DENVER, Feb. 15 /PRNewswire/ -- TeleTech Holdings, Inc. (Nasdaq: TTEC), a
leading global provider of e-commerce-enabling customer management solutions
(eCRM), today announced record fourth quarter and 1999 financial results.
Net income for the fourth quarter 1999 was $8.0 million or 12 cents per
share on a diluted basis, representing a 46 percent increase over forth
quarter 1998 net income of $5.5 million or 9 cents per share on a diluted
basis. Net income for the year ended December 31, 1999 was $25.1 million or
40 cents per share on a diluted basis, excluding the one-time gain recognized
in the third quarter 1999. This represents a 31 percent increase over 1998
net income of $19.2 million or 31 cents per share on a diluted basis.
1999 HIGHLIGHTS
The marketplace is turning its attention to eCRM -- and to TeleTech --
like never before. 1999 was a definitive year for us, and we now have the
people, the vision and the momentum to compete as the world's leading provider
of end-to-end eCRM solutions," commented Ken Tuchman, TeleTech's chairman of
the board.
"We significantly strengthened and deepened our management team and our
Board of Directors. We launched our CyberCare(TM) Internet-integrated
customer management platform to address the growing demands of today's
customers. We signed long-term, strategic contracts with many of the world's
leading brands, including the announcement of a joint venture with Ford Motor
Company -- an enormous opportunity for TeleTech, and an alliance that will
reshape our company and our industry."
"We also continued to demonstrate superior top-line growth, fueled by our
strong position in e-commerce and other high growth markets such as
telecommunications and financial services. Amidst this growth, we delivered
three quarters of sequential operating margin improvement as we filled our
excess capacity and continued to sign long-term, strategic contracts,"
continued Tuchman. "TeleTech's accomplishments solidify our leadership
position in eCRM and position us to continue as the leader in this very
high-growth market space that we pioneered."
Revenues for the fourth quarter 1999 increased more than 40 percent to a
record $151.9 million, up from $108.3 million in the fourth quarter 1998.
Revenues for the year ended December 31, 1999 reached a record $509.3 million,
a $140.2 million or 38 percent increase over 1998 revenues of $369.0 million.
Approximately 28 percent, or $38.8 million, of the 1999 annual revenue
increase came from growth in TeleTech's e-commerce and e-commerce
infrastructure clients.
Operating margins for the fourth quarter 1999 were 8.9 percent, an
increase over fourth quarter 1998 operating margins of 8.1 percent and third
quarter 1999 operating margins of 8.7 percent. Operating margins for the year
ended December 31, 1999 were 8.2 percent, as compared to 8.6 percent for the
year ended December 31, 1998.
TeleTech's 1999 international revenues grew approximately 30 percent from
1998, reaching $115.1 million and representing 23 percent of 1999 consolidated
revenues. This increase was primarily attributable to growth in TeleTech's
Australia, New Zealand, Mexico, Brazil and Argentina operations.
As of December 31, 1999, TeleTech had $56.3 million in cash, cash
equivalents and short-term investments and total debt-to-capitalization of
15 percent.
E-COMMERCE UPDATE
TeleTech's revenues related to e-commerce and e-commerce infrastructure
reached a record $91.7 million in 1999, a 73 percent increase over $52.9
million in 1998. TeleTech's revenues related to e-commerce and e-commerce
infrastructure represented nearly 20 percent of 1999 consolidated revenues, as
compared to 14 percent in 1998.
TeleTech established a strong presence in the high growth, high demand
e-commerce and e-commerce infrastructure markets in 1999 and early 2000 with
the addition of several leading brands, including American Express Membership
Banking, Blockbuster.com and Priceline Perfect YardSale, as well as start-ups
such as Driveoff.com. During the first quarter 2000, TeleTech also signed a
long-term contract with BigStore.com to support its recently launched
e-commerce site with the CyberCare platform.
Additionally, TeleTech has become the market leader in supporting the
broadband DSL market. TeleTech provides 360 degree customer relationship
management to its DSL clients, from acquiring, growing and retaining
customers, to provisioning lines through the ILECS and managing all
back-office order management. Also included in TeleTech's e-commerce
infrastructure revenues are the Internet Service Providers the company
supports.
"E-commerce is an accelerator to this already high growth market,"
commented Scott Thompson, TeleTech chief executive officer and president.
"TeleTech's e-commerce and e-commerce infrastructure-related revenues are
growing at nearly twice the rate of the company as a whole, demonstrating our
ability to deliver value within this highly competitive marketplace. We
believe TeleTech is the dominant eCRM provider to the emerging e-banking,
e-brokerage, and e-insurance markets, as well as broadband DSL. Our success
in these markets is directly tied to our ability to provide outstanding
end-to-end eCRM and to scale our support as fast as our clients demand."
OUTLOOK FOR 2000
International Data Corporation estimates that the outsourcing portion of
the CRM services industry is $30 billion today, and projects that the market
will grow at a 19 percent compounded annual growth rate over the next four
years. TeleTech has been growing at nearly twice this rate for the past five
years, and believes it will continue to outpace the growth of the industry and
increase its market share in the years ahead.
