The document is a presentation from Transcom, a global customer experience specialist, summarizing their fourth quarter and full-year 2013 results. It discusses Transcom's revenue growth of 7.9% in 2013 driven by increased volumes across all regions. While revenue decreased 1.6% in Q4 2013, earnings before interest and taxes increased due to cost savings programs and efficiency improvements. Transcom aims to improve profitability further by focusing on underperforming areas, expanding in select markets, and strengthening operational efficiency. The presentation outlines Transcom's strategic priorities and growth opportunities going forward.

1. 13 February 2014
Transcom
Fourth Quarter and Full-Year 2013
Results Presentation
Johan Eriksson, President & CEO
Pär Christiansen, CFO
Outstanding
Customer
Experience

2. Transcom at a glance
1

3. What is Transcom?
• A global customer experience
specialist...
• ...providing outsourced
customer care, sales,
technical support, and credit
management...
• ...through an extensive
network of contact centers
and work-at-home agents
3
”
Transcom’s business is to
help make sure that our
clients’ customers form
positive perceptions of their
interactions with them.

4. Transcom in numbers
• 29,000 people…
• …representing more than 100 nationalities
• 62 contact centers, onshore, off-shore and
near shore…
•
•
•
•
•
4
…in 26 countries
Delivering services in 33 languages...
...to over 400 clients in various industry verticals
€653.2 million revenue in 2013
Market cap: SEK 1,525.8 million as at December 30, 2013. Listed on NASDAQ OMX
Stockholm (TWW SDB B and TWW SDB A)

5. We have an extensive global footprint
Domestic markets
Near Shore Locations
Offshore Locations
 Austria
 Netherlands
 Slovakia
 UK
 Germany
 Norway
 Spain
 Australia
 Canada
 Croatia
 Estonia
 Latvia
 Czech Republic
 Hungary
 Lithuania
 Chile*
 Peru*
 Colombia*
 Philippines*
 Tunisia
5
 Czech Republic
 USA
 Canada
 Italy
 Poland
 Sweden
 Denmark
 Portugal
 Switzerland
 Croatia
* Developing into domestic/near shore
markets

6. Transcom’s service portfolio enables the creation of outstanding
customer experiences, while reducing cost and helping to drive growth
Customer service
Technical support
Customer retention
• Quality, accuracy, speed,
• Tiered support models
• Extensive product training
• Resolve customer issues at
• Prevent defection and
efficiency and sales targets
• Competitive differentiation
• Reinforce buying decisions
first contact
and brand relationships
maximize customer lifetime
• Protect your revenue
streams and turn potential
defectors into fans
Customer acquisition
Cross-selling & upselling
Collections
• Acquire new customers
• Generate new sales directly
• Recover debt and
cost-efficiently
• Uncover customer needs,
identify the right offerings,
secure customer orders
from existing customer base
• Support complex products
in day-to-day service
interactions
• Adept at building
relationships
6
rehabilitate customers
• Case management approach
• In-house teams for legal
processes

7. Transcom turnaround
EBIT margin has declined since 2007, but the negative
trend reversed in 2012
Revenue (€m)
Operating margin*
653.2
631.8
Situation today and short-term focus
• Transcom’s profitability has decreased in
recent years, but is now improving
• Continuous focus on underperforming areas
• Growth in selected areas and efficiency
improvements
• Broadening client base
605.6
599.2
589.1
6.0%
560.2
4.4%
554.1
4.3%
2.7%
2.2%
Market trends
• Growth driven by domestic Asia Pacific and
Latin America markets
• Diversification (geography and
business models)
1.5%
0.7%
2007
2008
2009
2010
2011
* Underlying performance, excluding restructuring and other non* Excluding non-recurring items.
recurring costs
7
2012
2013
Going forward - Strategic direction
• Focus on core CRM business
• Creation of outstanding customer
experiences, while helping clients to reduce
cost and drive growth
• Flexibility is critical

8. Our performance in Q4 2013 and FY 2013
2

9. Revenue in 2013 increased by 7.9% compared to 2012.
Net revenue, 2013 vs. 2012
€m
653.2 Growth
605.6
56.8
2.7%
CMS
55.3
North America
112.1
& Asia Pacific
Iberia & Latam 119.4
122.7
130.9 9.6%
145.8 5.5%
Central &
South Europe
138.3
North Europe
180.4
197.0
2012
9
9.4%
2013
9.2%
• All regions contribute to company
•
•
growth
Net of currency effects, growth was
8.8% (9.3% in core CRM operations)
Main driver is increasing volumes
with our installed client base

10. Revenue in Q4 2013 decreased by 1.6% compared to Q4 2012
Net revenue, Q413 vs. Q412
€m
162.9
160.2 Growth
CMS 13.5
12.7
-5.9%
North America
& Asia Pacific
31.9
30.0
-5.8%
Iberia & Latam
31.0
31.7
+2.5%
Central &
South Europe
35.5
36.2
+1.9%
North Europe
51.0
49.5
-2.9%
Q4 2012
Q4 2013
10
• Net of currency effects, growth was
•
•
•
0.5% (1.0% in core CRM operations)
Main driver is increasing volumes
with our installed client base
Exit of non-profitable contracts in the
North region impact revenue
Decrease in North America & Asia
Pacific is driven by a price decrease
for one client and lower volumes in
North America

11. EBIT, excluding non-recurring items, increased by €8.7m in
2013 compared to 2012
+8.1
-5.4
-2.9
+8.9
17.6
8.9
EBIT 2012
11
Cost savings
programs
Volume & efficiency
Expansion costs
Other
EBIT 2013

