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News » Teleperformance announces stellar 2023 performance amid recent stock slump

Teleperformance announces stellar 2023 performance amid recent stock slump

Teleperformance 2023 performance
Photo from Teleperformance

PARIS, FRANCE — Digital business services provider Teleperformance recently unveiled its annual financial results for the year ended December 31, 2023.

In its latest financial report, the outsourcing giant reported its fastest like-for-like growth in the industry and announced an optimistic outlook for 2024, underpinned by the successful integration of Majorel and a robust plan for further expansion and margin enhancement.

Teleperformance’s financial achievements in 2023 recorded significant milestones across the board, including:

  • A revenue of €8.34 billion ($9.08 billion), marking a like-for-like increase of 5.1%.
  • EBITA before non-recurring items reached €1.29 billion ($1.40 billion), with the margin climbing to 15.9%, up by 40 basis points compared to 2022.
  • Net free cash flow surged by 15.5%, amounting to €812 million ($884 million).
  • The cash conversion rate improved significantly to 45.7% from 40.2% in the previous year.

According to the firm, these achievements were driven by sustained revenue growth across Europe and Indian offshore activities, a diversified client portfolio, and a strong focus on artificial intelligence innovation and agile operating models.

Another key highlight of Teleperformance’s 2023 performance was the acquisition of Majorel, which significantly enhanced the company’s market positioning. The integration is on track to deliver approximately €150 million ($163 million) in synergies by 2025, with €50 million ($54 million) expected in 2024.

This positive news comes amid the firm’s recent 19% stock plunge over fears that AI could disrupt its core business. The stock sell-off was sparked after Swedish fintech firm Klarna boasted strong results from its AI chatbot, which is handling two-thirds of customer inquiries just one month after launch.

Still, Teleperformance has set forth ambitious targets for 2024, aiming for a like-for-like, pro forma revenue growth of 2% to 4% and an EBITA margin increase of 10 to 20 basis points, excluding Majorel integration costs. 

The company also plans to boost net free cash flow and continue rewarding shareholders with dividends and share buy-backs, maintaining a robust balance sheet with leverage below 2x EBITDA.

Daniel Julien, Chairman and CEO of Teleperformance, expressed confidence in the company’s strategy for the coming year. He also stressed the company’s focus on profitable, cash-generating growth despite the uncertain global environment. 

“With agility and flexibility, the Group will continue to tightly manage its costs and harvest the synergies expected to be created by the Majorel integration,” Julien stated.

Teleperformance recently ranked #2 in the 2024 OA500, an objective index of the world’s top 500 outsourcing companies. This is the second year the company clinched the index’s top 2 spot.

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