Teleperformance SE (TEP) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and thank you for being here for our presentation of our 2023 annual results. But before to start the formal presentation, I would like to address the elephant in the room now. And the elephant in the room is AI and new Gen AI, an enhancer for the human employees who do a job or is it the beginning of the great replacement. And what I can tell you over the business that we are doing is that it's mostly an enhancer, more accuracy, more productivity, and it gives us the ability to manage end-to-end more complex solutions. So that's why we embrace it. In few cases, but it's the minority of the cases, it replace the human employee and this is typically for more simple transactional factual interaction. Let's not forget that we are hired to help companies to reduce the friction that they have with their customers and to maintain the loyalty to the brand. And when a customer contact us, in most of the case, it's because there is a friction, there is a frustration. And of course, we need to give the accurate answer. And of course, the AI and the Gen AI are of a great help and even adding more possibilities to address more complex situation. But at the end of the day, there is a need for contextualization, common sense and decision. Gen AI has a lot of qualities. And by the way, I use it absolutely every day, and I think it's fantastic. But when it comes to common sense, decision and empathy, this is the real of the human being people. By the way, for you, if suddenly Gen AI try to show you empathy, then natural attitude of the people is just to get [indiscernible]. Empathy is human and uniquely human. Having said that, Teleperformance over the decades has always served the different technology waves. We have been a transformer of the customer experience and Teleperformance transformed itself. And this is what we are doing right now. We are going to give you as many examples -- tangible example as we can. And now except if I forget something -- so now I just would like to tell you also without breaching any confidentiality agreement that out of our top 10 clients and long-term clients in the world, 8 of them are large digital companies, either from Silicon Valley or from China. So which means that it doesn't seem that this company who are big leaders in AI promotion think that AI is going to replace us. Finally, I hope that you are going to have a different perception at the end of this presentation of what does Teleperformance? What is the future? And yes, I know that the stock price of Teleperformance has been very much impacted. For us, we work on the long term. We build -- we have built and we continue to build a company that leads the market. It's a strong company, generating a strong cash flow, and there is some kind of mismatch between the current situation in the stock exchange and the reality of the company. Now please let me start with a more formal presentation. And I think that now I still need to be manual. So yes, 2021, 2022 were great years of tailwinds. There was the COVID, people were confined and they had nothing to do, but to be with their computer and to play with their screen, either on the social media or with the e-commerce, and this was a timing of great optimists even in Silicon Valley. 2023, end of the confinement period, what did you all do? I go out, we go to the restaurant, we take the plane and so on. What does it mean? You reserve the time of interaction with the brand because you are not bored and you have something else to do, another priority. And clearly, there has been for many of our clients who have not lost share of volumes, shares of market or market shares, there has been less interaction in '23 than in '22, '21. They have been at peak. Then this new situation created a slowdown in the growth of the digital commerce. You will remember a very famous verse of Silicon Valley that said that 2023 was a year of efficiency, which has been somehow scaled back in the launch of new product, new service, new investment and also strict disciplined management of budgets. So basically, it has been a year of maximum efficiency where our clients were looking for the best possible labor arbitrage combined with the best possible automation, and I will come back to that later. Of course, there has been the Gen AI release that has created a hype in the media. It has a clear importance. And by the way, we have many products, TP proprietary products that integrate Gen AI, and you will see that with Bhupender later. But it has not significantly impacted our growth dynamic. What -- significantly our growth dynamic has been much more the shortcut from servicing a market from a domestic delivery place to servicing a market to offshore. Usually, you would go through domestic, then nearshore, then eventually offshore when you need to really, really squeeze your cost. Our business in India in 2023 grew by plus 17%. And of course, when our business in India grew by plus 17%, it means that in other more expensive geographies, our business doesn't grow the same way. So on the top line, it has a kind of definition effect to the growth because the price per unit is not the same. But on the bottom line, there is more room for margin. And by the way, we maintained or even improved our operating margin. Then clearly, the rest is obvious, except that we all live also right now with huge investment and a huge focus on data security because fraud is growing exponentially, all the government of the world would say that, whether it's our U.S. Government or the EU Government. And by the way, this creates opportunities, additional opportunities for Teleperformance Services. The numbers, you all saw the PR, I'm not going to be long on that. I know it was disappointing versus our first expectation when we had the tailwinds. But at the end of the day, like-for-like, we had a growth of 5.1% in revenue, except the COVID onetime business, and in 2021, '22. We increased our operating margin by 40 basis points. We increased our free cash flow to EUR 812 million because this company is in great shape, and we increased our cash conversion from 40% to 46%. I don't think that we should be ashamed of these numbers. Then in 2023, we made the acquisition of Majorel that was not always very well understood because we always said, we want to make acquisition in specialized niche business, high value, and we always want to do that. We do not find them every morning, the good one. Why did we buy Majorel? For really 2 simple reason. During difficult time, the large clients are consolidating their numbers of vendors. And to have the #1 position on the global market is a clear competitive advantage. #2, it's always a topic of the shoemaker who always has the worst shoes. Teleperformance was weak in the French market, sorry. And Teleperformance was a small actor on the German market. In both markets, Majorel was the leader. So suddenly, the market #3 in the world for outsourcing and the market #4 in the world in outsourcing, we did not have any more gap. This strengthened our position. And I will give a little bit more explanation later. But what is our starting point for 2024. We are now more than EUR 10 billion pro forma euro company, more than EUR 2 billion EBITDA, more than EUR 1.5 billion EBITA. Yes, Majorel stand-alone had EBITA margin lower than the one of Teleperformance, but the result of the process of the synergy in 2 years is going to give back the gap, to fill the gap. That was the rationale for the Majorel acquisition, I'm not going to spend too much time. Yes, there was also some very good complement. We tend to be very present in the banking and the fintech in the U.S. and in LatAm, not in Europe, they were present there. It's a great booster for us, insurance. Majorel has a well-tailored end-to-end claim management process. And I can tell you, a claim management process, whether it's in auto or in habitation is not exactly something that is solved by Gen AI. Gen AI can come in the process to optimize, but you have multiple interlocutors, you have timing to solve. You have multiple point of contacts. We love it. And they serve some of the largest insurance companies of the world. And of course, we are going to expand that in the other geographies. And I could continue. Now this is what I was telling you about the synergies. If you look at 2024, it seems to be a warship. We are going to get EUR 50 million in making our synergy work, but is going to cost us EUR 0 million. It's not a warship because it cost us EUR 50 million in 1 year. But the green EUR 50 million are here for multiyears. And then in '25, it should cost us EUR 50 million also and the full synergy should be at EUR 150 million. And here again, this come repeatedly, so for the next 10 years, it should make EUR 1.5 billion. Now I want to tell you why I'm so confident in Teleperformance future. First, we have our strategy that we started in the mid-2010 of developing niche, high-value services that grow double-digit, top line and bottom line. And in 2023, it was also the case, and in 2024, it will also be the case. What are these specialized services. I love to speak about this one, LanguageLine Solutions. When we acquired it in 2016, many people told us, what is the sense to buy an online interpretation company when there is, excuse me, to mention a brand, when there is Google translate. It's totally different. And why is it totally different? In the U.S., where LanguageLine is mostly present, there is a regulation. And this regulation wants every critical service, whether it's finance, health care, police, justice, to be able to speak to the individual in its native language. And I can tell you that LanguageLine Solutions continue to grow beautifully well, while integrating, of course, the support of AI. There is [indiscernible] that got a big drop during COVID, that was the only company that got a drop in the group during the COVID. But now we took advantage of that time to refine its process and it's now growing double digits and very profitable, [else] advocate to help the employees of the large U.S. companies to have additional benefit, which is a help to navigate and to advocate on their behalf within the very complex health care system in the U.S. You have to be American to understand what I mean. PSG, AllianceOne, I will let Scott Klein who is the President of the Specialized Service and the very talented President of the Specialized Services to present in details this line of business. But Scott Klein, if you could show yourself that you exist. That's just an example. What does it mean? Yes, it's a growth curve of LanguageLine Solution that had no future in 2016, from 2016 to 2024 plus 13% CAGR. Now the other strong basis for Teleperformance future and believe me, we love AI, we embrace AI and it's the AI augmented human. And again, it's -- and I know that there is a permanent debate between will AI enhance the humanity or are we going to the theory of the great replacement. We know the strike on Hollywood, we know so many things. How do we address that? First, we decided to have a general architect to manage our effort. It's Joao Cardoso, who is part of Teleperformance for 23 years. He is an engineer in computer science and with a specialization in formal language and in AI. And he is taking the leadership of all what we do in AI over the world. By the way, this individual has contributed a lot to the value of Teleperformance in the past because he was the architect behind Teleperformance Cloud Campus who helped us to convert Teleperformance from brick and mortar to work from home and virtually hiring, virtually training, virtually coaching, virtually and so on and so, at the time of the COVID in 2020 when from end of March to early July, April, May, sorry, 2 months. We made the conversion of more than 220,000 people. We have 600 solution architects who are analysts and developers in our Center of Excellence for AI, of course, in India, where you have a lot of talented resources, and Bhupender Singh who is my Co-CEO will explain that. He knows pretty well India. He was graduated from the Indian Institute of Technology and the Indian Institute of Management and he knows few things about deep learning. In Europe, we had a team already in Netherlands that had developed many solutions integrating AI. And by the way, there is a product that was present in the press a few days ago that created a kind of drama in the stock exchange to our big surprise because it's a product that we use for years, but I'm going to show you that later. We have a little bit more than 7,000 IT people for the network management, the help desk and many support, that would make already a nice IT company. We have 60 AI proprietary solution for the core service. We have 600 clients out of the 1,500. So today that we serve -- today have at least one element of TP AI solution, and I'm going to show you what. And guess what? For the replacement, for the symbol transactional interaction, of course, we deploy the bots, and we have 25,000 bots. That more or less are an equivalent of 150,000 people. That's a replacement, simple, factual, transactional, no need for empathy. What is the level of my account? How much do I know you? But I paid 2 weeks ago, and you continue to relaunch me or whatever. Just factual. For us, of course, AI is in the vast majority of our business, human augmentation. Human augmentation in accuracy, we have instantaneous access to multiple source of data and synthesis of that, which is very, very efficient. So we gain in productivity. With the online analytics, we have some gain of predictability, which help us to make better proposal and so to enhance our results. AI can help in some kind of personalization by indicating moods and giving some clues to the human. And of course, in a world that becomes more virtual every day and where the fraud becomes a daily issue, not only for the companies, but for the government and for everything, we use a lot AI in data security to reduce the fraud, which is something super important for our clients. I think that the real future of the business process outsourcing is the level of data security we are able to provide, that's a real topic. And because a lot of people speak about AI and do not give any details, I don't want to make marketing with all the name of the AI we have. We put some of them. We say exactly what they do, and you have exactly the details in this slide, which is Slide number 15. Thank you very much. I need to change my glasses. You will see there a product that is called TP product in data security. It's a patented solution, and it gives us signals on what's happening in the floor each time on the process adherence and each time there is some kind of outliers, it gives warning. And then it helps us to anticipate and manage. This product -- the base of this product was from Israel, by the way, we started it more than 10 years ago. Of course, large iteration [indiscernible] with integrating more and more of the possibilities. Bhupender is going to explain that much more. Now another strong basis for our future is we decided to start to commercialize our group's unique expertise because nobody has the expertise we have in customer experience management to the in-house market that remains a large, large part of the business. By creating TP Infinity, where we have right now, we start modestly with 650 consultants. I hope in a few years from now, there will be a few thousand consultants in strategy, technology, creative design, analytics and selling our best practice as a service, like a cloud as a service in best practice, whether it is workforce management, whether it's a QA, it means quality assistance and so on. Another strong basis for Teleperformance future is India. We do more or less 50% of our business in the beautiful English language. And in difficult times, let's not forget that the next 2, 3 years are going to be difficult at the macroeconomic level. If you look at the forecast of the World Bank or the IMF, you see that 2024 should be even more difficult than 2023 and 2025 is not going to be so great. If I'm not mistaken, we -- of course, we have delivery service all over the world. But the main markets that we serve are the rich market, the U.S. and Europe. And when U.S. should continue to grow by something like 1.5% in GDP, Europe is probably going to grow by 0.8%. And if I add U.K., it can even lower a little bit this number. So in that difficult times, people go directly for the max efficiency versus the [indiscernible]. And so to be strong in India is important. Today, we have 90,000 people in India. We plan in a few years from now to pass to 150,000. And here is where we were in India, we were at EUR 374 million in 2020, we are at close to EUR 600 million in '23, and we hope to be above EUR 1 billion by 2027, continuing our CAGR of plus 17%. And of course, we make all the investment for that. We are present in, I don't know, how many cities, Bhupender knows detail much better than I know. And finally, because even if personally, I would prefer to live 800 years and there is an AI group, they could try to explain us that we are going to live way beyond 100 by 2040. But age is age. And so it's important to prepare. First, the succession planning; and second, to answer to some demand of our shareholders and of the market, we are going to -- when we will be ready to split the function of Chairman and CEO. We want to do that smoothly, methodically and in such a way that it's going to be totally flawless. So Bhupender and I are working together, we speak exactly, even if he lives in London and if I live somewhere else, I never know where I live, we speak exactly every day, we review everything that happened within the company, what is important, how we consider it, what decision we should take. And you see ESG, ExCom and the ExCom, we added Joao that I mentioned and the Chief Marketing Officer. So the ExCom today has 30% woman in representation, which is a little bit better than before. And that's it for me. Thank you very much.

