hello
CLOSE ×

Article

TeleTech Announces Second Quarter 2016 Financial Results

Second Quarter 2016 Results
Revenue was $305.1 Million ($313.6 Million Non-GAAP Constant Currency);
Operating Income was $16.2 Million, 5.3 Percent of Revenue
(5.7 Percent Non-GAAP Constant Currency);
Fully Diluted EPS was 24 Cents
Signed $113 Million in New Business
Updates Outlook for Full Year 2016

 

DENVER, Aug. 3, 2016 /PRNewswire/ -- TeleTech Holdings, Inc. (NASDAQ: TTEC), a leading global provider of customer experience, engagement and growth solutions, today announced financial results for the second quarter ended June 30, 2016. The Company also filed its Quarterly Report on Form 10-Q with the U.S. Securities and Exchange Commission for the Quarter ended June 30, 2016.

"This quarter we made progress in many areas and faced challenges in others. It is clear from our results that our growth engine is underperforming and our sales execution must improve and accelerate," commented Ken Tuchman, chairman and chief executive officer of TeleTech. "We are refining our sales platform to deliver a greater volume of integrated outcome-based sales, and are intensely focused on sales execution and meaningful improvement in near-term profitability. With our blue chip client base, differentiated value proposition, and increasing market relevance, we remain confident in our strategy to be a leading global partner delivering transformational customer experience, engagement and growth solutions."

SECOND QUARTER 2016 FINANCIAL HIGHLIGHTS

Revenue        

  • Second quarter 2016 GAAP revenue decreased 1.6 percent to $305.1 million compared to $310.2 million in the prior year period.   
  • Non-GAAP constant currency revenue increased 1.1 percent to $313.6 million over the prior year.  

Income from Operations

  • Second quarter 2016 GAAP income from operations was $16.2 million, or 5.3 percent of revenue, compared to $23.4 million, or 7.5 percent of revenue in the second quarter 2015.
  • Non-GAAP constant currency income from operations was $18.0 million or 5.7 percent of adjusted revenue versus 7.6 percent the prior year.

Earnings Per Share

  • Second quarter 2016 GAAP fully diluted earnings per share attributable to TeleTech shareholders was 24 cents compared to 30 cents in the same period last year.
  • Non-GAAP fully diluted earnings per share was 28 cents compared to 34 cents in the prior year.

Bookings

  • During the second quarter 2016, TeleTech signed an estimated $113 million in annualized contract value revenue from new and expanded client relationships. The second quarter bookings mix was diversified across all verticals with 94 percent from existing clients, 47 percent from emerging businesses, and 12 percent from outside of the United States.  

STRONG BALANCE SHEET CONTINUES TO FUND OPERATIONS, SHARE REPURCHASES, DIVIDENDS, AND INVESTMENTS

  • As of June 30, 2016, TeleTech had cash and cash equivalents of $55.3 million and $146.2 million of total debt, resulting in a net debt position of $90.9 million.
  • As of June 30, 2016, TeleTech had approximately $420 million of additional borrowing capacity available under its revolving credit facility.
  • Cash flow from operations in the second quarter 2016 was $41.5 million compared to $81.7 million in the second quarter 2015.
  • Capital expenditures in the second quarter 2016 were $12.8 million compared to $16.5 million in the second quarter 2015.
  • TeleTech repurchased approximately one million shares of common stock during the second quarter 2016 for a total cost of $27.4 million. As of June 30, 2016, $33.5 million was authorized for future share repurchases. 
  • TeleTech paid a semi-annual dividend of $0.185 per share, or $8.9 million, in the second quarter  2016, which was paid to shareholders of record on March 31, 2016.

SEGMENT REPORTING & COMMENTARY

TeleTech reports financial results for the following four business segments: Customer Management Services (CMS), Customer Growth Services (CGS), Customer Technology Services (CTS) and Customer Strategy Services (CSS).  Financial highlights for the segments are provided below.

Customer Management Services (CMS) – Customer Experience Delivery Solutions

  • CMS second quarter 2016 revenue declined 3.0 percent to $212.8 million compared to $219.3 million in the year ago quarter. Income from operations was $8.3 million or 3.9 percent of revenue compared to $13.3 million or 6.1 percent in the prior year.
  • Non-GAAP constant currency revenue grew 0.5 percent over the year ago period and income from operations was $9.9 million or 4.5 percent of adjusted revenue. This compares to $13.4 million or 6.1 percent of revenue in the prior year.

