Transcom Holding AB (publ): Third quarter report 2023

Third quarter 2023 highlights

• Revenue increased to 180.6M€ (177.5)
• EBITDA excluding non-recurring items increased to 25.1M€ (23.0)
• EBITDA margin excluding non-recurring items increased to 13.9% (13.0%)
• Operating cash flow decreased to 9.4M€ (12.2)
• Net debt/EBITDA decreased to 3.5 (3.7)

January – September 2023

• Revenue increased to 548.2M€ (525.9)
• EBITDA excluding non-recurring items increased to 70.6M€ (62.9)
• EBITDA margin excluding non-recurring items increased to 12.9% (12.0%)
• Operating cash flow increased to 33.1M€ (27.5)
• Net debt/EBITDA decreased to 3.5 (3.7)

Comments by the CEO:

Accelerated transformation to AI & near/offshore delivery

Revenue for the third quarter increased to 180.6M€ (177.5). EBITDA increased to 25.1M€ (23.0) and the EBITDA margin, excluding non-recurring items, increased to 13.9% (13.0%). For the first time, LTM EBITDA passed 100M€, landing at 101M€ (89). 

We continue to win new contracts with new and existing clients, while further shifting our delivery towards AI & near & offshore delivery. Transcom is at the forefront of the AI revolution in customer service. We are evolving our market leading Digital & AI offering, with stronger advisory services, new proprietary solutions, and best-of-breed product partnerships.

While we are winning new business, volumes in existing contracts are declining due to the weak consumer confidence, in particular in discretionary consumer categories in eCom & Tech. Clients are looking for cost efficient solutions to address the situation and we respond by accelerating our transformation in line with our strategy. We are reducing onshore capacity and have reorganized to reduce cost and better serve large international clients. The new organization will drive global consistency, improve client service, and increase operational efficiency.

During 2023, we have scored new records on client satisfaction and employee engagement, providing a solid platform in the current market environment. Our AI & Digital solutions have received strong recognition from clients and industry analysts. We remain committed to our strategy of client focus and operational excellence, through strong culture and leadership. We will continue to develop our portfolio towards fast growing segments, AI & digital services, delivered from near/offshore locations.

Due to the weak consumer sentiment, we expect revenue and EBITDA to be subdued during the next couple of quarters. We are taking actions to further reduce cost and improve our competitiveness. We stand committed to our three-year plan of double-digit organic growth and 16% EBITDA margin.

Jonas Dahlberg, President & CEO

Q3 2023 Financial Update Webcast

Transcom will host a live webcast on Thursday, November 16 at 9:00 CET. The presentation is available on https://www.transcom.com/global/about-us/investor-relations.

Presentation details

Date/Time: Thursday, November 16, at 9:00 am CET

Online Registration link: https://app.livestorm.co/transcom-holding/transcom-holding-ab-q3-2023-results-presentation

Important note: Please register via the link above at least 5-10 minutes prior the webcast in order to obtain the webcast link. If you register in advance, you will be sent an email reminder an hour prior to the webcast.

For further information, please contact

Jonas Dahlberg, President & CEO
Phone: +46 (0)70 347 23 83, email: Jonas.dahlberg@transcom.com

Snejana Koleva, Chief Financial Officer
Phone: + 46 (0)70 508 3830, email: snejana.koleva@transcom.com

Helene Ruda, Head of Group Communications
Phone: +46 (0) 70 311 7560, email: helene.ruda@transcom.com

About Transcom

Transcom provides AI and digitally enhanced customer experience (CX) services to some of the world's most ambitious brands. More than 300 clients globally, including disruptive e-commerce players, category redefining fintechs, and technology legends rely on us for on-, off-, and nearshoring services. Transcom’s over 30,000 employees work in over 90 contact centers and work-at-home networks across 28 countries, creating brilliant experiences in customer care, sales, content moderation and backoffice services. We help our clients drive their brands forward, customer satisfaction up and operating costs down. For more information, visit www.transcom.com.