Good morning to all. I'm going to present to you the figure for 2023. I'm not going to come back on what Daniel said about the macroeconomic context that we lived in 2023. I just wanted to point out one thing, which was the exceptional FX volatility that happened this year -- last year, sorry. If I may say, we are used to live in an exceptional -- an expected volatility of FX. But the pattern has been dramatically different than what we lived in the past, meaning that not only the dollar was going down and up, but we had also some currency in which we are significantly present in the country and significantly we are present seeking to Colombia and seeking to Mexico where the currency climbs up and where -- in other countries where we are also significantly present, meaning Turkey, Egypt or Tunisia are not -- or Argentina where [indiscernible] dramatically. I will come back to that in a minute. What was the answer of TP, to continue to grow and to create value for. Of course, stability, diversification and credibility were key to secure growth. We'll see that in a minute. But what we decided very, very early in the year was to tighten the belt. So we have tightened the belt on the cost. We made some streamlining on people and some site optimization, very early in the year, even if it has an impact, which is deferred in the year. It drives us towards the best EBITDA margin that the group ever achieved. And certainly, we start to be very, very careful on cash because we believe that cash is absolutely key, whether it's CapEx, DSO or other tax issue. So at the end of the day, we are going to -- we are happy to report the best free cash flow that we ever reported. So let's move now to the figure precisely. Any of the figures that are presented, you have the full year 2023, which include, as you can remember, 2 months of Majorel. And of course, we put on the side to compare 2022 figures, which was published last year. I thought it was interesting to isolate TP by itself without the Majorel figure for the last -- for the full year of 2023. So you have on the right side of the slide, TP stand-alone with no impact of Majorel in its book. So you see that finally, 2 things. The 5.1% growth that was just mentioned by Daniel on which I will come back in a minute, the margin that we were able to deliver, which is 15.5% for the published reported figure, including 2 months of Majorel, but if you take TP stand-alone, it's 15.8% and even 15.9%, if you take in account the EUR 13 million that we spent to streamline the organization all along the year with TP to prepare the future. So to a certain extent, we have been able to improve dramatically our margin in 2023 versus 2022 at a base that was never achieved at TP group level. I just wanted to remind you that the growth of Majorel because you are going to ask me the question will be -- has been for 2023, 5.5%, so close to TP. And the margin was -- we'll see that has been different. As you have seen, we have presented to you through Daniel's presentation the full year of Majorel, where the margin is significantly below the margin of TP. Let's move now to the evolution of the sales. Probably, it's one of the years that has been the most difficult that we ever lived. Daniel touched about, I would say, headwind, you see the headwind there. In sales, we had EUR 600 million of headwinds, of which, EUR 350 million took currency effect, EUR 32 million of inflation, and of course, EUR 223 million from COVID contract. I'll come back on the [indiscernible] inflation in a minute. So we had EUR 600 million. We started the year by losing EUR 600 million in sales versus last year. Of course, this currency effect came from the dollar, from the Argentinian peso, the Indian rupee, the Egyptian [gineih], and Turkish lira. But the [indiscernible] inflation has an impact which was huge in Q4 as we started to fill it sufficiently in advance. Just to give you an idea, the inflation in Argentina was 211% all along the year, while the FX decline was 388%. So this difference lead us to a EUR 32 million impact on our sales that has been posted in Q4. The connection between inflation and FX shows that the monetary devaluation do not compensate the inflation -- the FX decrease. So beyond that, you have a growth of EUR 388 million, which is 5.1% growth, which is -- and again, I don't know whether it's appropriate to make it clear again in this global environment of today, but it's probably the best performance that the market and the big competitor achieved all along the year in 2023. And of course, you have the scope perimeter effect, which is EUR 400 million, mostly Majorel, EUR 343 million, but also PSGs that what was bought last year in November, I'm sure you remember that. Where we lead to EUR 8.3 billion that are the published figure of today. Let's have a look to the source of growth. Not surprisingly, the growth is distributed differently across the sector. In fact, if you take the U.S. market, which is made of North American, APAC and to a large extent, LatAm, you have a U.S. market which is flat, which is not surprising. I'm not even speaking about -- I would say, the deflation that was mentioned by Daniel about the fact that people are going to India. But the world market was flat. One in Europe, we have been able to drive a growth of EUR 200 million. And of course, the growth from specialized service of EUR 180 million. Probably, I just wanted to stay a minute there because what makes the difference from TP from the competition is that it's given over, I would say, distribution in terms of countries in vertical, we are able to capture the growth that is still happening. Of course, people who are totally focused on U.S., totally focused on a contract, totally focused on a client, had time to get growth. While TP, okay, it's not immune to the macroeconomic environment, that is able to swallow much more the potential slowdown of the growth in every country or in every market. This is true, of course, by vertical. And you see that the distribution of our sales by vertical, but also by region. We know that probably APAC is going to push also much more the growth in the future as specialized service will do also in the future. So we will come back to that later. And being largely with split across the world and across the sector, help us to swallow the ups and downs. Let's move to the EBITDA by activity. Again, figures are complex to read. Starting by the total, excluding Majorel, you'll find the 15.8% that I just mentioned, 15.9% if you take out the cost of [indiscernible] that we have done all along the year versus 15.5% of last year. Just a point I wanted to make, global figures are the same, EUR 1,261 million versus 1,262 million is because of the FX impact, you have an FX impact in 2022 -- in 2023 versus 2022, that is massive EUR 50 million of the profit would have disappeared in 2022 with 2023 rates because we have some business in Egypt, in India and in Turkey. But we have been able to improve the margin in terms of percentage versus last year. We put aside Majorel, the 2 months of Majorel, which are not different reporting lines. This is just for 2 months. And next year, it will be, of course, I would say, split around all the region. But these 2 months were not really fantastic, as you can see, 8.5%. This is due to some decisions that have been taken, some costs that have been taken out from the business, especially for some restructuring part and for some, I would say, cost of the deal. Clearly, what he said is also that you will see that we have been able to maintain at least the margin in all the regions, while specialized service has significantly improved notably in the second part of the year. If you remember that the first part of the year was hit by some specific impact, and now we are back to normal. Quick word about the other stuff, a few things to tell. Just to tell that amortization of intangible assets and performance share plan are noncash, I would say, accounting charges are going to -- that are going to impact us. And the other are mainly of the cost linked to the deal of Majorel, which is EUR 24 million that is going to vanish next year. Just a point on the earning performance. With no surprise, the financial result is less good than last year, not surprised to. Most of it is coming from the financial -- net financial charge between EUR 50 million and EUR 60 million, which is made of 2 things. One is, of course, the level of the debt that has increased, specifically with EUR 2 billion that came on our balance sheet starting early November, and of course, an impact on the rate, which hit a variable part of debt all along the year despite what has been decided to cover it. Just wanted to highlight the income tax, not only it went down in terms of value, but also in terms of freight, it's not by chance, it's a mix of work that has been done all along the year and to reduce the income tax for the group. I do believe this is the most important stuff of what we have done this year. We have been able to dramatically improve the cash flow. All along the year, we knew that we had to work on that, we have been able to improve our working cap dramatically by putting a strict attention to client cycle, whether it's DSO on build, and we will continue to do so all along the year. We did the same for the CapEx. We have been very, very picky in the CapEx decision, and we will continue to do that because we do believe this is absolutely key for us to continue on that road. And Daniel mentioned the 46% cash conversion rate. I just wanted to finish on this figure. Our company that is absolutely in disarray, we have been able to show the improvement of the CapEx over the last year -- the cash flow of the last year. Of course, there are ups and down, but they are much more ups than down, as you can see. And we do believe that we are going to continue this trend for the next year. But that's -- at least it gives a trend of what is making this company special versus yours. Where we are in terms of debt, EUR 4.3 [indiscernible], including EUR 832 million of lease. Of course, debt has increased of [indiscernible] by the acquisition of Majorel and its minority interest that we bought back from Majorel subsidiary in 2023. And we sent back to the shareholders close to EUR 600 million -- sorry, mid of, of course, dividend and share buyback. I'll come back in a minute to that. What we are absolutely convinced of is to continue to control our debt. We have a net debt-to-EBITDA ratio which is 2.18x on a pro forma basis and we are absolutely convinced that this is going to be the name of the game in the coming year. Not going to be very long on the balance sheet, but where we are in terms of debt because I know that there are plenty of people that are interested by the debt and how we manage the debt. Our financial debt, excluding the lease is EUR 3.7 billion. The cost of this debt is below 3.5, and the average maturity is 3.75 years. We are mostly fixed. And what is more important for us -- for you to understand is that this debt is absolutely secured. We have EUR 880 million cash at the end of the year on balance sheet, I just wanted to mention it again. And what is clear, and there are some bankers in the room, but we have access to liquidity. We have a dramatic access to liquidity and no issue whether it's a bond, whether it's a commercial paper or whether it's a bank. We have EUR 1.5 billion undrawn credit line that are available at any time to cover the business. Lastly, dividend and share buyback, okay? We maintained the dividend. We proposed to maintain the dividend. But what we did is we sent back to the shareholders close to EUR 600 million versus cash flow, EUR 812 million just to give you some meaning of figures that we are speaking of. So not a bad figure at all. I just wanted to finish my presentation with the capital allocation strategies that we are going to follow in the next years. The first thing is to finance development. We are going to be -- continue to be picky on CapEx, probably below 3% -- CapEx below 3% and in the range of what we have done this year. M&A still on the possibility, but still clearly not the first one. We are going, as mentioned by Daniel, for specialized service in priority, a midsized company, if it happened probably in the second part of the year, and if it happened with very, very clear pricing discipline. There is one message which is simple. We want to maintain our investment-grade rating. And I'm sorry to take this word, but we will do whatever it takes to make it happen. So we will be below 2x in 2024. This is clear, and we will continue to have this rating. No doubt on that. And once that is done, we'll return to shareholder. We believe that we should -- it will be through dividend and also share buyback, and we believe that the return to shareholders should be up to 2/3 of the net free cash flow of 2024. That is the message I wanted to do, and I leave the floor to Bhupender.