Customer Growth Services (CGS) – Digitally-Enabled Revenue Growth Solutions

  • CGS second quarter 2016 revenue grew 20.7 percent to $36.9 million compared to $30.6 million in the year ago quarter. Income from operations was $3.5 million or 9.4 percent of revenue, compared to $2.1 million or 6.9 percent in the prior year.
  • Non-GAAP constant currency revenue increased 22.4 percent over the year ago period and income from operations was $3.7 million or 9.8 percent of adjusted revenue. This compares to $2.1 million or 6.9 percent of revenue in the prior year.

Customer Technology Services (CTS) – Hosted and Managed Technology Solutions

  • CTS second quarter 2016 revenue declined 1.9 percent to $37.4 million compared to $38.1 million in the year ago quarter. Income from operations was $3.4 million or 9.0 percent of revenue compared to $3.3 million or 8.5 percent in the prior year.
  • Non-GAAP constant currency revenue declined 1.9 percent over the year ago period and income from operations was $3.4 million or 9.1 percent of adjusted revenue. This compares to $3.3 million or 8.5 percent of revenue in the prior year.

Customer Strategy Services (CSS) – Customer Experience Strategy and Data Analytics Solutions

  • CSS second quarter 2016 revenue declined 18.9 percent to $18.1 million from $22.3 million in the year ago quarter. Income from operations was $1.0 million or 5.7 percent of revenue compared to $4.7 million or 20.9 percent in the prior year.
  • Non-GAAP constant currency revenue declined 17.5 percent over the year ago period and income from operations was $1.1 million or 5.8 percent of adjusted revenue. This compares to $4.8 million or 21.6 percent of revenue in the prior year.

BUSINESS OUTLOOK

"While we are disappointed with our current results and near-term outlook, we are confident in both the market demand for digital, outcome-based customer experience solutions, and the relevancy and differentiation in our holistic customer experience platform," commented Regina Paolillo, chief financial and administrative officer of TeleTech. "Our priorities are focused on closing the sales execution gaps underlying the change in our 2016 revenue guidance and ensuring we pick up the pace on delivering higher levels of profitability, as reflected in the uptick in our 2016 operating income margin guidance."

We are updating our full year guidance as follows:

Revenue – We are reducing our revenue guidance to a range of $1.285 and $1.295 billion, compared to $1.335 and $1.345 billion.

Operating Margin – We are increasing our operating margin guidance to a range between 8.4 and 8.6 percent before asset impairments and restructuring charges, compared to 8.1 and 8.3 percent.

Capital Expenditures – We are reducing our capital expenditure guidance to 4.2 percent of revenue compared to 4.5 percent.

SEC FILINGS

The company's filings with the Securities and Exchange Commission are available in the "Investors" section of TeleTech's website, which can be found at www.teletech.com.

CONFERENCE CALL

A conference call and webcast with management will be held on August 4, 2016 at 8:30 a.m. Eastern Time. You are invited to join a live webcast of the conference call by visiting the "Investors" section of the TeleTech website at www.teletech.com. If you are unable to participate during the live webcast, a replay will be available on the TeleTech website.

NON-GAAP FINANCIAL MEASURES

To supplement the Company's consolidated financial statements presented in accordance with generally accepted accounting principles (GAAP) in the United States, the Company uses the following Non-GAAP financial measures: Free Cash Flow, Non-GAAP Revenue, Non-GAAP Income from Operations, Non-GAAP EBITDA and Non-GAAP EPS. Additionally our discussion of revenue and income from operations contain references to constant currency amounts. Constant currency measures are calculated by translating the current year reported amounts using the prior year foreign exchange rates for each underlying currency. TeleTech believes that providing these Non-GAAP financial measures provides investors with greater transparency to the information used by TeleTech's management in its financial and operational decision making and allows investors to see TeleTech's results "through the eyes" of management. TeleTech also believes that providing this information better enables TeleTech's investors to understand its operating performance and information used by management to evaluate and measure such performance. These financial measures are not intended to be used in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. A reconciliation of these Non-GAAP financial measures is available in the financial tables attached to this press release. We also encourage all investors to read TeleTech's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q.

