Convergys Corp. Reports Second Quarter Results

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<strong>Cincinnati &mdash; July 25 </strong><br />Convergys Corp., a global provider of customer care, human resources and billing services, has announced its financial results for the second quarter of 2007.<br /><br /><ul><li>Earnings of 28 cents per diluted share (equal to same period last year.</li><li>Signed global HR BPO contracts with Johnson &amp; Johnson and Starbucks.</li><li>Excellent cost management and continued growth of international operations in information management.</li><li>Sixth consecutive quarter of year-over-year customer care revenue growth (margin decline attributed to currency and new capacity expansion).</li><li>Employee care revenues up 25 percent (operating income declined primarily because of expensing $6.1 million in implementation costs related to one HR BPO contract).</li></ul><p>Convergys&#39; second-quarter revenues of $707 million were up 2 percent compared to the second quarter of 2006 reflecting growth from the customer care and employee care segments.&nbsp; </p><p>Significant improvement in operating income in information management was offset by declines in employee care and customer care.&nbsp; </p><p>Operating results include expensing implementation costs of $6.1 million related to a large employee care HR BPO contract, about $7 million of negative impact because of the weakened dollar, and capacity expansion costs of several million dollars in Customer Care.&nbsp; </p><p>Convergys&#39; operating income was $58.1 million in the second quarter, compared with $62.8 million in the same period last year.&nbsp; </p><p>Net income was $38.8 million in the second quarter.&nbsp; Earnings of 28 cents per diluted share were the same as the prior year period.<br /><br />&ldquo;Convergys continues to be well-positioned for long-term growth,&quot; said Dave Dougherty, president and CEO. &quot;We&#39;ve established a strong position in the HR BPO market, our information management business is doing an excellent job managing costs and continuing to grow in international markets and there&rsquo;s a continuing trend toward outsourcing in the customer care industry.</p><p>&ldquo;However, as this quarter&#39;s results demonstrate, we&rsquo;ve got short-term challenges with implementation costs on a large HR BPO contract, continued currency pressure and increased capacity expansion costs in our customer care business. We have a great team of employees at Convergys and all of us are focused on overcoming these challenges to deliver higher revenue and earnings growth.&quot;</p>

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