Financial results for the first nine months of 2002

FINANCIAL RESULTS FOR THE FIRST NINE MONTHS OF 2002 Luxembourg, 24 October 2002 - Transcom WorldWide S.A. ('Transcom') (Stockholmsbörsen: TWWA, TWWB; Nasdaq: TRCMA, TRCMB), Europe's largest CRM operator by geographical presence, today announced its financial results for the nine months and third quarter ended 30 September 2002. HIGHLIGHTS · EBITDA up 65.4% to ?12.9m (?7.8m) · Positive net income of ?1.1 million (?-3.3 million) · Net sales of ?165.8 million (?159.9) · Gross margin improves to 21.4% (18.9%) · Operating income up to ?3.2 million (?-1.5 million) · Operating cash flow up by 80% to ?10.6m (?5.9 million) · Acquisition of 75% of Gestel in Spain completed in July, adding 2 new call centers and at least ?25 million of annual revenues · New CRM facilities to open in Lecce, Southern Italy in November 2002 CONSOLIDATED INCOME 2002 2001 2001 STATEMENT (M EUR) Jan 1-Sept Jan 1-Sept Full year 30 30 Net Sales 165.8 159.9 215.3 Earnings before 12.9 7.8 14.6 depreciation and amortization Operating income 3.2 -1.5 2.3 Net financial items -0.6 -0.6 -0.9 Income after financial 2.6 -2.1 1.4 items and before income tax and minority interest Net result for the period 1.1 -3.3 -0.8 Earnings per share before 0.02 -0.05 -0.01* dilution Total weighted average 63,630,248 62,938,677 63,053,939 outstanding number of shares before dilution * Pro-forma as if the shares had been issued on 1 January 2001 OPERATING REVIEW Transcom, Europe's largest CRM operation by geographical presence, continued to deliver improving margins in the first nine months of 2002 despite challenging market conditions. Net sales increased to ?165.8 million (?159.9 million). The gross margin rose to 21.4% (18.9%), resulting in a significantly increased operating profit of ?3.2 million (?-1.5 million) and a positive net income of ?1.1 million (?-3.3 million). Operating cash flow remained strong, resulting in closing liquid funds of ?17.3m (?7.9m), despite the Gestel acquisition made out of operating free cash flow. The gross margin improvement reflected a slight reduction in the cost of sales, which was achieved through further improvements in efficiency levels, as well as continued above industry average utilization rates. The operating margin consequently improved to 1.9% (-0.9%). Transcom continued to benefit from the efficiency gains at the six new facilities opened in 2001, and the reduction in overflow and sub-contract business to 3rd party suppliers, which was reduced from 9.0% of revenue in the first nine months of 2001 to 7.2% for the same period in the current year. On July 15, Transcom announced the acquisition of 75% of Gestel, one of Spain's leading call center operators, from Banco Santander Central Hispano S.A. (BSCH), who will retain a 25% stake. This is a strategically important development for Transcom, giving it a strong position in the financial services sector, in one of the fastest growing CRM markets in Europe. Gestel is expected to generate revenues of at least ?25 million per annum with Transcom's operating free cash flow funding the acquisition. The new contract with Retevision, Spain's second largest fixed line telephony company (part of the Auna Group) is expected to increase revenues for Gestel substantially during 2003. Gestel's operating results have been consolidated with effect from 1 July 2002. Gestel employs 900 agents in two call centers in the Madrid area and has a four- year contract to provide customer relationship management (CRM) services to BSCH. The Company manages two call centers in the Barcelona and Seville regions for the Auna Group. The Gestel acquisition expands Transcom's capacity to 7,600 employees in 31 call centers in 16 countries, giving Transcom a competitive advantage in having the widest geographical coverage of any call center organization in Europe. Transcom's geographical expansion will continue, with particular focus on the establishment of further new operations in Western Europe. The Group's facilities, in all