Teleperformance Group Overview Including Q1 2018 Quarterly Information
DISCLAIMER ▪ The consolidated financial statements have been audited and certified. ▪ 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.
AGENDA TELEPERFORMANCE AT A GLANCE MARKET ENVIRONMENT STRATEGY AND GOVERNANCE Q1 2018 REVENUE AND OUTLOOK APPENDICES
DETAILED AGENDA 1. 1. TELEPERFORMANCE AT A A GLA GLANCE p. 5-10 p. 10 Tel eleperformance at a a glan glance 5-10 2. MARKET EN 2. ENVIRONMENT p. 11 p. 11-15 15 Mar arket en environment in in Co Core Ser Services Mar arket en environment in in Sp Specialized Ser Services 11-14 15 p. 16 p. 16-21 21 3. 3. STRATEGY AND D GO GOVERNANCE St Strategy Governance 16-19 20-21 4. 4. Q1 Q1 2018 2018 RE REVENUE AN AND D FY Y 2018 2018 OU OUTL TLOOK p. 22 p. 22-27 27 Q1 Q1 20 2018 18 Revenue 22-26 FY 20 FY 2018 18 Outl utlook 27 5. APPE 5. PPENDICES p. p. 28 28-58 58 Ap Appendix 1 Appendix 2 Ap 28-47 48-58 Key dif differentiating fact actors 20 2017 17 Ann Annual Resu esults 49-57 29-45 Governance structure and and Tel eleperformance shar hareholding 46-47 Alt Alternative Perf erformance Meas easures 58 4
TELEPERFORMANCE AT A GLANCE
TELEPERFORMANCE AT A GLANCE KEY MILESTONES OF A GROWTH STORY… ▪ Starting 40 years ago, ongoing growth story, either organically and through high profile acquisitions First listed on the Started Acquisitions in Founded in 1978 Acquisition in Paris stock operations in the Argentina and Mexico in France market US Brazil 2002 1986 1993 1998 1978 TELEPERFORMANCE #1 IN FRANCE TELEPERFORMANCE #1 IN EUROPE Acquisition Acquisition Acquisition of Offshore of BeCogent Acquisition Full control of of The programs (UK) & of Aegis USA LanguageLine TLScontact Answer Solutions launched Teledatos (US) Group (US) (Colombia) 2016 2008 2014 2003 2010 2012 TELEPERFORMANCE WORLDWIDE LEADER … STRENGTHENING ITS VERTICAL EXPERTISE AND SPECIALIZED SERVICES 6
TELEPERFORMANCE AT A GLANCE … TO BECOME THE WORLDWIDE MARKET LEADER LEVERAGING A UNIQUE GLOBAL NETWORK Teleperformance in 2017 Founded in 1978 Operations in 76 countries 223,000 Employees 171,000/ 350 Countries where TP operates Workstations Contact centers Worldwide leader with 2017 revenue of €4.2bn New site in Kosovo Serving 160+ ▪ Nearly 12,000 workstations opened in 2017 Markets ▪ New countries: Peru and Kosovo in 265 Languages New site in Peru 7
TELEPERFORMANCE AT A GLANCE …TO PROVIDE A FULL RANGE OF SERVICES IN CONSTANT EVOLUTION ▪ Mission: Teleperformance people, “all over the world, all around the clock”, helping people address their day-to-day issues , in an even more changing and complex environment ▪ A global service provider focused on the customer experience services requiring strong processes, right people and innovation capabilities to succeed ▪ From Core Services to Specialized Services: strengthening the Group profile with higher added-value services Revenue by activity in 2017 ▪ Core Services: • Customer services Core Services 85%* • Technical support • Client acquisition Ibero- • Inbound interaction activities represents 85% of Core Services revenue LATAM 26% EWAP 39% ▪ Specialized Services: • Online interpreting services (LanguageLine Solutions) CEMEA 15% • Visa application management services (TLScontact) 20% • Analytics and consulting solutions (Praxidia) • Accounts receivable management services (AllianceOne Receivables Management) Specialized • Collaborative CX platform (Wibilong) Services 15% * Core Services split by linguistic region: - EWAP English-speaking market and Asia-Pacific (the US, Canada, the UK, the Philippines, China, India, etc.) - Ibero-LATAM Latin American countries (Brazil, Mexico, Colombia, etc.), Portugal and Spain 8 - CEMEA Continental Europe, Middle East & Africa
TELEPERFORMANCE AT A GLANCE A GLOBAL LEADERSHIP RECOGNIZED IN THE INDUSTRY ▪ Over the last 5 years, Teleperformance has been recognized: 26 times by Frost 5 times as a leader 5 times as the Best Place To Work Best Employer & Sullivan in Gartner Magic leader by Everest certified 26 times certified 26 times Quadrant in 8 countries in 16 countries ▪ Probably the most ever recognized company in the CX outsourcing industry Teleperformance is also active in Corporate Social Responsability and Group’s employee voluntary contribution ”Citizen of the World” program has raised close to US$34M in cash and in kind, utilized to support the communities in which Teleperformance operates 9
