18 April 2013
Transcom
First Quarter 2013 Results
Presentation
Johan Eriksson, President & CEO
Outstanding
Customer
Experi...
Transcom at a glance
1
3
• A global customer experience
specialist...
• ...providing outsourced
customer care, sales,
technical support, and cred...
Transcom in numbers
• 30,000 people
• 70 contact centers, onshore, off-shore and near shore
• 27 countries
• Delivering se...
We have an extensive global footprint
Home markets
 Austria
 Netherlands
 Slovakia
 UK
 Belgium
 Germany
 Norway
 ...
Transcom’s organization
6
• Corporate management
- CEO, CFO, CIO, Head of Operations, Head of Global
Sales & Accounts
• Re...
Transcom’s service portfolio
7
• Customer service
Customer experience specialists trained to support
best-in-class product...
Recap of our situation and focus areas
8
Situation today and short-term focus
• Transcom’s profitability has decreased
in ...
Our performance in Q1 2013
2
Revenue in Q1 2013 increased 15.9% compared to Q1 2012
38.1 43.2
25.4
31.6
30.6
33.2
24.6
28.014.0
16.7
14.4
17.8
Q1 2012 ...
EBIT increased by €5m in Q1 2013 compared to Q1 2012
11
Restructuring
net effects
Volume &
efficiency-
driven
gains
Expans...
EBIT margin improvements in North America & APAC, Central
Europe, South and CMS, counterbalanced by North and Iberia
12
20...
We need to successfully address a number of short-
and medium-term operational and financial challenges
13
Stop the losses...
What will it take for Transcom to return to historical margins?
14
Key performance
driver
Trend vs. Q1 2012 Q1 2013 vs. Q1...
111.2
65.3 65.0
71.0
75.9
80.7
86.1
73.4
13.2 11.9
17.2
32.1
38.1
59.3
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
0...
3
Going forward
– Transcom’s strategic direction
17
Transcom’s brand promise
Outstanding Customer
Experience, driving
revenue and brand
loyalty
”
North America and Asia Pacific
• Continue expanding in local markets in Asia Pacific
Latin America
• Serving domestic mark...
19
Short-term focus
• Continuous focus on executing turnaround in
underperforming areas
• Continued focus on revenue expan...
Thank you!
Questions?
Transcom Q113 results presentation
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Transcom Q113 results presentation

  1. 1. 18 April 2013 Transcom First Quarter 2013 Results Presentation Johan Eriksson, President & CEO Outstanding Customer Experience
  2. 2. Transcom at a glance 1
  3. 3. 3 • A global customer experience specialist... • ...providing outsourced customer care, sales, technical support, and credit management... • ...through an extensive network of contact centers and work-at-home agents Transcom’s business is to help make sure that our clients’ customers form positive perceptions of their interactions with them. ” What is Transcom?
  4. 4. Transcom in numbers • 30,000 people • 70 contact centers, onshore, off-shore and near shore • 27 countries • Delivering services in 33 languages... • ...to over 400 clients in various industry verticals • €605.6 million revenue in 2012 • Market cap: SEK 1046.2 million as at March 28, 2013. Listed on NASDAQ OMX Stockholm (TWW SDB B and TWW SDB A) 4
  5. 5. We have an extensive global footprint Home markets  Austria  Netherlands  Slovakia  UK  Belgium  Germany  Norway  Spain  Australia Near Shore Locations Offshore Locations  Chile*  Peru*  Philippines*  Tunisia 5  Czech Republic  USA  Canada  Italy  Poland  Sweden  Denmark  Portugal  Switzerland  Croatia * Developing into home/near shore markets  Canada  Croatia  Estonia  Latvia  Czech Republic  Hungary  Lithuania
  6. 6. Transcom’s organization 6 • Corporate management - CEO, CFO, CIO, Head of Operations, Head of Global Sales & Accounts • Regional management - North region (25% of revenue) - Iberia (19% of revenue) - North America & Asia Pacific (19% of revenue) - South (16% of revenue) - Central Europe (10% of revenue) - Credit Management Services (CMS) in eight European countries (10% of revenue)
  7. 7. Transcom’s service portfolio 7 • Customer service Customer experience specialists trained to support best-in-class product, service and brand experiences for our clients’ customers • Technical support Tiered support models, from the simplest questions to more complex support scenarios • Customer retention Preventing defection and maximizing the lifetime of a customer • Customer acquisition Acquiring new customers cost-efficiently, and building strong customer relationships as a basis for future interactions • Cross- and upselling Building relationships and identifying customer needs during any type of interaction, and taking appropriate action to satisfy the customer’s need • Credit management services (CMS) Early collections, Contingent collections and Legal collections
