |||
| External expenses | (365,981) | (346,113) | ||
| Taxes other than income taxes | (12,441) | (13,847) | ||
| Depreciation and amortization | (87,646) | (83,329) | ||
| Amortization of intangible assets acquired as part of a business combination | (9,270) | (8,783) | ||
| Change in inventories | 185 | (121) | ||
| Other operating income | 5,587 | 5,768 | ||
| Other operating expenses | (22,095) | (55,322) | ||
| Net operating profit before finance costs | 152,911 | 118,709 | ||
| Income from cash and cash equivalents | 869 | 3,161 | ||
| Interest on financial liabilities | (8,311) | (8,805) | ||
| Net financing costs | (7,443) | (5,644) | ||
| Other financial income | 33,922 | 22,606 | ||
| Other financial expenses | (32,125) | (20,508) | ||
| Share of profit of equity-accounted investees (net of tax) | 0 | |||
| Profit before taxes | 147,265 | 115,163 | ||
| Income tax | (51,849) | (41,090) | ||
| Net profit | 95,416 | 74,073 | ||
| Net profit - Group share | 92,274 | 71,619 | ||
| Net profit attributable to non-controlling interests | 3,142 | 2,454 | ||
| Basic and diluted earnings per share (€) | 2 | 1 | ||
| BALANCE SHEET | ||||
|
€ thousands |
||||
| ASSETS | 12.31.2011 | 12.31.2010 | ||
| Non-current assets | ||||
| Goodwill | 710,272 | 701,059 | ||
| Other intangible assets | 97,972 | 107,246 | ||
| Property, plant and equipment | 255,170 | 256,007 | ||
| Financial assets | 24,099 | 23,454 | ||
| Deferred tax assets | 31,923 | 29,666 | ||
| Total non-current assets | 1,119,436 | 1,117,432 | ||
| Current assets | ||||
| Inventories | 621 | 454 | ||
| Current income tax receivable | 40,838 | 33,265 | ||
| Accounts receivable - Trade | 450,503 | 482,286 | ||
| Other current assets | 93,104 | 103,187 | ||
| Other financial assets | 6,961 | 7,397 | ||
| Cash and cash equivalents | 159,612 | 118,355 | ||
| Total current assets | 751,639 | 744,944 | ||
| Total assets | 1,871,075 | 1,862,376 | ||
| EQUITY AND LIABILITIES | 12.31.2011 | 12.31.2010 | ||
| Equity | ||||
| Share capital | 141,495 | 141,495 | ||
| Share premium | 556,181 | 556,181 | ||
| Translation reserve | 23,554 | 20,115 | ||
| Other reserves | 552,198 | 506,414 | ||
| Total equity attributable to equity holders of the parent | 1,273,428 | 1,224,205 | ||
| Non-controlling interests | 4,364 | 6,246 | ||
| Total equity | 1,277,792 | 1,230,451 | ||
| Non-current liabilities | ||||
| Long-term provisions | 5,457 | 5,465 | ||
| Financial liabilities | 25,686 | 29,439 | ||
| Deferred tax liabilities | 48,357 | 46,349 | ||
| Total non-current liabilities | 79,500 | 81,253 | ||
| Current liabilities | ||||
| Short-term provisions | 25,898 | 63,243 | ||
| Current income tax | 26,577 | 25,619 | ||
| Accounts payable - Trade | 83,345 | 93,365 | ||
| Other current liabilities | 269,106 | 280,671 | ||
| Other financial liabilities | 108,857 | 87,774 | ||
| Total current liabilities | 513,783 | 550,672 | ||
| Total equity and liabilities | 1,871,075 | 1,862,376 | ||
| CASH FLOW STATEMENT | ||||
|
€ thousands |
||||
| Cash flows from operating activities | 2011 | 2010 | ||
| Net profit - Group share | 92,274 | 71,619 | ||
| Net profit attributable to minority interests | 3,142 | 2,454 | ||
| Income tax expense | 51,849 | 41,090 | ||
| Depreciation and amortization | 96,439 | 92,112 | ||
| Change in provisions | (38,326) | 29,279 | ||
| Unrealized gains and losses on financial instruments | 1,206 | (1,851) | ||
| Gains/losses on disposal of non-current assets, net of tax | 494 | (197) | ||
| Income tax paid | (58,244) | (52,906) | ||
| Other | 2,164 | 787 | ||
| Internally generated funds from operations | 150,998 | 182,387 | ||
| Change in working capital requirements relating to operations | 32,667 | (4,855) | ||
| Net cash from operating activities | 183,665 | 177,532 | ||
| Cash flows from investing activities | ||||
| Acquisition of intangible assets and property, plant and equipment | (97,114) | (102,960) | ||
| Acquisition of subsidiaries, net of cash acquired | (15,087) | (79,570) | ||
| Loans and advances made | (32) | (116) | ||
| Proceeds relating to disposals of intangible assets and property, plant and equipment | 1,609 | 2,354 | ||
| Proceeds relating to disposals of subsidiaries, net of cash disposed of | 1,182 | 1,431 | ||
| Net cash from investing activities | (109,442) | (178,861) | ||
| Cash flows from financing activities | ||||
| Proceeds from the issue of share capital | 4,313 | |||
| Acquisition of treasury shares | (18,015) | 186 | ||
| Dividends paid to parent company shareholders | (18,654) | (18,677) | ||
| Dividends paid to minority interests in consolidated subsidiaries | (256) | (53) | ||
| Proceeds from new borrowings | 39,722 | 10,895 | ||
| Repayment of borrowings | (38,942) | (100,070) | ||
| Net cash from financing activities | (36,145) | (103,406) | ||
| Change in cash and cash equivalents | 38,078 | (104,735) | ||
| Effect of exchange rates on cash held | (2,717) | 596 | ||
| Net cash at January 1 | 111,712 | 215,851 | ||
| Net cash at December 31 | 147,073 | 111,712 | ||
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