TELEPERFORMANCE FINANCIAL TRACK RECORD …WITH A PROVEN FINANCIAL TRACK RECORD (2011 -2017) ▪ Profitable growth story Average 2011 2012 2013 2014 2015 2016 2017* 2011-2017 € M Revenue 2,126 2,347 2,433 2,758 3,398 3,649 4,180 Group LfL growth + 3.5% + 6.9% + 7.9% + 9.9% + 7.5% + 7.4% + 9.0% + 7.4% EWAP + 6.5% + 3.2% + 8.1% + 12.5% + 4.4% + 4.5% + 1.6% + 5.8% Ibero-LATAM + 10.5% + 16.5% + 11.2% + 6.8% + 7.8% + 11.3% + 22.4% + 12.4% CEMEA (5.2)% + 2.6% + 4.6% + 9.5% + 12.8% + 9.5% + 8.1% + 6.0% Specialized Services + 10.4% Current EBITDA 268 306 325 376 492 558 720 % revenue 12.6% 13.0% 13.4% 13.6% 14.5% 15.3% 17.2% Current EBITA 181 214 226 267 351 408 556 % revenue 8.5% 9.1% 9.3% 9.7% 10.3% 11.2% 13.3% Net profit – gr. share 95 129 129 150 200 214 312 Diluted EPS (€)* 1.63 2.27 2.27 2.62 3.45 3.67 5.31 Growth + 28.3% + 39.3% + 0.0% + 15.4% + 31.7% + 6.4% + 44.7% + 23.7% Net capex 96 108 126 157 172 190 147 % revenue 4.5% 4.6% 5.2% 5.7% 5.0% 5.2% 3.5% 4.8% Net Free cash flow 88 95 64 93 202 236 324 % current EBITDA 33% 31% 20% 25% 41% 42% 45% 10 * Data by linguistic region related to core services activity since 2017 Definition of the Alternative Performance Measures in appendix
MARKET ENVIRONMENT
MARKET ENVIRONMENT IN CORE SERVICES A SIZEABLE CUSTOMER EXPERIENCE (CX) MARKET WITH OUTSOURCING PENETRATION REMAINING LOW Contact center sourcing mix* (2010-2016) $bn ▪ Growth market outlook 310-335 100% = 280-300 • Total market up ~+ 2-3 % p.a. (in $) More interactions driven by mobility revolution and new digitized activities 22% Outsourced 25% • Outsourcing market up ~+ 5% p.a. (in $) ▪ Increasing share of outsourcing • The industry has evolved from low complexity work to a broad range of services that drives the customer experience In-house 78% 75% • Outsourcing providers are gaining share globally , delivering greater value than in-house centers in a more complex and demanding environment: quality, security, digitization, omnichannel, globalization • Dynamic regions 2010 2016 12 * Overall contact center spend including payment collections - Source: Everest (2017)
MARKET ENVIRONMENT IN CORE SERVICES A SIZEABLE MARKET WITH COMPELLING MID-TERM MARKET GROWTH ▪ Global outsourced customer experience (CX) market size in 2017: 72bn US dollars* ▪ North America is the largest market, with 42% of the volumes ▪ The fastest growing markets are LATAM nearshore for North America, and Asia-Pacific offshore and domestic Global outsourced CX market* 2017 Global outsourced CX market – (2017-2020) Breakdown by region* (%) $bn CAGR North Regions 2017 – 2020 5.3% America 42% 4.7% 4.9% 4.9% 5,00% 90 North America 3.1% North America (NA) dom. + 1.8% APAC offshore 82.6 (dom.) 78.8 80 3,00% 75.1 LATAM nearshore for NA + 7.1% 16% 71.7 22% 68.1 APAC offshore for NA + 7.0% 66.1 1,00% 70 Total NA + 4.4% LATAM -1,00% 60 offshore 50 -3,00% APAC LATAM dom. + 4.5% 4% 22% Asia-Pacific dom. + 6.0% -5,00% 40 LATAM EMEA + 4.6% 30 -7,00% 11% 2015 2016 2017e 2018e 2019e 2020e Total outsourced market + 4.8% EMEA Annual growth 25% * Excluding payment collections - Source: Frost & Sullivan (2017) 13
MARKET ENVIRONMENT IN CORE SERVICES COMPETITIVE ENVIRONMENT ▪ Worldwide leader in its core services market with a unique global positioning, as more diversified than competitors ▪ A still fragmented market, with Teleperformance market share at 6%, being consolidated by its leaders ▪ Enlarged competitive environment resulting from the evolution of Teleperformance business mix profile Ranking by number of countries - footprint* Top direct competitors in contact centers outsourcing – (2017) ranking by revenue in 2017* ($m) # Market players Countries 4 000 1 Teleperformance 76 2 Convergys 33 3 Webhelp 28 2 000 4 Arvato CRM 27 5 Concentrix 25 6 Acticall Sitel 24 7 TTEC (Teletech) 23 - 8 Transcom 20 8 Sykes 20 9 Sutherland 19 10 Alorica 16 14 * Based on company’s press release and publications
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