ABOUT TELETECH

TeleTech (NASDAQ: TTEC) is a leading global provider of customer experience, engagement and growth solutions. Founded in 1982, the Company helps its clients acquire, retain and grow profitable customer relationships. Using customer-centric strategy, technology, processes and operations, TeleTech partners with business leadership across marketing, sales and customer care to design and deliver a simple, more human customer experience across every interaction channel. Servicing over 80 countries, TeleTech's 41,500 employees live by a set of customer-focused values that guide relationships with clients, their customers, and each other. To learn more about how TeleTech is bringing humanity to the customer experience, visit TeleTech.com.

FORWARD-LOOKING STATEMENTS

Statements in this press release contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995, relating to our operations, expected financial position, results of operation, continuation of client relationships, and other business matters that are based on our current expectations, assumptions, and projections with respect to the future, and are not a guarantee of performance. We use words such as "may," "believe," "plan," "will," "anticipate," "estimate," "expect," "intend," "project," "would," "could," "target," or similar expressions, or when we discuss our strategy, plans, goals, initiatives, or objectives, we are making forward-looking statements.

We caution you not to rely unduly on any forward-looking statements. Actual results may differ materially from what is expressed in the forward-looking statements, and you should review and consider carefully the risks, uncertainties and other factors that affect our business and may cause such differences as outlined but are not limited to factors discussed in the sections entitled "Risk Factors" included in TeleTech's filings with the US Securities and Exchange Commission (the "SEC"), including our most recent Annual Report on Form 10-K and subsequent quarterly financial reports on Form 10-Q. TeleTech's filings with the SEC are available in the "Investors" section of TeleTech's website, www.teletech.com and at the SEC's public website at www.sec.gov.  Our forward looking statements speak only as of the date of the press release and we undertake no obligation to update them, except as may be required by applicable laws.

Investor Contact

Media Contact

Paul Miller

Elizabeth Grice

303.397.8641

303.397.8507

 

TELETECH HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

 (Unaudited)

                   
                   
     

Three months ended

 

Six months ended

     

 June 30,

 

 June 30,

     

2016

 

2015

 

2016

 

2015

                   

Revenue

 

$305,105

 

$310,223

 

$617,515

 

$635,744

                   

Operating Expenses:

               
 

Cost of services

 

226,768

 

223,617

 

458,108

 

456,601

 

Selling, general and administrative

 

44,774

 

47,376

 

90,274

 

97,613

 

Depreciation and amortization

 

17,221

 

15,680

 

34,950

 

31,043

 

Restructuring charges, net

 

114

 

198

 

202

 

1,007

 

Impairment losses

 

-

 

-

 

-

 

-

         Total operating expenses

 

288,877

 

286,871

 

583,534

 

586,264

                   

Income From Operations

 

16,228

 

23,352

 

33,981

 

49,480

                   
 

Other income (expense)

 

(734)

 

(18)

 

(2,054)

 

(1,706)

                   

Income Before Income Taxes

 

15,494

 

23,334

 

31,927

 

47,774

                   
 

Provision for income taxes

 

(2,952)

 

(7,841)

 

(7,480)

 

(12,246)

                   

Net Income

 

12,542

 

15,493

 

24,447

 

35,528

                   
 

Net income attributable to noncontrolling interest

(926)

 

(797)

 

(1,606)

 

(2,060)

                   

Net Income Attributable to TeleTech Stockholders

$  11,616

 

$  14,696

 

$  22,841

 

$  33,468

                   

Net Income Per Share Attributable to TeleTech Stockholders

             
                   
 

Basic

 

$     0.24

 

$     0.30

 

$     0.47

 

$     0.69

                   
 

Diluted

 

$     0.24

 

$     0.30

 

$     0.47

 

$     0.68

                   
                   

Income From Operations Margin

 

5.3%

 

7.5%

 

5.5%

 

7.8%

Net Income Attributable to TeleTech Stockholders Margin

3.8%

 

4.7%

 

3.7%

 

5.3%

Effective Tax Rate

 

19.1%

 

33.6%

 

23.4%

 

25.6%

                   
                   

Weighted Average Shares Outstanding

             

  Basic

 

47,873

 

48,325

 

48,120

 

48,347

  Diluted

 

48,221

 

49,064

 

48,483

 

