Q1 2020 REVENUE* AND ACTIONS TAKEN IN RESPONSE TO COVID-19 - Conference Call April 28, 2020
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Q1 2020 REVENUE* AND ACTIONS TAKEN IN RESPONSE TO COVID-19 * January 1, 2020 – March 31, 2020 Conference Call April 28, 2020
Disclaimer
All forward-looking statements reflect Teleperformance management’s present
expectations of future events and are subject to a number of factors and uncertainties
that could cause actual results to differ materially from those described in the
forward-looking statements. For a detailed description of these factors and
uncertainties, please refer to the “Risk Factors” section of our Registration Document,
available at www.teleperformance.com. Teleperformance undertakes no obligation to
publicly update or revise any of these forward-looking statements.
2Q1 2020 revenue
Key facts and figures
▪ Measures taken to overcome the global health crisis with three priorities
• Protecting employees: 100% compliance with all hygiene standards in the
Group‘s 80 countries and +155,000 employees working from home, i.e. 66% of
the operational workforce, vs c.5,000 at end-2019
• Protecting jobs by supporting brands and governments in ensuring business
continuity: 90% of clients served by home-working employees
• Protecting the Group and strengthening liquidity: launch of a cost reduction
annual program of around €250 million, over €1.5 billion in liquidity, including
additional lines of credit secured for €655 million, and BBB- rating with a stable
outlook confirmed by S&P in April
▪ Sustained growth in Q1 2020: +6.2% LFL growth in revenue, despite the effect of
Covid-19 on operations
• Rapid growth in January and February
• Flat performance in March due to first Covid-19 impact
3Q1 2020 revenue
Sustained growth in revenue despite Covid-19
Revenue growth in the first quarter remained strong: up +6.2% LFL
• Sustained growth above +7% like-for-like in January & February
• Stable performance in March due to the impact of the health crisis on the second half of the month
€ millions Change
Q1 2020 Q1 2019
Like-for-like Reported
€/$ exchange rate (12-months average) €1 = US$1.10 €1 = US$1.14
Revenue 1,352 1,271 +6.2% +6.4%
4Q1 2020 revenue
Revenue growth analysis
+6.2% lfl
+79 1,352
• Revenue growth: +6.4% as reported
1,271 +2 1,273 and +6.2% like-for-like
• Slightly favorable currency effect:
gains in the US dollar mainly offset by
declines in the Brazilian real, the
Colombian peso and the Argentine
peso against the euro
Q1 2019 Currency effect Q1 2019 at Like-for-like Q1 2020
constant growth
exchange rates
5Q1 2020 revenue
Revenue by activity
Revenue (€ m) Q1 2020 Q1 2019
Change (%) Core Services & D.I.B.S. LFL growth: +6.8%:
Like-for-like* Reported
• Sustained improvement in business in
Core Services & D.I.B.S. 1,179 1,105 +6.8% +6.6% January & February
- EWAP 431 400 +4.8% +7.8% • Revenue growth remained positive in
- Ibero-LATAM 356 316 +18.1% +12.5% March, although limited and uneven across
regions
- CEMEA 274 263 +3.9% +4.2%
- India & Middle East 118 126 -7.0% -6.6% Specialized Services lfl growth: +2.2%:
Specialized Services 173 166 +2.2% +4.9% • Significant decline in March due mainly to
the impact on TLScontact of travel bans and
Total 1,352 1,271 +6.2% +6.4% border shutdowns
* At constant exchange rates and scope of consolidation
6Q1 2020 revenue
Core Services & D.I.B.S. – English-speaking market & Asia-Pacific (EWAP)
• Satisfactory revenue growth in the first two
Q1 2020 vs. Q1 2019 (€m) months of the year
• Very slight growth in March, despite the initial
431 impacts of Covid-19 in North America, where
most segments were impacted, except for
400 +4.8% lfl
healthcare, the Internet services and automotive
industries. In the US, 90% of employees
currently work at home
• Operations in APAC progressed at a good pace:
very strong growth in Malaysia along Q1 and
return to solid revenue growth in March in China
Q1 2019 Q1 2020
• Revenue still down in the UK, despite good
growth in March due to the implementation of
Covid-19 hotline services for the government
7Q1 2020 revenue
Core Services & D.I.B.S. – Ibero-LATAM
• Double-digit lfl growth in March, despite a
Covid-19 related slowdown compared with the
