Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 02, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | TELETECH HOLDINGS INC | |
Entity Central Index Key | 1,013,880 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 48,395,849 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets | ||
Cash and cash equivalents | $ 86,170 | $ 77,316 |
Accounts receivable, net | 258,231 | 276,432 |
Prepaids and other current assets | 75,798 | 64,702 |
Deferred tax assets, net | 27,175 | 22,501 |
Income tax receivable | 3,015 | 4,532 |
Total current assets | 450,389 | 445,483 |
Long-term assets | ||
Property, plant and equipment, net | 165,795 | 150,212 |
Goodwill | 118,784 | 128,705 |
Deferred tax assets, net | 24,159 | 31,512 |
Other intangible assets, net | 53,564 | 59,905 |
Other long-term assets | 45,524 | 36,658 |
Total long-term assets | 407,826 | 406,992 |
Total assets | 858,215 | 852,475 |
Current liabilities | ||
Accounts payable | 46,358 | 37,019 |
Accrued employee compensation and benefits | 71,937 | 70,069 |
Other accrued expenses | 40,662 | 34,430 |
Income taxes payable | 7,247 | 10,141 |
Deferred tax liabilities, net | 358 | |
Deferred revenue | 30,183 | 29,887 |
Other current liabilities | 27,296 | 17,085 |
Total current liabilities | 224,041 | 198,631 |
Long-term liabilities | ||
Line of credit | 115,000 | 100,000 |
Deferred tax liabilities, net | 2,351 | 4,675 |
Deferred rent | 10,023 | 8,956 |
Other long-term liabilities | 81,011 | 74,149 |
Total long-term liabilities | 208,385 | 187,780 |
Total liabilities | $ 432,426 | $ 386,411 |
Commitments and contingencies (Note 10) | ||
Mandatorily redeemable noncontrolling interest | $ 3,920 | $ 2,814 |
Stockholders' equity | ||
Common stock - $0.01 par value; 150,000,000 shares authorized; 48,404,250 and 48,452,852 shares outstanding as of September 30, 2015 and December 31, 2014, respectively | 485 | 485 |
Additional paid-in capital | 347,445 | 356,792 |
Treasury stock at cost: 33,648,003 and 33,599,401 shares as of September 30, 2015 and December 31, 2014, respectively | (534,680) | (527,595) |
Accumulated other comprehensive income (loss) | (102,902) | (52,274) |
Retained earnings | 703,898 | 677,859 |
Noncontrolling interest | 7,623 | 7,983 |
Total stockholders' equity | 421,869 | 463,250 |
Total liabilities and stockholders' equity | $ 858,215 | $ 852,475 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Stockholders' equity | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 150,000,000 | |
Common stock, shares outstanding | 48,404,250 | 48,452,852 |
Treasury stock, shares | 33,648,003 | 33,599,401 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Consolidated Statements of Comprehensive Income | ||||
Revenue | $ 309,195 | $ 305,900 | $ 944,939 | $ 903,611 |
Operating expenses | ||||
Cost of services | 225,978 | 220,244 | 682,579 | 646,346 |
Selling, general and administrative | 48,418 | 49,847 | 146,031 | 148,016 |
Depreciation and amortization | 15,486 | 13,893 | 46,529 | 41,152 |
Restructuring charges, net | 622 | 593 | 1,629 | 1,750 |
Impairment losses | 3,066 | 3,066 | ||
Total operating expenses | 293,570 | 284,577 | 879,834 | 837,264 |
Income from operations | 15,625 | 21,323 | 65,105 | 66,347 |
Other income (expense) | ||||
Interest income | 196 | 542 | 877 | 1,545 |
Interest expense | (2,337) | (1,646) | (5,711) | (5,197) |
Other income (expense), net | 146 | 248 | 1,133 | 5,498 |
Total other income (expense) | (1,995) | (856) | (3,701) | 1,846 |
Income before income taxes | 13,630 | 20,467 | 61,404 | 68,193 |
Benefit from (provision for) income taxes | (1,192) | (5,778) | (13,438) | (14,071) |
Net income | 12,438 | 14,689 | 47,966 | 54,122 |
Net income attributable to noncontrolling interest | (1,243) | (1,442) | (3,303) | (3,795) |
Net income attributable to TeleTech stockholders | 11,195 | 13,247 | 44,663 | 50,327 |
Other comprehensive income (loss) | ||||
Foreign currency translation adjustments | (21,997) | (16,660) | (39,342) | (11,373) |
Derivative valuation, gross | (11,426) | (18,908) | (17,733) | (5,044) |
Derivative valuation, tax effect | 4,928 | 7,675 | 8,264 | 2,282 |
Other, net of tax | 223 | 248 | (2,140) | 804 |
Total other comprehensive income (loss) | (28,272) | (27,645) | (50,951) | (13,331) |
Total comprehensive income (loss) | (15,834) | (12,956) | (2,985) | 40,791 |
Less: Comprehensive income attributable to noncontrolling interest | (906) | (1,053) | (2,443) | (3,212) |
Comprehensive income attributable to TeleTech stockholders | $ (16,740) | $ (14,009) | $ (5,428) | $ 37,579 |
Weighted average shares outstanding | ||||
Basic | 48,345 | 49,093 | 48,346 | 49,493 |
Diluted | 48,936 | 49,940 | 49,052 | 50,338 |
Net income per share attributable to TeleTech stockholders | ||||
Basic | $ 0.23 | $ 0.27 | $ 0.92 | $ 1.02 |
Diluted | $ 0.23 | $ 0.27 | $ 0.91 | $ 1 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - 9 months ended Sep. 30, 2015 - USD ($) $ in Thousands | Stockholders' Equity of the Company Common Stock [Member] | Stockholders' Equity of the Company Treasury Stock [Member] | Stockholders' Equity of the Company Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income (Loss) | Stockholders' Equity of the Company Retained Earnings [Member] | Noncontrolling Interest [Member] | Total |
Preferred stock beginning balance, share at Dec. 31, 2014 | 0 | ||||||
Common stock beginning balance, share at Dec. 31, 2014 | 48,453,000 | 48,452,852 | |||||
Beginning balance,value at Dec. 31, 2014 | $ 485 | $ (527,595) | $ 356,792 | $ (52,274) | $ 677,859 | $ 7,983 | $ 463,250 |
Net income | 44,663 | 47,966 | |||||
Net income excluding mandatorily redeemable noncontrolling interest | 2,766 | 47,429 | |||||
Dividends to shareholders | (17,423) | (17,423) | |||||
Adjustments to redemption value of mandatorily redeemable noncontrolling interest | (1,201) | (1,201) | |||||
Dividends distributed to noncontrolling interest | (2,925) | (2,925) | |||||
Foreign currency translation adjustments | (39,019) | (323) | (39,342) | ||||
Derivatives valuation, net of tax | (9,469) | (9,469) | |||||
Vesting of restricted stock units, share | 330,000 | ||||||
Vesting of restricted stock units, value | $ 3 | 5,098 | (8,394) | (3,293) | |||
Exercise of stock options, share | 284,000 | ||||||
Exercise of stock options, value | $ 3 | 4,413 | (9,668) | (5,252) | |||
Excess tax benefit from equity-based awards | 354 | 354 | |||||
Equity-based compensation expense | 8,361 | 122 | 8,483 | ||||
Purchases of common stock, share | (663,000) | ||||||
Purchases of common stock, value | $ (6) | (16,596) | (16,602) | ||||
Other, net of tax | (2,140) | $ (2,140) | |||||
Preferred stock ending balance, share at Sep. 30, 2015 | 0 | ||||||
Common stock ending balance, share at Sep. 30, 2015 | 48,404,000 | 48,404,250 | |||||
Ending balance,value at Sep. 30, 2015 | $ 485 | $ (534,680) | $ 347,445 | $ (102,902) | $ 703,898 | $ 7,623 | $ 421,869 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities | |||
Net income | $ 12,438 | $ 47,966 | $ 54,122 |
Adjustment to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 15,486 | 46,529 | 41,152 |
Amortization of contract acquisition costs | 754 | 740 | |
Amortization of debt issuance costs | 534 | 527 | |
Imputed interest expense and fair value adjustments to contingent consideration | 786 | (3,675) | |
Provision for doubtful accounts | 964 | 471 | |
Gain on disposal of assets | (118) | ||
Impairment losses | 3,066 | 3,066 | |
Deferred income taxes | 4,380 | 13,051 | |
Excess tax benefit from equity-based awards | (420) | (1,086) | |
Equity-based compensation expense | 3,300 | 8,569 | 9,031 |
Loss (gain) on foreign currency derivatives | 4,820 | 1,756 | |
Changes in assets and liabilities, net of acquisitions: | |||
Accounts receivable | 4,722 | (24,179) | |
Prepaids and other assets | (6,839) | (16,118) | |
Accounts payable and accrued expenses | 11,857 | (17,830) | |
Deferred revenue and other liabilities | (11,406) | 3,945 | |
Net cash provided by operating activities | 116,164 | 61,907 | |
Cash flows from investing activities | |||
Proceeds from sale of long lived assets | 116 | 135 | |
Purchases of property, plant and equipment, net of acquisitions | (19,679) | (49,184) | (52,234) |
Investments in non-marketable equity investments | (9,000) | ||
Acquisitions, net of cash acquired of zero and $812, respectively | (1,776) | (23,903) | |
Net cash used in investing activities | (59,844) | (76,002) | |
Cash flows from financing activities | |||
Proceeds from line of credit | 1,697,500 | 1,540,100 | |
Payments on line of credit | (1,682,500) | (1,525,100) | |
Payments on other debt | (2,556) | (3,769) | |
Payments of contingent consideration related to acquisitions | (11,883) | (8,547) | |
Dividends paid to shareholders | (8,710) | ||
Dividends distributed to noncontrolling interest | (3,557) | (4,838) | |
Proceeds from exercise of stock options | 459 | 314 | |
Excess tax benefit from equity-based awards | 420 | 1,086 | |
Purchase of treasury stock | (16,602) | (47,281) | |
Payments of debt issuance costs | (35) | ||
Net cash used in financing activities | (27,464) | (48,035) | |
Effect of exchange rate changes on cash and cash equivalents | (20,002) | (8,275) | |
(Decrease) increase in cash and cash equivalents | 8,854 | (70,405) | |
Cash and cash equivalents, beginning of period | 77,316 | 158,017 | |
Cash and cash equivalents, end of period | 86,170 | 86,170 | 87,612 |
Supplemental disclosures | |||
Cash paid for interest | 4,640 | 4,038 | |
Cash paid for income taxes | 10,924 | 10,540 | |
Non-cash investing and financing activities | |||
Acquisition of equipment through increase in accounts payable | 5,448 | $ 2,944 | |
Acquisition of long lived assets through capital leases | 5,316 | 5,316 | |
Dividends declared but not paid | $ 8,713 | $ 8,713 |
Consolidated Statements of Cas7
Consolidated Statements of Cash Flows (Parenthetical) $ in Thousands | 9 Months Ended |
Sep. 30, 2014USD ($) | |
Cash flows from investing activities | |
Acquisitions, net of cash acquired of zero and $812, respectively | $ 3,525 |
OVERVIEW AND BASIS OF PRESENTAT
OVERVIEW AND BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2015 | |
OVERVIEW AND BASIS OF PRESENTATION [Abstract] | |
OVERVIEW AND BASIS OF PRESENTATION | (1) OVERVIEW AND BASIS OF PRESENTATIO N Summary of Business TeleTech Holdings, Inc. and its subsidiaries (“TeleTech” or the “Company”) is a customer engagement management services provider, delivering integrated consulting, technology, growth and customer care solutions on a global scale. Our suite of product and service capabilities allows us to design and deliver enhanced, value-driven customer experiences across numerous communication channels. TeleTech’s 41,000 employees serve clients in the automotive, communication, financial services, government, healthcare, logistics, media and entertainment, retail, technology, transportation and travel industries via operations in the U.S., Australia, Belgium, Brazil, Bulgaria, Canada, China, Costa Rica, Germany, Hong Kong, Ireland, Israel, Lebanon, Macedonia, Mexico, New Zealand, the Philippines, Poland, Singapore, South Africa, Thailand, Turkey, the United Arab Emirates, and the United Kingdom. Basis of Presentation The Consolidated Financial Statements are comprised of the accounts of TeleTech, its wholly owned subsidiaries, its 55% equity owned subsidiary Percepta, LLC, and its 80% interest in iKnowtion, LLC. All intercompany balances and transactions have been eliminated in consolidation. The unaudited Consolidated Financial Statements do not include all of the disclosures required by accounting principles generally accepted in the U.S. (“GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited Consolidated Financial Statements reflect all adjustments which, in the opinion of management, are necessary to state fairly the consolidated financial position of the Company and the consolidated results of operations and comprehensive income (loss) and the consolidated cash flows of the Company. Operating results for the periods presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. During the three months ended June 30, 2015, an additional expense of $1.75 million was recorded as an additional estimated tax liability that should have been recorded in prior periods related to ongoing discussions with relevant government authorities related to site compliance with tax advantaged status. The total amount of $1.75 million should have been recorded as additional tax expense in the amount of $466 thousand in 2012, $406 thousand in 2013, $645 thousand in 2014 and $234 thousand in the first quarter of 2015. During the three months ended June 30, 2015, the Company recorded an additional $3.2 million loss related to foreign currency translation within Other comprehensive income (loss) that should have been recorded in 2014 and the three months ended March 31, 2015 to correct for an error in translating the financial results of Sofica Group AD, which we acquired on February 28, 2014. Of the $3.2 million recorded, approximately $1.7 million and $1.5 million should have been recorded in the year ended December 31, 2014 and the three months ended March 31, 2015, respectively. The Company also recorded an additional $2.7 million loss to “Other, net of tax” within Other comprehensive income (loss) in the three months ended March 31, 2015 and the nine months ended September 30, 2015 related to the annual actuarial analysis for the Company’s Philippines pension liability that should have been recorded in the fourth quarter of 2014. The Company has evaluated the aggregate impact of these adjustments and concluded that these adjustments were not material to the previously issued or current period consolidated financial statements. These unaudited Consolidated Financial Statements should be read in conjunction with the Company’s audited Consolidated financial Statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. Use of Estimates The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions in determining the reported amounts of assets and liabilities, disclosure of contingent liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenue and expenses during the reporting period. On an on-going basis, the Company evaluates its estimates including those related to derivatives and hedging activities, income taxes including the valuation allowance for deferred tax assets, self-insurance reserves, litigation reserves, restructuring reserves, allowance for doubtful accounts, contingent consideration, and valuation of goodwill, long-lived and intangible assets. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ materially from these estimates under different assumptions or conditions. Recently Issued Accounting Pronouncements In April 2015, the FASB issued ASU No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs”. ASU 2015-03 requires all costs incurred in connection with the issuance of debt to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability. This ASU is effective for interim and annual periods beginning on or after December 15, 2015 and early adoption is permitted. The Company is evaluating when it will adopt the standard but does not expect the adoption of this standard to have a material impact on its financial position, results of operation or related disclosures. In September 2015, the FASB issued ASU 2015-16, “Simplifying the Accounting for Measurement-Period Adjustments”. ASU 2015-16 requires that the cumulative impact of all measurement period adjustments be recorded in the period in which the adjustment is identified. This change eliminates the requirement to restate prior financial statements. The ASU is effective for interim and annual periods beginning on or after December 15, 2015 and can be early adopted for periods for which the financial statements have not yet been issued. The Company took advantage of the early adoption provision and adopted the standard during the quarter ended September 30, 2015. It did not have a material impact on its financial position, results of operation or related disclosures. |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Sep. 30, 2015 | |