three Baltic States, position it well for further growth in Eastern Europe. Transcom has continued focusing on cost control with the continued winding down of its facilities in Copenhagen and Helsinki, both of which should close in Q4. The Vordingborg (Denmark) and Tallinn (Estonia) facilities will absorb this capacity. This will result in significant cost savings for Transcom and demonstrates the continuing commitment to improving margins by operating from the most cost-efficient locations. The announcement of the opening of a new CRM operation, in Lecce, Southern Italy in November 2002, reinforces this focus. Transcom derives a significant proportion of its income from its principal client, Tele2, the leading pan-European telecommunications service provider. This relationship continues to enable Transcom to organically develop the largest call center network in Europe. However, an important development in the third quarter was the change in the percentage of Transcom's sales not related to the Tele2 group, which increased to 23%, compared to 18% for the same period last year. The outlook for the last quarter of 2002 remains positive with increased CRM marketing expenditure anticipated, as well as the impact of new revenues from contracts secured in the year to date. Transcom is and will continue to benefit from, the additional capacity and increased efficiency levels arising from the opening of new call centers in Tulle (France), Halle (Germany), Vordingborg (Denmark), Borås (Sweden), Casablanca (Morocco) and Riga (Latvia) during 2001 and Lecce (Italy) in 2002, as well as the acquisitions of Neltélink (Lithuania) and Gestel (Spain) in 2002. Mr Keith Russell took up his appointment as the new President and Chief Executive Officer during the third quarter. Mr Russell has extensive experience and a strong track record in the CRM industry, joining the Group from BSkyB where he was Director of the TV broadcaster's call center operations. Mr Vigo Carlund was appointed the new Chairman of Transcom having served for the previous two and a half years as the President and CEO of Transcom. FINANCIAL REVIEW Sales increased by 3.7% to ?165.8 million (?159.9 million), primarily due to the consolidation of the Gestel acquisition from July 2002. Earnings before interest, taxes, depreciation and amortization increased by an impressive 65.4% to ?12.9 million (?7.8 million). Operating profits for the first nine months of 2002 consequently improved to ?3.2 million (?-1.5 million). Transcom reflected a pre-tax profit of ?2.6 million compared to (?-2.1 million), whilst the Group reported a ?1.1 million profit after tax, compared to a loss of ?3.3 million for the same period last year. Cash flow from operations in the first nine months increased by 79.7% to ?10.6 million (?5.9 million). Capital expenditure fell substantially to ?8.5 million (?12.3 million) due to the reduced number of call center openings. ?4.7 million was spent in Q3 on the Gestel acquisition. This reflects a substantial proportion of the payment for Gestel, with the remaining payments to be made in Q4 and Q1 2003. The change in working capital in the nine months was ?1.7 million (?5.1 million). Transcom had liquid funds of ?17.3 million (?7.9 million) at 30 September 2002, after taking account of the money paid for the majority of the Gestel acquisition. Long term debt of ?15.5 million remained at the same level as at 31 December 2001, comprising the drawn down element of the ?27.5 million convertible loan from Industriförvaltnings AB Kinnevik. The equity to assets ratio at 30 September was 54.6% (59.6%). OTHER INFORMATION Transcom's financial results for the fourth quarter and full year 2002 will be announced in February 2003. This report has not been subject to review by the Company`s auditors. The Board of Directors of Transcom WorldWide S.A. Luxembourg, 24 October 2002. For further information please contact: Keith Russell, President and +352 40 14 21 000 CEO Dwayne Taylor, Investor & +44 20 7321 5010 Press enquiries Transcom WorldWide