49,113

 

TELETECH HOLDINGS, INC. AND SUBSIDIARIES

SEGMENT INFORMATION

(In thousands)

(Unaudited)

                 
                 
   

Three months ended

 

Six months ended

   

 June 30,

 

 June 30,

   

2016

 

2015

 

2016

 

2015

                 

Revenue:

               

Customer Management Services

 

$212,807

 

$219,316

 

$440,728

 

$462,325

Customer Growth Services

 

36,893

 

30,570

 

70,412

 

56,526

Customer Technology Services

 

37,350

 

38,087

 

72,618

 

73,801

Customer Strategy Services

 

18,055

 

22,250

 

33,757

 

43,092

Total

 

$305,105

 

$310,223

 

$617,515

 

$635,744

                 

Income From Operations:

               

Customer Management Services

 

$    8,339

 

$  13,324

 

$  23,934

 

$  35,026

Customer Growth Services

 

3,482

 

2,122

 

3,977

 

2,148

Customer Technology Services

 

3,376

 

3,250

 

6,156

 

5,259

Customer Strategy Services

 

1,031

 

4,656

 

(86)

 

7,047

Total

 

$  16,228

 

$  23,352

 

$  33,981

 

$  49,480

 

TELETECH HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

         
   

 June 30,

 

 December 31, 

   

2016

 

2015

         
         

ASSETS

       

Current assets:

       

   Cash and cash equivalents

 

$  55,330

 

$           60,304

   Accounts receivable, net

 

261,569

 

283,474

   Other current assets

 

80,641

 

71,294

      Total current assets

 

397,540

 

415,072

         

Property and equipment, net

 

170,124

 

168,289

Other assets

 

254,484

 

259,966

         

Total assets

 

$822,148

 

$         843,327

         

LIABILITIES AND EQUITY

       

Total current liabilities

 

$177,998

 

$         206,906

Other long-term liabilities

 

219,951

 

191,473

Mandatorily redeemable noncontrolling interest

 

-

 

4,131

Total equity

 

424,199

 

440,817

         

Total liabilities and equity

 

$822,148

 

$         843,327

 

TELETECH HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION

(In thousands, except per share data)

(Unaudited)

                 
   

Three months ended

 

Six months ended

   

 

 June 30,

 

 

 June 30,

   

2016

 

2015

 

2016

 

2015

Reconciliation of Revenue:

               
                 

Revenue

 

$305,105

 

$310,223

 

$617,515

 

$635,744

   Changes due to foreign currency fluctuations  1

 

8,503

     

18,497

   

Non-GAAP Revenue

 

$313,608

 

$310,223

 

$636,012

 

$635,744

                 
                 

Reconciliation of EBIT & EBITDA:

               
                 

Net Income Attributable to TeleTech stockholders

 

$  11,616

 

$  14,696

 

$  22,841

 

$  33,468

Interest income

 

(263)

 

(364)

 

(429)

 

(681)

Interest expense

 

1,753

 

1,676

 

3,717

 

3,374

Provision for income taxes

 

2,952

 

7,841

 

7,480

 

12,246

EBIT

 

$  16,058

 

$  23,849

 

$  33,609

 

$  48,407

                 

Depreciation and amortization

 

17,221

 

15,680

 

34,950

 

31,043

                 

EBITDA

 

$  33,279

 

$  39,529

 

$  68,559

 

$  79,450

                 
                 

Reconciliation of Free Cash Flow:

               
                 

Cash Flow From Operating Activities:

               

   Net income

 

$  12,542

 

$  15,493

 

$  24,447

 

$  35,528

   Adjustments to reconcile net income to net cash

               

       provided by operating activities:

               

          Depreciation and amortization

 

17,221

 

15,680

 

34,950

 

31,043

          Other

 

11,725

 

50,520

 

(6,371)

 

18,942

   Net cash provided by operating activities

 

41,488

 

81,693

 

53,026

 

85,513

                 

Less - Total Capital Expenditures

 

12,794

 

16,467

 

27,743

 

29,505

                 

Free Cash Flow

 

$  28,694

 

$  65,226

 

$  25,283

 

$  56,008

                 
                 

Reconciliation of Non-GAAP Income from Operations:

               
                 

Income from Operations

 

$  16,228

 

$  23,352

 