ACQUISITIONS [ABSTRACT] | |
ACQUISITIONS | (2) ACQUISITIONS rogenSi In the third quarter of 2014, as an addition to the Customer Strategy Services (“CSS”) segment, the Company acquired substantially all operating assets of rogenSi Worldwide PTY, Ltd., a global leadership, change management, sales, performance training and consulting company. The total purchase price was $34.4 million, subject to certain working capital adjustments, and consists of $18.1 million in cash at closing and an estimated $14.5 million in three earn-out payments, contingent on the acquired companies and TeleTech’s CSS segment achieving certain agreed earnings before interest, taxes, depreciation and amortization (“EBITDA”) targets, as defined in the sale and purchase agreement. Additionally, the estimated purchase price included a $1.8 million hold-back payment for contingencies as defined in the sale and purchase agreement which will be paid in the first quarter of 2016, if required. The total contingent consideration possible per the sale and purchase agreement ranges from zero to $17.6 million and the earn-out payments are payable in early 2015, 2016 and 2017, based on July 1, 2014 through December 31, 2014, and full year 2015 and 2016 performance, respectively. The fair value of the contingent consideration was measured by applying a probability weighted discounted cash flow model based on significant inputs not observable in the market (Level 3 inputs). Key assumptions include a discount rate of 4.6% and expected future value of payments of $15.3 million. The $15.3 million of expected future payments was calculated using a probability weighted EBITDA assessment with the highest probability associated with rogenSi achieving the targeted EBITDA for each earn-out year . As of the acquisition date, the fair value of the contingent consideration was approximately $14.5 million. During the fourth quarter of 2014 and the third quarter of 2015, the Company recorded fair value adjustment s of the contingent consideration of $0.5 million and $0.8 million , respectively, based on revised estimates noting higher probability of exceeding the EBITDA targets (see Note 7). As of September 30, 2015, the fair value of the remaining contingent consideration was $ 9.9 million, of which $5.9 million and $4.0 million were included in Other accrued expenses and Other long-term liabilities in the accompanying Consolidated Balance Sheets, respectively. The following summarizes the fair values of the identifiable assets acquired and liabilities assumed as of the acquisition date (in thousands): Acquisition Date Fair Value Cash $ Accounts receivable, net Other assets Property, plant and equipment Deferred tax assets, net Customer relationships Tradename / trademarks Non-compete agreements Goodwill Accounts payable Accrued employee compensation and benefits Accrued expenses Other Total purchase price $ In the third quarter of 2015, the Company finalized its valuation of rogenSi for the acquisition date assets acquired and liabilities assumed. The only material adjustment was an increase to the balances for tradename/ trademarks, customer relationships and non-compete agreements by $3.4 million and a resulting decrease to goodwill of $3.4 million. In connection with this valuation finalization, a reduction to amortization expense of $0.3 million was recorded during the quarter ended September 30, 2015. The rogenSi customer relationships and non-compete agreements will be amortized over useful lives of 70 months and 30 months, respectively . The goodwill recognized from the rogenSi acquisition is attributable, but not limited to, the acquired workforce and expected synergies within CSS. None of the tax basis of the acquired intangibles and goodwill will be deductible for income tax purposes. The acquired goodwill and the operating results of rogenSi are reported, as its own reporting unit, within the CSS segment from the date of acquisition. Sofica In the first quarter of 2014, as an addition to the Customer Management Services (“CMS”) segment, the Company acquired a 100% interest in Sofica Group, a Bulgarian joint stock company (“Sofica”). Sofica provides customer lifecycle management and other business process services across multiple channels in multiple sites in over 18 languages. The purchase price of $14.2 million included $9.4 million in cash consideration (including working capital adjustments) and an estimated $3.8 million in earn-out payments, payable in 2015 and 2016, contingent on Sofica achieving specified EBITDA targets, as defined by the stock purchase agreement . The total contingent consideration possible per the stock purchase agreement ranges from zero to $7.5 million. Additionally, the purchase price includes a $1.0 million hold-back payment for contingencies as defined in the stock purchase agreement which will be paid in the second quarter of 2016, if required. The fair value of the contingent consideration was measured based on significant inputs not observable in the market (Level 3 inputs). Key assumptions include a discount rate of 5.0% and expected future value of payments of $4.0 million. The $4.0 million of expected future payments was calculated using a probability weighted EBITDA assessment with the highest probability associated with Sofica achieving the targeted EBITDA for each earn-out year . As of the acquisition date, the fair value of the contingent consideration was approximately $3.8 million. During the third and fourth quarters of 2014, the Company recorded fair value adjustments of the contingent consideration of $1.8 million and $0.6 million, respectively, based on revised estimates noting higher probability of exceeding the EBITDA targets (see Note 7). During the second quarter of 2015, the Company recorded a negative fair value adjustment for contingent consideration of $0.5 million based on revised estimates noting lower profitability than initially estimated. As of September 30, 2015, the fair value of the remaining contingent consideration was $3.1 million which was included in Other accrued expenses in the accompanying Consolidated Balance Sheets. Financial Impact of Acquired Businesses The acquired businesses purchased in 2014 noted above contributed revenues of $14.6 million and $41.9 million, and income from operations of $3.3 million and $6.4 million, inclusive of $0.3 million and $1.7 million of acquired intangible amortization, to the Company for the three and nine months ended September 30, 2015, respectively. These same acquired businesses contributed revenues of $8.5 million and $14.5 million, and income from operations of $1.4 million and $2.1 million, inclusive of $0.4 million and $0.7 million of acquired intangible amortization, to the Company for the three and nine months ended September 30, 2014, respectively. Investments CaféX In the first quarter of 2015, the Company invested $9.0 million in CafeX Communications, Inc. (“CafeX”) through the purchase of a portion of the Series B Preferred Stock of CafeX. After the transaction, the Company owns 17.3% of the total equity of CafeX. CaféX is a provider of omni-channel web-based real time communication (WebRTC) solutions that enhance mobile applications and websites with in-app video communication and screen share technology to increase customer satisfaction and enterprise efficiency. TeleTech anticipates deploying the CafeX technology as part of the TeleTech customer experience offerings within the CMS business segment and as part of its Humanify platform. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2015 | |
SEGMENT INFORMATION [ABSTRACT] | |
SEGMENT INFORMATION | (3) SEGMENT INFORMATION The Company reports the following four segments: · the CMS segment includes the customer experience delivery solutions which integrate innovative technology with highly-trained customer experience professionals to optimize the customer experience across all channels and all stages of the customer lifecycle from an onshore, offshore or work-from-home environment; · the CGS segment provides technology-enabled sales and marketing solutions that support revenue generation across the customer lifecycle, including sales advisory, search engine optimization, digital demand generation, lead qualification, and acquisition sales, growth and retention services; · the CTS segment includes operational and design consulting, systems integration, and cloud and on-premise managed services, the requirements needed to design, deliver and maintain best-in-class multichannel customer engagement platforms; and · the CSS segment provides professional services in customer experience strategy, customer intelligence analytics, system and operational process optimization, and culture development and knowledge management. The Company allocates to each segment its portion of corporate operating expenses. All intercompany transactions between the reported segments for the periods presented have been eliminated. The following tables present certain financial data by segment (in thousands): Three Months Ended September 30, 2015 Depreciation Income Gross Intersegment Net & (Loss) from Revenue Sales Revenue Amortization Operations Customer Management Services $ $ — $ $ $ Customer Growth Services — Customer Technology Services Customer Strategy Services — Total $ $ $ $ $ Three Months Ended September 30, 2014 Depreciation Income Gross Intersegment Net & (Loss) from Revenue Sales Revenue Amortization Operations Customer Management Services $ $ — $ $ $ Customer Growth Services — Customer Technology Services Customer Strategy Services — Total $ $ $ $ $ Nine months Ended September 30, 2015 Depreciation Income Gross Intersegment Net & (Loss) from Revenue Sales Revenue Amortization Operations Customer Management Services $ $ — $ $ $ Customer Growth Services — Customer Technology Services Customer Strategy Services — Total $ $ $ $ $ Nine months Ended September 30, 2014 Depreciation Income Gross Intersegment Net & (Loss) from Revenue Sales Revenue Amortization Operations Customer Management Services $ $ — $ $ $ Customer Growth Services — Customer Technology Services Customer Strategy Services — Total $ $ $ $ $ Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Capital Expenditures Customer Management Services $ $ $ $ Customer Growth Services Customer Technology Services Customer Strategy Services Total $ $ $ $ September 30, December 31, 2015 2014 Total Assets Customer Management Services $ $ Customer Growth Services Customer Technology Services Customer Strategy Services Total $ $ September 30, December 31, 2015 2014 Goodwill Customer Management Services $ $ Customer Growth Services Customer Technology Services Customer Strategy Services Total $ $ The following table presents revenue based upon the geographic location where the services are provided (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Revenue United States $ $ $ $ Philippines Latin America Europe / Middle East / Africa Asia Pacific Canada Total $ $ $ $ |
SIGNIFICANT CLIENTS AND OTHER C
SIGNIFICANT CLIENTS AND OTHER CONCENTRATIONS | 9 Months Ended |
Sep. 30, 2015 | |
SIGNIFICANT CLIENTS AND OTHER CONCENTRATIONS [Abstract] | |
SIGNIFICANT CLIENTS AND OTHER CONCENTRATIONS | (4) SIGNIFICANT CLIENTS AND OTHER CONCENTRATIONS The Company had one client that contributed in excess of 10% of total revenue for the nine months ended September 30, 2015 and 2014. This client operates in the communications industry and is included in the CMS segment. This client contributed 10.5 % and 11.9 % of total revenue for the three months ended September 30, 2015 and 2014, respectively. This client contributed 10.8 % and 11.9 % of total revenue for the nine months ended September 30, 2015 and 2014, respectively. This client had an outstanding receivable balance of $ 16.3 million and $ 31.5 million as of September 30, 2015 and 2014, respectively. The loss of one or more of its significant clients could have a material adverse effect on the Company’s business, operating results, or financial condition. The Company does not require collateral from its clients. To limit the Company’s credit risk, management performs periodic credit evaluations of its clients and maintains allowances for uncollectible accounts and may require pre-payment for services. Although the Company is impacted by economic conditions in various industry segments, management does not believe significant credit risk existed as of September 30, 2015. |
GOODWILL
GOODWILL | 9 Months Ended |
Sep. 30, 2015 | |
GOODWILL [ABSTRACT] | |
GOODWILL. | (5) GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill consisted of the following (in thousands): Effect of December 31, Acquisitions / Foreign September 30, 2014 Adjustments Impairments Currency 2015 Customer Management Services $ $ — $ — $ $ Customer Growth Services — — Customer Technology Services — — — Customer Strategy Services — Total $ $ $ $ $ During the third quarter of 2015, the Company finalized the acquisition valuation and accounting for rogenSi which required a reallocation of values between goodwill and other intangible assets (see Note 2.) The Company performs a goodwill impairment assessment on at least an annual basis. The Company conducts its annual goodwill impairment assessment during the fourth quarter, or more frequently, if indicators of impairment exist. The Company concluded that goodwill for all reporting units was not impaired at December 1, 2014. While no impairment indicators were identified, due to the small margin of fair value in excess of carrying value for two reporting units, Revana (approximately 6 %) and WebMetro (approximately 11 %) both of which are a part of the CGS segment, these reporting units remain at considerable risk for future impairment if projected operating results are not met or other inputs into the fair value measurement change. At September 30, 2015, the Company updated its quantitative assessment of these reporting units fair value using an income based approach. The determination of fair value requires significant judgments including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term growth rates for the businesses, the useful lives over which the cash flows will occur and determination of appropriate discount rates (based in part on the Company’s weighted average cost of capital). Changes in these estimates and assumptions could materially affect the determination of fair value and/or conclusions on goodwill impairment for each reporting unit. As of September 30, 2015, the updated fair value for Revana is in excess of its carrying value (approximately 23 %) and no further analysis is required. At September 30, 2015, the updated fair value for WebMetro was below the carrying value which necessitated an interim impairment analysis. The Company tested all of the assets of this reporting unit for impairment . Definite-lived long-lived assets consisted of fixed assets, internally developed software, and an intangible asset related to the WebMetro customer relationships. The Company determined that the undiscounted future cash flows would be sufficient to cover the net book value of all definite-lived long-lived assets. For the goodwill impairment analysis, the Company calculated the fair value of the WebMetro reporting unit and compared that to the updated carrying value and determined that the fair value was not in excess of its carrying value. Key assumptions used in the fair value calculation for goodwill impairment testing include, but are not limited to, a compounded annual revenue growth rate of 20% for years 2016 through 2019, a perpetuity growth rate of 4.0% based on the current inflation rate combined with the GDP growth rate for the reporting unit’s geographical region and a discount rate of 17.0%, which is equal to the reporting unit’s equity risk premium adjusted for its size and company specific risk factors. Estimated future cash flows under the income approach are based on the Company’s internal business plan adjusted as appropriate for the Company’s view of market participant assumptions. The current business plan assumes the occurrence of certain events, including increased revenue growth for the next several years. Significant differences in the outcome of some or all of these assumptions may impact the calculated fair value of this reporting unit resulting in a different outcome to goodwill impairment in a future period. Since the fair value of the reporting unit was not in excess of its carrying value, the Company calculated the implied fair value of goodwill and compared that value to the carrying value of goodwill. Implied fair value of goodwill is equal to the excess of the reporting unit’s fair value over the amounts assigned to its net indentifiable assets and liabilities . Upon completing this assessment, the Company determined that the implied fair value of goodwill was below the carrying value and thus a $3.1 million impairment was recorded in the three and nine months ended September 30, 2015, and was included in Impairment losses in the Consolidated Statements of Comprehensive Income (Loss). |