Thank you, Olivier. I'll start with the topic of AI because possibly, that's the only topic that everyone wants to hear about today. At Teleperformance, for the past few years, we've had a fairly holistic approach to AI. And we've been embedding AI in our products, in our processes that we use in our daily life. And these are across 3 categories. One, we have been using AI to improve the operational outcomes for our clients. So to reduce costs, 15% to 30% efficiencies and to improve outcomes. The outcomes could be quality improvement, accuracy improvement, improvement in the sales conversions. And wherever we have deployed it, we've seen 10% to 25% improvement. The second category where we have been deploying AI is to improve our operational support functions. So things like operational supervision, workforce management, QAs. And again, we've seen improvement of 10% to 25% in quality and 15% to 30% reduction in costs. And finally, for reducing the cost and improving the outcomes of our internal support functions, be it HR, IT, finance. So as we mentioned before also, we've been investing dozens of millions of euros for the past few years in our transformative TAP capabilities. And today, we've got over 600 experts working on AI projects. Yes. This is a typo here. It should be 600 experts working on AI projects. And within those projects, about 250 are in Gen AI and another 150 are in the pipeline. And the kind of companies that we do these Gen AI projects for are -- some of those are mentioned in the right side. So one of the largest entertainment companies in the world, it is U.S. headquartered, but it is a global company for a large U.S. e-commerce platform company, a big hospitality company from Scandinavia, one of the biggest card companies in America, Western European National Airline, another airline, which is a subsidiary of one of the largest aviation groups in Europe, a large tobacco company and one of the largest telecom company, again, had quoted in the U.S. So I just wanted to give a sense that these Gen AI projects are not only for some small companies, but it is for some of the largest companies that we are supporting in. Apart from that, what we are doing is we're also embedding AI in some of our core processes. So we've got to process standards, which are industry-leading; TOPS, which stand for Teleperformance Operational Processes and Standards and BEST, which stands for Baseline Enterprise Standards of Teleperformance. So we're incorporating AI in those. We're also embedding AI and now upgrading those to Gen AI in some of our products. Daniel touched upon a few of those, and I'll come to the top 5 later on. And then apart from building our own products, we are getting into partnerships with leading companies like Microsoft, ServiceNow, Genesis, and there are a few more in the works, where we are using their products both for our own purposes and also as integrator for our clients. Coming to some of our core products. We've got more than 60 AI-enabled products. The top 5 are mentioned here. So we've got TP Client, which is our proprietary CRM platform, which is deployed in currently 228 clients. TP Protect, which is our compliance and security product, which detects and then send triggers for any abnormal behaviors, that's deployed in 669 clients. You got StoryfAI which is a real-time interpretation, which can handle up to 100 languages, which is deployed in 78 clients. TP Recommender is a Gen AI enabled prescriptive analytics product which is largely used in sales and collection set up, and that's deployed in 59 clients. And TP Interact is another Gen AI enabled analytics product, which is used for 3 different things. One for automation of quality interactions. Historically, in our industry, typically, quality was monitored manually for about sample size of 2% to 5% of interactions. With TP Interact, we can monitor 100% of the interactions. Second, it is used for giving a real-time coaching and feedback to our agents. Immediately after interaction ends, it summarizes what the agent did well and what he or she could have done better. And with Gen AI enablement, it also now can track customer sentiment and it gives SKUs to our agents as to how to modify their tone, their verbiage, their offer to be able to service the customer better. Apart from our own products, we are also again partnering with other platforms. So I've just mentioned 2 here, but there are others that we have already and there are some more that are in the works. So Twilio is a CX automation platform, which can look at an interaction and can divert it into a self-serve or auto fulfillment channel, depending upon the complexity of that interaction that's deployed in 144 clients today, and Centrical is a productivity enhancement and gamification platform that's deployed in 60 clients today. Moving on to the topic of financials. And like any industry, there are multiple factors that impact the profitability and the top line growth dynamics of an industry. I've listed down 4 interdependent factors that have been impacting the profitability and growth dynamics in our industry over the past 15 years or so. So I'll first explain this conceptually and then I'll put some numbers behind these. So the first and foremost is the macroeconomic environment. In more stable periods where there is high GDP growth rate, where the cost of capital is low and the inflation is moderate, obviously, our clients are looking for growth, and they're expanding in new products, new markets, new geographies. And that creates high volume of activities for the industry, which also in turn means there is less pricing competition. Unfortunately, the reverse is true, in tougher times, what happens is companies start scaling back to conserve cash, which means lower volume of activities and hence, more pricing pressure. If you look at the second factor around -- on that point also, I do want to highlight that while TP is somewhat more resilient because of its diversification across lines of business, across geographies, across verticals, across clients, but we live in the same world, and so we are not totally immune from it. The second factor and it is interrelated to the macroeconomic environment is offshoring and near-shoring. And it is interrelated because during tougher times, clients are looking for more expense takeout and hence, they prefer offshore and nearshore than to onshore. Thirdly, technology, automation, AI. That also has similar effect as offshoring in the near term because technology typically drives productivity. And because in our industry, most of the commercials are still input based, in the near term, it is deflationary on the top line. But it does drive our profitability for the companies that are able to enable their products with the right technology and also in the medium term, it creates more business opportunities. And the new services could be at 2 levels. It could be at an industry level. So the classic example is trust and safety, and the industry did not exist till about a decade back. And today, it's in the $7 billion to $8 billion range. Or it could be at a company level where those services existed, but a company -- a particular company may not have had enough share in that line of business, and I'll mention couple of examples of that later on for Teleperformance. Now let's look at some numbers around that. So this chart shows the growth rate and profitability for Teleperformance over the last 15 years. And it's divided in 3 periods. The first period is 2008 to 2012, which is, as you would remember, the global financial crisis and then the gradual recovery and our numbers somewhat tracked that trend. It is important to point out here that during this period, TP was not as large and as resilient that it is today. It was much smaller and more concentrated on the CX business. Then from 2012 until about 2018, the world saw a fairly steady 2.5% to 3% GDP growth rate in the developed market. The cost of capital was low, the inflation, again, was moderate in the developing countries. And during that period, if you look at it, we grew by 7% to 9% like-for-like. This is also the period where we had the RPA hype starting in about 2013 and reaching its peak around 2015, 2016. Despite that, we grew by 7% to 9%. Now the 7% to 9% actually is a combination of 2 numbers. Our actual gross growth rate during this period -- gross growth rate, meaning new business coming from either totally new clients or coming from existing clients in new lines of businesses or new markets. So the gross growth rate was around 14% to 15%. But then we had a churn of 5% to 7% on account of increased offshoring and automation. And hence, we get the 7% to 9%. Then 2018 onwards, a few things happened. One, we had an exposure in the number of interactions, mainly driven by the digital commerce companies because they were expanding rapidly and they were driving interactions. And then obviously, with COVID, there was a further boost to that. And we also had increased the adoption. There was a company level thing also during this period that TP aggressively got into additional lines of business, whether it was trust and safety, more specialized services, more sales activities. So because of combination of all those sectors, during this period, our gross growth rate moved up from the earlier 14%, 15% to more like 16%, 17%. And during this period, the churn, again, driven by automation and offshoring was in the range of about 7%, 8%. And hence, you see the like-for-like growth rate in the range of 9% to 12% during this period. And during this entire period, if you look at it since 2012, our EBITDA margins have been going up. And again, what is important to point out here is the margins have been going up despite our average unit price not tracking the inflation rate. So our margins went up, but the average price that we were charging to our clients did not grow by the inflation rate. In fact, they grew at almost about 60% of the inflation rate. So that's the value that we have been adding to our clients. We have been helping them to manage their cost structure below the inflation rate. And that's why this industry has been growing fundamentally over the last decades. Come to 2023, what happened? Now obviously, both Olivier and Daniel have touched upon it significantly. So I won't kind of go through all the factors once more. But even in 2023, the gross new business that we had was 13%, just over 13%. We did add EUR 1 billion of new business in our business last year. But then we also had the churn, the same churn that we've been talking about around 8% or so from offshoring and automation. And before the question is asked, and I know it is counterintuitive. It actually was more driven by offshoring than automation. We did not -- yes, there was automation, but did not see a significant uptake in automation rate versus what we had seen in the previous 5 years. But yes, we did see a significant uptick in offshoring during last year. And hence, that 13% gross, 8% churn, net of about 5% growth rate. That was past, what about future. And if you look at the forecast for the next few years, the forecast in the developing economies is not as strong as what it was in the previous 5 years. '24 is expected to be only 1.4% in the advanced economy. So further drop from what had happened last year. And then it does pick up afterwards, '25 onwards as per the forecast, but it is still not going back to the '22 and '21 levels. So what we are doing is we are adjusting our strategies and the financial forecast accordingly. So in terms of the priorities for us, we continue to build out our new Teleperformance organization, taking the best of talent from Majorel or TP and then adding especially in digital capabilities, vertical capabilities and new lines of business from outside. Second, we will continue to accelerate our AI deployment. We actually see this as an offensive move rather than a defensive move because it does create new business opportunities for us. And also, it creates a ground for us to capture higher share. We'll continue to focus on the alternate lines of business, so specialized services, sales, back office. And I won't touch upon all, but I will touch upon sales because for some reason, people misinterpret this as telemarketing. Yes, there is a bit of that. But what we are referring to sales here is actually B2B account and relationship management. So for example, ad sales relates to helping small and medium businesses, restaurants, independent hotels or, let's say, neighborhood salons and other things to onboard digital and media platforms, all the big media, social media platforms or digital commerce companies, onboard them and then spend money on them tracking the ROI. So that's what we do for many of the -- almost the biggest platforms in the world. We do that for them. The consumer goods supply chain management also is, again, virtual relationship management. Historically, the consumer goods companies have been managing their vast hundreds and thousands of retailers through either wholesalers or through armies of their own sales officers. The pandemic taught us that these could also be managed remotely. So what we are now doing is actually working with number of consumer goods companies to manage their end retailers some of the bigger retailers like let's say, supermarkets, the Tescos, the Sainsburys, the Waitrose, et cetera, client companies can manage directly. But when you're talking about thousands of retailers, the small grocery stores, et cetera, they require management. Typically, historically, it was either wholesaler where you ended up sharing 10% to 12% of our gross -- of your margin pool or you had your own army, which was a fixed cost. By doing it with us, it's both more efficient and also you have consistency in service with the recording of every interaction that gets done with them. TP Infinity. We touched upon it earlier. Historically, this was more as a capability for us to help us deliver and sell our core business. Now we are carving it out as a separate business line. And we'll continue to optimize expenses, leveraging shared services and technologies to be make sure that we maintain high margins and also create headroom for further investments. And finally, the guidance for '24. So in this environment, we've taken a conservative approach, and we are giving a like-for-like revenue growth on a pro forma basis, which means assuming full 12 months of Majorel in '23, 2% to 4%. And here, I would like to peel one more layer. Stand-alone TP, which is excluding Majorel, even in '24, the growth rate is north of 5%, very similar to the like-for-like growth rate that we saw in '23. This is because while there is an overall slowdown in business services kind of sector, you've seen the guidance from almost every company, whether they are direct competitors or indirect competitors, there is a slowdown. But TP, because of its diversified geographies, lines of businesses, verticals and clients, is much more resilient and hence is able to still grow by that rate. Unlike TP, many mid- and smaller-sized companies in our sector who are exposed to either some particular vertical or client or geography are not able to actually deliver that kind of growth. And hence, you would have seen from the guidance of many of the companies that have come out in the last couple of weeks, it's a much slower growth rate or actually deceleration kind of in the year. Majorel like many of these smaller and medium-sized companies related to TP, also had a greater concentration of global Internet accounts. And as we know, this is a sector where we have seen the biggest budget cuts, and hence, they have seen a significant deceleration in the growth rate in the second half of last year, and that is continuing in this year, too. Having said that, it is still a good acquisition for TP for the long term because it reinforces the leadership position of Teleperformance in a consolidating market. It establishes fairly strong and profitable position in Germany and France markets, which are #3 and #4 outsourcing markets. It doubles the footprint in Asia Pac, which is the fastest-growing outsourcing market. It does add some niche capabilities in claims management, in document management, in luxury goods marketing. And so from a long-term perspective, it does work well. There's other factor that is also there in Majorel. Their account management and operational management team is excellent. And -- but it did not have that established new business engine. And so it will take us somewhere around 12 to 18 months to expand our new business engine so that the combined growth rate can go back to 5% plus levels. Talking about profitability, we'll continue to improve that. This year also, we are targeting 10 to 20 basis point improvement on a pro forma basis, and this is excluding the cost of integration and synergies. With the improved profitability, we will see an increase in net cash free flow -- net free cash flow. And with a more controlled and disciplined capital allocation. This free cash flow will also result in a stronger balance sheet, where by the year-end, we should have debt levels below 2x EBITDA. And with that, thank you.

