TeleTech Provides Business Update

DENVER – TeleTech Holdings, Inc. (Nasdaq: TTEC), a global provider of customer management and business process outsourcing (BPO) solutions, today provided the following business update.

As previously disclosed, management of the Company has plans to enhance the Company’s future profitability, including obtaining new clients and further streamlining operations.

New Clients
Although TeleTech’s revenue growth has been slower than anticipated in the first half of 2005, the Company is now signing new client agreements that were previously expected to close earlier in the year. As a result, TeleTech is pleased to announce it recently signed a letter of intent with a large U.S. healthcare company to perform customer management work that will fully utilize the Stockton, California Customer Management Center (“CMC”). This new work will replace a client agreement that was anticipated to terminate during 2005 due to the client having excess internal capacity. The termination of this client relationship was anticipated when the Company forecasted that its 2005 client attrition rate would be less than its 2004 client attrition rate.

In addition, TeleTech continues to focus upon closing opportunities in its new business pipeline and the Company was recently awarded a multi-year inbound customer care contract with a major airline. Further updates regarding additional business awards will be provided when the Company announces its second quarter 2005 financial results.

Excess Capacity
Under our plan to reduce higher-cost excess capacity throughout the globe, in July 2005 TeleTech announced it will exit its Glasgow, Scotland CMC in July 2006 upon termination of the lease agreement. The decision to exit the Glasgow CMC will result in an approximate $2.5 million charge in the Company’s second quarter 2005 financial statements and will result in an annualized pre-tax profit improvement of at least $2.5 million beginning in the third quarter of 2006. The Company also expects to exit two North American CMCs upon termination of their respective lease agreements during the first half of 2006 without recording a material charge as the related assets will be fully depreciated.

Newgen
As previously announced, during the second quarter of 2005, TeleTech accelerated the integration of Newgen into the Company’s core operations by taking the following actions: (1) completing the conversion of existing automotive dealers to Newgen’s new Guarantee Results Product (“GRP”) platform, and (2) beginning to transfer certain work to a lower-cost location. These actions, while anticipated to improve profitability in future periods, impacted the second quarter’s operating income as follows: (1) Due to back-office inefficiencies that existed at the beginning of the second quarter, Newgen focused primarily on the conversion of existing automotive dealers to the new GRP platform and not on pursuing new client agreements during the quarter, and (2) costs increased while work was being transferred to a lower-cost location. As a result of process improvements implemented during the second quarter, Newgen reduced the time to on-board new clients from approximately 35 days to 10 days. With the completion of the GRP conversion and improved back office processes, Newgen will now begin to market its products to new automotive dealers and manufacturers to increase revenue.

TeleTech now expects Newgen’s second quarter 2005 operating loss will be approximately $3.5 million, which is higher than previously anticipated. TeleTech projects that as a result of executing the above initiatives, Newgen, absent allocations of corporate overhead, will operate at a profit during the fourth quarter of 2005.

This outlook is for Newgen only, as the Company believes consolidated TeleTech will report positive net income for the second quarter of 2005 and continue to operate profitably throughout the year.

Share Repurchases
During the second quarter of 2005, TeleTech continued its share repurchase program and purchased 1.9 million shares for $15 million. Going forward, management of the Company is committed to continuing its share repurchase program. As a result of the shares repurchased during the second quarter, TeleTech ended the quarter with approximately $21 million drawn on its revolving credit facility and approximately $82 million of cash and cash equivalents.