New York-based language service provider (LSP) TransPerfect released results for the three months to the end of September 2021. Announcing another bumper quarter, the company said Q3 revenues grew 31% to USD 279m from the same period the previous year.
Put differently, TransPerfect added roughly USD 66m to its top line in the space of three months. The majority of growth — 24.5% or around USD 52m — was organic, while revenues from acquisitions accounted for the rest.
As a privately-owned company headquartered in the US, TransPerfect is not required to disclose revenues publicly, but has chosen to do so on a regular basis.
TransPerfect’s best-ever month for billings came in September 2021, when the LSP generated just north of USD 100m. Year-to-date revenues for the nine months ended September 30, 2021 stood at USD 777m, 29% above the same period in 2020.
With a strong Q3 under its belt, TransPerfect has firmed up its chances of hitting the target of USD 1bn in annual revenues for full-year 2021. (To do so, the company needs final-quarter revenues to equal or top USD 223m.)
TransPerfect said Q4 is historically the company’s strongest; which means they may surpass the billion-dollar milestone by some measure. The LSP also pointed out that, on a trailing 12-month (TTM) basis, TransPerfect has actually already surpassed the USD 1bn mark — crossing that particular threshold at the end of August 2021.
CEO Phil Shawe told Slator, “In general, we’re seeing a healthy business environment across sectors and spanning regions.” Most industries and geographies in which TransPerfect operates “are moving into Q4 with positive momentum,” Shawe said, and on a regional basis, “based on several factors and indications from our clients, we’re planning for higher comparative growth in APAC in 2022.”
“While TransPerfect and Semantix continue to show enthusiasm around the opportunities that the merger has created — both organizations also demonstrate diligence and realism as relates to the integration process” — Phil Shawe, CEO, TransPerfect
Against this backdrop, he identified travel and hospitality and GlobalLink as the “two standout drivers of organic growth in Q3.”
Discussing the rebound of travel and hospitality, Shawe said “more pronounced recovery in demand” in the sector for Q3 was particularly notable within digital marketing, “where clients are approaching, matching, or in some cases even exceeding pre-Covid levels of activity.” Moreover, “we believe the travel industry is largely optimistic about 2022,” he said.
The company’s enterprise translation management system (TMS) GlobalLink also “demonstrated excellent traction with customers,” adding 129 new clients during the quarter versus 123 in Q2, Shawe said. Continued demand for GlobalLink has seen TransPerfect’s technology revenues climb nearly 40% year-to-date compared with 2020, Shawe added.
Light Touch M&A
Asked about progress with Semantix, the Sweden-based LSP that TransPerfect acquired in August 2021, Shawe noted that “the Semantix team has maintained their pre-merger positive trajectory,” including winning new business.
Shawe also recalled TransPerfect’s “light touch” strategy as regards “merger partners,” which he said is based on “providing as much autonomy as possible to management — and also offering access to technology and other internal resources.”
He added, “While TransPerfect and Semantix continue to show enthusiasm around the opportunities that the merger has created — both organizations also demonstrate diligence and realism as relates to the integration process, especially because we’re all working hard to ensure a positive post-merger experience for clients, vendors, and our combined teams.”
Semantix is TransPerfect’s largest M&A transaction to date, forecasting around USD 87m in 2021 revenues.
TransPerfect also acquired digital marketing agency Webcertain in Q3, and completed two strategic acquisitions in Q2 2021. In September 2021, TransPerfect appointed EY-Partenon veteran Edgar Vargas-Castañeda as Vice President of Growth Strategies & Business Optimization.
On the subject of upcoming M&A, Shawe told Slator, “As always, we’re looking to complement TransPerfect’s existing suite of services and technology products through M&A. For us, the most important thing is that we do so with like-minded, entrepreneurial, and growth-focused management teams,” he said.
As TransPerfect enters its final quarter of 2021, the LSP’s closest rival by revenue, UK-based RWS, is expected to announce its financial results for the 2021 full-year to September 30 in late October 2021.