I think it's time now for the Q&A session. So please feel free.

Yes. Antonin Baudry, HSBC. My first question is about top line growth, short-term and midterm. First, short-term, will it be possible to have more color about the top line growth that you expect in Q1 2024? On the exit rate that you expect at the end of the year to have more granularity on your 2% to 4% that you expect for 2024? The second question is about the midterm guidance of revenue growth, you do not give us details or quantified targets in the midterm. Should we expect at some point the company to come back with a quantification of midterm guidance in the occasion of Capital Market Day, for example, later in the year? Or does it mean that you do not know finally what will be your revenue growth in the midterm?

Just on the first half, as you saw at the end of the year, specifically December has not been as strong as what we wanted. We know that and that leads to the figures that we have reported. Anyway, we knew that for Q1 and to a lesser extent, Q2, we have, I would say, base of comparisons that are still high, if I remember properly 8.3% -- 8.6% in Q1 last year and 5.3%, 5.7% in the second part of the year. So of course, we are going to have a second part of the year, how we build the budget. We have the first part of the year that will be, I would say, not so much growing, growing marginally and the second part of the year growing dramatically, despite the fact that specialized service that is here through Scott is going to deliver a significant growth and accelerating this growth all along the year. So we have been careful in fixing the guidance for 2024. I'm sure you -- we can probably have plenty of default. But what we heard -- what we learned from 2023 is just to be careful on the guidance and just to be careful on the margin, and I'll come back on the margin later on. But this is what we want to do. But we know for a fact and from what -- that the first half will be, I would say, much more flat in the second part of the year, exactly like what you heard from competition -- from extended competition. And this is exactly what we are going to leave. The second part?

Yes, the second part, we have a certitude, which is to grow faster than our market. And the growth of the market is defined very well by companies, I mean, resource companies. Everest is a good benchmark. And we are sure that we are going to continue to grow faster than the market. Now what is going to be the growth of the market or what is going to be the future in 6 months, in 9 months, if there is no specific disaster, we are able to say it. What it will be in 3 years from now, we are not able to see it. And again, it's not AI that prevent us to say it. It's the social political environment that is extraordinarily volatile. And I think that the governments of the world would like to be able to say it. But if I remember well, the minister of the economy of a government that I know pretty well because I'm born there, in France, just to review downwards is forecast for 2024. So right now, you will understand that we are careful on the long term. When the sky will be a little bit less foggy, we will give you numbers. Right now, our certitude is to make better than the others.

Suhasini from Goldman Sachs. A couple from me, please. I think in conversations with investors, one of the questions that always comes up, it's probably for Bhupender, about the implementation of third-generation AI in your software stack and with customers. Of the pilots that you have done with your customers, have any converted and have you implemented it? And in relation to that, can you help us understand -- if let's say, you had 100 interactions that you were servicing a customer, for example, and the mix was maybe 50 voice and 50 chatbots, plus chats with human beings. How does that mix basically change after you implement the Generation AI? And if you had, let's say, some level of deflation, do you then go back to the customer and say, okay, now we are able to give you the cost savings maybe, can we take a bit more from you in terms of incremental outsourcing or maybe take a bit of share from other players in the end market, is that how your conversations go? And therefore, your pie doesn't shrink or maybe it grows? That's first question.

That's -- thank you for the question because it was the answer. But Bhupender, please.

Yes, I was about to say. Thank you, Suhasini, you can be in our business, you can be our salesperson. But many parts to your question. First, the Gen AI projects have any been implemented? Yes, tens and not in hundreds as yet, but yes, in tens they have been implemented. They are live today. Second part in terms of, I think, what you're saying is what's the percentage of automation ultimately, that's what you're asking. Remember, this is -- at least TP, I'm not talking about the entire industry, but at least TP, we have been on this journey for the past few years, and we have been working systematically with our clients to automate the lower-end, simpler transactions. So the number that I gave to you, 5% to 7% deflation on account of offshoring and automation, we have been doing that consistently for at least I'm aware since...

Before 2013.

Yes, 2013, '14, just using RP, et cetera. But even before that, there were other kind of things, the call deflection and other things that were happening earlier also. So we have been doing that for quite some time. So what is getting left behind incrementally is difficult to automate. And hence, the impact of AI and automation associated with it is also less pronounced on TP than maybe some other company who may not have had those kind of things. You talked about Chat. Chat is actually only about 5% of our overall business because elements like chat probably are more prone to automation this thing. And -- so but coming back, I gave you the numbers. At the moment, replacement is not that substantial. What we are seeing is significant productivity improvement, which could go up to 20%, 25%. But replacement is truly very low end of activities, which for us was already automated to some extent.

I would like to add something -- I would like to have some color to this answer. Let's take in the financial industry, the KYC or the fraud prevention that are typical line of services that we provide to our large clients. Of course, the vast majority is already treated by the AI. What comes to us is a minority. But this minority is growing every year, and it's exactly the same with the content moderation. The content moderation, I mean, if we speak about -- okay, everybody knows who has a big social platform, they are all our clients, by the way. So they have done such a good job with the AI that right now, they are able to prevent offensive material to come online in 98% of the case. We manage only 2% of the case. But today, this is more than EUR 700 million at Teleperformance and our main competitor there, and it's strange because nobody asked them question, is Accenture.

Yes. Perfect. The second one is on the 2024 guidance, please. I appreciate you gave the color that in terms of what maybe changed in 2023 for you versus your previous expectations. And there, the churn was driven more by offshoring. So if you think about, let's say, your views on 2024. Do you still see the bigger risk coming from incremental offshoring? Has that stabilized? Or are you still worried that there's more to come?

I think that is continuing. We are still in a tougher economic environment period. So the year of efficiency of most of the big tech companies continues. And hence, they are looking for budget cuts, expense management and hence, offshoring continues. See, the math for us is not that complicated. If I use the same numbers that I gave to you earlier, instead of growing by 13%, we'll probably only grow by 11% top line with 7% to 8% of churn because of combination of offshoring and automation. And why are we growing by 11% and not by 13% that we grew last year? That's because we have not been able to expand. You can't expand your business development engine kind of overnight. It does take 12 to 18 months to actually to get that cranking. And our base has -- the base that has increased by about 25%. So that's what has happened. So once we build our business development engine to cater to the expanded base, we'll go back to that -- we expect to go back to 13%, 14% top line growth rate, and there will be churn, which we have been seeing for more than 10 years now.

By the way, the fact that it's going to continue, we see that also as positive. The world is not so binary because right now, we grow, we grew last year by plus 17% in India, and we are going to continue to grow a lot there. And of course, top line is deflationary. But bottom line, it increased the ratios. And for sure, there is something very important that Bhupender started to mention, is the fact and that you mentioned, by the way yourself, is the fact that by providing the best possible labor arbitrage plus the best possible AI, we become the best partners of our clients' expectation. And this is the way we secure the partnership, and we grow our share of wallet. There was a question.

Yes. It's Karl Green of RBC. I've got 3 questions. I'll probably take them in turn. The first question is really around what's happening at Majorel. I think in the fourth quarter, you indicated in the statement that the margins came out at about 8.5%, which was a long way below what they averaged for the year. And I think also there was the comment that H2 growth has slowed as well because of customer mix. So can you indicate what the fourth quarter pro forma organic growth was for Majorel, please? . And then just thinking about the comment for 2024, I think you said that Teleperformance stand-alone can probably still grow at around 5%, which, therefore, implies a lot lower growth for Majorel. So just to understand how much of a drag Mjorel is going to be? And that question also then flows on to the margin as well. If it was 8.5% margin in the fourth quarter. What kind of margin ex synergies should we be thinking about for Majorel because that seems to be the real weak spot in terms of the down-stepping in guidance? Sorry, that's sort of lots of questions in one there, but that would be really helpful.

Just a question about the 8.5% of the 2 months of Majorel, which are exceptional because you have roughly EUR 10 million of costs that have been embedded in these 2 months that are exceptional, meaning some reorganization in some specific countries that were decided before. Some people that decided to leave, plus some cost of the deal that was embedded in their margins that we were unable to highlight differently. So we are probably much more -- we are not probably much more -- not probably, we are, if you take Q4 of Majorel, they are not so different of what they have -- what they are for the full year that has been displayed in the presentation. It's clear that the growth of Majorel in Q4 has been reduced significantly versus the trend and I was telling you that the final growth of Majorel for the full year was 5.5% like-for-like estimated. And we know that December has been difficult in Majorel, slightly negative. That is what I can tell you. In 2024, again, I'm going to be clear on that, we are not going to follow Majorel and TP. We call it TP Blue and TP Pink so far. We are trying to mix them together. And this is -- and why because what we want to do is to do it quick, fast and good. What does it mean? It means that you are launching a lot of different, let's say, topic in the meantime. And tomorrow, Majorel will be totally part of what is clear is that growth embedded with -- from the budget from TP was higher than Majorel. It's going to be mixed along, and we are going to not be able to follow specifically Majorel by itself in 2024 as a separate company. That's what I can tell you. You saw that the margin of Majorel is dilutive to TP, and this is where we are. We have decided to accelerate as much as we can the synergies. That means that the EUR 50 million that Daniel mentioned earlier on, is a run rate figure, that means that the decisions that have been made so far should lead to a run rate of EUR 50 million of margin for the full year. We probably -- but the cost is there, the cost you are going to incur, the EUR 50 million cost, of course, we are going to easily discount. But the run rate of the synergy will be EUR 50 million, hopefully better, but the costs will have an impact on the full year, of course. And we will be probably lower in terms of impact of -- positive impact of the synergy in 2024. That's what I can tell you. Probably half of it.