  8. 8. Recap of our situation and focus areas 8 Situation today and short-term focus • Transcom’s profitability has decreased in recent years, but is now improving • We see positive effects as a result of restructuring actions • Continuous focus on underperforming areas • Growth in selected areas and efficiency improvements • Broadening client base Market trends • Growth driven by domestic Asia Pacific and Latin America markets • Diversification (geography and business models) Going forward - Strategic direction • Creation of outstanding customer experiences, while helping clients to reduce cost and drive growth • Flexibility is critical
  9. 9. Our performance in Q1 2013 2
  10. 10. Revenue in Q1 2013 increased 15.9% compared to Q1 2012 38.1 43.2 25.4 31.6 30.6 33.2 24.6 28.014.0 16.7 14.4 17.8 Q1 2012 Q1 2013 10 Central Europe South Iberia North America & Asia Pacific North Growth +13.5% CMS Net revenue, Q113 vs. Q112 €m +24.5% +8.3% +13.9% +19.3% +23.3% 170.5 147.1 • All units contributed positively to the top-line growth • Main driver is increasing volumes with our installed base clients • Several new clients added during the year also contributed • Revenue benefited from €3.8m in compensation received for transferring the right to collect on a Swedish debt portfolio • France deconsolidated from March 1 (effect in Q113: -€0.9m)
  11. 11. EBIT increased by €5m in Q1 2013 compared to Q1 2012 11 Restructuring net effects Volume & efficiency- driven gains Expansion investments Other EBIT Q113 EBIT Q112 1.1 +2.3 +4.3 -1.7 +0.1 6.1 • €3.8 million positive impact in Q113 as a result of compensation that Transcom has received in exchange for transferring our right to collect on a Swedish debt portfolio • €6.0 million positive impact in Q113 due to a capital gain following the deconsolidation of our former French subsidiary, offset by €6.0 million in restructuring and other non-recurring costs • EBIT in Q112 included a non-recurring cost of €1.3 million related to site closures in North America
  12. 12. EBIT margin improvements in North America & APAC, Central Europe, South and CMS, counterbalanced by North and Iberia 12 2013 Jan-Mar 2012 Jan-Mar EBIT margin North Central Europe South Iberia North America & AP CMS TOTAL 0.2% 3.4% 4.7% 2.0% -2.0% 23.4% 3.6% 3.4% -1.9% -4.9% 5.5% -4.8% 6.0% 0.7% • Volume and efficiency-driven performance improvements in North America & Asia Pacific, Central Europe and South • Deconsolidation of France as well as higher volumes and efficiency in Italy benefited South • North: Volume fluctuations against forecast, leading to overstaffing, and salary increases • Iberia: Impact of early Easter • CMS: Compensation received for transferring our right to collect on Swedish debt portfolio
  13. 13. We need to successfully address a number of short- and medium-term operational and financial challenges 13 Stop the losses in France (€1m/month in 2012). Transcom plans to stop financing the French subsidiary’s loss-making operations beyond March 1, 2013. Increase onshore seat utilization in North America Successfully resolve tax claims Germany – renegotiate labor agreements Return UK CMS to profitability Successfully implement action plan to improve operational performance in the North region
  14. 14. What will it take for Transcom to return to historical margins? 14 Key performance driver Trend vs. Q1 2012 Q1 2013 vs. Q1 2012 Average Seat Utilization ratio (89% vs. 83%) Share of revenue generated offshore (21% vs. 16%) Average Efficiency ratio (billable over worked hours) n/a (positive development) Monthly attrition n/a (unchanged) Improvements on four KPIs vs. previous year Continue improving key performance indicators • Seat utilization • Efficiency • Offshore/onshore split • Attrition
  15. 15. 111.2 65.3 65.0 71.0 75.9 80.7 86.1 73.4 13.2 11.9 17.2 32.1 38.1 59.3 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 0.0 20.0 40.0 60.0 80.0 100.0 120.0 Q311 Q411 Q112 Q212 Q312 Q412 Q113 Gross debt (€ m) Net debt (€ m) Net debt/EBITDA • Gross debt increased by €5.4m vs. Q412 • Net Debt increased by €21.2m compared to the Q412 level • Net Debt/EBITDA ratio: 2.51 (1.97 in Q412) • Interest charge €0.9m (€0.7m in Q412) Debt & leveraging
  16. 16. 3 Going forward – Transcom’s strategic direction
  17. 17. 17 Transcom’s brand promise Outstanding Customer Experience, driving revenue and brand loyalty ”
  18. 18. North America and Asia Pacific • Continue expanding in local markets in Asia Pacific Latin America • Serving domestic markets and the US, in addition to Spanish clients North Europe Central Europe • Near shore Short- and medium-term growth opportunities
  19. 19. 19 Short-term focus • Continuous focus on executing turnaround in underperforming areas • Continued focus on revenue expansion and efficiency improvements • Increased focus on quality and service delivery to support significant ramp-up of new volumes Medium-to long-term priorities • Grow revenue in line with overall market growth in the markets where we choose to compete • Improve profitability and decrease earnings volatility - Continuously strengthen operational efficiency - Optimizing our geographic delivery mix - Focus on broadening our client base Summary: key priorities going forward
  20. 20. Thank you! Questions?

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