DERIVATIVES
DERIVATIVES | 9 Months Ended |
Sep. 30, 2015 | |
DERIVATIVES [ABSTRACT] | |
DERIVATIVES | (6) DERIVATIVES Cash Flow Hedges The Company enters into foreign exchange and interest rate related derivatives. Foreign exchange derivatives entered into consist of forward and option contracts to reduce the Company’s exposure to foreign currency exchange rate fluctuations that are associated with forecasted revenue earned in foreign locations. Interest rate derivatives consist of interest rate swaps to reduce the Company’s exposure to interest rate fluctuations associated with its variable rate debt. Upon proper qualification, these contracts are designated as cash flow hedges. It is the Company’s policy to only enter into derivative contracts with investment grade counterparty financial institutions, and correspondingly, the fair value of derivative assets consider, among other factors, the creditworthiness of these counterparties. Conversely, the fair value of derivative liabilities reflects the Company’s creditworthiness. As of September 30, 2015, the Company has not experienced, nor does it anticipate, any issues related to derivative counterparty defaults. The following table summarizes the aggregate unrealized net gain or loss in Accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2015 and 2014 (in thousands and net of tax): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Aggregate unrealized net gain/(loss) at beginning of period Add: Net gain/(loss) from change in fair value of cash flow hedges Less: Net (gain)/loss reclassified to earnings from effective hedges Aggregate unrealized net gain/(loss) at end of period $ $ $ $ The Company’s foreign exchange cash flow hedging instruments as of September 30, 2015 and December 31, 2014 are summarized as follows (amounts in thousands). All hedging instruments are forward contracts unless noted otherwise. Local Currency U.S. Dollar % Maturing Contracts Notional Notional in the next Maturing As of September 30, 2015 Amount Amount 12 months Through Philippine Peso (1) % February 2020 Mexican Peso % July 2020 $ Local Currency U.S. Dollar Notional Notional As of December 31, 2014 Amount Amount Canadian Dollar $ Philippine Peso (1) Mexican Peso New Zealand Dollar $ (1) Includes contracts to purchase Philippine pesos in exchange for New Zealand dollars and Australian dollars, which are translated into equivalent U.S. dollars on September 30, 2015 and December 31, 2014. The Company’s interest rate swap arrangements as of September 30, 2015 and December 31, 2014 were as follows: Contract Contract Notional Variable Rate Fixed Rate Commencement Maturity Amount Received Paid Date Date Swap 1 $ 25 million 1 - month LIBOR % April 2012 April 2016 Swap 2 15 million 1 - month LIBOR % May 2012 May 2017 $ 40 million Fair Value Hedges The Company enters into foreign exchange forward contracts to economically hedge against foreign currency exchange gains and losses on certain receivables and payables of the Company’s foreign operations. Changes in the fair value of derivative instruments designated as fair value hedges are recognized in earnings in Other income (expense), net. As of September 30, 2015 and December 31, 2014 the total notional amounts of the Company’s forward contracts used as fair value hedges were $ 226.1 million and $ 242.5 million, respectively. Derivative Valuation and Settlements The Company’s derivatives as of September 30, 2015 and December 31, 2014 were as follows (in thousands): September 30, 2015 Designated Not Designated as Hedging as Hedging Designation: Instruments Instruments Foreign Interest Foreign Derivative contract type: Exchange Rate Exchange Derivative classification: Cash Flow Cash Flow Fair Value Fair value and location of derivative in the Consolidated Balance Sheet: Prepaids and other current assets $ $ — $ Other long-term assets — — Other current liabilities Other long-term liabilities — Total fair value of derivatives, net $ $ $ December 31, 2014 Designated Not Designated as Hedging as Hedging Designation: Instruments Instruments Foreign Interest Foreign Derivative contract type: Exchange Rate Exchange Derivative classification: Cash Flow Cash Flow Fair Value Fair value and location of derivative in the Consolidated Balance Sheet: Prepaids and other current assets $ $ — $ Other long-term assets — — Other current liabilities Other long-term liabilities — Total fair value of derivatives, net $ $ $ The effects of derivative instruments on the Consolidated Statements of Comprehensive Income (Loss) for the three months ended September 30, 2015 and 2014 were as follows (in thousands): Three Months Ended September 30, 2015 2014 Designated as Hedging Designated as Hedging Designation: Instruments Instruments Foreign Interest Foreign Interest Derivative contract type: Exchange Rate Exchange Rate Derivative classification: Cash Flow Cash Flow Cash Flow Cash Flow Amount of gain or (loss) recognized in Other comprehensive income (loss) - effective portion, net of tax $ $ $ $ Amount and location of net gain or (loss) reclassified from Accumulated OCI to income - effective portion: Revenue $ $ — $ $ — Interest expense — — Three Months Ended September 30, 2015 2014 Designation: Not Designated as Hedging Instruments Not Designated as Hedging Instruments Derivative contract type: Foreign Exchange Foreign Exchange Derivative classification: Forward Contracts Fair Value Forward Contracts Fair Value Amount and location of net gain or (loss) recognized in the Consolidated Statement of Comprehensive Income (Loss): Costs of services $ — $ — $ - $ - Other income (expense), net $ — $ $ - $ The effects of derivative instruments on the Consolidated Statements of Comprehensive Income (Loss) for the nine months ended September 30, 2015 and 2014 were as follows (in thousands): Nine Months Ended September 30, 2015 2014 Designated as Hedging Designated as Hedging Designation: Instruments Instruments Foreign Interest Foreign Interest Derivative contract type: Exchange Rate Exchange Rate Derivative classification: Cash Flow Cash Flow Cash Flow Cash Flow Amount of gain or (loss) recognized in Other comprehensive income (loss) - effective portion, net of tax $ $ $ $ Amount and location of net gain or (loss) reclassified from Accumulated OCI to income - effective portion: Revenue $ $ — $ $ — Interest expense — — Nine Months Ended September 30, 2015 2014 Designation: Not Designated as Hedging Instruments Not Designated as Hedging Instruments Derivative contract type: Foreign Exchange Foreign Exchange Derivative classification: Forward Contracts Fair Value Forward Contracts Fair Value Amount and location of net gain or (loss) recognized in the Consolidated Statement of Comprehensive Income (Loss): Costs of services $ — $ — $ - $ - Other income (expense), net $ — $ $ - $ |
FAIR VALUE
FAIR VALUE | 9 Months Ended |
Sep. 30, 2015 | |
FAIR VALUE [Abstract] | |
FAIR VALUE | (7) FAIR VALUE The authoritative guidance for fair value measurements establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires that the Company maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, similar assets and liabilities in markets that are not active or can be corroborated by observable market data. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The following presents information as of September 30, 2015 and December 31, 2014 for the Company’s assets and liabilities required to be measured at fair value on a recurring basis, as well as the fair value hierarchy used to determine their fair value. Accounts Receivable and Payable - The amounts recorded in the accompanying balance sheets approximate fair value because of their short-term nature. Debt - The Company’s debt consists primarily of the Company’s Credit Agreement, which permits floating-rate borrowings based upon the current Prime Rate or LIBOR plus a credit spread as determined by the Company’s leverage ratio calculation (as defined in the Credit Agreement). As of September 30, 2015 and Decem ber 31, 2014, the Company had $ 115.0 million and $ 100.0 million , respectively, of borrowings outstanding under the Credit Agreement. During the third quarter of 2015 outstanding borrowings accrued interest at an average rate of 1.2 % per annum, excluding unused commitment fees. The amounts recorded in the accompanying Balance Sheets approximate fair value due to the variable nature of the debt. Derivatives - Net derivative assets (liabilities) are measured at fair value on a recurring basis. The portfolio is valued using models based on market observable inputs, including both forward and spot foreign exchange rates, interest rates, implied volatility, and counterparty credit risk, including the ability of each party to execute its obligations under the contract. As of September 30, 2015, credit risk did not materially change the fair value of the Company’s derivative contracts. The following is a summary of the Company’s fair value measurements for its net derivative assets (liabilities) as of September 30, 2015 and December 31, 2014 (in thousands): As of September 30, 2015 Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs (Level 1) (Level 2) (Level 3) At Fair Value Cash flow hedges $ — $ $ — $ Interest rate swaps — — Fair value hedges — — Total net derivative asset (liability) $ — $ $ — $ As of December 31, 2014 Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs (Level 1) (Level 2) (Level 3) At Fair Value Cash flow hedges $ — $ $ — $ Interest rate swaps — — Fair value hedges — — Total net derivative asset (liability) $ — $ $ — $ The following is a summary of the Company’s fair value measurements as of September 30, 2015 and December 31, 2014 (in thousands): As of September 30, 2015 Fair Value Measurements Using Quoted Prices in Significant Active Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs (Level 1) (Level 2) (Level 3) Assets Derivative instruments, net $ — $ — $ — Total assets $ — $ — $ — Liabilities Deferred compensation plan liability $ — $ $ — Derivative instruments, net — — Contingent consideration — — Total liabilities $ — $ $ As of December 31, 2014 Fair Value Measurements Using Quoted Prices in Significant Active Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs (Level 1) (Level 2) (Level 3) Assets Derivative instruments, net $ — $ — $ — Total assets $ — $ — $ — Liabilities Deferred compensation plan liability $ — $ $ — Derivative instruments, net — — Contingent consideration — — Total liabilities $ — $ $ Deferred Compensation Plan — The Company maintains a non-qualified deferred compensation plan structured as a Rabbi trust for certain eligible employees. Participants in the deferred compensation plan select from a menu of phantom investment options for their deferral dollars offered by the Company each year, which are based upon changes in value of complementary, defined market investments. The deferred compensation liability represents the combined values of market investments against which participant accounts are tracked. Contingent Consideration — The Company recorded contingent consideration related to the acquisitions of iKnowtion, Guidon, TSG, WebMetro, Sofica and rogenSi. These contingent payables were recognized at fair value using a discounted cash flow approach and a discount rate of 21.0%, 21.0%, 4.6%, 5.3%, 5.0% or 4.6%, respectively. The discount rates vary dependant on the specific risks of each acquisition including the country of operation, the nature of services and complexity of the acquired business, and other similar factors. These measurements were based on significant inputs not observable in the market. The Company will record interest expense each period using the effective interest method until the future value of these contingent payables reaches their expected future value of $14.0 million. Interest expense related to all recorded contingent payables is included in Interest expense in the Consolidated Statements of Comprehensive Income (Loss). During the second and fourth quarters of 2014, the Company recorded fair value adjustments of the contingent consideration associated with the TSG reporting unit within the CTS segment based on revised estimates noting achievement of the targeted 2014 and 2015 EBITDA was remote. Accordingly, a $4.0 million and $3.9 million, respectively, reductions in the payable were recorded as of September 30, 2014 and December 31, 2014 and were included in Other income (expense) in the Consolidated Statements of Comprehensive Income (Loss). During the third and fourth quarters of 2014, the Company recorded fair value adjustments of the contingent consideration associated with the Sofica reporting unit within the CMS segment of $1.8 million and $0.6 million, respectively, as the Company’s revised estimates reflected Sofica exceeding its EBITDA targets for both 2014 and 2015. Accordingly, the $1.8 million and $0.6 million increases in the payable were recorded as of September 30, 2014 and December 31, 2014 and were included in Other income (expense) in the Consolidated Statements of Comprehensive Income (Loss). During the third quarter of 2014, the Company recorded a fair value adjustment of the contingent consideration associated with the WebMetro reporting unit within the CGS segment based on revised estimates noting achievement of the targeted 2014 EBITDA was remote. Accordingly, a $1.7 million reduction in the payable was recorded as of September 30, 2014 and was included in Other income (expense) in the Consolidated Statements of Comprehensive Income (Loss). During the fourth quarter of 2014 and the third quarter of 2015 , the Company recorded fair value adjustment s of the contingent consideration associated with the rogenSi reporting unit within the CSS segment based on revised estimates reflecting rogenSi exceeding its EBITDA targets for 2014 and 2015 . Accordingly a $0.5 million and a $0.8 million increase in the payable was recorded as of December 31, 2014 and September 30, 2015, respectively, and w ere included in Other income (expense) in the Consolidated Statements of Comprehensive Income (Loss). During the second quarter of 2015, the Company recorded a fair value adjustment of the contingent consideration associated with the Sofica reporting unit within the CMS segment based on revised estimates reflecting Sofica earnings will be lower than revised estimates for 2015. Accordingly a $0.5 million decrease in the payable was recorded as of September 30, 2015 and was included in Other income (expense) in the Consolidated Statements of Comprehensive Income (Loss). A rollforward of the activity in the Company’s fair value of the contingent consideration payable is as follows (in thousands): Imputed December 31, Interest / September 30, 2014 Acquisitions Payments Adjustments 2015 iKnowtion $ $ — $ $ $ Guidon — — — TSG — — — — — WebMetro — — — — — Sofica — rogenSi — Total $ $ — $ $ $ |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2015 | |
