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EMEA Advisory Board Meeting James F. Orr March 11, 2004

Draft #3 – 3/10/04 11:00 A.M. EMEA Advisory Board Meeting James F. Orr March 11, 2004. KEY MESSAGES. Markets - Large and Growing 3 of 4 Businesses Growing – CMG, EC, International IMG, Especially North America, Facing Challenges Opportunities Remain – Growth Outside U.S.

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EMEA Advisory Board Meeting James F. Orr March 11, 2004

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  1. Draft #3 – 3/10/04 11:00 A.M. EMEA Advisory Board Meeting James F. Orr March 11, 2004

  2. KEY MESSAGES • Markets - Large and Growing • 3 of 4 Businesses Growing – CMG, EC, International • IMG, Especially North America, Facing Challenges • Opportunities Remain – Growth Outside U.S. • Product Development / Delivery Key • Path to Profitable International Growth Guiding Principle: Maximize Long Term Shareholder Return

  3. Revenue FINANCIAL RECORD 1997 – 2003 ($Millions) Operating Income 15% CAGR 15% CAGR 2003 1997 2003 1997 * OI for ‘97 is restated excluding amortization of goodwill expense to be comparable with ‘03 consensus estimates

  4. Revenue FINANCIAL RECORD 2004 Consensus Estimates ($Millions) Operating Income 2004 2004

  5. MARKET TRENDS • Communications Industry: • Carriers Still Under Significant Financial Pressure • Size and Number of Billing System Deals Down • Global Markets Still Weak • Customer Care: • Offshore Demand Accelerating • Pricing Pressures Continue • Employee Care: • Desire to Outsource Increasing • Demand Expanding for Global Solutions

  6. Product vs. Custom Solutions Bolt-On vs. Legacy Replacement Increasingly Being Considered Core Strength Across CVG NEED TO GROW REVENUE AND REDUCE COST CLIENT NEEDS INCREASING FINANCIAL PRESSURE In-Source Outsource COMPELLING CVG VALUE PROPOSITION

  7. Avaya BT Retail Brazil Telecom China Unicom Comcast Cox Communications DirecTV EWE Tel Fifth Third Bank Office Depot RR Donnelley Rite Aid Satelindo Sprint United States Postal Service IMPORTANT PROGRESS 2003 Wins

  8. IMG Stalled Invest in IMG’s Product Portfolio to Drive Growth In Market Share STRATEGIC INITIATIVES - UPDATE • Strategic Initiative • Status • Employee Care Very Promising • Build Significant Size Employee Care Business ($500MM+) • Improve CMG Value Proposition to Capture Large BPO Deals • CMG Growing Again (e.g., USPS) • Investment Driving International Growth • Invest in Resources Required to Expand in Markets Outside N.A.

  9. CURRENT SITUATION • Significant Market Opportunities - Global Demand Accelerating for Business Process Outsourcing • Considerable Business Strengths: • Highly Scalable Transaction Processing Assets • Skilled Management of Customer and Employee Relationships • Strong Data Center and Contact Center Capabilities • 3 of 4 Businesses Growing, But IMG: • Remains Too Narrowly Concentrated • Cost Structure is Too High

  10. 2004 GOALS • Accelerate Growth • CMG • EC • Position IMG for Future Growth • Create Technology Advantage • Dramatically Enhance Customer Satisfaction • Continued Global Expansion

  11. Summary • CMG Global Leadership Position • Opportunity for Employee Care Leadership • International Beginning to Grow • Challenges in IMG North America • Valuable Products and Technology – Must Leverage • Experienced Management Team • Must Execute Strategy to Grow and Diversify

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