RMH Lowers Earnings Projections, Announces UPS Deal

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RMH Teleservices yesterday cut its earnings projections for the quarter ending Sept. 30 but heralded a new contract with United Parcel Service.


The teleservices provider lowered its earnings forecast for the quarter to 4 cents per share, down from previous projections of 12 cents per share. CEO John Fellows attributed the reduction to ongoing infrastructure investments that will cost $1.5 million this quarter and another $1.5 million next quarter.


Most of the money will be invested in expanding professional personnel. The new staff is needed to manage and develop new clients, the company said.


The company is projecting revenue of about $250 million in fiscal 2002, which begins Oct. 1. If proved accurate, the estimated revenue would be the highest on record for RMH Teleservices.


Fueling some of that revenue growth will be a new contract to provide inbound teleservices for UPS, Atlanta. The company said it had a multiyear deal with UPS and that work for the express carrier and package delivery company would begin immediately.


Further details about the contract were not released. Earlier this month, RMH Teleservices announced an expanded contract with another major client, Microsoft subsidiary MSN.


Call center expansion and growth in the technology and telecommunications industries have fueled the rise of RMH Teleservices stock, which rose from $5 a share at the beginning of April to more than $11 a share at the beginning of this month. Investors reacted favorably yesterday to the company's announcements. The stock, which started the day at $11.55 a share, was trading at well over $14 a share by mid-afternoon. It ended the day at $17.33.


RMH Teleservices, Bryn Mawr, PA, has 5,000 workstations and 7,500 employees and operates 25 call centers in the United States and Canada. It services primarily the telecommunications, financial services and insurance industries.


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