INCOME TAXES [ABSTRACT] | |
INCOME TAXES | (8) INCOME TAXES The Company accounts for income taxes in accordance with the accounting literature for income taxes, which requires recognition of deferred tax assets and liabilities for the expected future income tax consequences of transactions that have been included in the Consolidated Financial Statements. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using tax rates in effect for the year in which the differences are expected to reverse. Quarterly, the Company assesses the likelihood that its net deferred tax assets will be recovered. Based on the weight of all available evidence, both positive and negative, the Company records a valuation allowance against deferred tax assets when it is more-likely-than-not that a future tax benefit will not be realized. During the first quarter of 2014, a benefit of $1.2 million was recorded due to the closing of statutes of limitations in Canada. In accordance with ASC 740, the Company recorded a liability during the second quarter of 2015 of $ 1.75 million, inclusive of penalties and interest, for an uncertain tax position. See Note 1. When there is a judgment concerning the recovery of deferred tax assets in future periods, a valuation allowance is recorded into earnings during the quarter in which the judgment occurred. During the second quarter of 2015, the Company increased its valuation allowance by $0.8 million. This net increase was related to a $0.3 million increase in the Netherlands and Israel for deferred tax assets that do not meet the “more likely than not” standard under current accounting guidance, a $0.3 million increase related to deferred tax assets in the Philippines related to the future utilization of NOL’s, and a $0.2 million increase in various other jurisdictions. During the third quarter of 2015, the Company increased its valuation allowance by $0.7 million. This net increase was related to deferred tax assets in the Philippines for the future utilization of NOL’s. As of September 30, 2015, the Company had $ 51.3 million of gross deferred tax assets (after a $ 10.2 million valuation allowance) and net deferred tax assets (after deferred tax liabilities) of $ 48.6 million related to the U.S. and international tax jurisdictions whose recoverability is dependent upon future profitability. The effective tax rate for the three and nine months ended September 30, 2015 was 8.7 % and 21.9 % , respectively. The effective tax rate for the three and nine months ended September 30, 2014 was 28.2 % and 20.6 % , respectively. The Company’s U.S. income tax returns filed for the tax years ending December 31, 2012 to present remain open tax years. The Company has been notified of the intent to audit, or is currently under audit, of income taxes in the U.S. specifically for the acquired entity Technology Solutions Group for the tax year 2012 (prior to acquisition), for rogenSi in Hong Kong for the tax year 2014, Canada for tax years 2009 and 2010 and New Zealand for tax year the 2013 . Although the outcome of examinations by taxing authorities are always uncertain, it is the opinion of management that the resolution of these audits will not have a material effect on the Company’s Consolidated Financial Statements. |
RESTRUCTURING CHARGES AND IMPAI
RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES | 9 Months Ended |
Sep. 30, 2015 | |
RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES [Abstract] | |
RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES | (9) RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES Restructuring Charges During the three and nine months ended September 30, 2015 and 2014, the Company undertook a number of restructuring activities primarily associated with reductions in the Company’s capacity and workforce in several of its segments to better align the capacity and workforce with current business needs. A summary of the expenses recorded in Restructuring, net in the accompanying Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2015 and 2014, respectively, is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Reduction in force Customer Management Services $ $ $ $ Customer Growth Services — — — Customer Technology Services Customer Strategy Services — — Total $ $ $ $ A rollforward of the activity in the Company’s restructuring accruals is as follows (in thousands): Reduction in Force Total Balance as of December 31, 2014 $ $ Expense Payments Change in estimates - — Balance as of September 30, 2015 $ $ The remaining restructuring accruals are expected to be paid or extinguished during 2015 and are all classified as current liabilities within Other accrued expenses in the Consolidated Balance Sheets. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2015 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | (10) COMMITMENTS AND CONTINGENCIES Credit Facility In the second quarter of 2013, the Company entered into a $700.0 million, five-year, multi-currency revolving credit facility (the “Credit Agreement”) with a syndicate of lenders which includes an accordion feature that permits the Company to request an increase in total commitments up to $1.0 billion, under certain conditions. Wells Fargo Securities, LLC, KeyBank National Association, Bank of America Merrill Lynch, BBVA Compass and HSBC Bank USA, National Association served as Joint Lead Arrangers. The Credit Agreement amends and restates in its entirety the Company’s prior credit facility entered into during 2010 and amended in 2012. The Credit Agreement provides for a secured revolving credit facility that matures on June 3, 2018 with an initial maximum aggregate commitment of $700.0 million. At the Company’s discretion, direct borrowing options under the Credit Agreement include (i) Eurodollar loans with one, two, three, and six month terms, and/or (ii) overnight base rate loans. The Credit Agreement also provides for a sub-limit for loans or letters of credit in both U.S. dollars and certain foreign currencies, with direct foreign subsidiary borrowing capabilities up to 50% of the total commitment amount. The Company may increase the maximum aggregate commitment under the Credit Agreement to $1.0 billion if certain conditions are satisfied, including that the Company is not in default under the Credit Agreement at the time of the increase and that the Company obtains the commitment of the lenders participating in the increase. The Company primarily utilizes its Credit Agreement to fund working capital, general operations, stock repurchases, dividends and other strategic activities, such as the acquisitions described in Note 2. As of September 30, 2015 and December 31, 2014, the Company had borrowings of $ 115.0 million and $ 100.0 million , respectively, under its Credit Agreement, and its average daily utilization was $ 323.0 million and $ 291.0 million for the nine months ended September 30, 2015 and 2014, respectively. After consideration for issued letters of credit under the Credit Agreement, totaling $ 3.4 million, and current level of availability based on covenant calculations, the Company’s remaining borrowing capacity was approximately $ 385 million as of September 30, 2015. As of September 30, 2015, the Company was in compliance with all covenants and conditions under its Credit Agreement. From time-to-time, the Company has unsecured, uncommitted lines of credit to support working capital for a few foreign subsidiaries. As of September 30, 2015, no foreign loans were outstanding. Letters of Credit As of September 30, 2015, outstanding letters of credit under the Credit Agreement totaled $ 3.4 million and primarily guaranteed workers’ compensation and other insurance related obligations. As of September 30, 2015, letters of credit and contract performance guarantees issued outside of the Credit Agreement totaled $ 4.5 million. Legal Proceedings From time to time, the Company has been involved in legal actions, both as plaintiff and defendant, which arise in the ordinary course of business. The Company accrues for exposures associated with such legal actions to the extent that losses are deemed both probable and estimable. To the extent specific reserves have not been made for certain legal proceedings, their ultimate outcome, and consequently, an estimate of possible loss, if any, cannot reasonably be determined at this time. Based on currently available information and advice received from counsel, the Company believes that the disposition or ultimate resolution of any current legal proceedings, except as otherwise specifically reserved for in its financial statements, will not have a material adverse effect on the Company’s financial position, cash flows or results of operations. |
NONCONTROLLING INTEREST
NONCONTROLLING INTEREST | 9 Months Ended |
Sep. 30, 2015 | |
NONCONTROLLING INTEREST [Abstract] | |
Noncontrollling Interest | (11) NONCONTROLLING INTEREST The following table reconciles equity attributable to noncontrolling interest (in thousands): Nine Months Ended September 30, 2015 2014 Noncontrolling interest, January 1 $ $ Net income attributable to noncontrolling interest Dividends distributed to noncontrolling interest Foreign currency translation adjustments Equity-based compensation expense Noncontrolling interest, September 30, $ $ |
MANDATORILY REDEEMABLE NONCONTR
MANDATORILY REDEEMABLE NONCONTROLLING INTEREST | 9 Months Ended |
Sep. 30, 2015 | |
Mandatorily Redeemable Noncontrolling Interest [Abstract] | |
Mandatorily Redeemable Noncontrolling Interest | (12) MANDATORILY REDEEMABLE NONCONTROLLING INTEREST The Company holds an 80% interest in iKnowtion. In the event iKnowtion meets certain EBITDA targets for calendar year 2015, the purchase and sale agreement requires TeleTech to purchase the remaining 20% interest in iKnowtion in 2016 for an amount equal to a multiple of iKnowtion’s 2015 EBITDA as defined in the purchase and sale agreement. These terms represent a contingent redemption feature which the Company determined is probable of being achieved. The Company has recorded the mandatorily redeemable noncontrolling interest at the redemption value based on the corresponding EBITDA multiples as prescribed in the purchase and sale agreement at the end of each reporting period. At the end of each reporting period the changes in the redemption value are recorded in retained earnings. Since the EBITDA multiples as defined in the purchase and sale agreement are below the current market multiple, the Company has determined that there is no preferential treatment to the noncontrolling interest shareholders resulting in no impact to earnings per share. A rollforward of the mandatorily redeemable noncontrolling interest is included in the table below (in thousands). Nine Months Ended September 30, 2015 2014 Mandatorily redeemable noncontrolling interest, January 1 $ $ Net income attributable to mandatorily redeemable noncontrolling interest Working capital distributed to mandatorily redeemable noncontrolling interest Change in redemption value Mandatorily redeemable noncontrolling interest, September 30 $ $ |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 9 Months Ended |
Sep. 30, 2015 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) [ABSTRACT] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | (13) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following table presents changes in the accumulated balance for each component of other comprehensive income (loss), including current period other comprehensive income (loss) and reclassifications out of accumulated other comprehensive income (loss) (in thousands): e Foreign Currency Derivative Translation Valuation, Net Other, Net Adjustment of Tax of Tax Totals Accumulated other comprehensive income (loss) at December 31, 2014 $ $ $ $ Other comprehensive income (loss) before reclassifications Amounts reclassified from accumulated other comprehensive income (loss) — Net current period other comprehensive income (loss) Accumulated other comprehensive income (loss) at September 30, 2015 $ $ $ $ Accumulated other comprehensive income (loss) at December 31, 2013 $ $ $ $ Other comprehensive income (loss) before reclassifications Amounts reclassified from accumulated other comprehensive income (loss) — Net current period other comprehensive income (loss) Accumulated other comprehensive income (loss) at September 30, 2014 $ $ $ $ The following table presents the classification and amount of the reclassifications from Accumulated other comprehensive income (loss) to the statement of comprehensive income (loss) (in thousands): Statement of For the Three Months Ended September 30, Comprehensive Income 2015 2014 (Loss) Classification Derivative valuation Gain (loss) on foreign currency forward exchange contracts $ $ Revenue Loss on interest rate swaps Interest expense Tax effect Provision for income taxes $ $ Net income (loss) Other Actuarial loss on defined benefit plan $ $ Cost of services Tax effect Provision for income taxes $ $ Net income (loss) Statement of For the Nine Months Ended September 30, Comprehensive Income 2015 2014 (Loss) Classification Derivative valuation Gain (loss) on foreign currency forward exchange contracts $ $ Revenue Loss on interest rate swaps Interest expense Tax effect Provision for income taxes $ $ Net income (loss) Other Actuarial loss on defined benefit plan $ $ Cost of services Tax effect Provision for income taxes $ $ Net income (loss) |
NET INCOME PER SHARE
NET INCOME PER SHARE | 9 Months Ended |
Sep. 30, 2015 | |
NET INCOME PER SHARE [Abstract] | |