$  33,981

 

$  49,480

Restructuring charges, net

 

114

 

198

 

202

 

1,007

Impairment losses

 

-

 

-

 

-

 

-

                 

Non-GAAP Income from Operations

 

$  16,342

 

$  23,550

 

$  34,183

 

$  50,487

                 

Non-GAAP Income from Operations Margin

 

5.4%

 

7.6%

 

5.5%

 

7.9%

                 
                 

Reconciliation of Non-GAAP EPS:

               
                 

Net Income Attributable to TeleTech stockholders

 

$  11,616

 

$  14,696

 

$  22,841

 

$  33,468

Add:  Asset impairment and restructuring charges, net of related taxes

 

93

 

143

 

148

 

640

Add:  Changes in acquisition contingent consideration, net of related taxes

 

-

 

(500)

 

-

 

(455)

Add:  Changes in valuation allowance and returns to provision adjustments

 

1,558

 

2,175

 

2,436

 

1,586

                 

 Non-GAAP Net Income Attributable to TeleTech stockholders

 

$  13,267

 

$  16,514

 

$  25,425

 

$  35,239

                 

    Diluted shares outstanding

 

48,221

 

49,064

 

48,483

 

49,113

                 

 Non-GAAP EPS Attributable to TeleTech stockholders

 

$0.28

 

$0.34

 

$0.52

 

$0.72

                 
                 

Reconciliation of Non-GAAP EBITDA:

               
                 

Net Income Attributable to TeleTech stockholders

 

$  11,616

 

$  14,696

 

$  22,841

 

$  33,468

   Interest income

 

(263)

 

(364)

 

(429)

 

(681)

   Interest expense

 

1,753

 

1,676

 

3,717

 

3,374

   Provision for income taxes

 

2,952

 

7,841

 

7,480

 

12,246

   Depreciation and amortization

 

17,221

 

15,680

 

34,950

 

31,043

   Asset impairment and restructuring charges

 

114

 

198

 

202

 

1,007

   Changes in acquisition contingent consideration

 

-

 

(545)

 

-

 

(503)

   Equity-based compensation expenses

 

1,825

 

2,588

 

4,584

 

5,278

                 

 Non-GAAP EBITDA

 

$  35,218

 

$  41,770

 

$  73,345

 

$  85,232

                 

1-  Foreign currency fluctuations are calculated on a constant currency basis by translating the current year reported amounts using the prior year foreign exchange rates for each underlying currency. 

 

TELETECH HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION

(In thousands)

(Unaudited)

             

SECOND QUARTER 

           

(three months ended  June 30, 2016)

         
             

Revenue

           
   

GAAP Revenue

Non-GAAP Adjustments

Non-GAAP Revenue

Foreign Exchange Impact

Constant Currency Revenue

CMS

 

$           212,807

$            -

$           212,807

$               7,681

$            220,488

 

YoY Growth Rate:

-3.0%

 

-3.0%

 

0.5%

             

CGS

 

$            36,893

$            -

$            36,893

$                  510

$              37,403

 

YoY Growth Rate:

20.7%

 

20.7%

 

22.4%

CTS

 

$            37,350

$            -

$            37,350

$                     9

$              37,359

 

YoY Growth Rate:

-1.9%

 

-1.9%

 

-1.9%

CSS

 

$            18,055

$            -

$            18,055

$                  303

$              18,358

 

YoY Growth Rate:

-18.9%

 

-18.9%

 

-17.5%

Emerging Businesses

 

$            92,298

$            -

$            92,298

$                  822

$              93,120

 

YoY Growth Rate:

1.5%

 

1.5%

 

2.4%

             

Company (Consolidated)

 

$           305,105

$            -

$           305,105

$               8,503

$            313,608

 

YoY Growth Rate:

-1.6%

 

-1.6%

 

1.1%

             

Operating Income

           
   

GAAP Operating Income

Non-GAAP Adjustments

Non-GAAP Operating Income

Foreign Exchange Impact

Constant Currency Operating Income

CMS

 

$              8,339

$           62

$              8,401

$               1,492

$                9,893

 

Operating Margin:

3.9%

 

3.9%

 

4.5%

             

CGS

 

$              3,482

$            -

$              3,482

$                  183

$                3,665

 

Operating Margin:

9.4%

 

9.4%

 

