Interim Report 2001 January 1 - September 30

Interim Report 2001 January 1 - September 30 Administration Transcom was originally set up to provide customer service for Comviq`s mobile telephony customers in Sweden in 1995. In the following years the services expanded to include the fixed telephony customers for Tele 2 and also to provide services for the cable television customers of Viasat. The services expanded to include Norway and Denmark as the clients expanded their geographical territories. The Scandinavian operation also started to offer services to other industries such as energy, financial and the travel industries amongst others. In late 1997 SEC (Société Européenne de Communication S.A.) began to offer fixed telephony services on the European continent through their subsidiary Tele2 Europe. During the next couple of years the company expanded their activities to most European countries as well as expanding the range of services provided to include mobile telephony in some countries where they held a license, as well as becoming an MVNO (Mobile Virtual Netoperator). At the same time, in order to meet the demand of customer support, Tele2 Europe started Transcom Europe. The two parallel organisations had an exceptional growth and at the end of March 2000 the two organisations merged through a reverse acquisition to form Transcom WorldWide S.A, headquartered in Luxembourg. At this time the company became a subsidiary of Industriförvaltnings AB Kinnevik, an investment company with interests in telecommunication, media, paper and agriculture. Transcom continued to grow at a rapid pace and at Kinnevik´s Annual General Meeting on May 18 2001, it was decided to distribute by means of fission all the shares in Transcom to Kinnevik´s shareholders, and to list the company on the NASDAQ exchange in New York and the Stockholmsbörsens "O" list. The listing was completed on September 6th when the company's shares began trading. The company now operates 24 call centres in 14 countries and employs approximately 6,300. Result for the nine months ended September 30, 2001 During the first nine months the net turnover amounted to Euro 159.9 million (120.0) a growth of 33%. EBITDA increased from Euro 6.0 million to Euro 7.8 million an increase of 30%. Operating income before goodwill amortisation was Euro 1.0 million (1.6). At constant exchange rates the revenue growth would be 36% and the EBITDA growth would be 19%. The revenue not related to the Tele2 Group increased to Euro 29.8 million (18.3), 19% of the total, compared to 15% in 2000. During the period Euro 520,000 has been allocated as a reserve for the closure of the Düsseldorf centre. With the opening of Halle both the capacity and the cost structure will improve in Germany. Result for the third quarter of 2001 During the third quarter the total revenue amounted to Euro 47.0 million (45.9) 2% growth with an EBITDA of Euro 1.0 million (2.2). The operating loss before goodwill amortisation amounted to Euro 1.4 million (1.1 profit). At constant exchange rates revenue growth would be 5%. The revenue not related to the Tele2 group increased during the period to Euro 8.6 million (6.8), an increase of 26%. Traditionally the third quarter is the quarter marked with low activities due to the vacation periods, in northern Europe in July and in the south in August. The telecommunications campaigns started in September with a significant increase in traffic, however approximately two weeks were lost on telemarketing campaigns due to the terrorist attacks in New York. The third quarter was the start up period for the new centres in Tulle (France), Halle (Germany), Borås (Sweden) and Tallinn (Estonia) where extensive training of agents has been conducted. During the third quarter the capacity for outbound telemarketing has increased significantly with new installations of predictive diallers in most centres. During this period the company has also introduced directory assistance in Sweden, a service that is intended to be introduced in additional countries. The volume on the Continent was reduced slightly (3%) compared to last year due to the fact that the marketing campaigns of the Tele 2 group did not start until September this year as the campaigns were adjusted to closely reflect the vacation period. There was a similar adjustment to the campaigns in the Nordic Region but due to an increased number of customers the revenue growth amounted to 8%. In addition, during the quarter the company began to introduce flexible working hours for the employees. This will be rolled out across the company gradually to the benefit of the clients, employees and shareholders as it will adjust our resources to more efficiently support the customer demand. Outlook Transcom is in progress of expanding its activities in new geographical areas within the next six months to include Latvia, Lithuania and the U.K. This will give Transcom the most extensive geographical coverage of any customer care centre organisation in Europe. Financial Position Transcom`s liquid funds increased from Euro 4.6 million to Euro 7.9 million during the 9 month period. There is an aggregate principal of Euro 27.5 million of Convertible debentures with the Kinnevik Group, 15.5 million of which has been drawn down at September 30, 2001 compared to Euro 10.8 million of loans at the beginning of the year. Transcoms Capital Expenditure amounted to Euro 12.3 million (6.8) for the period and the equity ratio was 60% (63%) at September 30, 2001. Next Financial Report It is expected that the year-end release for 2001 will be published on February 26, 2002. Luxembourg, October 25, 2001 Chief Executive Officer and President The interim report has not been subject to specific review by the company`s auditors. ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2001/10/25/20011025BIT01480/bit0002.doc The full report http://www.waymaker.net/bitonline/2001/10/25/20011025BIT01480/bit0002.pdf The full report