Dialogue popular on listing

Johannesburg, 19 Sept 2006

Call centre group Dialogue, which listed on the JSE`s Alternative Exchange (AltX) this morning, saw its first shares change hands quickly.

The company, which listed under the code DLG, saw its first 1 000 shares change hands at 17 seconds past nine at R1.40. It placed the shares in a private placement the day before at R1. By 10am, its shares were trading at R1.32, 5.71% down on the opening price.

JSE CEO Russell Loubser, addressing the audience at the listing function in Sandton, said the company, which has 1 500 call centre seats and was started in 1999 with 30 staff, is expected to grow rapidly.

"They are not going to be only 1 500 bums on seats for long," he said, referring to Dialogue having recently signed up US credit card firm Capital One.

Dialogue CEO Jason Drew told the audience the company had big plans. "We are at the beginning of our journey, not at the end of it." He added he was looking forward to being the first call centre company to be listed.

Drew said Dialogue aims to have 18 customers in the next 18 months. It has 13 customers signed up, of which many are in the financial services game.

He also intends mitigating currency risk by having seven international firms on its books, and 11 local. Among its customers are Bidvest, McCarthy, Absa and Standard Bank.

Scope for growth

SA, he says, is becoming a telephone society in which people wish to pick up the phone and do business that way. As the demand for telephone service grows, more such outsourcing opportunities will become available.

Globally, says Drew, the market is worth $130 billion, and SA does not even receive a fraction of that amount, yet. "I hope SA is on the map next year too," he says referring to growth seen in India and the Philippines in the outsourcing sector.

The company, which deals with 38 million calls a year, has shown 12-fold growth in three years, according to its promotional material. At the end of December 2004, it reported revenue of R43 million, and an attributable loss of R3.6 million. By the end of 2005, it reported revenue of R78 million, and an attributable profit of R6.3 million.

Its forecast for the end of this year is to see revenue of R113.9 million, and an attributable profit of R12.3 million. By the end of 2007, it aims to reach R157.8 million in revenue and an attributable profit of R19 million.

Dialogue is the largest independent call centre company in SA, and the second largest firm of its kind in the country. Drew says the company is looking for opportunities to grow through acquisition. "We`re certainly looking at the acquisition trail, both here and in Africa."

Among countries the firm is keen on he lists Nigeria, Egypt and Kenya, despite these countries not having a call centre market yet. He is confident, however, as mobile telephony locally has aided the SA industry`s growth in the area.

By 8:46am today, five bids to buy shares had been made, the highest of which was R1.20. The highest asking price at this time was R1.85. Just before the market opened at 9am, there were bids to buy of between R1.40 and R1. The asking price varied between R1.70 and R2.50.