9.8%

CTS

 

$              3,376

$           43

$              3,419

$                  (35)

$                3,384

 

Operating Margin:

9.0%

 

9.2%

 

9.1%

CSS

 

$              1,031

$           10

$              1,041

$                   29

$                1,070

 

Operating Margin:

5.7%

 

5.8%

 

5.8%

Emerging Businesses

 

$              7,889

$           53

$              7,942

$                  177

$                8,119

 

Operating Margin:

8.5%

 

8.6%

 

8.7%

             

Company (Consolidated)

 

$            16,228

$         115

$            16,343

$               1,669

$              18,012

 

Operating Margin:

5.3%

 

5.4%

 

5.7%

             
             

Segments Defined:

CMS (Customer Management Services), CGS (Customer Growth Services), 

 
 

CTS (Customer Technology Services), CSS (Customer Strategy Services)

 
 

Emerging Businesses: CGS, CTS, and CSS

             

Methodology: 

Foreign exchange fluctuations are calculated on a constant currency basis by

 
 

translating the current year reported amounts using the prior year foreign exchange

 
 

rate for each underlying currency

 
             

Non-GAAP Operating Income:

Adjusted for restructuring and impairment costs

 

 

TELETECH HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION

(In thousands)

(Unaudited)

             

YEAR-TO-DATE

           

(six months ended June 30, 2016)

         
             

Revenue

           
   

GAAP Revenue

Non-GAAP Adjustments

Non-GAAP Revenue

Foreign Exchange Impact

Constant Currency Revenue

CMS

 

$         440,728

$            -

$           440,728

$             16,558

$            457,286

 

YoY Growth Rate:

-4.7%

 

-4.7%

 

-1.1%

             

CGS

 

$           70,412

$            -

$            70,412

$               1,320

$              71,732

 

YoY Growth Rate:

24.6%

 

24.6%

 

26.9%

CTS

 

$           72,618

$            -

$            72,618

$                   36

$              72,654

 

YoY Growth Rate:

-1.6%

 

-1.6%

 

-1.6%

CSS

 

$           33,757

$            -

$            33,757

$                  583

$              34,340

 

YoY Growth Rate:

-21.7%

 

-21.7%

 

-20.3%

Emerging Businesses

 

$         176,787

$            -

$           176,787

$               1,939

$            178,726

 

YoY Growth Rate:

1.9%

 

1.9%

 

3.1%

             

Company (Consolidated)

 

$         617,515

$            -

$           617,515

$             18,497

$            636,012

 

YoY Growth Rate:

-2.9%

 

-2.9%

 

0.0%

             

Operating Income

           
   

GAAP Operating Income

Non-GAAP Adjustments

Non-GAAP Operating Income

Foreign Exchange Impact

Constant Currency Operating Income

CMS

 

$           23,934

$         150

$            24,084

$                  354

$              24,438

 

Operating Margin:

5.4%

 

5.5%

 

5.3%

             

CGS

 

$             3,977

$            -

$              3,977

$                  374

$                4,351

 

Operating Margin:

5.6%

 

5.6%

 

6.1%

CTS

 

$             6,156

$           43

$              6,199

$                 (122)

$                6,077

 

Operating Margin:

8.5%

 

8.5%

 

8.4%

CSS

 

$                (86)

$           10

$                  (76)

$                  (64)

$                 (140)

 

Operating Margin:

-0.3%

 

-0.2%

 

-0.4%

Emerging Businesses

 

$           10,047

$           53

$            10,100

$                  188

$              10,288

 

Operating Margin:

5.7%

 

5.7%

 

5.8%

             

Company (Consolidated)

 

$           33,981

$         203

$            34,184

$                  542

$              34,726

 

Operating Margin:

5.5%

 

5.5%

 

5.5%

             
             

Segments Defined:

CMS (Customer Management Services), CGS (Customer Growth Services), 

 
 

CTS (Customer Technology Services), CSS (Customer Strategy Services)

 
 

Emerging Businesses: CGS, CTS, and CSS

 
             

Methodology: 

Foreign exchange fluctuations are calculated on a constant currency basis by

 
 

translating the current year reported amounts using the prior year foreign exchange

 
 

rate for each underlying currency

 
             

Non-GAAP Operating Income:

Adjusted for restructuring and impairment costs