NET INCOME PER SHARE | (14) NET INCOME PER SHARE The following table sets forth the computation of basic and diluted shares for the periods indicated (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Shares used in basic earnings per share calculation Effect of dilutive securities: Stock options Restricted stock units Performance-based restricted stock units — — Total effects of dilutive securities Shares used in dilutive earnings per share calculation For the three months ended September 30, 2015 and 2014, options to purchase 0.1 million and 0.1 million shares of common stock, respectively, were outstanding, but not included in the computation of diluted net income per share because the exercise price exceeded the value of the shares and the effect would have been anti-dilutive. For the nine months ended September 30, 2015 and 2014, options to purchase 0.1 million and 0.1 million shares of common stock, respectively, were outstanding, but not included in the computation of diluted net income per share because the exercise price exceeded the value of the shares and the effect would have been anti-dilutive. For the three months ended September 30, 2015 and 2014, restricted stock units (“RSUs”) of 0.2 million and 0.4 million, respectively, were outstanding, but not included in the computation of diluted net income per share because the effect would have been anti-dilutive. For the nine months ended September 30, 2015 and 2014, RSUs of 0.4 million and 0.2 million, respectively, were outstanding, but not included in the computation of diluted net income per share because the effect would have been anti-dilutive. |
OVERVIEW AND BASIS OF PRESENT22
OVERVIEW AND BASIS OF PRESENTATION (POLICIES) | 9 Months Ended |
Sep. 30, 2015 | |
OVERVIEW AND BASIS OF PRESENTATION [Abstract] | |
Overview | Summary of Business TeleTech Holdings, Inc. and its subsidiaries (“TeleTech” or the “Company”) is a customer engagement management services provider, delivering integrated consulting, technology, growth and customer care solutions on a global scale. Our suite of product and service capabilities allows us to design and deliver enhanced, value-driven customer experiences across numerous communication channels. TeleTech’s 41,000 employees serve clients in the automotive, communication, financial services, government, healthcare, logistics, media and entertainment, retail, technology, transportation and travel industries via operations in the U.S., Australia, Belgium, Brazil, Bulgaria, Canada, China, Costa Rica, Germany, Hong Kong, Ireland, Israel, Lebanon, Macedonia, Mexico, New Zealand, the Philippines, Poland, Singapore, South Africa, Thailand, Turkey, the United Arab Emirates, and the United Kingdom. |
Basis Of Presentation | Basis of Presentation The Consolidated Financial Statements are comprised of the accounts of TeleTech, its wholly owned subsidiaries, its 55% equity owned subsidiary Percepta, LLC, and its 80% interest in iKnowtion, LLC. All intercompany balances and transactions have been eliminated in consolidation. The unaudited Consolidated Financial Statements do not include all of the disclosures required by accounting principles generally accepted in the U.S. (“GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited Consolidated Financial Statements reflect all adjustments which, in the opinion of management, are necessary to state fairly the consolidated financial position of the Company and the consolidated results of operations and comprehensive income (loss) and the consolidated cash flows of the Company. Operating results for the periods presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. During the three months ended June 30, 2015, an additional expense of $1.75 million was recorded as an additional estimated tax liability that should have been recorded in prior periods related to ongoing discussions with relevant government authorities related to site compliance with tax advantaged status. The total amount of $1.75 million should have been recorded as additional tax expense in the amount of $466 thousand in 2012, $406 thousand in 2013, $645 thousand in 2014 and $234 thousand in the first quarter of 2015. During the three months ended June 30, 2015, the Company recorded an additional $3.2 million loss related to foreign currency translation within Other comprehensive income (loss) that should have been recorded in 2014 and the three months ended March 31, 2015 to correct for an error in translating the financial results of Sofica Group AD, which we acquired on February 28, 2014. Of the $3.2 million recorded, approximately $1.7 million and $1.5 million should have been recorded in the year ended December 31, 2014 and the three months ended March 31, 2015, respectively. The Company also recorded an additional $2.7 million loss to “Other, net of tax” within Other comprehensive income (loss) in the three months ended March 31, 2015 and the nine months ended September 30, 2015 related to the annual actuarial analysis for the Company’s Philippines pension liability that should have been recorded in the fourth quarter of 2014. The Company has evaluated the aggregate impact of these adjustments and concluded that these adjustments were not material to the previously issued or current period consolidated financial statements. These unaudited Consolidated Financial Statements should be read in conjunction with the Company’s audited Consolidated financial Statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. |
Use of Estimates | Use of Estimates The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions in determining the reported amounts of assets and liabilities, disclosure of contingent liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenue and expenses during the reporting period. On an on-going basis, the Company evaluates its estimates including those related to derivatives and hedging activities, income taxes including the valuation allowance for deferred tax assets, self-insurance reserves, litigation reserves, restructuring reserves, allowance for doubtful accounts, contingent consideration, and valuation of goodwill, long-lived and intangible assets. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ materially from these estimates under different assumptions or conditions. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In April 2015, the FASB issued ASU No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs”. ASU 2015-03 requires all costs incurred in connection with the issuance of debt to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability. This ASU is effective for interim and annual periods beginning on or after December 15, 2015 and early adoption is permitted. The Company is evaluating when it will adopt the standard but does not expect the adoption of this standard to have a material impact on its financial position, results of operation or related disclosures. In September 2015, the FASB issued ASU 2015-16, “Simplifying the Accounting for Measurement-Period Adjustments”. ASU 2015-16 requires that the cumulative impact of all measurement period adjustments be recorded in the period in which the adjustment is identified. This change eliminates the requirement to restate prior financial statements. The ASU is effective for interim and annual periods beginning on or after December 15, 2015 and can be early adopted for periods for which the financial statements have not yet been issued. The Company took advantage of the early adoption provision and adopted the standard during the quarter ended September 30, 2015. It did not have a material impact on its financial position, results of operation or related disclosures. |
ACQUISITIONS (TABLES)
ACQUISITIONS (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
ACQUISITIONS [ABSTRACT] | |
Schedule of Assets Acquired and Liabilities Assumed | The following summarizes the fair values of the identifiable assets acquired and liabilities assumed as of the acquisition date (in thousands): Acquisition Date Fair Value Cash $ Accounts receivable, net Other assets Property, plant and equipment Deferred tax assets, net Customer relationships Tradename / trademarks Non-compete agreements Goodwill Accounts payable Accrued employee compensation and benefits Accrued expenses Other Total purchase price $ |
SEGMENT INFORMATION (TABLES)
SEGMENT INFORMATION (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
SEGMENT INFORMATION [ABSTRACT] | |
Schedule of Segment Selected Financial Data | The following tables present certain financial data by segment (in thousands): Three Months Ended September 30, 2015 Depreciation Income Gross Intersegment Net & (Loss) from Revenue Sales Revenue Amortization Operations Customer Management Services $ $ — $ $ $ Customer Growth Services — Customer Technology Services Customer Strategy Services — Total $ $ $ $ $ Three Months Ended September 30, 2014 Depreciation Income Gross Intersegment Net & (Loss) from Revenue Sales Revenue Amortization Operations Customer Management Services $ $ — $ $ $ Customer Growth Services — Customer Technology Services Customer Strategy Services — Total $ $ $ $ $ Nine months Ended September 30, 2015 Depreciation Income Gross Intersegment Net & (Loss) from Revenue Sales Revenue Amortization Operations Customer Management Services $ $ — $ $ $ Customer Growth Services — Customer Technology Services Customer Strategy Services — Total $ $ $ $ $ Nine months Ended September 30, 2014 Depreciation Income Gross Intersegment Net & (Loss) from Revenue Sales Revenue Amortization Operations Customer Management Services $ $ — $ $ $ Customer Growth Services — Customer Technology Services Customer Strategy Services — Total $ $ $ $ $ Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Capital Expenditures Customer Management Services $ $ $ $ Customer Growth Services Customer Technology Services Customer Strategy Services Total $ $ $ $ September 30, December 31, 2015 2014 Total Assets Customer Management Services $ $ Customer Growth Services Customer Technology Services Customer Strategy Services Total $ $ September 30, December 31, 2015 2014 Goodwill Customer Management Services $ $ Customer Growth Services Customer Technology Services Customer Strategy Services Total $ $ |
Schedule of Revenue by Geographic Area | The following table presents revenue based upon the geographic location where the services are provided (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Revenue United States $ $ $ $ Philippines Latin America Europe / Middle East / Africa Asia Pacific Canada Total $ $ $ $ |
GOODWILL (TABLES)
GOODWILL (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
GOODWILL [ABSTRACT] | |
Schedule of Goodwill Rollforward | Goodwill consisted of the following (in thousands): Effect of December 31, Acquisitions / Foreign September 30, 2014 Adjustments Impairments Currency 2015 Customer Management Services $ $ — $ — $ $ Customer Growth Services — — Customer Technology Services — — — Customer Strategy Services — Total $ $ $ $ $ |
DERIVATIVES (TABLES)
DERIVATIVES (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
DERIVATIVES [ABSTRACT] | |
Schedule of Cash Flow Hedges OCI Rollforward | The following table summarizes the aggregate unrealized net gain or loss in Accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2015 and 2014 (in thousands and net of tax): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Aggregate unrealized net gain/(loss) at beginning of period Add: Net gain/(loss) from change in fair value of cash flow hedges Less: Net (gain)/loss reclassified to earnings from effective hedges Aggregate unrealized net gain/(loss) at end of period $ $ $ $ |
Schedule of Notional Amounts of Outstanding Cash Flow Hedges | The Company’s foreign exchange cash flow hedging instruments as of September 30, 2015 and December 31, 2014 are summarized as follows (amounts in thousands). All hedging instruments are forward contracts unless noted otherwise. Local Currency U.S. Dollar % Maturing Contracts Notional Notional in the next Maturing As of September 30, 2015 Amount Amount 12 months Through Philippine Peso (1) % February 2020 Mexican Peso % July 2020 $ Local Currency U.S. Dollar Notional Notional As of December 31, 2014 Amount Amount Canadian Dollar $ Philippine Peso (1) Mexican Peso New Zealand Dollar $ (1) Includes contracts to purchase Philippine pesos in exchange for New Zealand dollars and Australian dollars, which are translated into equivalent U.S. dollars on September 30, 2015 and December 31, 2014. |
Schedule of Interest Rate Swaps | Contract Contract Notional Variable Rate Fixed Rate Commencement Maturity Amount Received Paid Date Date Swap 1 $ 25 million 1 - month LIBOR % April 2012 April 2016 Swap 2 15 million 1 - month LIBOR % May 2012 May 2017 $ 40 million |
Schedule of Derivatives Instruments on Balance Sheet | The Company’s derivatives as of September 30, 2015 and December 31, 2014 were as follows (in thousands): September 30, 2015 Designated Not Designated as Hedging as Hedging Designation: Instruments Instruments Foreign Interest Foreign Derivative contract type: Exchange Rate Exchange Derivative classification: Cash Flow Cash Flow Fair Value Fair value and location of derivative in the Consolidated Balance Sheet: Prepaids and other current assets $ $ — $ Other long-term assets — — Other current liabilities Other long-term liabilities — Total fair value of derivatives, net $ $ $ December 31, 2014 Designated Not Designated as Hedging as Hedging Designation: Instruments Instruments Foreign Interest Foreign Derivative contract type: Exchange Rate Exchange Derivative classification: Cash Flow Cash Flow Fair Value Fair value and location of derivative in the Consolidated Balance Sheet: Prepaids and other current assets $ $ — $ Other long-term assets — — Other current liabilities Other long-term liabilities — Total fair value of derivatives, net $ $ $ |
Schedule of Derivative Impact on Statement of Comprehensive Income | The effects of derivative instruments on the Consolidated Statements of Comprehensive Income (Loss) for the three months ended September 30, 2015 and 2014 were as follows (in thousands): Three Months Ended September 30, 2015 2014 Designated as Hedging Designated as Hedging Designation: Instruments Instruments Foreign Interest Foreign Interest Derivative contract type: Exchange Rate Exchange Rate Derivative classification: Cash Flow Cash Flow Cash Flow Cash Flow Amount of gain or (loss) recognized in Other comprehensive income (loss) - effective portion, net of tax $ $ $ $ Amount and location of net gain or (loss) reclassified from Accumulated OCI to income - effective portion: Revenue $ $ — $ $ — Interest expense — — Three Months Ended September 30, 2015 2014 Designation: Not Designated as Hedging Instruments Not Designated as Hedging Instruments Derivative contract type: Foreign Exchange Foreign Exchange Derivative classification: Forward Contracts Fair Value Forward Contracts Fair Value Amount and location of net gain or (loss) recognized in the Consolidated Statement of Comprehensive Income (Loss): Costs of services $ — $ — $ - $ - Other income (expense), net $ — $ $ - $ The effects of derivative instruments on the Consolidated Statements of Comprehensive Income (Loss) for the nine months ended September 30, 2015 and 2014 were as follows (in thousands): Nine Months Ended September 30, 2015 2014 Designated as Hedging Designated as Hedging Designation: Instruments Instruments Foreign Interest Foreign Interest Derivative contract type: Exchange Rate Exchange Rate Derivative classification: Cash Flow Cash Flow Cash Flow Cash Flow Amount of gain or (loss) recognized in Other comprehensive income (loss) - effective portion, net of tax $ $ $ $ Amount and location of net gain or (loss) reclassified from Accumulated OCI to income - effective portion: Revenue $ $ — $ $ — Interest expense — — Nine Months Ended September 30, 2015 2014 Designation: Not Designated as Hedging Instruments Not Designated as Hedging Instruments Derivative contract type: Foreign Exchange Foreign Exchange Derivative classification: Forward Contracts Fair Value Forward Contracts Fair Value Amount and location of net gain or (loss) recognized in the Consolidated Statement of Comprehensive Income (Loss): Costs of services $ — $ — $ - $ - Other income (expense), net $ — $ $ - $ |
