Teleperformance (TEP) H2 2024 earnings summary

Executive summary

• Achieved over €10 billion in revenue for the first time, with 23.2% reported growth and 2.6% pro forma growth year-over-year; Q4 pro forma growth accelerated to 4.0%.

• Free cash flow exceeded €1.08 billion, up 33.5% year-over-year, demonstrating strong business resilience.

• Margin expansion driven by core BPO/Core Services and double-digit growth in Specialized Services; recurring EBITA margin rose to 15.0%.

• Majorel integration on track, delivering €94 million in cost synergies in 2024; ZP acquisition completed, strengthening Specialized Services.

• Governance enhanced with CEO/chairman role separation, new board members with AI/international expertise, and succession plan in place.

Financial highlights

• Reported revenue grew 23.2% to €10,280 million; pro forma revenue up 2.6% year-over-year.

• Adjusted net result increased by 10.2% to €807 million; net income at €523 million due to non-recurring items.

• Free cash flow reached €1,084 million, with a cash conversion rate of 52%.

• EBITDA before non-recurring items: €2,096 million (20.4% margin); recurring EBITA: €1,537 million (15.0% margin).

• Net debt reduced to €3,890 million; net debt/recurring EBITDA at 1.9x; cost of debt below 4%.

Outlook and guidance

• 2025 like-for-like revenue growth targeted at 3%-5% (excluding TLScontact contract non-renewal); recurring EBITA margin to improve by up to 10 bps.

• Specialized Services expected to grow high single digits, excluding special effects.

• Free cash flow target of €1 billion before non-recurring items for 2025; continued deleveraging and dividend growth planned.

• ZP consolidation from February 2025; up to €100 million targeted for AI partnership investments.

• Guidance excludes impact of non-renewal of a major visa application management contract.