12. EBIT, excluding non-recurring items, increased by €2.3m in
Q4 2013 compared to Q4 2012
+2.2
+0.1
-1.1
1.1
4.3
Expansion costs
Other
EBIT 2013
2.0
EBIT 2012
12
Cost savings
programs
Volume & efficiency

13. EBIT margin* increase in FY 2013 driven by improvements in
Central & South Europe and CMS
FY 2013
EBIT margin*
North Europe
Central & South Europe
Iberia & Latam
North America & AP
CRM
CMS
Total
* Excluding non-recurring items
2.5%
2.9%
2.8%
-1.2%
1.9%
10.9%
2.7%
FY 2012
3.7%
-3.8%
4.6%
0.2%
1.3%
3.5%
1.5%
• North Europe: Costs for closing the Norrköping
site and the CRM operations in Denmark.
Temporarily higher costs due to volume ramp-up
in Norway and Sweden. New sites in Oslo,
Norway and Umeå, Sweden increased costs.
• Central & South Europe: Higher volumes,
increased offshore delivery, and deconsolidation
of former French subsidiary.
• Iberia & Latam: Costs due to expansion in Spain
and Latam, and closure of site in Valdivia, Chile.
Lower volumes and efficiency in Chile.
• North America & Asia Pacific: Lower volumes
delivered onshore in North America, price
decrease on one account.
• CMS: Revenue increase and lowered production
and overhead costs
13

14. EBIT margin* increase in Q4 2013 driven by improvements in
Central & South Europe and CMS
2013
Oct-Dec
EBIT margin*
North Europe
Central & South Europe
Iberia & Latam
North America & AP
CRM
CMS
Total
* Excluding non-recurring items
2012
Oct-Dec
3.3%
4.8%
3.1%
-4.6%
2.0%
10.2%
2.7%
4.8%
-2.9%
4.9%
-2.3%
1.5%
-1.2%
1.2%
• North Europe: Costs for closing the Norrköping
site, and temporarily higher costs due to ramp-up
in Sweden and Norway
• Central & South Europe: Higher volumes and
increased offshore delivery, improved efficiency
in Germany, and deconsolidation of former
French subsidiary
• Iberia & Latam: Costs due to expansion in Spain
and Latam, build-up of site in Colombia, and
closure of site in Valdivia, Chile. Lower volumes
and efficiency in Chile.
• North America & Asia Pacific: Lower volumes
delivered onshore in North America, price
decrease on one account.
• CMS: Lowered production and overhead costs
14

15. We need to successfully address a number of shortand medium-term operational and financial challenges
Stop the losses in France (€1m/month in 2012).
Successfully resolve tax claims
Lower corporate costs
Increase onshore seat utilization in North America
Successfully implement action plan to improve operational performance in the North region
Improve operational performance in Latin America
15

16. What will it take for Transcom to return to
historical margins?
Continue improving key performance indicators
• Seat utilization
• Efficiency
• Offshore/onshore split
• Attrition
Improvements on four KPIs vs. previous year
Key performance
driver
Trend vs. Q4 2012
Q4 2013 vs. Q4 2012
Average Seat
Utilization ratio
Share of revenue
generated offshore
(22% vs. 16%)
Average Efficiency
ratio (billable over
worked hours)
n/a (positive development)
Monthly staff
attrition
16
(85% vs. 87%)
n/a (slight decrease in
attrition)

17. Debt & leveraging
Gross debt (€ m)
Net debt (€ m)
Net debt/EBITDA
100.0
86.3
90.0
80.0
71.0
70.0
75.9
91.1
94.6
94.4
80.7
2.50
65.0
59.3
60.0
2.00
56.7
49.7
1.50
50.0
38.1
40.0
36.2
32.1
1.00
30.0
20.0
11.9
3.00
17.2
0.50
10.0
0.00
0.0
Q112
Q212
Q312
Q412
Q113
Q213
Q313
Q413
• Gross debt stable compared to the Q313 level
• Net Debt decreased by €13.5m compared to the Q313 level
• Net Debt/EBITDA ratio: 1.40 (1.93 in Q313)
• Financial cost €1.3m (€2.0m in Q313)
17

18. Going forward
– Transcom’s strategic direction
3

19. Transcom’s brand promise
”
19
Outstanding Customer
Experience, driving
revenue and brand
loyalty

20. Growth opportunities and key priorities going forward
Growth opportunities
Key priorities
North America and Asia Pacific
Short-term focus
• Continue expanding in local markets in
• Executing turnaround in
Asia Pacific
• Expand onshore volumes in North
America
underperforming areas
• Revenue expansion and efficiency
improvements
• Quality and service delivery
Latin America
• Serving domestic markets and the US,
in addition to Spanish clients
North Europe
• Leverage strong position in home
market
Central Europe
• Primarily near shore opportunities
• Strong capability in expanding Eastern
European markets
20
Medium-to long-term priorities
• Grow revenue at least in line with
overall market growth in the
markets where we choose to
compete
• Improve profitability and decrease
earnings volatility
-
-
Continuously strengthen operational
efficiency
Optimizing our geographic delivery mix
Focus on broadening our client base

21. Welcome to Transcom’s mid-quarter and CSR update on March 5 in
Stockholm, for investors, equity analysts, ESG analysts and journalists
• Update on Transcom’s performance and important focus areas going
•
•
•
21
forward, including the company’s CSR activities, which form an integral
part of our day-to-day business activities
Ethos International will present the results from our recent stakeholder
dialogues
12:00-13:30 lunch meeting at Summit, Hitechbuilding, Sveavägen 9,
Stockholm, floor 17
R.S.V.P. to Frida Åsander by March 3, 2014:
Email frida.asander@transcom.com or call +46 73 964 33 03

22. Thank you!
Questions?