TeleTech Reports on Q3, Holds Full Results Pending Review

TeleTech Holdings, Inc. (NASDAQ: TTEC), an Englewood, Colo.-based operator of call centers and provider of BPO services, reported late Thursday that third quarter revenue rose, but most other information regarding the company’s third quarter financial performance was not released pending a review of past stock-options accounting practices.

Due to the review of TeleTech's historical stock option and other equity-based compensation grant practices being by the company's audit committee, TeleTech reported. 

For the third quarter of 2007, the company reported revenue of $335.8 million, a 10.5 percent increase over the year-ago quarter. Revenue for services for clients in offshore locations rose 33 percent to $136.5 million in the third quarter 2007 and represented 41 percent of total revenue. Year to date, revenue from services performed for clients in offshore locations grew approximately 41 percent to $396 million and represented nearly 40 percent of total revenue. The third quarter also marked the largest amount of capacity additions in any given quarter with approximately 3,600 new workstations deployed predominantly in offshore locations.

Preliminary income from operations in the third quarter 2007 was $25.9 million. Included in third quarter 2007 income from operations was a total of $4.8 million in asset impairment and restructuring charges. Excluding these charges, preliminary income from operations was $30.7 million, or 9.1 percent of revenue, the company reported.

Based on the work conducted so far, Teletech management “presently believes that it will be required to incur additional non-cash compensation charges for prior periods and that restatement of previous interim and annual financial statements for the periods 1999 through 2007 is likely,” the company said in the earnings announcement. “There also may be an impact on the current fiscal year's results of operations.

The restatements could go back as far as 1999, the company added.