Thompson concluded, "Looking ahead, we will continue to focus on large,
long-term complex contracts, a successful strategy over the past five years
for delivering strong revenue growth. Our management team is committed to
improving operating performance. And we will continue to broaden our service
offering and expand our global footprint to meet the demands of our global
client base with the speed and scale necessary to compete in today's
aggressive marketplace."
TELETECH PROFILE
Founded in 1982, TeleTech is a leading provider of integrated,
e-commerce-enabling customer management solutions (eCRM) for global
organizations predominantly in the telecommunications, financial services,
technology, government and transportation industries. Its innovative customer
interaction platform, CyberCare(TM), integrates the full spectrum of voice and
Internet communications, including custom e-mail response, "chat" and
extensive Web co-browsing capabilities. TeleTech operates more than 11,900
state-of-the-art customer interaction center workstations and employs more
than 16,300 people in nine countries. Through 29 customer interaction centers
in the Americas, Europe and Asia, TeleTech couples high-velocity
e-infrastructure service deployment with premier quality e-customer
relationship management to assure our clients/partners unparalleled success in
acquiring, retaining and growing customer relationships.
Information regarding TeleTech Holdings can be found on the Worldwide Web
at http://www.teletech.com.
FORWARD LOOKING STATEMENTS
All statements not based on historical fact are forward-looking statements
that involve substantial risks and uncertainties. In accordance with the
Private Securities Litigation Reform Act of 1995, following are important
factors that could cause TeleTech's actual results to differ materially from
those expressed or implied by such forward-looking statements: There can be no
assurance that TeleTech will be able to maintain or accelerate its growth
rate, or maintain its profitability. TeleTech's agreements with its clients
generally do not assure that TeleTech will generate a specific level of
revenue, do not designate TeleTech as the client's exclusive service provider,
and are terminable by the clients on relatively short notice. The loss of one
or more of its significant clients, or the loss or delay in implementation of
a large customer management program, could cause quarterly variations in
TeleTech's revenues. There also can be no assurance that TeleTech can
build-out facilities in a timely and economic manner. TeleTech's
profitability is significantly influenced by its customer interaction center
capacity utilization and TeleTech may experience excess peak period capacity
when it opens new or expands an existing customer interaction center or
terminates or completes a large client program. Readers are encouraged to
review TeleTech's 1998 Annual Report on Form 10-K and 1999 Quarterly Reports
on Form 10-Q for the first, second and third quarters of 1999, which describe
other important factors that may impact TeleTech's business, results of
operations and financial condition.
TELETECH HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
Three months ended Twelve months ended
December 31, December 31,
1999 1998 1999 1998
Revenues $151,934 $108,336 $509,268 $369,045
Operating expenses:
Costs of services 101,875 72,936 339,946 241,230
Selling, general and
administrative expenses 36,514 26,572 127,758 96,077
Total operating
expenses 138,389 99,508 467,704 337,307
Operating Income 13,545 8,828 41,564 31,738
Other income (334) 283 125 1,480
Gain on settlement of
long-term contract -- -- 6,726 --
Business combination
(expenses) -- -- -- (1,321)
Income Before Income
Taxes 13,211 9,111 48,415 31,897
Income tax expense 5,218 3,640 19,325 12,695
Net Income $7,993 $5,471 $29,090 $19,202
Basic Earnings Per Share $0.13 $0.09 $0.48 $0.32
Diluted Earnings Per Share $0.12 $0.09 $0.46 $0.31
Operating Margin 8.9% 8.1% 8.2% 8.6%
Net Income Margin 5.3% 5.1% 5.7% 5.2%
Shares Outstanding
Basic 61,618 60,445 61,183 59,950
Diluted 65,200 62,127 63,406 62,052
TELETECH HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
December 31, December 31,
1999 1998
ASSETS
Current assets:
Cash and cash equivalents $14,663 $8,796
Short-term investments 41,599 37,082
Accounts receivable, net 78,753 68,830
Other current assets 10,250 6,666
Total current assets 145,265 121,374
Property and Equipment, net 108,945 77,546
Other assets 39,520 31,990
Total assets $293,730 $230,910
LIABILITIES AND STOCKHOLDERS' EQUITY
Total current liabilities $63,528 $58,229
Total noncurrent liabilities 25,166 7,188
Total stockholders' equity 205,036 165,493
Total liabilities and stockholders'
equity $293,730 $230,910
TELETECH HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED CASH FLOW INFORMATION
(In thousands)
Twelve months ended
December 31,
1999 1998
Cash flow from operating activities:
Net income $29,090 $19,202
Adjustments to reconcile net
income to net cash provided
from operating activities:
Depreciation and amortization 29,887 19,293
Other (6,809) (13,647)
Net cash provided from operating
activities 52,168 24,848
Total Capital Expenditures
(inclusive of capital leases) $56,629 $41,057
SOURCE TeleTech Holdings, Inc.
Web site:
http://www.teletech.com
CONTACT: Michael Klatman, Vice President, Investor Relations,
303-894-7379,
michael.klatman@teletech.com, or Emily Eikelberner,
Manager, Investor Relations, 303-894-7360,
emilyeikelberner@teletech.com, both of TeleTech Holdings, Inc.