I can add 4 points. First -- if you want 5. First, Majorel is a company that was known for excellent delivery and had tailwinds, thanks to a strong presence in social media. And an excellently badging deal that they made with Booking.com, it has been public. So it's not something new. By the way the clients of Majorel love Majorel. And we shared some of our clients and sometimes it's Majorel people who take the lead of these clients just to show that there is a clear inter penetration. But Majorel was -- did not have an engine that Teleperformance specifically has, which is our spearhead, our arrow, which is our strong business development team in all the regions. So we -- and, of course, as now we have Majorel and there is tailwind, we need to boost structure that we have. It's a question -- but it takes time. It's a question to hire right person to, make sure that they are well on boarded, and -- okay, it's a question of months, maybe 12 months, maybe 18 months. But it's not a structural issue. Then when you merge 2 companies in the same business, you always have at the margin some kind of erosion because suddenly a client that loves you say, "Hey, common, now you represent 60% of my share of wallet. I cannot. I need to balance a little bit the risk. So I love you, but you are going to have only 50%. And so there is a little bit of this leakage marginal in the first year. And four, the point number 4 is with the synergy, we compensate the gap in margin. And so the deal with Majorel is not going to be dilutive to Teleperformance margin after 2025.

Okay. So just going back, Olivier, so the synergy numbers, that run rate for the exit of each year. So we won't see the -- in theory, the full EUR 150 million until fiscal '26. Is that...

Exactly. Yes.

Okay. And then my second -- sorry, my second and third question is much simpler. Bhupe, just on the churn definition. Is that completely synonymous therefore, with deflation? Or do you include a degree of customer loss within that churn number I sense it's synonymous?

There is some degree of customer loss, but that's minimal. It's not kind of huge. It's mainly driven by revenue deflation from automation offshoring.

And then the final question, I suppose to all 3 of you. I'd just really like to understand the logic as to why you don't report an underlying earnings definition and how that would be in your shareholders' interest to actually report that? And underlying -- most companies of your size report an underlying earnings definition and an underlying net income definition, which adjusts for lumpy one-off finance charges and associated tax and other lumps and bumps. Given that creates volatility at the bottom line, do you think it would be in shareholders' interest to move to that basis?

I'll ask our Chief Financial Officer.

No, we might do that. So I didn't thought it was absolutely key for you to get the stuff, but okay.

I don't think it matters for the sell side, I think investors would find it very useful.

Okay. Thank you for the suggestion.

Three questions from me as well. Ben Wild from Deutsche Bank. Firstly, just thinking about scale in the industry and as the generative AI solutions that you've talked about today become commoditized and more widely available from third-party providers, is there a risk that some of the smaller players in the industry are more agile in being able to divert capacity towards niche growth verticals? And more broadly, why is scale important? Why is being the market leader important in this industry in that context? The second question, if I could just take them all at once. In terms of offshoring, obviously, a huge dynamic in '23, can you explain -- historically, you've achieved very significant gross margin premium on offshore volumes? Can you explain how you can justify those premium margins with your clients, especially in the current environment where there's a huge focus on cost and potentially going forward when clients will be looking to automate some of their volumes? And then the third question, I think one of your peers was talking in the last few days at a conference about potentially 30% to 40% of volumes in the industry being at risk of automation going forward. Can you comment -- when you think about market growth over the midterm, can you commit to market growth being positive?

We are going to try to answer together. First, the small players and more agile, it always happens. You always have a new start-up that can be super agile and so on. But this is not the time for that. I mean, we serve very large clients who need and want to consolidate with less partners. When we ask directly question to our clients even before to make our 2024 budget to say, okay, how do you see '24, how is it going to be? And we get answers that are not extraordinarily enthusiastic about the business. But typically, we get the answer. In any case, you are going to have the same level of business because we want to consolidate with global partners. We want to be sure that we have the consistency. We have to be sure that we don't need to speak to 50 different people with 30 different managers who manage the vendors. So we are much more in the era of consolidation. And our largest clients, you know, they are clients for -- right now, the average is 14 years seniority. But its 14-year seniority only because we onboard new clients every year. We have many -- among our top 10 clients, we have many clients that are with us for more than 20 years. So I mean it's not because suddenly you have an agile guys that is going to come and to say, "Hey, me, me, me," that is going to change something. On top of that, we are not exactly blind. We have something that we call TP Lighthouse which is a special unit based in India that scans the market every single day, and we know what's happening all around the world every single day.

It's not necessarily that large players cannot be agile.

Then what the client likes is that we have the largest footprint in the industry. And so not every size fit everybody. Some clients are going to prefer to deal with us in Colombia because they are in the U.S., it will be 3 hours from Houston or from Atlanta or -- and they will feel more comfortable, more proximity. They will not be 12 hours jet lag. I can tell you, I go way often to the Philippines, and I live in Miami, it's 26 hours trip. Our clients like the fact that Philippines, India, Latin America, Egypt, wherever in the world, we have a solution that we can customize for them. Then are we at risk of de-growth? We don't think so. We don't think so. But when you read -- there is a book that is very famous right now, which is The Beginning of The End, written by smart economist and sociologist in the U.S., which shows that maybe the world of the 50 glorious or the 60 glorious in which the Western World has been, maybe is challenged today. From us, from our point of view, we continue to see ourselves in a growth situation. Now I don't know if tomorrow, there is not going to have a political threat that is going to cut the world trade. I don't know if tomorrow, there is going to be the [Houthis] who are going to cut the submarine Internet cable that make the world communicating. For that, we have a lot of protection because everything is double that TP. So if it's [indiscernible] one route is another one. And then we have the cloud. But I'm sorry, but all of us, we have entered in a very difficult-to-predict world long term. I think that we are solid. I think that we are going to do the best in our class. And what I call our class is not just customer experience contact center, it's BPO. It's -- there is something strange by the way, in the perception that I see from the market, which is -- it seems that a class of actors are deeply impacted by a kind of distress in the future. When another class of actors do exactly the same job or at least for 50% of their business are not at all impacted, but this is probably the common sense of the algorithm.

If I could just follow-up on the first question. Given your comments about vendor consolidation, it sounds like there's likely to be an ongoing M&A thematic in the industry among your peers. If there's another mega deal in the sector, would you be forced to consider to go out and do another deal yourself to remain the largest player?

We don't believe in doing defensive deals.

And Majorel deal was an offensive one. A lot of people did not understand that it was an offensive one because it helped to fill a gap in France and Germany that were the market #3 and #4.

We have to stop because we would be late, if not -- speaking.

I think that we have a break now, and then there is a second part where you are going to listen about Bhupender Singh, Miranda Collard, who is our Global Chief Client Officer, who is here with us today and Scott Klein about the business deep inside. Thank you. Thank you very much. [Break]