FAIR VALUE (TABLES)
FAIR VALUE (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
FAIR VALUE [Abstract] | |
Schedule of Fair Value Derivative Assets and Liabilities | The following is a summary of the Company’s fair value measurements for its net derivative assets (liabilities) as of September 30, 2015 and December 31, 2014 (in thousands): As of September 30, 2015 Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs (Level 1) (Level 2) (Level 3) At Fair Value Cash flow hedges $ — $ $ — $ Interest rate swaps — — Fair value hedges — — Total net derivative asset (liability) $ — $ $ — $ As of December 31, 2014 Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs (Level 1) (Level 2) (Level 3) At Fair Value Cash flow hedges $ — $ $ — $ Interest rate swaps — — Fair value hedges — — Total net derivative asset (liability) $ — $ $ — $ |
Schedule of Fair Value Assets and Liabilities | The following is a summary of the Company’s fair value measurements as of September 30, 2015 and December 31, 2014 (in thousands): As of September 30, 2015 Fair Value Measurements Using Quoted Prices in Significant Active Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs (Level 1) (Level 2) (Level 3) Assets Derivative instruments, net $ — $ — $ — Total assets $ — $ — $ — Liabilities Deferred compensation plan liability $ — $ $ — Derivative instruments, net — — Contingent consideration — — Total liabilities $ — $ $ As of December 31, 2014 Fair Value Measurements Using Quoted Prices in Significant Active Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs (Level 1) (Level 2) (Level 3) Assets Derivative instruments, net $ — $ — $ — Total assets $ — $ — $ — Liabilities Deferred compensation plan liability $ — $ $ — Derivative instruments, net — — Contingent consideration — — Total liabilities $ — $ $ |
Schedule of Business Acquistions by Acquisition Contingent Consideration | A rollforward of the activity in the Company’s fair value of the contingent consideration payable is as follows (in thousands): Imputed December 31, Interest / September 30, 2014 Acquisitions Payments Adjustments 2015 iKnowtion $ $ — $ $ $ Guidon — — — TSG — — — — — WebMetro — — — — — Sofica — rogenSi — Total $ $ — $ $ $ |
RESTRUCTURING CHARGES AND IMP28
RESTRUCTURING CHARGES AND IMPAIRMENT (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES [Abstract] | |
Schedule of Restructuring Liabilities | A summary of the expenses recorded in Restructuring, net in the accompanying Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2015 and 2014, respectively, is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Reduction in force Customer Management Services $ $ $ $ Customer Growth Services — — — Customer Technology Services Customer Strategy Services — — Total $ $ $ $ |
Schedule of Restructuring Liability Rollforward | Reduction in Force Total Balance as of December 31, 2014 $ $ Expense Payments Change in estimates - — Balance as of September 30, 2015 $ $ |
NONCONTROLLING INTEREST (TABLES
NONCONTROLLING INTEREST (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
NONCONTROLLING INTEREST [Abstract] | |
Noncontrolling Interest Rollforward | Nine Months Ended September 30, 2015 2014 Noncontrolling interest, January 1 $ $ Net income attributable to noncontrolling interest Dividends distributed to noncontrolling interest Foreign currency translation adjustments Equity-based compensation expense Noncontrolling interest, September 30, $ $ |
MANDATORILY REDEEMABLE NONCON30
MANDATORILY REDEEMABLE NONCONTROLLING INTEREST (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
Mandatorily Redeemable Noncontrolling Interest [Abstract] | |
Mandatorily Redeemable Noncontrolling Interest Rollforward | Nine Months Ended September 30, 2015 2014 Mandatorily redeemable noncontrolling interest, January 1 $ $ Net income attributable to mandatorily redeemable noncontrolling interest Working capital distributed to mandatorily redeemable noncontrolling interest Change in redemption value Mandatorily redeemable noncontrolling interest, September 30 $ $ |
ACCUMULATED OTHER COMPREHENSI31
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) [ABSTRACT] | |
Other Comprehensive Income Attributable to TeleTech Shareholders Table | The following table presents changes in the accumulated balance for each component of other comprehensive income (loss), including current period other comprehensive income (loss) and reclassifications out of accumulated other comprehensive income (loss) (in thousands): e Foreign Currency Derivative Translation Valuation, Net Other, Net Adjustment of Tax of Tax Totals Accumulated other comprehensive income (loss) at December 31, 2014 $ $ $ $ Other comprehensive income (loss) before reclassifications Amounts reclassified from accumulated other comprehensive income (loss) — Net current period other comprehensive income (loss) Accumulated other comprehensive income (loss) at September 30, 2015 $ $ $ $ Accumulated other comprehensive income (loss) at December 31, 2013 $ $ $ $ Other comprehensive income (loss) before reclassifications Amounts reclassified from accumulated other comprehensive income (loss) — Net current period other comprehensive income (loss) Accumulated other comprehensive income (loss) at September 30, 2014 $ $ $ $ |
Income Statement Location of Adjustments Reclassified from Accumulated Other Comprehensive Income to Income | The following table presents the classification and amount of the reclassifications from Accumulated other comprehensive income (loss) to the statement of comprehensive income (loss) (in thousands): Statement of For the Three Months Ended September 30, Comprehensive Income 2015 2014 (Loss) Classification Derivative valuation Gain (loss) on foreign currency forward exchange contracts $ $ Revenue Loss on interest rate swaps Interest expense Tax effect Provision for income taxes $ $ Net income (loss) Other Actuarial loss on defined benefit plan $ $ Cost of services Tax effect Provision for income taxes $ $ Net income (loss) Statement of For the Nine Months Ended September 30, Comprehensive Income 2015 2014 (Loss) Classification Derivative valuation Gain (loss) on foreign currency forward exchange contracts $ $ Revenue Loss on interest rate swaps Interest expense Tax effect Provision for income taxes $ $ Net income (loss) Other Actuarial loss on defined benefit plan $ $ Cost of services Tax effect Provision for income taxes $ $ Net income (loss) |
NET INCOME PER SHARE (TABLES)
NET INCOME PER SHARE (TABLES) | 9 Months Ended |
Sep. 30, 2015 | |
NET INCOME PER SHARE [Abstract] | |
Schedule of Diluted Shares Calculation | The following table sets forth the computation of basic and diluted shares for the periods indicated (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Shares used in basic earnings per share calculation Effect of dilutive securities: Stock options Restricted stock units Performance-based restricted stock units — — Total effects of dilutive securities Shares used in dilutive earnings per share calculation |
OVERVIEW AND BASIS OF PRESENT33
OVERVIEW AND BASIS OF PRESENTATION (NARRATIVE) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Sofica [Member] | ||||||
UNUSUAL OR INFREQUENT ITEM [Line Items] | ||||||
Other comprehensive income before reclassifications - foreign currency translation adjustment | $ 3,200 | $ 1,500 | $ 1,700 | |||
Philippines pension liability [Member] | ||||||
UNUSUAL OR INFREQUENT ITEM [Line Items] | ||||||
Other, net of tax | 2,700 | |||||
Government Authorities [Member] | ||||||
UNUSUAL OR INFREQUENT ITEM [Line Items] | ||||||
Tax Adjustments, Settlements, and Unusual Provisions | $ 1,750 | $ 234 | $ 645 | $ 406 | $ 466 |
ACQUISITIONS (ASSETS ACQUIRED T
ACQUISITIONS (ASSETS ACQUIRED TABLE) (DETAILS) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Aug. 08, 2014 |
Business Acquisition [Line Items] | |||
Total deferred tax assets, net | $ 51,300 | ||
Goodwill | 118,784 | $ 128,705 | |
Accrued employee compensation and benefits | $ 71,937 | $ 70,069 | |
rogenSi [Member] | |||
Business Acquisition [Line Items] | |||
Cash | $ 2,670 | ||
Accounts receivable | 6,417 | ||
Property, plant and equipment | 578 | ||
Other assets | 2,880 | ||
Total deferred tax assets, net | 449 | ||
Customer relationships | 6,331 | ||
Tradename / trademarks | 5,545 | ||
Non-compete agreements | 927 | ||
Goodwill | 17,260 | ||
Total assets acquired | 43,057 | ||
Accounts payable | 708 | ||
Accrued employee compensation and benefits | 2,203 | ||
Accrued expenses | 1,146 | ||
Other | 4,597 | ||
Total liabilities assumed | 8,654 | ||
Total purcahse price | $ 34,403 |
ACQUISITIONS (NARRATIVE) (DETAI
ACQUISITIONS (NARRATIVE) (DETAILS) - USD ($) | 2 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended | 12 Months Ended | |||
Feb. 28, 2014 | Sep. 30, 2015 | Mar. 31, 2015 | Sep. 30, 2014 | Aug. 08, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Business Acquisition [Line Items] | ||||||||
Valuation Technique on Contingent Consideration | Contingent Consideration - The Company recorded contingent consideration related to the acquisitions of iKnowtion, Guidon, TSG, WebMetro, Sofica and rogenSi. These contingent payables were recognized at fair value using a discounted cash flow approach and a discount rate of 21.0%, 21.0%, 4.6%, 5.3%, 5.0% or 4.6%, respectively. The discount rates vary dependant on the specific risks of each acquisition including the country of operation, the nature of services and complexity of the acquired business, and other similar factors. These measurements were based on significant inputs not observable in the market. The Company will record interest expense each period using the effective interest method until the future value of these contingent payables reaches their expected future value of $14.0 million. Interest expense related to all recorded contingent payables is included in Interest expense in the Consolidated Statements of Comprehensive Income (Loss). | |||||||
Contingent Consideration, at fair value | $ 13,556,000 | $ 13,556,000 | $ 24,744,000 | |||||
Revenue of Acquirees since Acquisition Date, Actual | 14,600,000 | $ 8,500,000 | 41,900,000 | $ 14,500,000 | ||||
Income (loss) from operations of Acquirees since Acquisition Date, Actual | 3,300,000 | 1,400,000 | 6,400,000 | $ 2,100,000 | ||||
Business Combination Pro Forma Information Amortization Expense of Acquirees Since Acquisition | 300,000 | $ 400,000 | 1,700,000 | $ 700,000 | ||||
Sofica [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Percentage of Voting Interests Acquired | 100.00% | |||||||
Description of Acquired Entity | Sofica provides customer lifecycle management and other business process services across multiple channels in multiple sites in over 18 languages. | |||||||
Cost of Acquired Entity, Up Front Cash Consideration | $ 9,400,000 | |||||||
Future Value of Liabilities Incurred From Business Acquisitions | $ 3,800,000 | |||||||
Valuation Technique on Contingent Consideration | The fair value of the contingent consideration was measured based on significant inputs not observable in the market (Level 3 inputs). Key assumptions include a discount rate of 5.0% and expected future value of payments of $4.0 million. The $4.0 million of expected future payments was calculated using a probability weighted EBITDA assessment with the highest probability associated with Sofica achieving the targeted EBITDA for each earn-out year. | |||||||
Acquisition hold-back payment | $ 1,000,000 | |||||||
Discount rate | 5.00% | |||||||
Contingent Consideration Arrangements, Basis for Amount | . The total contingent consideration possible per the stock purchase agreement ranges from zero to $7.5 million. Additionally, the purchase price includes a $1.0 million hold-back payment for contingencies as defined in the stock purchase agreement which will be paid in the second quarter of 2016, if required. | |||||||
Contingent Consideration, at fair value | $ 4,000,000 | |||||||
Contingent Consideration, at Fair Value, Current Portion | 3,100,000 | 3,100,000 | ||||||
rogenSi [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Description of Acquired Entity | rogenSi Worldwide PTY, Ltd., a global leadership, change management, sales, performance training and consulting company. | |||||||
Business Acquisition, Purchase Price Allocation, Assets Acquired (Liabilities Assumed), Net | $ 34,403,000 | |||||||
Cost of Acquired Entity, Up Front Cash Consideration | 18,100,000 | |||||||
Future Value of Liabilities Incurred From Business Acquisitions | $ 15,300,000 | |||||||
Valuation Technique on Contingent Consideration | The fair value of the contingent consideration was measured by applying a probability weighted discounted cash flow model based on significant inputs not observable in the market (Level 3 inputs). Key assumptions include a discount rate of 4.6% and expected future value of payments of $15.3 million. The $15.3 million of expected future payments was calculated using a probability weighted EBITDA assessment with the highest probability associated with rogenSi achieving the targeted EBITDA for each earn-out year | |||||||
Acquisition hold-back payment | $ 1,800,000 | |||||||
Discount rate | 4.60% | |||||||
Contingent Consideration Arrangements, Basis for Amount | The total contingent consideration possible per the sale and purchase agreement ranges from zero to $17.6 million and the earn-out payments are payable in early 2015, 2016 and 2017, based on July 1, 2014 through December 31, 2014, and full year 2015 and 2016 performance, respectively. | |||||||
Contingent Consideration, at fair value | $ 14,500,000 | |||||||
Contingent Consideration, at Fair Value, Current Portion | 5,900,000 | 5,900,000 | ||||||
Contingent Consideration, at Fair Value, Noncurrent Portion | 4,000,000 | 4,000,000 | ||||||
rogenSi [Member] | Customer Relationships [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Finite-lived Intangible Assets, Fair Value Disclosure | 70 | 70 | ||||||
rogenSi [Member] | Non-compete agreements useful lives [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Finite-lived Intangible Assets, Fair Value Disclosure | $ 30 | $ 30 | ||||||
CafeX [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Cost Method Investments Description | the Company invested $9.0 million in CafeX Communications, Inc. (“CafeX”) through the purchase of a portion of the Series B Preferred Stock of CafeX. After the transaction, the Company owns 17.3% of the total equity of CafeX. |
SEGMENT INFORMATION (SEGMENT FI
SEGMENT INFORMATION (SEGMENT FINANCIALS) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Segment Reporting Information [Line Items] | |||||
Gross Revenue | $ 309,202 | $ 305,909 | $ 944,960 | $ 903,639 | |
Intersegment Sales | (7) | (9) | (21) | (28) | |
Net Revenue | 309,195 | 305,900 | 944,939 | 903,611 | |
Depreciation and amortization | 15,486 | 13,893 | 46,529 | 41,152 | |
Income (Loss) from Operations | 15,625 | 21,323 | 65,105 | 66,347 | |
Capital Expenditures | 19,679 | 17,751 | 49,184 | 52,234 | |
Total Assets | 858,215 | 858,215 | $ 852,475 | ||
Goodwill | 118,784 | 118,784 | 128,705 | ||
Customer Management Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Gross Revenue | 212,690 | 226,814 | 675,015 | 673,421 | |
Intersegment Sales | 0 | 0 | 0 | 0 | |
Net Revenue | 212,690 | 226,814 | 675,015 | 673,421 | |
Depreciation and amortization | 10,900 | 9,973 | 32,750 | 29,607 | |
