DENVER, April 26 /PRNewswire/ -- TeleTech Holdings, Inc. TTEC, a
leading global provider of customer relationship management (CRM) services and
solutions, today announced first quarter 2001 financial results. Net income for the first quarter 2001 was $8.4 million, or 11 cents per
share on a diluted basis, excluding non-recurring items.
This compares to pro
forma net income of $10.8 million, or 14 cents per share on a diluted basis,
in the year ago quarter.
During the first quarter, the company implemented aggressive cost-cutting
actions to improve long-term profitability.
These included a reduction in
force of approximately 300 employees and the shutdown of an underutilized
customer interaction center.
As a result, the company recorded non-recurring
charges of $20.3 million.
Including these non-recurring charges, TeleTech
recognized a net loss in the first quarter of $3.9 million, or $(0.05) per
share.
Revenues for the first quarter 2001 increased 24 percent to
$237.9 million, up from $192.3 million in the first quarter 2000.
This growth
was primarily attributable to TeleTech's international operations, new clients
in North America and Percepta, TeleTech's joint venture with Ford Motor
Company.
TeleTech's international revenues grew more than 70 percent compared to
the first quarter of 2000, reaching $98.5 million and representing 41 percent
of consolidated first quarter 2001 revenues.
Excluding programs that support
U.S.-based customers from international facilities in Canada and Mexico,
TeleTech's first quarter international revenues were $67.7 million, or
29 percent of consolidated revenues.
Operating margin for the first quarter 2001, exclusive of non-recurring
items, was 6.6 percent, compared to 9.2 percent in the first quarter 2000.
The first quarter 2001 operating margin was primarily impacted by excess
capacity in the company's North American shared customer interaction centers
due to delayed programs from new and existing clients as a result of an
accelerated downturn in the U.S. economy.
``Since I resumed the CEO role in mid-March, our management team has taken
aggressive action to address the current economic challenges,'' commented Ken
Tuchman, TeleTech chairman and CEO.
``We implemented significant cost
containment measures this quarter and have identified opportunities to
streamline processes across geographies and business units to further improve
operational efficiency in upcoming quarters.
Additionally, our sales team is
energized and focused on refueling our sales pipeline.''
BUSINESS OUTLOOK
The following statements are based on current expectations regarding
TeleTech's outlook on its future financial results.
TeleTech expects second quarter 2001 revenues to increase roughly
5 percent compared to the year ago quarter, and to be within a range of
$225 to $230 million.
The company expects second quarter 2001 net income to
be within the range of $0.10 to $0.12 per diluted share.
This excludes a
potential $(0.01) to $(0.02) impact resulting from the company's preferred
stock investment in enhansiv, a remote-hosted CRM technology provider.
``Looking forward, we are driving a 'back to the basics' theme,'' concluded
Tuchman.
``We are focused on winning large, long-term contracts with Global
1000 companies and delivering our world-class solutions to these customers.
We believe the combination of our global reach and 19 years of customer
management experience uniquely positions us to deliver a customized,
end-to-end solution across 27 countries.
This capability is unmatched in the
marketplace and provides the foundation for sustainable, long-term growth.''
CONFERENCE CALL
TeleTech executive management will host a conference call to discuss first
quarter 2001 financial results today at 5:00 p.m. ET.
To participate, please
dial 719-457-2635 (code: 606671).
Replay of the conference call will be
available by dialing 719-457-0820 (code: 606671), starting at approximately
8:00 p.m. ET and will play for ten days.
The conference call will also be
simulcast live on the Internet via TeleTech's web site at
http://www.teletech.com.
Replay will be available at this location for
30 days.
TELETECH PROFILE
Founded in 1982, TeleTech is a leading provider of integrated customer
relationship management (CRM) services and solutions for global organizations
predominantly in the communications, financial services, government and
transportation industries.
TeleTech has operations in 11 countries, which
include Argentina, Australia, Brazil, Canada, China, Mexico, New Zealand,
Singapore, Spain, the United Kingdom and the United States.
TeleTech's CRM
capabilities, including B2B electronic channel management and database
management, help companies inform, acquire, service, grow and retain their
customers throughout the entire relationship lifecycle.
TeleTech integrates a
full spectrum of voice and Internet communications, including custom e-mail
response, ``chat'' and extensive Web co-browsing capabilities.
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: lower than
anticipated customer interaction center capacity utilization; the loss or
delay in implementation of a customer management program; TeleTech's ability
to build-out facilities in a timely and economic manner; greater than
anticipated competition from new entrants into the customer care market,
causing increased price competition or loss of clients; the loss of one or
more significant clients; higher than anticipated start-up costs associated
with new business opportunities and ventures; TeleTech's ability to predict
future revenues and associated costs, as well as the potential volume or
profitability of any future technology or consulting sales; TeleTech's
agreements with clients may be canceled on relatively short notice; and
TeleTech's ability to generate a specific level of revenue is dependent upon
customer interest in and use of the Company's clients' products and services.
Readers are encouraged to review TeleTech's 2000 Annual Report on Form 10-K,
and other publicly filed documents which describe other important factors that
may impact TeleTech's business, results of operations and financial condition.
TeleTech undertakes no obligation to update its forward-looking statements
after the date of this release.
TELETECH HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
Three months ended
March 31,
2001 2000
Revenues $237,880 $192,326
Operating expenses:
Costs of services 151,682 126,165
Other operating expenses 70,612 48,482
Non-recurring items 20,251
Total operating expenses 242,545 174,647
Operating Income (4,665) 17,679
Other income (expense) (1,196) 30
Income Before Income Taxes (5,861) 17,709
Income tax expense (2,316) 6,463
Net Income before Minority Interest (3,545) 11,246
Minority Interest (321) --
Net Income $(3,866) $11,246
Basic Earnings Per Share $(0.05) $0.15
Diluted Earnings Per Share $(0.05) $0.14
Operating Margin (2.0)% 9.2%
Net Income Margin (1.6)% 5.8%
Effective Tax Rate 39.5% 36.5%
Shares Outstanding
Basic 74,753 73,360
Diluted 77,459 78,886
Excluding Non-recurring items:
Operating Income $15,586 $17,679
Operating Margin 6.6% 9.2%
Net Income $8,385 $10,838
Basic Earnings Per Share $0.11 $0.15
Diluted Earnings Per Share $0.11 $0.14
Effective Tax Rate 39.5% 38.8%
TELETECH HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, December 31,
2001 2000
ASSETS
Current assets:
Cash and cash equivalents $36,587 $58,797
Investment in available-for-sale
securities 3,600 16,774
Short-term investments 2,787 8,904
Accounts receivable, net 177,109 193,351
Other current assets 30,490 23,595
Total current assets 250,573 301,421
Property and Equipment, net 204,374 178,760
Other assets 105,866 109,718
Total assets $560,813 $589,899
LIABILITIES AND STOCKHOLDERS' EQUITY
Total current liabilities $115,017 $137,298
Total noncurrent liabilities 85,683 76,427
Minority interest 13,130 12,809
Total stockholders' equity 346,983 363,365
Total liabilities and stockholders'
equity $560,813 $589,899
TELETECH HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED CASH FLOW INFORMATION
(In thousands)
Three months ended
March 31,
2001 2000
Cash flow from operating activities:
Net income (loss) $(3,866) $11,246
Adjustments to reconcile net
income to net cash provided from
operating activities:
Depreciation and amortization 14,919 9,247
Other (4,336) (32,773)
Net cash provided by (used in)
operating activities $6,717 $(12,280)
Total Capital Expenditures $42,757 $12,422