Welcome back. I appreciate everyone returning. Take a moment and get comfortable. As Daniel said, I'm Scott Klein. I'm the CEO of specialized services. And it's really a privilege for me to be here today to represent the 40,000 folks or so that work in these 5 different businesses. My objective today is to not only tell you a little bit about these businesses, but to also at the same talk about how we've integrated technology, specifically AI into these 5 businesses and we've been doing it for well over 7 years. From our perspective, when the world woke up to ChatGPT and everything else, AI, for us, it was old news because it was a very significant important part of our business, which we think of as a combination of humans working with technology to serve people. Our clients run the gamut of governments and just about any kind of business you can think of, any kind of health care institution that you can think of. And what we do is we're helping those people at their most critical moments of need. And I'll tell you a little bit more about that as we talk about each of these companies, but these are moments of truth. These are moments that matter. This is not trying to just find your way to a subway or a bus. These are things that can have a dramatic impact if they're not done right when it comes to caring for people. As a matter of fact, if we don't do it right, people can actually die. There are many commonalities about these businesses. We have a relentless focus on continuous improvement making sure that every day when we wake up, we're doing everything we can to deliver total and complete client satisfaction to the people that we do business with. When we think about people, we think about training, making our people better, better tools via technology to help make our people better. And finally, process improvement to make sure that when we do it, we only do it once. We don't do things once and then again, we get it right the first time. You heard Daniel talk about these businesses being unique because we've been blessed with rapid double-digit growth in profit and revenue for quite some time, and we look to see to continue doing that not only in 2024, but beyond as well. These are the 5 businesses: PSG is all about recruiting. Health Advocate is about caring for the employees of our client companies, AllianceOne, quite simply, receivables management, we collect money, TLScontact helps people manage what they need to do when they travel from one country to the next and LanguageLine Solutions, which enables people that do not speak 1 language to be able to function in life also those that are death and heart of hearing. 5 different companies, each different, but as I mentioned, with a number of things in common. One of the things that unites each of these 5 businesses is they all operate from what we call an evidence document. And those documents document everything that we say as organizations with proof. The first time we created an evidence document was for LanguageLine Solutions because as far and away the largest company of our type in the world, our competitors were very comfortable saying, well, we do everything that LanguageLine does, well, that just wasn't true. So what we did is we put together the evidence that supported every single claim that we make and when a client or a potential client says, "Hey, Scott, your competitor was in here, they said they do everything that you do for half the price". We would then be able to show them our proof and then ask them to ask the competitor to show theirs. And for all the years that we've been doing this, we have never had a competitor show their proof. And that is why these companies continue to grow the way that they have. Let's start with PSG Global Solutions. We solve recruitment challenges for our clients. And we do that in a number of different ways. We run an entire range of solutions that we perform for our clients that can be something as simple as just sourcing clients, all the way to the far right, which is doing everything from identifying the clients, interviewing the client, testing for these people getting them to the point, where they're hired and ready to join the company in training. And we do all of those things in between. For example, we do reference checking. We do credentialing. A lot of the work we do is in health care, where it's very specific. Everybody wants to know that the references are checked properly. All of these things together combine into a complete total end-to-end solution that is accomplished with a combination of technology and people. One of the things that's so great about this business is everybody loves PSG solutions with one exception, and that's our competitors. They hate PSG because we have the highest Net Promoter Score in the industry. We have the highest retention rate of our clients and that is because we do what we say we're going to do, and we get it done and we get it done right. This is a massive market. This is one of the things that attracted us to this business. This is a market just in the United States that's $300 billion that's spent here and most of it is done in-house. But in today's world, where everyone is looking for efficiency, everyone's looking for economization. We can do it better for them. We can do it for less. We can deliver higher quality candidates. And one of the things that our clients like most about us is the clients we -- the candidates that we deliver, the new hires that we deliver have less attrition than these companies produce with the people that they hire on their home. Think of it this way. Hiring is hard. We've all been there. We know what it's like PSG makes it easier. With each of these companies, I want to talk a little bit about something that we've done with AI. And this is just 1 example for PSG, where we have been able to create technology solutions that, first of all, make it faster and easier for us to put together the strings that are required when we work with our search engine partners to find the right people that we want. What we can do with this solution is we need to visit with less potential candidates to get the most new hires made. As a result, when we implemented the solution, the number of conversations that we're able to have with potential hires went higher and higher. Our ability to make sure that we could endorse the clients that everything that they said about themselves before they got hired was absolutely true. The initial return on investment of this solution was 65% that is unheard of. But again, it's the combination of technology with our real live human recruiters that work with candidates along the entire journey end-to-end to get them hired and in place. Health Advocate, really unique business. This is primarily a U.S.-based business, where we offer a value proposition to our company clients that sounds like this, whatever you pay us to help your employees navigate the U.S. health care system will pay back to you more than what you spend with us because you will have happier employees, you'll have healthier employees, they'll stay with you longer. And oh, by the way, your health care costs will go down relative to whatever is happening in the health care market. Very straightforward, very easy for a potential client to understand. Now our mission is to educate those employees of our clients to make them realize there are things that they can do to make sure that we keep them healthier. Then we engage with them. For example, we know if an employee has some kind of a chronic disease that requires say, a chest X-ray every year. We're in touch with that employee 3 months before the chest X-ray is due. We help them make the appointment to make sure that they're going to some place that's convenient to them and quite possibly at a much lower cost than where they might go otherwise. They can go wherever they want, but we help them make the appointment and guide them along the way. And then we are their advocates. We help them when they find that they have a particular health condition that they can then get the right care that they need in a much more timely manner and having us as their guide to get them along the way, and we have literally hundreds of thousands of stories of case histories of employees who we helped get healthier faster or avoided getting very sick in the first place. In Health Advocate, we say we're caring for you in all ways, always, all the different possible ways all of the time, 24 hours a day, 365 days a year by the way, in over 240 different languages. Now basically, the business breaks out into 5 different segments. The first one is health and benefits navigation. So it's enrollment time. We work with those individuals to help them pick the best plan for them and their families, very effective. And again, very often an employee on their own will just say, "Oh, I'm going to pick the most expensive plan, where it may not be the best one for them". Second is our care management, someone gets ill, they need help. And we not only care for the employee themselves, but everybody in their family, not just their spouse, not just their kids, it can be their parents as well. One day an employee may wake up and find out that their child is a drug addict, we provide them with help and how to manage that. And that takes us to the third part of this business, which is our employee assistance plan, where they can call in to us, and we help them figure out what resources they need in order to get a much more successful outcome. Personal well-being, taking care of themselves doing the right things, making sure they're taking their medications on a regular basis, for example. And finally, the fifth part of this business it has traditionally been all up close and personal, where we actually send teams to the employees place of business at the companies, and we actually do all kinds of biometric screenings. We're checking their heart, their blood pressure. We're doing blood tests and we're doing early diagnosis of things that could become a problem later. And it is not uncommon, when we do this on-site work that we literally find people that are in such poor health that we're putting them in an ambulance and sending them to a hospital right from that session. Now once upon a time, this was all in person. But today, in our remote world, we have ways of doing this remotely where we're sending kits to people's homes so that they can collect the information for us send it in and we can do the evaluation. So 5 distinct parts of this business, but all focused on keeping those employees healthy, happy and working instead of sick and not working. This is a wonderful example of how AI can really make a difference. Today, when we're interacting with an employee or someone in their family. We're always collecting data about what's going on, what do we -- what's their issue? What's their problem. And in the old world before AI. In all likelihood, all of that data was getting collected and not a whole lot was happening with it. But today, thanks to AI, we're analyzing that data, and we're acting upon it in real time. So in the old world, where we'd have an interaction with an individual, it may take a month before it really manifested itself into something terrible. It resulted in a very costly trip to the emergency room. And then maybe months and months of care. With AI, we pick up overnight that there may be a problem here. And we immediately engage with that individual to make sure that we're proactively intervening so that they can avoid those horrible outcomes that were a part of the world in the pre-AI time avoiding the emergency room and going to a regular doctor or whatever kind of care that they needed, huge difference, great outcome. And again, another reason why this business grows and why clients love it and stay with this business. AllianceOne. I like to think of AllianceOne is different than the traditional collections company. I always used to think of collectors being those types of people that would call you up and say, if you don't pay this bill on time on that car, I'm coming to your house and I'm going to nail your knee caps to the hood of your car, that is not what AllianceOne is. We're more of the kind of gentler collection agency. And if you go to our website, it has a different message. We're here to help people deal with their debt, and we do so quite successfully. Again, the value proposition here scans the entire realm of the world of collections activity. It can be very simple, soft collections, reminding people that they owe us money and helping us -- helping them to make sure that they get it paid. Then the activity gets a little bit more involved. It can go from texts or e-mails to letters to now one-on-one phone calls, where we're acting on behalf of our clients. And much of the work that we do is we are acting in a traditional outsourcing model on behalf of our clients. But all the way to the right, our late-stage collection activity is actually done in the name of AllianceOne, where we are acting on our own, of course, on behalf of some clients, but we are now in full collection mode activity. Again, here's another activity that is supported by artificial intelligence. In the traditional approach, things move very slowly, over time, texts, e-mails, calls, whatever it took to engage the client and then over time, getting that individual to pay us the money that they owe us. Well, with AI, we now know which of those debtors have the highest propensity to pay us and what is the best way to reach them, could be by phone. Younger people today want to be reached by text, whatever it is, this speeds up the process gets us the money faster. Our cost of collection goes down 10% to 15% and our recovery rate goes up 10% to 15% at the same time. So again, delivering efficiencies for our clients, having a better experience for the debtor and also providing our opportunity for ourselves to make more money while we do this. TLScontact, probably the most unique business in this portfolio. TLScontact helps travelers get their visas, when they want to travel to a country that requires a visa for them. Imagine, if you will, what this business was like when COVID happened. Revenue went to absolute 0 in this business. What we did is we took that time during COVID to totally reengineer the way TLScontact operates. And today, even with travel still not back to, where it was pre-COVID. This business is growing massively and is way more profitable than it was based on the old processes that we had pre-COVID. This business operates in 90 different countries, and we process millions and millions of Visa transactions every year. What we do is we help the traveler gather the information they need to apply for a visa, let's say you live in China and you want to go to France, you go to 1 of our locations in China. You bring your information, we help you get it organized. We collect your biometrics, perhaps your fingerprint, your face or dependent on the needs of the country that you're going to. And we then package it all up, we send it off to the consulate -- the consulate says yes or no, and we then finish out the transaction with the traveler. What also makes this business unique is our clients, our countries. Our source of revenue is the traveler. So we've been able to use AI to further improve our efficiency. We use AI to constantly be studying what the arrival patterns are at all of those locations around the world. So we make sure that we have everything in place, when people arrive to handle them in the most efficient way possible. That results in less wait time, faster processing time, pre-COVID, it took 4 to 5 hours to get through 1 of our centers. Today, on average, it's less than 45 minutes. What that does is it translates into massive efficiency because our locations are smaller, the number of employees that we need to operate them are less, and by using AI, we can continually fine-tune up or down what it is that we need. Finally, LanguageLine Solutions. This is how I came to be part of Teleperformance. When we sold LanguageLine to TP back in 2016, as Daniel mentioned. LanguageLine Solutions provides 360 degrees of language coverage for all of our different clients in every possible vertical that you can imagine, and we are, by far, the largest company of our type in the world. We are larger than the next 20 competitors combined, and we continue to grow at very solid double digits. We provide one-stop shopping because we can do it all, and I'm going to tell you just a little bit about the solutions that we provide. Over the phone interpretation is exactly what it sounds like. If you're a patient in a hospital and you're checking in, you get one of those dual handset phones, put in your hand and the registrar takes the other side and in any 1 of over 240 different languages, we can help the hospital get that patient registered. Next is and the fastest, biggest growing part of our business is video interpretation. It's over the phone, but with that visual component added -- it also allows us to do American Sign language or British sign language depending on what part of the world we're operating in to be able to care for the patient. The third part of our interpretation business is what we call on-site interpreting, which is just what it sounds like, where we actually are putting interpreters in the room with a group of people to be able to facilitate a conversation. Testing and training. This is a service that we provide to our clients to make sure that their people, perhaps they're on staff interpreters are prepared to better handle the people that they deal with. We also evaluate professionals, who claim to be bilingual to make sure that they are confident to be able to operate. An example, in a hospital, when we're talking to doctors, You'd be surprised how many doctors fail our test because they may have grown up in some country other than an English-speaking country, but they have their medical education at an English-speaking institution. And believe it or not, about 50% of the doctors that we test are not confident to be able to service patients in their own spoken tongue. Guess what? That's what LanguageLine does for them. Now the last and today, perhaps by far, the most exciting part of our business is what we used to call language line translation and localization. This is all about the written world. But if you want to talk about some place, where AI has become a major disruptor it's in this part of the business, which is great news for us. Written translation is the biggest part of the language services market. It is the smallest part of Language Lines business, tens of millions of dollars. It is a $32 billion market. And by being able to use AI and all of the other competencies and technologies that we have, it opens up this entire market. As Daniel mentioned earlier, the bulk of our business is English to something else. With AI, we can now handle written translation in any 2 languages or multiple languages, whatever the need is. And as a result of that, we've created now what we call language line global content solutions, which gives us the ability to embed ourselves with clients working with their teams to not only translate, but to manage their content as well. Making us much more valuable. The great news is, for us, talk about Agile, we are so agile. We are out moving the bigger players in this market on a daily basis. This, for them is a nightmare. This for us is the brand-new big time horizon for the future. And with that, I'm ready to take any questions that you might have on specialized solutions.

Just interested to understand how involved you have been and are in finding the new businesses that join specialized services and how that acquisition process actually works in practice?

Yes. 100%. I operate as the -- each 1 of these companies has its own CEO, except LanguageLine, which has me. But I'm deeply involved and we're evaluating acquisitions on an ongoing basis. looking for organizations that meet very specific criteria that match with our other specialized services. I often joke that in the TP Lexicon Specialized services means high-growth, high-margin businesses. And that is all that we look at, and we're looking at them constantly and always just looking for the ones that are just perfect for us. Health Advocate great example. PSG Global Solutions, another one, and we've always got a handful of others that we're taking a look at. We need a mic down here as well.

Okay. Two questions on LanguageLine Solutions, please. Just in terms of that compound growth you've seen over a number of years now, just roughly how does that break down between pricing and volume broadly? And then the second question, just in terms of that last comment you made about Global Content Solutions, which you're very excited about. Just what are the limits to how big that business could be? Because I think some of the incumbent operators would argue that you have to have deep domain experience to operate in certain specialty segments. What would your views be on that?

So once upon a time ago, that was true. We already have the domain expertise, but to be able to harness the technology without being beholden to all the legacy systems that those organizations have gives us the opportunity to outpace and outmaneuver. And within weeks of rolling out global content solutions, we were not only talking to clients, potential clients that would have never done business with us before, but they were immediately moving to signing long-term agreements with us to manage their content and handle the translation. As far as the pricing volume ratio, the volume has been very, very consistent double digits that is eating up more and more of the market, taking from competitors expanding the marketplace. In the United States, it is the law that health care institutions must provide a qualified interpreter in every interaction with a non-English-speaking patient or someone that's deaf or hard of hearing. But it is just health care. Everything else, it's being done because banks, insurance companies and travel organizations all realize that the spending power of those non-English speakers or the death or heart of hearing are a great opportunity for them. So the pie has expanded, but we continue to take market share away from others. And the reason for that is everything we do is focused on continuous improvement, making it better, more effective. We have competitors that are out there that are much lower priced than we are -- but I'll give you an example. For us, the average time of over-the-phone interpretation call is 12 minutes. Our competitors' average times for the most part are somewhere around 15 or 16 minutes. So they can offer a lower price. But then the client is paying that much more because they're paying for 4 or 5 extra minutes. So we're constantly looking at ways of squeezing out waste, squeezing out error to continue to enjoy the market position that we have.

