APAC Revenues Improve but Profits Remain Elusive

Call center operator APAC Customer Services (Nasdaq: APAC) Tuesday reported a net loss in the third quarter of nearly $2.8 million, compared with a loss of $5 million in the same period a year ago. Company revenues rose 15 percent to $56.8 million due to increases in revenues from off-shore operations, and greater volume from a second UPS facility. Revenues from domestic operations rose 8 percent to $45.7 million while offshore revenues jumped 63 percent to $11.1 million.

Chief Executive Officer Bob Keller said in a statement that APAC could reach its goal of being profitable in the fourth quarter. “We’ve measurably improved employee retention, program quality and operational efficiency,” said Keller. The company has also selected the site for its fourth facility in the Philippines and “initiated a hedging program to protect the company against further strengthening in the Philippine peso,” he said.

Investors yesterday sent APAC stock down 17 percent to close at $2.07 a share.

APAC said it had 12 calling centers with 4,473 seats in its domestic centers and 2,533 seats offshore at the end of the quarter. Annualized average revenue per seat was $41,010 in domestic centers, a rise of 15 percent compared to the third quarter of 2006. Offshore centers saw $33,054 in annualized average revenue per seat, up 2 percent.

Deerfield, Ill.-based APAC provides customer services for companies in healthcare, finance, business services and other fields.