Income (Loss) from Operations | 8,930 | 18,625 | 43,956 | 55,941 | |
Capital Expenditures | 13,529 | 13,891 | 35,545 | 38,390 | |
Total Assets | 513,744 | 513,744 | 514,957 | ||
Goodwill | 23,797 | 23,797 | 25,871 | ||
Customer Growth Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Gross Revenue | 33,853 | 28,765 | 90,379 | 86,545 | |
Intersegment Sales | 0 | 0 | 0 | 0 | |
Net Revenue | 33,853 | 28,765 | 90,379 | 86,545 | |
Depreciation and amortization | 1,535 | 1,511 | 4,543 | 4,535 | |
Income (Loss) from Operations | (257) | 1,800 | 1,891 | 5,401 | |
Capital Expenditures | 1,148 | 1,270 | 4,285 | 2,939 | |
Total Assets | 78,432 | 78,432 | 88,394 | ||
Goodwill | 27,329 | 27,329 | 30,395 | ||
Customer Technology Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Gross Revenue | 42,141 | 35,203 | 115,956 | 103,735 | |
Intersegment Sales | (7) | (9) | (21) | (28) | |
Net Revenue | 42,134 | 35,194 | 115,935 | 103,707 | |
Depreciation and amortization | 2,447 | 1,927 | 6,806 | 5,650 | |
Income (Loss) from Operations | 3,774 | (286) | 9,033 | 1,641 | |
Capital Expenditures | 4,883 | 2,371 | 8,950 | 10,409 | |
Total Assets | 177,975 | 177,975 | 159,441 | ||
Goodwill | 42,709 | 42,709 | 42,709 | ||
Customer Strategy Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Gross Revenue | 20,518 | 15,127 | 63,610 | 39,938 | |
Intersegment Sales | 0 | 0 | 0 | 0 | |
Net Revenue | 20,518 | 15,127 | 63,610 | 39,938 | |
Depreciation and amortization | 604 | 482 | 2,430 | 1,360 | |
Income (Loss) from Operations | 3,178 | 1,184 | 10,225 | 3,364 | |
Capital Expenditures | 119 | $ 219 | 404 | $ 496 | |
Total Assets | 88,064 | 88,064 | 89,683 | ||
Goodwill | $ 24,949 | $ 24,949 | $ 29,730 |
SEGMENT INFORMATION (REVENUE GE
SEGMENT INFORMATION (REVENUE GEOGRAPHY) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 309,195 | $ 305,900 | $ 944,939 | $ 903,611 |
United States [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 159,461 | 143,854 | 488,854 | 427,919 |
Philippines [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 84,450 | 89,963 | 255,021 | 262,171 |
Latin America [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 34,585 | 42,725 | 112,763 | 128,029 |
Europe Middle East Africa [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 20,401 | 20,825 | 59,004 | 62,308 |
Canada [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 1,542 | 1,365 | 4,430 | 4,258 |
Asia Pacific[ Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 8,756 | $ 7,168 | $ 24,867 | $ 18,926 |
SIGNIFICANT CLIENTS(NARRATIVE)
SIGNIFICANT CLIENTS(NARRATIVE) (DETAILS) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Entity Wide Revenue Major Customer Line Items | ||||
Accounts receivable amount from major customer | $ 16.3 | $ 16.3 | ||
Client A [Member] | Customer Management Services [Member] | ||||
Entity Wide Revenue Major Customer Line Items | ||||
Revenue from major customer as a percentage of total revenue | 10.50% | 11.90% | 10.80% | 11.90% |
Accounts receivable amount from major customer | $ 31.5 | $ 31.5 |
GOODWILL (GOODWILL ROLLFORWARD)
GOODWILL (GOODWILL ROLLFORWARD) (DETAILS) $ in Thousands | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Goodwill [Line Items] | |
Beginning balance, goodwill | $ 128,705 |
Acquisitions / Adjustments | (3,600) |
Impairments | (3,066) |
Effect of Foreign Currency | (3,255) |
Ending balance, goodwill | 118,784 |
Customer Management Services [Member] | |
Goodwill [Line Items] | |
Beginning balance, goodwill | 25,871 |
Effect of Foreign Currency | (2,074) |
Ending balance, goodwill | 23,797 |
Customer Growth Services [Member] | |
Goodwill [Line Items] | |
Beginning balance, goodwill | 30,395 |
Impairments | (3,066) |
Ending balance, goodwill | 27,329 |
Customer Technology Services [Member] | |
Goodwill [Line Items] | |
Beginning balance, goodwill | 42,709 |
Ending balance, goodwill | 42,709 |
Customer Strategy Services [Member] | |
Goodwill [Line Items] | |
Beginning balance, goodwill | 29,730 |
Acquisitions / Adjustments | (3,600) |
Effect of Foreign Currency | (1,181) |
Ending balance, goodwill | $ 24,949 |
GOODWILL (NARRATIVE) (DETAILS)
GOODWILL (NARRATIVE) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2015 | Dec. 31, 2014 | |
ValuationAllowanceForImpairmentOfRecognizedServicingAssetsLineItems | |||
Impairment losses | $ 3,066 | $ 3,066 | |
WebMetro [Member] | |||
ValuationAllowanceForImpairmentOfRecognizedServicingAssetsLineItems | |||
Fair value of a reporting unit in excess of carrying value expressed as a percentage | 11.00% | ||
Impaired Intangible Asset, Method for Fair Value Determination | For the goodwill impairment analysis, the Company calculated the fair value of the WebMetro reporting unit and compared that to the updated carrying value and determined that the fair value was not in excess of its carrying value. Key assumptions used in the fair value calculation for goodwill impairment testing include, but are not limited to, a compounded annual revenue growth rate of 20% for years 2016 through 2019, a perpetuity growth rate of 4.0% based on the current inflation rate combined with the GDP growth rate for the reporting unit's geographical region and a discount rate of 17.0%, which is equal to the reporting unit's equity risk premium adjusted for its size and company specific risk factors. | ||
Impairment losses | $ 3,100 | ||
Revana [Member] | |||
ValuationAllowanceForImpairmentOfRecognizedServicingAssetsLineItems | |||
Fair value of a reporting unit in excess of carrying value expressed as a percentage | 23.00% | 23.00% | 6.00% |
DERIVATIVES (OCI ROLLFORWARD) (
DERIVATIVES (OCI ROLLFORWARD) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
DERIVATIVES [ABSTRACT] | ||||
Aggregate unrealized net gain/(loss) at beginning of year | $ (21,315) | $ 119 | $ (18,345) | $ (8,352) |
Add: Net gain/(loss) from change in fair value of cash flow hedges | (8,660) | (11,245) | (14,070) | (4,948) |
Less: Net (gain)/loss reclassified to earnings from effective hedges | 2,161 | 12 | 4,601 | 2,186 |
Aggregate unrealized net gain/(loss) at end of period | $ (27,814) | $ (11,114) | $ (27,814) | $ (11,114) |
DERIVATIVES (NOTIONAL TABLE) (D
DERIVATIVES (NOTIONAL TABLE) (DETAILS) PHP in Thousands, NZD in Thousands, MXN in Thousands, CAD in Thousands, $ in Thousands | Sep. 30, 2015PHP | Sep. 30, 2015MXN | Sep. 30, 2015USD ($) | Dec. 31, 2014PHP | Dec. 31, 2014NZD | Dec. 31, 2014MXN | Dec. 31, 2014CAD | Dec. 31, 2014USD ($) |
Derivative [Line Items] | ||||||||
Notional Amount | $ 226,100 | $ 242,500 | ||||||
Forwards | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | 498,583 | 578,957 | ||||||
Forwards | CAD | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | CAD 1,500 | 1,441 | ||||||
Forwards | PHP | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | PHP 14,363,000 | $ 321,071 | PHP 17,428,000 | 398,046 | ||||
% Maturing in the Next 12 Months | 41.00% | 41.00% | 41.00% | |||||
Forwards | MXN | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | MXN 2,650,000 | $ 177,512 | MXN 2,532,000 | 179,089 | ||||
% Maturing in the Next 12 Months | 28.50% | 28.50% | 28.50% | |||||
Forwards | NZD | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | NZD 490 | $ 381 |
DERIVATIVES (INTEREST RATE SWAP
DERIVATIVES (INTEREST RATE SWAPS) (DETAILS) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | |
Derivative [Line Items] | ||
Notional Amount | $ 226.1 | $ 242.5 |
Interest Rate Swap One [Member] | ||
Derivative [Line Items] | ||
Notional Amount | $ 25 | |
Variable Rate Received | 1 - month LIBOR | |
Fixed Rate Paid | 2.55% | |
Contract Commencement Date | Apr. 1, 2012 | |
Contract Maturity Date | Apr. 1, 2016 | |
Interest Rate Swap Two [Member] | ||
Derivative [Line Items] | ||
Notional Amount | $ 15 | |
Variable Rate Received | 1 - month LIBOR | |
Fixed Rate Paid | 3.14% | |
Contract Commencement Date | May 1, 2012 | |
Contract Maturity Date | May 1, 2017 | |
Total Interest Rate Swaps [Member] | ||
Derivative [Line Items] | ||
Notional Amount | $ 40 |
DERIVATIVES (BALANCE SHEET CLAS
DERIVATIVES (BALANCE SHEET CLASSIFICATION) (DETAILS) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Cash Flow [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | $ (47,424) | $ (29,169) |
Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Cash Flow [Member] | Prepaids And Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | 1,631 | 192 |
Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Cash Flow [Member] | Other assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | 79 | 389 |
Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Cash Flow [Member] | Other Current Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | (20,006) | (12,680) |
Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Cash Flow [Member] | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | (29,128) | (17,070) |
Designated as Hedging Instruments [Member] | Interest Rate | Cash Flow [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | (915) | (1,440) |
Designated as Hedging Instruments [Member] | Interest Rate | Cash Flow [Member] | Prepaids And Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | 0 | |
Designated as Hedging Instruments [Member] | Interest Rate | Cash Flow [Member] | Other assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | 0 | |
Designated as Hedging Instruments [Member] | Interest Rate | Cash Flow [Member] | Other Current Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | (749) | (988) |
Designated as Hedging Instruments [Member] | Interest Rate | Cash Flow [Member] | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | (166) | (452) |
Not Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Fair Value [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | (3,941) | 792 |
Not Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Fair Value [Member] | Prepaids And Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | 4 | 797 |
Not Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Fair Value [Member] | Other assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | 0 | |
Not Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Fair Value [Member] | Other Current Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | (3,945) | $ (5) |
Not Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Fair Value [Member] | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Total net derivative asset (liability) | $ 0 |
DERIVATIVES (INCOME STATEMENT C
DERIVATIVES (INCOME STATEMENT CLASSIFICATION) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Other income (expense), net | $ 146 | $ 248 | $ 1,133 | $ 5,498 |
Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Cash Flow [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of gain or (loss) recognized in other comprehensive income (loss) - effective portion, net of tax: | (2,313) | (11,271) | (4,756) | (4,814) |
Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Cash Flow [Member] | Amount and Location of Net Gain or Loss Reclassified From Accumulated Other Comprehensive Income to Income [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Revenues | (3,987) | 248 | (8,200) | (2,795) |
Designated as Hedging Instruments [Member] | Interest Rate | Cash Flow [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of gain or (loss) recognized in other comprehensive income (loss) - effective portion, net of tax: | 153 | 26 | 454 | (134) |
Designated as Hedging Instruments [Member] | Interest Rate | Cash Flow [Member] | Amount and Location of Net Gain or Loss Reclassified From Accumulated Other Comprehensive Income to Income [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Interest expense | (264) | (267) | (783) | (790) |
Not Designated as Hedging Instruments [Member] | Foreign Exchange [Member] | Fair Value [Member] | Amount and Location of Net Gain or Loss Recognized in Income Nondesignated Hedging Instruments [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Other income (expense), net | $ (5,651) | $ 3,708 | $ (8,146) | $ 1,502 |
DERIVATIVES (NARRATIVE) (DETAIL
DERIVATIVES (NARRATIVE) (DETAILS) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
DERIVATIVES [ABSTRACT] | ||
Notional Amount | $ 226.1 | $ 242.5 |
FAIR VALUE (DERIVATIVES TABLE)
FAIR VALUE (DERIVATIVES TABLE) (DETAILS) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Fair Value Net Derivative Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash flow hedges | $ 0 | $ 0 |
Interest rate swaps | 0 | 0 |
Fair value hedges | 0 | 0 |
Total net derivative asset (liability) | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value Net Derivative Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash flow hedges | (47,424) | (29,169) |
Interest rate swaps | (915) | (1,440) |
Fair value hedges | (3,941) | 792 |
Total net derivative asset (liability) | (52,280) | (29,817) |
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value Net Derivative Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash flow hedges | 0 | 0 |
Interest rate swaps | 0 | 0 |
Fair value hedges | 0 | 0 |
Total net derivative asset (liability) | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value Net Derivative Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash flow hedges | (47,424) | (29,169) |
Interest rate swaps | (915) | (1,440) |
Fair value hedges | (3,941) | 792 |
Total net derivative asset (liability) | $ (52,280) | $ (29,817) |
FAIR VALUE (FAIR VALUE ASSETS A
FAIR VALUE (FAIR VALUE ASSETS AND LIABILITIES) (DETAILS) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Liabilities [Abstract] | ||
Contingent consideration | $ (13,556) | $ (24,744) |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Assets [Abstract] | ||
Derivative assets, net | 0 | |
Total assets | 0 | |
Liabilities [Abstract] | ||
Deferred compensation plan liability | 0 | |
Derivative instruments, net | 0 | |
Contingent consideration | 0 | |
Total liabilities | 0 | |
Significant Other Observable Inputs (Level 2) [Member] | ||
Assets [Abstract] | ||
Derivative assets, net | 0 | |
Total assets | 0 | |
Liabilities [Abstract] | ||
Deferred compensation plan liability | (9,267) | $ (8,478) |
Derivative instruments, net | (52,280) | $ (29,817) |
Contingent consideration | 0 | |
Total liabilities | (61,547) | $ (38,295) |
Significant Unobservable Inputs (Level 3) [Member] | ||
Assets [Abstract] | ||
Derivative assets, net | 0 | |
Total assets | 0 | |
Liabilities [Abstract] | ||
Deferred compensation plan liability | 0 | |
Derivative instruments, net | 0 | |
Contingent consideration | (13,556) | $ (24,744) |
Total liabilities | $ (13,556) | $ (24,744) |
FAIR VALUE (CONTINGENT CONSIDER
FAIR VALUE (CONTINGENT CONSIDERATION TABLE) (DETAILS) $ in Thousands | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Business acquisitions, Contingent Consideration [Line Items] | |
Beginning balance, contingent consideration payable | $ 24,744 |
Payments | (12,010) |
Imputed Interest/ Adjustement | 822 |
Ending balance, contingent consideration payable | 13,556 |
Iknowtion [Member] | |
Business acquisitions, Contingent Consideration [Line Items] | |
Beginning balance, contingent consideration payable | 2,265 |
Payments | (1,800) |
Imputed Interest/ Adjustement | 30 |
Ending balance, contingent consideration payable | 495 |
Guidon [Member] | |
Business acquisitions, Contingent Consideration [Line Items] | |
Beginning balance, contingent consideration payable | 1,000 |
Payments | (1,000) |
Sofica [Member] | |
Business acquisitions, Contingent Consideration [Line Items] | |
Beginning balance, contingent consideration payable | 6,317 |
Payments | (2,838) |
