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ICT GROUP REPORTS THIRD QUARTER 2002 RESULTS~ REVENUE UP 33%; EPS INCREASES TO $0.23 ~ ~ Provides Fourth Quarter Guidance and 2003 Revenue Outlook ~NEWTOWN, PA, OCTOBER 24, 2002 – ICT GROUP, INC. (NASDAQ: ICTG), today reported consolidated revenue of $74.1 million for the third quarter ended September 30, 2002, a 33% increase over 2001 third quarter revenue of $55.8 million. Operating income for the third quarter increased to $4.6 million, from $1.2 million in the prior year period. Net income for the third quarter of 2002 increased to $2.9 million, from $0.6 million in the same period of 2001. Diluted earnings per share for the third quarter of 2002 were $0.23, compared to $0.05 in the third quarter of 2001.“Our strong results for the period resulted from the successful execution of our strategy reliant on a diversified mix of services, markets, industries, and customers,” said John J. Brennan, Chairman and Chief Executive Officer of ICT GROUP. “The Company’s revenue growth continued to be driven primarily by the CRM services business, with third quarter revenue from these operations totaling $34.9 million, up 55% from last year’s third quarter, and accounting for 47% of total Company revenue compared to 40% in the same period last year. As a result of the successful execution of our CRM services growth strategy, revenue from inbound operations increased to 52% of total Company revenue in the quarter. This marks the first quarter in ICT GROUP’s history that revenue from inbound operations accounted for more than half of total Company revenue. “Our CRM sales business also remained strong, with revenue totaling $39.2 million, up 18% from last year’s third quarter and accounting for 49% of total Company revenue. Other CRM services, including value-added technology and marketing support services, increased 25% and represented the balance of total Company revenue for the period.” >From a geographic market perspective, the Company achieved strong year-over-year revenue growth in both its domestic and international operations in the third quarter. Consolidated revenue from domestic CRM business units increased 35% from $41.4 million in last year’s third quarter to $56.0 million in the third quarter of 2002. Consolidated revenue from international CRM business units increased 26%, from $14.4 million in the third quarter of 2001 to $18.2 million. In the third quarter of 2002, contact centers located outside the U.S. accounted for 44% of consolidated CRM production volumes, up from 38% in last year’s third quarter. The Company intends to continue expanding its international operations into new geographic markets as well as to increase its near-shore and off-shore capacity to more cost-effectively support U.S. and U.K. customers. ICT GROUP further expanded its Canadian operations during this quarter, and in October of 2002, the Company acquired a 100-station contact center operation in Mexico City from Grupo Teleinter, S.A. de C.V. This acquisition not only provides ICT GROUP with entry into Mexico and potential expansion into Latin America and South America, but it also provides it with additional cost-effective operations to support the U.S. Hispanic market. Mr. Brennan continued, “Revenue growth remained strong across the telecom/technology, healthcare and financial services sectors during the third quarter, with telecom/technology revenue increasing 89%, revenue from healthcare clients increasing 65% and revenue from financial services clients increasing 31%. We also strengthened our balance sheet during the third quarter, with cash and cash equivalents reaching $15.3 million at the end of this quarter and our long term debt-to-equity ratio decreasing to 23%.” ICT GROUP expects to maintain its business momentum by continuing to invest in migrating its operations to lower cost contact centers outside the U.S. and transitioning its business mix to more rapidly growing customer care and value-added marketing support services. The Company expects to incur additional costs and infrastructure investments to support these expansion initiatives. For the fourth quarter of 2002, the Company currently anticipates revenue of $76 to $78 million with net income of $0.27 to $0.29 per diluted share. Full year revenue is currently expected to be in the range of $297 to $299 million and full year earnings are currently expected to be in the range of $0.98 to $1.00 per diluted share. For 2003, the Company currently expects revenue to increase 15% to 20% compared to 2002. ICT GROUP, headquartered in Newtown, Pa., is a leading global provider of integrated customer relationship management (CRM) solutions. The Company helps clients identify, acquire, retain, service, measure and maximize the lifetime value of their customer relationships. The Company manages CRM service operations in the U.S., Europe, Canada, Australia, Mexico and the Caribbean from which it supports domestic and multinational corporations and institutions, primarily in the financial, insurance, telecommunications, healthcare, information technology, media and energy services industries. ICT GROUP also offers a full suite of hosted CRM solutions, for use by clients at their own in-house facility or on a co-sourced basis in conjunction with ICT GROUP’s fully compatible Web-enabled customer service operations. To learn more about ICT GROUP, visit the Company’s website at www.ictgroup.com. Important Cautionary Information Regarding Forward-Looking Statements This press release contains certain forward-looking statements, such as expected revenues and earnings, plans to expand into new international markets and to increase capacity, ability to maintain growth momentum, expected demand for services, ability to migrate operations to lower cost centers and ability to transition business to faster growing operations. The forward-looking statements involve assumptions and are subject to substantial risks and uncertainties. Whenever possible, forward- looking statements are preceded by, followed by or include the words "believes," "expects," "anticipates" or similar expressions, which speak only as of the date the statement is made. ICT GROUP assumes no obligation to update any such forward-looking statements. For such statements, ICT GROUP claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Actual events or results of operations, cash flows and financial condition of ICT GROUP may differ materially from those discussed in the forward-looking statements as a result of various factors, including without limitation, those discussed in ICT GROUP's annual report on Form 10-K for the year ended December 31, 2001, the Form 10-Q for the quarter ended September 30, 2002 and other documents, such as reports on Form 8-K and other reports on Form 10-Q filed by ICT GROUP with the Securities and Exchange Commission. Although ICT GROUP believes that the expectations reflected in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from ICT GROUP's expectations, or that could materially and adversely affect ICT GROUP’s financial condition, may include, but are not limited to the following, many of which are outside ICT GROUP's control: demand for ICT GROUP’s services, the cost to defend or settle litigation against ICT GROUP, judgments, orders, rulings and other developments in litigation against ICT GROUP, unanticipated labor difficulties, ICT GROUP’s capital and financing needs (including the incurrence of significant expenses of a planned offering of common stock if the offering is abandoned), ICT GROUP’s ability to integrate acquired businesses, customer demand for a client's product, the client's budgets and plans, interest rates and other conditions affecting the client's industry, unanticipated contract or technical difficulties, identifying and opening planned contact centers within timeframes necessary to meet client demands, reliance on strategic partners, industry and government regulation, reliance on telecommunications and computer technology, general and local economic conditions, and competitive pressures in ICT GROUP's industry. These factors, as well as others, such as conditions in the securities markets and actual or perceived results or developments affecting companies in our industry, could affect the trading price of our common stock. Editorial Contact: Jackie Amendolari ICT Group, Inc. 267-685-5018 investorinfo@ictgroup.com top of page |
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