What did you [indiscernible]?

On average, across 240 languages, we're averaging less than 17 seconds. Today, if you had a Spanish call, for example, probably the average is under 5 seconds. But it's -- we've invested heavily in technology. And again, this is the combination of people and technology being brought together to deliver the best possible solution. And one of the questions I get asked most often in cocktail parties is, "Hey, isn't there an apps for that?" There are apps that can provide a certain level of interpretation or translation, but at those moments of need, those critical moments of need, it has to be right. And quite frankly, those automated tools continue to have hallucinations and provide inaccurate translations or inaccurate interpretations. There was a major article that was printed yesterday talking about some of the massive problems that have been created. There's a place for machine translation, and there is a place for machine interpretation and our commitment in the marketplace is when machine interpretation is ready to go, when it is safe, we will be the first to bring it to market. And one of the other neat pieces of work that we've done in the last few years is we own a patent that says, if you're using machine interpretation and things begin to go wrong, it can automatically be moved to a live interpreter. That is a patent that we own. Anybody else wanting to run that play will need to come through that patent because it is fully, fully protected.

Scott, thanks very much. On the TLS contact business, just wondering how many regions does that operate in? And of those, which is the fastest growing? And then the second question is on AllianceOne. Is that purely credit collection of consumers? Or is that business credit?

No, no, 100% consumer. 100% consumer. TLS operates just about everywhere in the world with the exception of North and South America. So Asia huge, Europe huge, Australia, so it's very, very broad-based.

[indiscernible]?

Hard to say hard to say. Right now, the biggest short-term upside for us is China. As China continues to open up more and more to the market, the world, there's probably the greatest short-term opportunity there. When I mentioned before, that our volumes have exceeded pre-COVID, that's still with a very depressed China. Other questions? I see I think I see one in the back. Okay. One last -- one last slide I did want to cover before we go. Is all of these companies do business with each other and with the core business as well. So today, PSG Global is doing the recruiting for the TP core business in the United States and in the Philippines and for a sister company AllianceOne in both Jamaica and North America. LanguageLine provides language services to these other companies. And probably the most exciting of all of these is LanguageLine has interpreters connected to TP locations around the world as well. So we have that competitive advantage versus anybody else in this business that we've got all of those different markets that we can go to when we need those unique languages. Mandarin in Malaysia, as an example, or French in Dominican Republic. Whatever it is, we have access to those things. But thank you. And Bhupi, I will turn it...

Maybe one thing you could mention is the very nature of the U.S. market in which if you do not provide exactly the proper information in an interpretation services, it has major consequences not only for the individual but major financial and legal consequences.

Sure. So in the United States, if you're a health care institution and you fail to provide a proper professional interpreter, that hospital can lose their federal funding for the organization, and they track it very closely. And one of the other advantages that we have is LanguageLine is now capable of fully integrating into electronic health record systems, which makes it easier for those hospitals to document that they did, in fact, use proper interpretation where they registered not only the name and ID number of our interpreters, but they also have instant access to the credentials that we have to support each and every one of those. Bhupi.

Will we get my 2 colleagues on the screen? Yes. So I'll be joined by Miranda, who is our Chief Customer Officer in this presentation and also we got 2 people joining us remotely. There they are. Anish Mukker is the CEO of our India business. And Ruchi, actually wears multiple hats. The reason she's here today, is she's our Indian ambassador to America. So she actually is the interface with American clients for India business. So hello, and you can go back now. So let's start by reminding ourselves of what our mission is. So as a CX leader, our mission has been to help organizations. They could be corporate clients or they could be government departments to manage and enhance their relationships with their customers and citizens leveraging whatever is the best technology of that time and also the human resources wherever they may be, onshore, nearshore, offshore. So that has been historically what TP has always been working on. In addition, over the last few years, as we have moved beyond CX into broader business services, we've added the goal of simplifying and optimizing the operations for our clients to make it simpler, faster, safer and at a lower cost. So over decades of TP's existence, it has built a number of capabilities and differentiators. What we are going to discuss today are 4 of those. 1, the market reach and a geographic reach that TP has, which is unparalleled. #2, the transformation that is underway, and I'll give a few examples of that, from being a leader in the CX space to a major player in the transformative business services space. #3, Miranda will cover the extensive and deep client relationships that we have with almost every major brand in big industry verticals. And with these, we still have significant runway for growth. Yes, in some clients, we do have a decent share of wallet, but that share of wallet is high only in one line of business. There are additional lines of businesses where we have probably in some cases, 0 share of wallet. So there is still a long runway there. And then finally, Ruchi and Anish will cover the India powerhouse, which is a source of talent, capabilities, good cost base and is also an emerging market for future. So in terms of market reach, as I mentioned earlier, we do have an unparalleled coverage. You've got over 500,000 people in 100 countries, and we service 170 markets worldwide. And within this, in the top 10 GDP countries of the world, we are a strong #1 or #2 except for Japan. There's possibly no other company in the world, which is as resilient in terms of geographic coverage as TP. And over the past few years, through a combination of organic and inorganic efforts, we have been transforming ourselves to be a broader business services player. So as I mentioned in the morning too, we have been investing dozens of millions every year to build our TAP capabilities. And initially, we started using this to be a differentiator to be able to deliver other market growth. Now we are also using that to enhance our relationship with our clients and go beyond front office into mid-office and back office to be a one office player. And this is then further boosted by acquisitions, both in the core business and specialized services. And recently, we announced the launch of TP Infinity so that the digital capabilities can also be a service in itself. Now this is an example that this is not something that we thought of during this breakfast because of share price. This is our business mix as stands today, and this is -- has been a work in progress. So today, what we are tagged as, as a CX player is 54% of our business. And within that, as I mentioned, the chat, which everyone was so nervous about last week is only about 5% or so. And it has been -- it has been continually being automated over the last 10 years, at least, I can talk about. Beyond that, there were other kind of automation that were there. And other thing that we also need to highlight here is that some of the other lines of business like complex technical support or sales or trust and safety, they've got to a certain scale. They're not like 10 million businesses. They are in the range of 700 million to 800 million businesses. Specialized Services is a $1.5 billion business. So there is still a lot of kind of uncertainty about kind of people talking about the CX space, et cetera, but we have been transforming our business mix over the past few years below the radar that maybe people are not giving us the credit for. I won't go into this again because it was covered in the morning. The only thing that I will say is that is it is small today, we started only about a couple of years back, but it is beginning to gain traction. And we are averaging 1 new client in this line of business every week. These are small assignments, kind of 50,000, 100,000 kind of engagements, but we are averaging 1 every week on that. And so this is beginning to gain traction right now. I cover this slide in the morning. So what I'll do on AI is actually, I'll cover 3 examples. So this is the first one. This is of TP Interact, which I briefly touched upon this morning. This is the automation of QA. QA stands for quality analysis. And this is for one of the largest domain hosting and website registor companies in the world. Again, you would associate this kind of company to be more technology oriented and probably can do this on their own, but they came to TP to do it for them. So it hopefully answers the question as to why someone will not do it themselves, and we'll ask TP to do it. So what have we done for it? We -- historically, it was being done in a manual manner and also there was no real-time feedback to the agents. So we have implemented the TP Interact and the full suite of TP Interact, which is GenAI enabled. It automates the quality monitoring. It coaches the agent. And also gives actionable insight real time so that the agent can change his or her behavior. Improvements repeat calls have reduced by 26% improvement in the customer experience by 14%. And most importantly for this client, the reason they actually -- they're doing it because it improves their sales conversion. And so cost of acquiring a new customer goes down significantly. The second is for a global, but U.S. headquartered e-commerce platform, where we assisted a GenAI agent assist. Again, it's -- you all have probably heard the term copilot. So it is like a copilot. And what it does is it's for e-mail processes. So at step one, it categorizes, it reads the e-mail, categorizes in the right category, so that it's passed through the right skill set, right team. And then for the simpler transactions, it also auto-populates an answer, which are then our agents review and kind of then further pass it on. Significant improvement in productivity, 30% improvement in productivity, quality scores have gone from 90% to 97% plus. And the quality QA effort has gone down by 45%. And the final example on AI is of knowledge management. Now, again, it's not that knowledge basis have not existed in our clients. They've always existed. That's how we have operated. But a, these were clunky document finders and they were not conversational. So our agents still had to go through all these things to be able to figure out the right answer. So we've implemented GenAI-based knowledge management put a layer of that, TPs layer on top of clients' knowledge basis. It is more conversational. It also auto-populates again for the simpler queries and our agents can review it. Today, it has been deployed for more than 100 clients. And whenever we have deployed it, the productivity improvement has been in the range of 15% to 25%. And with that, Miranda, it's you.

Good afternoon. By way of introduction, my name is Miranda Collard. I'm the Global Chief Client Officer for Teleperformance as well as the Founder and Chair of TP Women, which is our gender equality ERG globally, and I'm very excited to be here today. So I wanted to start just by reiterating what these 5 gentlemen shared earlier this morning, which is we have over 1,400 clients globally with an incredible average tenure of 14 years. Obviously, throughout many verticals that were shared earlier today in many of the presentations, but one of the key components that's important is that Teleperformance serves 30% to 70% of the top 10 ranked customers globally in each of these industries, which is a great breadth and scope. But what's most important is how we expand across our client base. So I wanted to share a little bit about the discipline, the data and the governance that we do as an organization to really draw out a credible plan, a growth plan, if you will, for each of our clients across the globe. And then I'll share an example of what that looks like. So this is our framework where there's 3 important components to everything we do and how we assess our client partnerships. First is all of the business, the Teleperformance serves with that client today, by line of business, by channel, by language, by market, all of the data and information that you can bring forward. The second is the captive environment. You heard a lot of conversations about rebadging, et cetera, and opportunities, particularly as the year of efficiencies continue to move on. The captive environment is an in-house operation that our clients have typically in the U.S., many around the world, depending on the client, but that's always an opportunity for Teleperformance to lean in with one of our clients. The third is the competition. So what is the competition doing? Who are they? What markets are they serving? In what channels? Obviously, stack ranking will come into play, if we are in competitive lines of service, but FTEs, et cetera, and we analyze all of this information and data. We have a tool that captures all of it as part of our planning, our business planning processes, but really, we look at that to determine business growth, how we can expand across multiple lines of service using all of the great playbooks of Teleperformance, increased stickiness based off our tenure and our C-level relationships really meeting the clients where they need to be met and of course, deepening our strategic partnerships. An overlay of this data and information is meeting on a regular basis with the C-suite of our partnerships so that we can really connect the dots for them and how Teleperformance can help them achieve their ultimate objectives each and every year. So just a quick example of one of the many clients that we could show you. This is really a 4-year view of how we've been able to accomplish a growth in one of our largest banking clients. They're ranked globally around the world. Obviously, it just in the last 3 years, we've had 14 program launches with this client. You can see over the last 4 years, we've gone from 600 FTE globally to 3,300 FTE globally. That includes serving 11 different lines of businesses in 3 different countries around the globe. It's about a 500% growth rate. You can see here that we started in the Philippines. We moved to Mexico and India about the same time frame as we were extrapolating the additional lines of business. One of the key elements to this specific partnership is information security and bringing forward the best of TP Interact and all of the tools that you've seen today. But we actually partnered with this bank to really build out our Infosec structure to be unparalleled with the competitive -- or the competition, but it really gave us a competitive advantage because we knew we had dual scorecards within our organization as well as their organization. So we ended up getting a gold supplier award which means anywhere in the world that we can do business with them, we don't have to be wedded in each geography, they can pick up the phone and we can do business some wherever they need to go. Obviously, our vertical expertise was key critical for here in the banking financial services sector as well as the back office. It was key for us the multi-geography relationships, there's people on the ground in each of these geographies as well as in their global offices, which is located in the U.S. So it's very critical that we're meeting them everywhere they need to be met. The strategic partnership here, obviously, all the way to Daniel has been incredible and created more stickiness for us. And then just bringing the tools and suites of services that we have forward to match both the data and information that we have as well as the strategic alignment of the C-suite and how Teleperformance come in and help them meet those objectives. That's it for me, but let me just say with tomorrow being International Women's Day, I want to wish all of you, women in the audience, very Happy International Women's Day tomorrow. Thank you for being here. Of course, I got to give the flag.

