Convergys Corporation reported increased results this week for the third quarter and nine-month period ended September 30, 1998.
Convergys' third quarter revenues were $370.3 million, up 55 percent from $238.5 million in the third quarter of 1997. In the first quarter of 1998, Convergys acquired AT&T Solutions Customer Care (formerly Transtech) and the teleservices operations of Maritz, Inc. These acquisitions contributed
approximately $111 million to the revenue increase in the third quarter. Excluding these acquisitions, revenues increased 9 percent on a year-over-year period.
Operating income increased 33 percent, to $45.8 million, compared to $34.5 million in the same quarter last year. Net income increased 8 percent to $25.6 million in the third quarter of 1998 from $23.6 million in the second quarter of 1998, but fell 3 percent compared to the third quarter of 1997.
Results for the third quarter 1998 compared with the third quarter of 1997 reflect a $6 million increase in amortization of goodwill and other intangibles and approximately $8 million in additional
interest expense related to the acquisitions. Additionally, third quarter Year 2000 compliance spending grew to $7 million from $3 million last year.
Diluted earnings per share totaled 18 cents for the third quarter 1998, compared to 19 cents for the same period last year.
The company's revenues for the first nine months of 1998 increased 44 percent to $1,042.5 million from $725.0 million in the same period last year. Transtech and Maritz contributed $261 million to the increase. Excluding acquisitions, revenues grew nearly 8 percent. Excluding an acquisition-related first quarter special item, operating income for the first nine months of 1998 was $128.7 million, up 17 percent from the same period last year. Net income for the first nine months of 1998 was $73.3 million or 52 cents per share, excluding the special item. Net income for the first nine months of 1997 was $81.4 million.