is a rapidly expanding Customer Relationship Management (CRM) solution provider, with 31 call center operations employing more than 7,600 people in 16 countries - Luxembourg, Sweden, France, Denmark, Germany, Finland, Italy, Switzerland, Norway, the Netherlands, Spain, Austria, Morocco, Estonia, Latvia and Lithuania. The company provides CRM solutions for companies in a wide range of industry sectors, including telecommunications and e-commerce, travel & tourism, retail, financial services and utilities. Transcom offers clients a broad array of relationship management services, including inbound and outbound call handling, Interactive Voice Response, Internet Services, e-mail processing and fax broadcast. Client programs are tailor-made and range from single applications to complex programs, which are offered on a country-specific or international basis in up to 38 languages. Transcom WorldWide S.A.'A' and 'B' shares are listed on the NASDAQ National Market under the symbols TRCMA and TRCMB and on the Stockholmsbörsen O-List under the symbols TWWA and TWWB. CONSOLIDATED INCOME STATEMENT (M 2002 Jan 1- 2001 Jan 1- 2001 Full EUR) Sept 30 Sept 30 year Net Sales 165.8 159.9 215.3 Cost of sales -130.3 -129.7 -169.6 Gross Profit 35.5 30.2 45.7 Selling, general and admin expenses -29.7 -29.2 -40.1 Goodwill amortisation -2.6 -2.5 -3.3 Operating income 3.2 -1.5 2.3 Net financial items -0.6 -0.6 -0.9 Income after financial items 2.6 -2.1 1.4 Minority share in earnings -0.3 0.0 -0.2 Taxes -1.2 -1.2 -2.0 Net result for the period 1.1 -3.3 -0.8 Earnings per share before dilution 0.02 -0.05 -0.01* Earnings per share after dilution 0.02 -0.05 -0.01* Total weighted average outstanding 63,630,248 62,938,677 63,053,939 number of shares before dilution Total weighted average outstanding 70,724,087 62,938,677 63,053,939 number of shares after dilution * Pro-forma as if the shares had been issued on 1 January 2001 CONSOLIDATED INCOME STATEMENT (M 2002 July 1-Sept 2001 July 1-Sept EUR) 30 30 Net Sales 55.2 47.0 Cost of sales -44.2 -38.8 Gross Profit 11.0 8.2 Selling, general and admin -10.2 -9.6 expenses Goodwill amortisation -1.0 -0.9 Operating income -0.2 -2.3 Net financial items -0.3 -0.3 Income after financial items -0.5 -2.6 Minority share in earnings 0.1 0.0 Taxes -0.0 -0.2 Net result for the period -0.6 -2.8 Earnings per share -0.01 -0.04 Total weighted average 63,630,248 62,938,677 outstanding number of shares CONSOLIDATED BALANCE 31-Dec 30-Sept 30-Sept SHEET (M EUR) 2001 2001 2002 Fixed Assets Goodwill 43.4 44.4 47.7 Other Fixed Assets 25.4 25.9 26.1 68.8 70.3 73.8 Current Assets Short-term receivables 38.2 40.5 48.7 Cash and bank 17.6 7.9 17.3 55.8 48.4 66.0 Total Assets 124.6 118.7 139.8 Shareholders equity 74.3 70.7 76.3 Minority interest in equity 0.4 0.2 0.8 Long-term liabilities Convertible Loan 15.5 15.5 15.5 Interest bearing liabilities 0.6 0.4 1.2 16.1 15.9 16.7 Short-term liabilities Non-interest bearing liabilities 33.8 31.9 46.0 Total shareholders equity and 124.6 118.7 139.8 liabilities CONSOLIDATED STATEMENT OF Full Year Jan 1-Sept 30 Jan 1-Sept 30 CASH FLOWS (M EUR) 2001 2001 2002 Cash flow from: Operations 10.3 5.9 10.6 Capital Expenditure -13.7 -12.3 -8.5 Purchase of business 0.0 0.0 -4.7 Working capital movement 10.6 5.1 1.7 Financing activities 5.8 4.6 0.6 Cash flow for the period 13.0 3.3 -0.3 Opening liquid funds 4.6 4.6 17.6 Closing liquid funds 17.6 7.9 17.3 SHAREHOLDERS EQUITY Full Year 2001 Jan 1-Sept 30 2002 (M EUR) Opening balance 74.5 74.3 Issuance of stock 0.8 0.0 Translation -0.2 0.9 differences Net income for the -0.8 1.1 period Closing balance 74.3 76.3 The income statement and balance sheet are produced in accordance with International Accounting Standards. ------------------------------------------------------------ Denna information skickades av Waymaker http://www.waymaker.se Följande filer finns att ladda ned: http://www.waymaker.net/bitonline/2002/10/24/20021024BIT00210/wkr0001.doc http://www.waymaker.net/bitonline/2002/10/24/20021024BIT00210/wkr0002.pdf