Q1 2020 vs. Q1 2019 (€m)
first two months
356 • Colombia, Brazil, and nearshore business in
316
Mexico and Spain were the main growth
+18.1% lfl drivers
• Financial services, e-tailing and the Internet
services industry expanded at a good pace
• Quick implementation of work-at-home
solutions: the best penetration rate (nearly
80%), compared with other Group regions and
Q1 2019 Q1 2020
close to 100% in Portugal
8Q1 2020 revenue
Core Services & D.I.B.S. – Continental Europe & MEA (CEMEA)
• Sluggish growth in March: less harsh impact of
Q1 2020 vs. Q1 2019 (€m) Covid-19 than in other regions, though highly
contrasted situations from one country, or one
industry, to another
274
263 • Business contracted sharply in March in the
+3.9% lfl countries with the strictest lockdown policies,
such as Italy and Tunisia
• Steady increases in revenue in others
countries: multilingual hubs in Greece,
Scandinavia as well as Turkey, Egypt and Russia,
where the Group recently opened new sites
Q1 2019 Q1 2020
9Q1 2020 revenue
Core Services & D.I.B.S. – India & Middle East
• Activities in March contracted sharply, due
Q1 2020 vs. Q1 2019 (€m) to the drastic lockdown measures in India,
with a number of site closures during the
month
• Rapid expansion of work-at-home solutions
126
118 to meet client demand has helped minimize
-7.0% lfl
this impact. To date, nearly 60% of the agents
in India work at home.
• International offshore contracts have been
prioritized
Q1 2019 Q1 2020 • Terminations of the less profitable domestic
contracts have accelerated in March
10Q1 2020 revenue
Specialized Services
• LanguageLine Solutions business was the
Q1 2020 vs. Q1 2019 (€m) main growth driver: a double digit growth in
Q1 supported by its solid interpreters
working from home delivery model
173
• Sharp decline in revenue of TLScontact,
166
+2.2% lfl notably in March, when operations were
reduced by half
Q1 2019 Q1 2020
11Q1 2020 revenue
Outlook
▪ Margin will be negatively impacted in H1, especially in Q2
▪ Ongoing positive commercial momentum
▪ No annual financial guidance provided at this stage
▪ Tackling H2 2020 with confidence based on:
• measures taken to weather the storm and prepare the after crisis period
• resumption of existing client and supporting new clients acquired during the crisis
12APPENDICES
13Alternative performance measures Change in like-for-like revenue: Change in revenue at constant exchange rates and scope of consolidation = (current-year revenue – last-year revenue at current-year rates - revenue from acquisitions at current-year rates) / last-year revenue at current-year rates. EBITDA before non-recurring items (Earnings before Interest, Taxes, Depreciation and Amortization): Operating profit before depreciation and amortization, amortization of intangible assets acquired as part of a business combination, goodwill impairment charges and non-recurring items. EBITA before non-recurring items (Earnings before Interest, Taxes and Amortization): Operating profit before amortization of intangible assets acquired as part of a business combination, goodwill impairment charges and non-recurring items. Non-recurring items: Principally comprises restructuring costs, incentive share award plan expense, costs of closure of subsidiary companies, transaction costs for the acquisition of companies, and all other expenses that are unusual by reason of their nature or amount. Net free cash flow: Cash flow generated by the business - acquisitions of intangible assets and property, plant and equipment net of disposals - financial income/expenses. Net debt: Current and non-current financial liabilities - cash and cash equivalents. Diluted earnings per share (net profit attributable to shareholders divided by the number of diluted shares and adjusted): Diluted earnings per share is determined by adjusting the net profit attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding by the effects of all potentially diluting ordinary shares. These include convertible bonds, stock options and incentive share awards granted to employees when the required performance conditions have been met at the end of the financial year. 14
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