Imputed Interest/ Adjustement | (366) |
Ending balance, contingent consideration payable | 3,113 |
rogenSi [Member] | |
Business acquisitions, Contingent Consideration [Line Items] | |
Beginning balance, contingent consideration payable | 15,162 |
Payments | (6,372) |
Imputed Interest/ Adjustement | 1,158 |
Ending balance, contingent consideration payable | $ 9,948 |
FAIR VALUE (NARRATIVE) (DETAILS
FAIR VALUE (NARRATIVE) (DETAILS) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Business acquisitions, Contingent Consideration [Line Items] | ||||
Average interest rate on annual borrowings | 1.20% | |||
Valuation Technique on Contingent Consideration | Contingent Consideration - The Company recorded contingent consideration related to the acquisitions of iKnowtion, Guidon, TSG, WebMetro, Sofica and rogenSi. These contingent payables were recognized at fair value using a discounted cash flow approach and a discount rate of 21.0%, 21.0%, 4.6%, 5.3%, 5.0% or 4.6%, respectively. The discount rates vary dependant on the specific risks of each acquisition including the country of operation, the nature of services and complexity of the acquired business, and other similar factors. These measurements were based on significant inputs not observable in the market. The Company will record interest expense each period using the effective interest method until the future value of these contingent payables reaches their expected future value of $14.0 million. Interest expense related to all recorded contingent payables is included in Interest expense in the Consolidated Statements of Comprehensive Income (Loss). | |||
Technology Solutions Group [Member] | ||||
Business acquisitions, Contingent Consideration [Line Items] | ||||
Increase (decrease) in contingent consideration payable | $ (4) | $ (3.9) | ||
WebMetro [Member] | ||||
Business acquisitions, Contingent Consideration [Line Items] | ||||
Increase (decrease) in contingent consideration payable | $ (1.7) | |||
Sofica [Member] | ||||
Business acquisitions, Contingent Consideration [Line Items] | ||||
Increase (decrease) in contingent consideration payable | (0.5) | $ 1.8 | 0.6 | |
rogenSi [Member] | ||||
Business acquisitions, Contingent Consideration [Line Items] | ||||
Increase (decrease) in contingent consideration payable | $ 0.8 | $ 0.5 |
INCOME TAXES (NARRATIVE) (DETAI
INCOME TAXES (NARRATIVE) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Mar. 31, 2014 | Jun. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Tax Narrative [Line Items] | ||||||
Income Tax Examination, Penalties and Interest Accrued | $ 1,750 | |||||
Net Change in Valuation Allowance | 800 | $ 700 | ||||
Total deferred tax assets, net of valuation allowance | $ 51,300 | 51,300 | ||||
Valuation allowance on deferred tax assets | 10,200 | 10,200 | ||||
Deferred tax assets, net of valuation allowance and deferred tax liabilities | $ 48,600 | $ 48,600 | ||||
Effective income tax rate | 8.70% | 28.20% | 21.90% | 20.60% | ||
Netherlands and Israel [Member] | ||||||
Income Tax Narrative [Line Items] | ||||||
Net Change in Valuation Allowance | 300 | |||||
Canada [Member] | ||||||
Income Tax Narrative [Line Items] | ||||||
Tax Adjustments, Settlements, and Unusual Provisions | $ 1,200 | |||||
Income Tax Years under Audit | 2009 and 2010 and New Zealand for tax year the 2013 | |||||
United States [Member] | ||||||
Income Tax Narrative [Line Items] | ||||||
Income Tax Years under Audit | 2012 to present | |||||
Technology Solutions Group [Member] | ||||||
Income Tax Narrative [Line Items] | ||||||
Income Tax Years under Audit | 2,012 | |||||
Hong Kong rogenSi [Member] | ||||||
Income Tax Narrative [Line Items] | ||||||
Income Tax Years under Audit | 2,014 | |||||
Philippines [Member] | ||||||
Income Tax Narrative [Line Items] | ||||||
Net Change in Valuation Allowance | 300 | |||||
Other jurisdictions [Member] | ||||||
Income Tax Narrative [Line Items] | ||||||
Net Change in Valuation Allowance | $ 200 |
RESTRUCTURING CHARGES AND IMP52
RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES (LIABILITY CLASSIFICATION TABLE) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Restructuring Cost and Reserve [Line Items] | ||||
Reduction in force | $ 622 | $ 593 | $ 1,629 | $ 1,750 |
Restructuring charges, net | 622 | 593 | 1,629 | 1,750 |
Customer Management Services [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Reduction in force | 516 | 358 | 1,331 | 1,404 |
Customer Growth Services [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Reduction in force | 37 | |||
Customer Technology Services [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Reduction in force | 13 | $ 235 | 13 | $ 309 |
Customer Strategy Services [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Reduction in force | $ 93 | $ 285 |
RESTRUCTURING CHARGES AND IMP53
RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES (LIABLITY ROLLFORWARD TABLE) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Restructuring Cost and Reserve [Line Items] | ||||
Beginning balance, restructuring reserve | $ 2,071 | |||
Restructuring charges, net | $ 622 | $ 593 | 1,629 | $ 1,750 |
Payments | (2,449) | |||
Ending balance, restructuring reserve | 1,251 | 1,251 | ||
Reduction in Force [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning balance, restructuring reserve | 2,071 | |||
Restructuring charges, net | 1,629 | |||
Payments | (2,449) | |||
Ending balance, restructuring reserve | $ 1,251 | $ 1,251 |
RESTRUCTURING CHARGES AND IMP54
RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES (NARRATIVE) (DETAILS) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES [Abstract] | ||
Restructuring Reserve | $ 1,251 | $ 2,071 |
Payments | $ (2,449) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (NARRATIVE) (DETAILS) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Jun. 30, 2013 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | ||||
Initial Borrowing Capacity | $ 700,000 | |||
Maximum Borrowing Capacity | $ 1,000,000 | |||
Borrowings outstanding on credit facility | $ 115,000 | $ 100,000 | ||
Average daily utilization under credit facility | 323,000 | $ 291,000 | ||
Letters of credit issued under credit facility | 3,400 | |||
Remaining borrowing capacity under credit facility | 385,000 | |||
Letters of credit issued outside credit facility | $ 4,500 |
NONCONTROLLING INTERES (NONCONT
NONCONTROLLING INTERES (NONCONTROLLING INTEREST ROLLFORWARD TABLE) (DETAILS) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Stockholders' Equity Attributable to Noncontrolling Interest | ||
Noncontrolling interest, January 1 | $ 7,983 | $ 8,081 |
Net income attributable to noncontrolling interest | 2,766 | 3,379 |
Dividends distributed to noncontrolling interest | (2,925) | (3,150) |
Foreign currency translation adjustments | (323) | (167) |
Equity based compensation expense | 122 | 12 |
Noncontrolling interest, June 30 | $ 7,623 | $ 8,155 |
MANDATORILY REDEEMABLE NONCON57
MANDATORILY REDEEMABLE NONCONTROLLING INTEREST (ROLLFORWARD TABLE) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Mandatorily redeemable noncontrolling interest [Line Items] | ||||
Mandatorily redeemable noncontrolling interest, January 1 | $ 2,814 | |||
Net income attributable to mandatorily redeemable noncontrolling interest | $ 12,438 | $ 14,689 | 47,966 | $ 54,122 |
Change in redemption value | (1,201) | |||
Mandatorily redeemable noncontrolling interest, June 30 | 3,920 | 3,920 | ||
Iknowtion [Member] | ||||
Mandatorily redeemable noncontrolling interest [Line Items] | ||||
Mandatorily redeemable noncontrolling interest, January 1 | 2,814 | 2,509 | ||
Net income attributable to mandatorily redeemable noncontrolling interest | 537 | 416 | ||
Dividends distributed to mandatorily redeemable noncontrolling interest | (632) | (1,244) | (632) | (1,244) |
Change in redemption value | 1,201 | 1,109 | ||
Mandatorily redeemable noncontrolling interest, June 30 | $ 3,920 | $ 2,790 | $ 3,920 | $ 2,790 |
ACCUMULATED OTHER COMPREHENSI58
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (ROLLFORWARD TABLE) (DETAILS) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Accumulated Other Comprehensive Income (Loss) | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Accumulated other comprehensive income (loss) Beginning Balance | $ (52,274) | $ (20,586) |
Other comprehensive income (loss) before reclassifications | (55,908) | (16,113) |
Amounts reclassified from accumulated other comprehensive income (loss) | 5,280 | 2,949 |
Net current period other comprehensive income (loss) | (50,628) | (13,164) |
Accumulated other comprehensive income (loss) Ending Balance | (102,902) | (33,750) |
Foreign Currency Translation Adjustment | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Accumulated other comprehensive income (loss) Beginning Balance | (33,352) | (10,581) |
Other comprehensive income (loss) before reclassifications | (39,019) | (11,206) |
Net current period other comprehensive income (loss) | (39,019) | (11,206) |
Accumulated other comprehensive income (loss) Ending Balance | (72,371) | (21,787) |
Derivative Valuation, Net of Tax | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Accumulated other comprehensive income (loss) Beginning Balance | (18,345) | (8,352) |
Other comprehensive income (loss) before reclassifications | (14,070) | (4,948) |
Amounts reclassified from accumulated other comprehensive income (loss) | 4,601 | 2,186 |
Net current period other comprehensive income (loss) | (9,469) | (2,762) |
Accumulated other comprehensive income (loss) Ending Balance | (27,814) | (11,114) |
Other, Net of Tax | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Accumulated other comprehensive income (loss) Beginning Balance | (577) | (1,653) |
Other comprehensive income (loss) before reclassifications | (2,819) | 41 |
Amounts reclassified from accumulated other comprehensive income (loss) | 679 | 763 |
Net current period other comprehensive income (loss) | (2,140) | 804 |
Accumulated other comprehensive income (loss) Ending Balance | $ (2,717) | $ (849) |
ACCUMULATED OTHER COMPREHENSI59
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (INCOME STATEMENT CLASSIFICATION TABLE) (DETAILS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Presentation of Income Statement Reclassifications [Line Items] | ||||
Revenue | $ 309,195 | $ 305,900 | $ 944,939 | $ 903,611 |
Interest expense | 2,337 | 1,646 | 5,711 | 5,197 |
Provision for income taxes | 1,192 | 5,778 | 13,438 | 14,071 |
Net Income (Loss) | 12,438 | 14,689 | 47,966 | 54,122 |
Accumulated Other Comprehensive Income (Loss) | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Net Income (Loss) - Other | 5,280 | 2,949 | ||
Derivative Valuation, Net of Tax | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Net Income (Loss) - Other | 4,601 | 2,186 | ||
Tax effect | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Provision for income taxes - Other | 25 | 16 | 76 | 48 |
Net Income (Loss) - Other | (227) | (254) | (679) | (763) |
Cost of Services | Tax effect | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Cost of services | (252) | (270) | (755) | (811) |
Reclassification from accumulated other comprehensive income | Derivative Valuation, Net of Tax | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Provision for income taxes | 4,382 | 1,399 | ||
Net Income (Loss) | (2,160) | (12) | (4,601) | (2,186) |
Reclassification from accumulated other comprehensive income | Tax effect | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Provision for income taxes | 2,091 | 7 | ||
Foreign Exchange Forward | Reclassification from accumulated other comprehensive income | Foreign Currency Translation Adjustment | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Revenue | (3,987) | 248 | ||
Foreign Exchange Forward | Reclassification from accumulated other comprehensive income | Derivative Valuation, Net of Tax | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Revenue | (8,200) | (2,795) | ||
Interest Rate | Reclassification from accumulated other comprehensive income | Derivative Valuation, Net of Tax | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Interest expense | $ (783) | $ (790) | ||
Interest Rate | Reclassification from accumulated other comprehensive income | Loss on interest rate swaps [Member] | ||||
Presentation of Income Statement Reclassifications [Line Items] | ||||
Interest expense | $ (264) | $ (267) |
NET INCOME PER SHARE (DILUTED S
NET INCOME PER SHARE (DILUTED SHARES TABLE) (DETAILS) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Weighted Average Number of Shares Outstanding Reconciliation [Abstract] | ||||
Shares used in basic earnings per share calculation | 48,345 | 49,093 | 48,346 | 49,493 |
Effect of dilutive securities: | ||||
Stock options | 278 | 420 | 355 | 420 |
Restricted stock units | 291 | 427 | 332 | 425 |
Performance-based restricted stock units | 22 | 19 | ||
Total effects of dilutive securities | 591 | 847 | 706 | 845 |
Shares used in dilutive earnings per share calculation | 48,936 | 49,940 | 49,052 | 50,338 |
NET INCOME PER SHARE (NARRATIVE
NET INCOME PER SHARE (NARRATIVE) (DETAILS) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Stock Options [Member] | ||||
Anti-dilutive options to purchase common stock [Line Items] | ||||
Anti-dilutive securities | 0.1 | 0.1 | 0.1 | 0.1 |
Restricted Stock Units (RSUs) [Member] | ||||
Anti-dilutive options to purchase common stock [Line Items] | ||||
Anti-dilutive securities | 0.2 | 0.4 | 0.4 | 0.2 |
EQUITY-BASED COMPENSATION PLANS
EQUITY-BASED COMPENSATION PLANS (NARRATIVE) (DETAILS) - USD ($) $ / shares in Units, $ in Thousands | Nov. 03, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Equity-based compensation expense | $ 3,300 | $ 3,200 | $ 8,569 | $ 9,031 | |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Date | Nov. 1, 2015 | ||||
Restricted Stock Units (RSUs) [Member] | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Equity-based compensation expense | 3,200 | 3,000 | 8,300 | $ 8,600 | |
Unrecognized Compensation Expense | $ 31,800 | $ 31,800 | |||
Non-option Equity Awards Granted | 744,800 | 583,333 | |||
Stock Options [Member] | Chief Executive Officer [Member] | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Exercise of stock options, share | 800,000 | ||||
Option Indexed to Issuer's Equity, Strike Price | $ 11.35 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Description | To effectuate a "cashless exercise" of the option, on August 24, 2015, Mr. Tuchman entered into a Stock Purchase Agreement with TeleTech, under the terms of which he exercised the option at the end of business on August 31, 2015 and, upon issuance of the option shares, sold to TeleTech, in a simultaneous transaction, a number of shares necessary to pay the option exercise price plus any tax withholding obligations. The option shares were valued a the market price as of the close of business on that date. Mr. Tuchman's option, granted under TeleTech's 1999 Stock Option and Incentive Plan, was fully vested and set to expire in November, 2015. The Stock Purchase Agreement was approved by the independent members of TeleTech's Board of Directors who deemed it to be in the best interest of the company and all its shareholders. | ||||
Cost of Services | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Equity-based compensation expense | $ 900 | 500 | $ 2,000 | $ 1,700 | |
Selling General And Administrative Expenses [Member] | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||||
Equity-based compensation expense | $ 2,400 | $ 2,200 | $ 6,600 | $ 7,300 |