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Convergys Reports Second Quarter Results

Convergys Corporation (NYSE: CVG), a global leader in customer management, today announced its financial results for the second quarter of 2013.

The Company also announced that it completed real estate transactions related to corporate simplification actions initiated in prior years.

Second Quarter Summary
  • Revenue of $504 million, up three percent compared with prior year;
  • Adjusted EBITDA of $61 million, up six percent compared with $58 million in the prior year;
  • Adjusted EPS from continuing operations of $0.25, compared with $0.19 in the prior year; GAAP EPS from continuing operations of $0.20, including expected pension settlement and real estate sale-related corporate simplification impacts;
  • Repurchased 1.5 million Convergys shares for $25 million, or $16.43 per share;
  • $587 million cash and short term investments on balance sheet at quarter end;
  • Confirmed expectations for revenue growth and profit improvement in 2013.

“We delivered steady improvement in revenue, EBITDA and EPS in the second quarter as we execute our plan for sustained growth and margin expansion,” said Andrea Ayers, president and CEO. “Our winning business model is driving predictable, consistent performance through a unique combination of global quality delivery, comprehensive solutions and close client engagement. We had another quarter of strong new business signings, and are confirming our full-year guidance.”

Ayers added, “As a well-capitalized market leader we are able to both invest in strategic growth and return capital to investors. We acquired Datacom’s Asia contact center operations for approximately $20 million, paid a $6 million dividend and repurchased $25 million of stock in the quarter, and will remain disciplined with our capital deployment strategy.”

Second Quarter Results – Continuing Operations

Revenue – Revenue was $504 million, a three percent increase compared with $491 million in the same period last year.

Operating Income – Adjusted operating income was $39 million, a 12 percent increase compared with adjusted operating income of $35 million in the same period last year. GAAP operating income was $30 million including the corporate simplification impacts discussed below. Prior-year GAAP operating loss of $61 million included Information Management sale and corporate simplification impacts.

Adjusted operating margin was 7.7 percent, up 70 basis points compared with 7.0 percent in the same period last year.

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