Q4 2019 Presentation Todays presenter Jonas Dahlberg President - - PowerPoint PPT Presentation
February 14, 2020 Q4 2019 Presentation Todays presenter Jonas Dahlberg President & Chief Executive Officer Transcom since June 2019 Previous roles: CFO, Transcom Holding AB (2019-2020) CFO, Sweco Group (2012 2019)
February 14, 2020
Today’s presenter Jonas Dahlberg President & Chief Executive Officer
Transcom since June 2019 Previous roles:
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Q4 highlights
E/O items, operating cash flow, leverage
Mitigating INPS contract ended November 30
additional capacity in Zagreb (Croatia) and new site in Tunis (Tunisia), sites in Cairo (Egypt) and Davao (Philippines) under development
growth through client focus and operational excellence, supported by strong leadership and culture
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Utilities BFSI Gov & Health- care Media Travel
What we do: outsourced customer relationship management
We are a global customer care provider
concepts delivered by our global team of local specialists… …supporting our clients’ digital agenda by combining our core services with leading digital capabilities and tools… …delivering services in 33 languages to international brands in various industries
Core services
Conversational commerce Digital channels Robotic Process Automation Interaction Analytics Chatbots Gamification
Call Chat Email
27,000
customer experience specialists
serving customers via
Services & utilities Commerce & Logistics
Auto- motive Logistics Retail/ e-commerce IT/Tech White- goods
Telco & Cable
Social media Messaging
Telco Cable
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Where we do it: Western Europe and Global English markets – Through international delivery
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Europe Global English Markets
Europe
Delivery model
countries
from 8 countries
the Philippines
the US
Share of total revenue
2019FY
66% 34%
Europe Global English
Site locations Serviced geographies
Solid foundation as basis for profitable growth
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Double digit margin and solid organic growth From 5 to 9% EBITDA 2015-2019
Closing the books on PPP – 33 MEUR savings achieved in OH and administration
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2017 Target 11.0 2018 2019 21.0 33.0 33.1 5.0 6.0 10.8 8.4 1.8 16.0 12.2 4.8 12.3 10.6 10.2 English speaking region Europe Central functions
Headcount reductions in support functions, transfer to Shared service centers, and procurement Headcount reduction through delayering, ratio optimization, and transfer of services to Shared service centers Headcount reduction through delayering, ratio optimization, and transfer of services to Shared service centers
Actual run-rate
Gross of investments, ca. EUR 1.5m in 2018 and ca. EUR 1.0m in 2019. Some Central functions savings shifted to Europe and English
EUR m
Transcom is growing in attractive customer segments
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Note: FY 2017 is consolidated at Issuer level, adjusted for EO items and full year adjusted for the acquisitions of TWW group and Xzakt group. On July 27, 2018, the group acquired Awesome OS which has been consolidated from this date. 2019 includes Latin America until Feb 2019 (0.9M Sales and -0.1M EBITA). Adj. EBITA% per industry includes allocation of unallocated/group-wide expenses.
Developments during the quarter 5.1% 6.4% 10.7% EBITA 2019
Revenue by industry segment, EUR m
99 130 155 214 206 208 271 208 179 2017 2018 2019 Telco & Cable Service & Utilities Commerce & Logistics 584 544 541
portfolio
sized e-com clients
Transcom is shifting towards profitable delivery locations
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Revenue by type of delivery (%), EUR m
Q4 2019
and new site in Tunis
Davao (Philippines) – Ready for clients end Q1 Q3 2019
Q2 2019
Q1 2019
Nearshore
544
2017 2018 2019 Offshore Onshore
584 541
Note: FY 2017 is consolidated at Issuer level and full year adjusted for the acquisitions of TWW group and Xzakt group. On July 27, 2018, the group acquired Awesome OS which has been consolidated from this date. 2019 includes Latin America until Feb 2019 ((0.9M Sales and -0.1M EBITA).
8% 19% 2% EBITA 2019
74% 71% 65% 18% 20% 25% 8% 9% 10%
Next phase is about profitable growth – Achieving double digit margins and solid organic growth
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Client focus Operational excellence Culture and leadership
and lean OH
centricity
management
recruiting, retention and workplace presence
approach
in North America
Q4 – Solid improvement of financials
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1) Net debt / EBITDA 2019 calculated in line with the definition of Leverage Ratio in the terms and conditions of the outstanding senior secured notes based on an EBITDA of EUR 47.4m (not including non-recurring items in excess of 15% of EBITDA) and Net Interest Bearing Debt of EUR 198.3m (excluding Subordinated Loans and pension liabilities)
Continued trajectory of improved profitability
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1) 2014 – 2016 figures represents consolidated TWW accounts, 2017-2018 is consolidated at Issuer level, and adjusted for the acquisitions of TWW and Xzakt group. On July 27, 2018, the group acquired Awesome OS which has been consolidated from this date. 2019 is fully including recording of IFRS 16 Leases, no retroactive calculation done for comparison periods. 2) M&A amortisation not included in D&A.
