Revenue Declines at Restructured ICT

In the US, CRM outsourcing firm ICT Group has seen a drop in revenue to $96.1m in Q1, from $108.7m for the same period last year.

However, revenue from its core services - comprised mainly of North American customer care, technology and BPO Services, together with international operations - increased 2% to $91.5m and accounted for 95% of total revenue. This compares with core business revenue of $89.9m for Q1 2008.

Non-core business, comprising US and Canada market research services and financial telesales, declined to 244,000 hours from 1.0 million hours in last year's first quarter.

Earlier in the year, the firm announced that it would no longer be providing market research services, and that it would close or partially close six of its contact centers in the US and Canada, and offshore much of the work from those in Europe and Australia.

Consistent with this strategy to 'right-shore' capacity for its international business units, the company now plans to close or downsize certain international operations, which would result in restructuring charges in the second and third quarters of 2009. These are not expected to exceed $1m in total.

During the quarter, gross margin rose to 40.8% from 35.9% last year, and the company reported break-even earnings results for the 2009 first quarter, compared with the $1m net loss incurred in the year-ago period. Included in this year's results was $85k in net restructuring charges.

Commenting on first quarter performance, Chairman and CEO John Brennan noted that while the firm had reduced costs by implementing operating efficiencies and increasing worldwide capacity utilization to 79% from 73% last year, selling, general and administrative expenses decreased, compared with both the year-ago period and prior quarters, due to reduced facilities and staff costs.

ICT Group expects to report positive year-over-year growth in core business revenue throughout 2009 through increased productivity and greater workstation utilization.

Web site: www.ictgroup.com .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.