Anish, you can start.

Can we put the chart please, the first chart. So TP has been in India for about 23 years, but we have really turbocharged our growth in the last 4, touching now about 90,000 employees, almost across 35 physical sites and almost about 33,000 of our entire employee set of works from home, which is really incredible in terms of our reach into the country. As far as the financials of the country are concerned and the new business is concerned, we have grown at a CAGR of 19.5% over the last 4 years. U.S. market as part of that has grown at a really, really high CAGR of about 37%. '23, we added 44 new clients. Now we service almost 215 clients globally, 108 of those are international. We are serving them through 22 countries. And our clients range from Fortune 20 to fintechs to HealthTech to insurtech and anywhere across the spectrum between the two. The operations rigor for India is, I would say, super normal. Our client satisfaction scores for the last 2 years, 91% and 92%, respectively, are the benchmarks in the industry. Our win rates of all the new deals that come to us is at about 32%, which is highest across the TP regions. But also if you look at it from a competitive standpoint, it's amongst the benchmark. And just last year, India has added about 3 partnership across 3 different verticals, which are north of 500 people. In our operational performance, we always rank in the golden quadrant. Actually, I'm proud to say 98% of our client base puts India operations in the golden quadrant in a very highly secure environment, as Bhupi had alluded earlier, of 800 bit-size-score consistently. Our people engine is humming really nicely with Glassdoor and Indeed score at 4.7, 4.6. Great place to work consistently in the last 10 years and also a great place to work for women, which is really incredible for an organization like us in India, so which again, we are really, really proud of. But most importantly, at the foundation what India is doing, it's actually empowering the capability build for TP Global. One of that is that we are now a GPS, the global business services for TP north of 5,000 people, and we are building new services on finance and accounting, HRO IT. And secondly, we house almost 50% of the transformation, digital and AI talent of the company in the country. We have now built a deep domain capability in financial services, travel and hospitality, tech, retail and health care verticals, with more than 25,000 experts which work in the back office. So in a nutshell, TP India is the fastest-growing business for TP. It is also the most profitable. And as I said, delivering benchmark clients set with incredible people engine, and this actually is creating a multi-popular engine of growth for TP globally. Next slide, please.

Our double-digit growth in India was driven by new logo acquisitions and line of business expansion from existing clients. Our focus is on accelerating our growth even further. We aim to leverage the strength of our powerhouse and capitalize on niche services. One of our key offerings is our global business shared services and domain-focused back-office line of businesses, which encompasses a range of specialized services such as finance and accounting, human resource outsourcing, IT as a service, TP Digital, privacy and vertical-specific back-office BPO operations, like revenue cycle management in health care, fraud prevention, AML, KYC, digital customer onboarding, data intake and management, order management and more. Our GBS service serves the TP group globally and clients, housed as a center of excellence in India with significant savings for us. We have been making steady progress in this area securing wins with both existing and new clients. Market studies do indicate that these services are experiencing continued growth. India with its digitally savvy and skilled resources, coupled with innovation and favorable commercial terms provides an ideal location for captives and outsourcing. A noteworthy aspect I do want to mention is that 74 percentage of our international revenues are derived from our profitable back office and non-voice service lines. Building upon the success, we are furthering strengthening our strategy of positioning India as a center of excellence for global business shared services and vertical back-office operations. We have a dedicated team of leaders and experts leading the charge, with our largest presence in India for a GBS center of excellence and vertical back office line of businesses. Next slide, please. Just double-clicking on the vertical back office services, let me briefly highlight and give you a glimpse of some of our operationalized service lines that we offer. And these are not all inclusive. We provide deep domain expertise for our primary verticals. Our solutions are tailored to address industry challenges, and they really focus on reducing total cost of ownership for our partners, eliminating repetitive tasks and nonvalue-add activities through a consultive and continuous improvement approach, we really strive to deliver productivity benefits for both ourselves and our partners. Back office services done well, provides a boost to overall operations, resulting in an enhanced customer experience and really feeds into our one office strategy. Next slide, please. As we discuss our outlook for India in 2024 and beyond as we continue to invest in and strengthen our powerhouse.

See, what we have achieved in the last 3 years actually will only be eclipsed and [ paled ] by our aspirations and plans for the next 3. We aspire and confident of growing to 150,000 employees, serving now north of 300-plus clients with contributing almost 1/5 of company's profit with the deepest domain skills coming from operations as well as our talent. In the next 3 years, we will continue to accelerate our growth trajectory achieving 17% to 18% of annualized growth, and our repivot on deeper domain expertise will drive higher revenue realization per seat and therefore, higher gross margins, and that will continue to strengthen. We are also committing to infuse greater pipe into India, 30% more than what it stands in 2023 in the following years and while improving our win rate by 3 percentage points to 35%. At the core of that is the -- our investment of people and investment in tools. To drive that exponential growth, we will continue to invest in talent beyond customer experience, people with deep industry expertise and the ability to transform business with strategic momentum and building the leadership bench as we have realized that India is becoming the talent factory for the rest of TP. And furthermore, we are transforming TP from Incyte at the same time, digitizing our internal processes, driving savings of additional EUR 50 million in the group in the next 18 months. India will also begin the innovation nation for TP to accelerate change, to build new efficiency platforms, the hub for implementation, AI and machine learning use cases that were earlier spoken about and also devising new ways of working as we source large-scale talent using new staffing models. Finally, we are building domain-rich products. Some of that you saw on the last chart, underwriting services, claims, subrogation, data analytics for retail, trust and safety, embedding risk management in our operations, finance and accounting as well and actually becoming a cross between digital and domain to drive the nonlinear transformation that our industry will come to experience in the next 3 years. So that's what we are aspiring to do and as part of our domain and transformation strategy. And it will also see us carving out at least 2 client operations in the chosen areas of our verticals in the next 12 to 14 months. That's all for me. Thank you.

Now we open for Q&A.

Yes. I would just like to say something. India is our strong powerhouse. But if you would have had today the management team of Colombia, the management team of Portugal, the management team of Greece, the management team of Philippines, the management team of Egypt, they would have competed with these 2 talent -- 2 very talented leaders.

Two questions. I move on India, since we've just finished with that. I think you said at the top of the presentation, Bhupi, that the Indian revenue plans for 2027 are just shy of EUR 1.2 billion. So of that incremental revenue, how much of that is going to reflect effectively transition offshoring from other regions, particularly the U.S.? That's my first question. And then the second question from Miranda, just in terms of -- we've heard about some of the gross business wins for the group overall. And just looking at that composition of growing with existing customers taking captive, so outsourcing and then taking share from competition. Broadly, how do you see that sort of splitting out over the next few years?

I can answer the first one very simply. I have no clue. And I'm going -- so sorry, -- let me I have no clue of how much of that will come from my own cannibalization. What we are more confident about is that we will see this 15% plus CAGR in India, because we are seeing the tailwinds for that. So that I'm more confident how much of that 15% comes from TP from outside, no idea.

I'm a little bit more confident than Bhupi. I also have no clue, but I know that the vast majority is going to come from additional business because everything that already had to be outsourced to India from our existing business has been done in majority.

Can I say I have no clue, too. Just checking. No, I think if I had a crystal ball, I would say that we'll continue to see a share of wallet and additional lines of business growth that from a new business perspective, a tracking perspective, 50% plus of what we get from each year, and continue to move from there as we progress. We have a systematic approach to tracking our share of wallet, the total lines of business, the amount of business opportunity that we have, and we're very maniacal about leveraging that information.

I would have an additional question about the reason of acquisition of new clients in the current difficult environment. Do you see a slowdown in the acquisition of new clients, or in terms of new clients, new deals momentum is the same on the uncertainty is more on volume than new clients win.

Yes. So two parts there. Firstly, the big deals have dried up. So they become far and wide because clients are still in an expense and budget management mode. And typically, big, huge big deals come when they're thinking of big expansion plans. So that's overall market sentiment are not kind of in terms of this thing. In terms of our win rate, it has not changed dramatically. It is still in the kind of close to 30% for us.

I think that there is clearly a slowdown in the decision process because somehow as there is less expansion, now it's about strategic transformation at our client level. And then this goes to the C level, which is much more about rebadging of in-house business. And we think that the future is going to lead towards more balancing in favor of outsourcing from some in-house business versus the opposite because I had many times the question, now with the AI or whatever, all other companies reinsourcing, I can tell you, no.

Just a follow-up on this one. AI is supposed to create more complexity, so to increase the level of outsourcing. So is it something that you experienced currently, the increase of outsourcing rates from your clients?

See outsourcing percentage of business that is outsourced by clients has been increasing, if you look at over the last decade or so. It used to be about in the range of 25-75 a decade back, 75% in-house, 25% outsourced. That number is probably closer to 28% and 72% now. So kind of -- this percentage has been gradually increasing. Whether AI will actually increase or not, we don't know, but the trend is that percentage -- there is -- the way we look at it is there is still a sizable chunk that is in-house that we can go after. And that's what one of the elements of Miranda's hypermetrics was.

Do you think AI and how fast some of this new technology has been emerging is impacting the speed of the decision processes? Or is it more to your point about the kind of the slower or sort of pace of larger decision-making? Or is the AI itself and the new technology actually having an impact as sort of clients wait and see how things develop and what comes to market?

We think that we have very sophisticated clients. So when they wanted to develop some of the AI-specific stuff, they did it. And we can work even on the AI. Some of their clients did not want to develop a specific layer, and we put our own layer. The slowdown of the decision is not related to that. The slowdown of the decision is really about the fact that we are in an era today, where for the majority of the business, it's time exactly like for Olivier for Teleperformance to control any kind of decision and not to hurry up in making a transformation. So it's -- I would say it's a longer process to transform a company from in-house to outsourcing than to have a company that is growing, that is very enthusiastic and asking you to put more outsourced resources. This is exactly the dynamic that we are leaving today. We are on time almost. 10 minutes late, sorry, as I'm French, we always say these are the 10 minutes of courtesy. Sorry -- thank you very much for your presence. I don't know, if we convince you, but all what we said was true, real, basic and you can ask any question you can ask us to visit our operation, you can ask to interact with people. We are open. Thank you very much.

Thank you.