627 586 584 544 541 32 31 38 39 49 5,2% 5,3% 6,5% 7,2% 9,0% 2015A 2016A 2017A 2018A 2019A
EURm
Sales
(11.6%)
Sales and EBITDA development 1) Summary of historical P&L 1)
EURm 2015 2016 2017 2018 2019 2018 Q4 2019 Q4 Sales 626.5 586.1 584.0 543.6 541.5 143.0 141.8 Cost of sales
D&A2)
D&A leasing
Gross profit 125.0 119.4 119.5 116.7 130.9 35.1 36.5 % margin 19.9% 20.4% 20.5% 21.5% 24.2% 24.5% 25.8% SG&A
D&A leasing
23.4 23.1 30.0 31.6 39.0 13.5 12.7 % margin 3.7% 3.9% 5.1% 5.8% 7.2% 9.4% 9.0%
62.8 20.2 % margin 11.6% 14.3%
IFRS 164) 32.3 31.2 38.2 39.4 48.8 15.6 16.6 % margin 5.2% 5.3% 6.5% 7.2% 9.0% 10.9% 11.7%
E/O items trending downwards
Non recurring items, EUR millions
LTM By quarter
Q4 non recurring items totaled EUR -0.5 million
E/O continued to decline and totaled EUR 8.4 million for 2019
Note: FY 2017 is consolidated at Issuer level and full year adjusted for the acquisitions of TWW group and Xzakt group.
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5 10 15 20 25 30 35 40 45 50 16.6 2.2 37.3 7.2 Q2 2017 7.0 6.0 Q1 2017 9.5 Q3 2017 20.0 3.5 Q4 2017 23.8 Q1 2018 34.5 20.6 Q4 2018 4.3 Q2 2018 34.4 Q3 2018 3.6 4.0 32.5 Q2 2019 Q1 2019 15.0 3.1 2.2 Q3 2019 0.8 11.5 0.5 8.4 Q4 2019
Improved operating cash flow
improved to EUR 51.4 million (2.5)
improved to EUR 21.2 million (3.5)
improved EUR 8.4 million (-0.8)
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EURm 2018 2019 2018 Q4 2019 Q4 Profit/loss before tax
2,143 2,636 4,496 Adjustments for non cash items 30,050 33,429
5,717 Net financial items 19,674 17,565 3,861 4,973 Income taxes paid
Changes in working capital
5,684
8,417 Operating cash flow 2,495 51,366 3,459 21,220 Investments
Acquisitions/disposals of business, net of cash
1,048
791
Cash flow from investing activities
Cash flow form financing activities 34,072
Cash flow for the period
1,127
1,841
Q4 working capital in line with normal variations
Note: 2014–2016 figures represents consolidated TWW accounts, 2017-2018 figures are consolidated at Issuer level. Q2 2017 and onwards includes the acquisition of Xzakt group. Q3 2018 and onwards, includes the acquisition of Awesome group.
Non recurring items, EUR millions
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20 40 60 80 100 120 140 160 6,5 8,5 3,5 0,0 3,0 0,5 7,5 7,0 1,5 5,0 1,0 8,0 5,5 2,0 6,0 2,5 4,0 4,5 4.3 6.1 Q3 2018 Q4 2018 Q2 2016 21 5.4 5.4 Q4 2017 Q1 2017 Q1 2019 Q2 2019 6.5 6.3 Q1 2015 5.3 3.4 24 Q2 2015 Q3 2015 4.7 4.8 Q4 2015 4.9 Q1 2016 3.0 40 Q3 2016 Q4 2016 4.0 Q2 2017 Q3 2017 Q1 2018 6.4 5.5 18 Q2 2018 5.3 5.5 34 30 30 31 31 3.9 26 27 31 22 29 34 25 30 36
NWC % Prepaid expenses and accrued income Trade receivables Trade payables Other receivables - Current Accrued expenses and prepaid income Other liabilities - Current6.1 33 Q3 2019 Q4 2019 5.6 30