ICT Group Inc. Reports Record Sales And Earnings For Fourth Quarter And Year; Net Income Up 179% For Fourth Quarter And 101% For 1997

Business Wire, Feb 26, 1998

LANGHORNE, Pa.--(BUSINESS WIRE)--Feb. 26, 1998--ICT Group Inc., an international provider of integrated call center teleservices, Thursday reported fourth quarter 1997 revenues of $26.6 million, an increase of 35% over 1996 fourth quarter revenues of $19.7 million.

John J. Brennan, chairman and chief executive officer, reported, "More importantly, ICT Group's operating income increased 247% to $1.5 million in the fourth quarter of 1997 and operating margins were 5.5% compared to 2.1% in the 1996 fourth quarter.

"This marked the fourth consecutive quarter of improving operating margins, reflecting ICT Group's continued success at maintaining costs and leveraging investments made in new services and customer support infrastructure." Net income for the three months ended Dec. 31, 1997 increased 179% to $922,000 from $331,000 in 1996 and diluted earnings per share increased to $.08 from $.03.

For the year 1997, Brennan further stated, "ICT Group generated significant business momentum. Consolidated revenues grew 28% over 1996 to $91.7 million. Aggressive cost controls, improved management in adding call center capacity and locating new call centers in attractive labor markets, and renegotiating supplier contracts have allowed us to realize additional operating leverage in 1997."

Operating income increased 69% to $4.0 million in 1997 and net income more than doubled from $1.3 million in 1996 to $2.7 million in 1997. Diluted earnings per share increased to $0.22 from $0.12 in 1996.

ICT Group's sales within the insurance and financial services sectors continued to grow in 1997, and at the same time the company successfully developed new clients within the health care, telecommunications and utility industries which helped reduce client concentration.

ICT Group's business activity accelerated in the second half of 1997 and remained strong across all divisions and targeted industry markets. Fourth quarter TeleServices division revenues increased 36% to $20.2 million from $14.8 million in 1996. Both domestic and international teleservices operations registered strong quarter growth over last year, increasing 37% and 35%, respectively.

Marketing Services division revenues increased 56% to $4.6 million for the quarter over last year as revenues from the Financial Marketing, Medical Marketing and Research Services business units increased 96%, 54% and 27%, respectively.

Management Services division revenues were up 46% from the third quarter of 1997 but were down slightly from the 1996 fourth quarter due to the conclusion of a service contract earlier in 1997.

Brennan concluded, "We are extremely pleased with our fourth quarter revenue growth and operating results. ICT Group's strategy of providing high quality teleservices while concurrently containing costs in an increasingly competitive marketplace combined with providing value-added marketing and management services is enabling us to improve operating margins and strengthen client relationships.

"Strategic alliances formed in 1997 with ALLTEL, Aspect Telecommunications, Systems and Computer Technology (SCT) and Information Management Associates (IMA) further enhance our ability to capture outsourced call center management contracts.

"We believe that our strong balance sheet with $17.7 million in cash combined with a three-year recent commitment from Bank Boston, N.A. and Summit Bancorp to provide a $45.0 million credit facility well positions ICT Group to finance its internal growth and to pursue prospective acquisitions."

ICT Group, an independent provider of call center teleservices for sales, marketing and customer care, employs more than 375 professionals in management, sales, systems and operations and approximately 4,000 telephone sales and service representatives and research interviewers.

The company manages 30 call centers in 10 states, Europe and Canada, from which it supports outbound and inbound calling for domestic and multinational corporations and institutions, primarily in the financial, insurance, telecommunications, health care, information media, energy and hospitality/transportation industries.

In addition to its corporate staff, ICT Group's sales and marketing divisions as well as its market research division are headquartered in Langhorne. ICT Group has sales offices in Philadelphia; Chicago; Miami; Stamford, Conn.; Seattle; Amherst, N.Y.; London, England, and Dublin, Ireland.

Facilities conducting international operations are located in Miami; Dublin, Ireland; London, England; and New Brunswick and Nova Scotia, Canada.

To learn more about ICT Group, visit its web site at www.ictgroup.com. ICT Group is traded on Nasdaq:ICTG. -0-

This press release contains certain forward-looking statements that are subject to risks and uncertainties. Forward-looking statements include certain information relating to the development of alliances and the anticipated benefits of such alliances, as well as information that may be contained elsewhere in this press release where statements are preceded by, followed by or include the words "believes," "expects," "estimates," "anticipates," or "plans," or similar expressions.