APAC Customer Services Announces Third Quarter 2008 Results
Delivers net income of $0.04 per diluted share
Reduces debt by $3.9 million

BANNOCKBURN, Ill., Nov 05, 2008 (BUSINESS WIRE) -- APAC Customer Services, Inc. (Nasdaq: APAC), a leading provider of customer care services and solutions, today reported financial results for its third fiscal quarter ended September 28, 2008.

Revenue for the 2008 third quarter rose 4.3% to $59.2 million from $56.8 million in the 2007 third quarter. Gross profit for the 2008 third quarter was $10.1 million, or 17.0%, compared to $4.5 million, or 8.0%, in the prior-year period. The company reported net income of $2.0 million, or $0.04 per diluted share, compared to a net loss of $2.8 million, or $0.06 per diluted share, in the prior-year quarter. Third quarter 2008 adjusted EBITDA was $5.8 million compared to $1.7 million in the 2007 third quarter.

President and CEO Mike Marrow commented, "I'm very pleased with our third quarter results. Our profitability has improved significantly. Current clients are awarding us additional business. We are winning business with new clients. These results line up very well against the goals we laid out earlier in the year. APAC is clearly on the right track.

"Today's difficult economic conditions underscore the many benefits of outsourcing customer care. We are in a unique position to help our clients reduce costs while simultaneously boosting their customer satisfaction."

Debt and Liquidity

The company's debt decreased to $13.8 million at the end of the 2008 third quarter from $17.7 million at the end of the 2008 second quarter due primarily to improved operating income. Net capital expenditures during the 2008 third quarter were $0.4 million compared to $3.5 million in the prior year comparable period, and free cash flow improved $6.7 million to $4.9 million from a negative $1.8 million in the 2007 third quarter.

Third Quarter 2008 Conference Call

Management of APAC Customer Services will hold a conference call, including a visual presentation on the company's website, to discuss financial results on Thursday, November 6, 2008, at 10:00 a.m. Central Time (11:00 am ET). To participate in the live call by telephone, please dial (719) 325-4907 and reference APAC's earnings call. No pass code is required.

The conference call, including the visual presentation, will be available live in the Investor Relations section of APAC Customer Services' web site at http://www.apaccustomerservices.com. Please access the site at least 15 minutes prior to the scheduled start time in order to download the required audio software (RealPlayer or Windows Media Player). Information regarding the reconciliation of our non-GAAP measures to our GAAP results will be posted on our website at http://www.apaccustomerservices.com.

A replay of the webcast and visual presentation will be accessible through the Company's website for seven days following the live event. For those unable to listen to the call via the Internet, a replay of the call will be available until 11:00 p.m. Central Time (midnight ET) on November 13, 2008, by dialing (719) 457-0820. The pass code for the replay is #4707855.

About APAC Customer Services, Inc.

APAC Customer Services, Inc. (NASDAQ: APAC) is a leading provider of customer care services and solutions for market leaders in healthcare, business services, publishing, communications, travel and entertainment, and financial services industries. APAC partners with its clients to deliver custom solutions that enhance bottom-line performance. For more information, call 1-800-OUTSOURCE. APAC's comprehensive web site is at http://www.apaccustomerservices.com.

Forward-Looking Statements

This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Generally, forward-looking statements include expressed expectations, estimates and projections of future events and financial performance and the assumptions on which these expressed expectations, estimates and projections are based. Statements that are not historical facts, including statements about the beliefs and expectations of the company and its management are forward-looking statements. All forward-looking statements are inherently uncertain as they are based on various expectations and assumptions about future events, and they are subject to known and unknown risks and uncertainties and other factors that can cause actual events and results to differ materially from historical results and those projected. Such statements are based upon the current beliefs and expectations of the company's management. The company intends its forward-looking statements to speak only as of the date on which they were made. The company expressly undertakes no obligation to update or revise any forward-looking statements as a result of changed assumptions, new information, future events or otherwise.

The following factors, among others, could cause the company's actual results to differ from historic results or those expressed or implied in the forward-looking statements: its revenue is generated from a limited number of clients and the loss of one or more significant clients could have a material adverse effect on the company; terms of its client contracts; its ability to return to profitability; its ability to continue to reduce costs and achieve efficiencies; availability of cash flows from operations and borrowing availability under its revolving loan facility; its ability to comply with, or obtain waivers of or changes to, its debt covenants; its ability to effectively manage customer care center capacity and off-shore growth; its ability to conduct business internationally, including managing foreign currency exchange risks; its ability to attract and retain qualified employees; and fluctuations in revenue associated with the company's Medicare Part D enrollment and customer care programs.

Other reasons that may cause actual results to differ from historic results or those expressed or implied in the forward-looking statements can be found in the company's Annual Report on Form 10-K for the fiscal year ended December 30, 2007 and its subsequent filings on Form 10-Q for the fiscal quarters ended March 30, 2008 and June 29, 2008. These filings are available on a website maintained by the SEC at http://www.sec.gov.

About Non-GAAP Financial Measures

To supplement our Consolidated Financial Statements presented in accordance with GAAP, we use the following measures defined as non-GAAP measures: EBITDA, adjusted EBITDA and free cash flow. The presentation of these non-GAAP measures is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP or as a measure of liquidity. The items excluded from these non-GAAP financial measures are significant components of our financial statements and must be considered in performing a comprehensive assessment of our overall financial results. The company expects to use consistent methods for computation of non-GAAP financial measures. Its calculations of non-GAAP financial measures may not be consistent with calculations of similar measures used by other companies.

We believe that these non-GAAP financial measures provide meaningful supplemental information and are useful in understanding our results of operations and analyzing of trends because they exclude certain charges such as interest, taxes and depreciation and amortization expenses. We also believe that these non-GAAP financial measures are useful to investors and analysts in allowing for greater transparency with respect to the supplemental information used by us in our financial and operational decision-making. In addition, we believe investors, analysts and lenders benefit from referring to these non-GAAP measures when assessing our performance and expectations of our future performance. However, this information should not be used as a substitute for our GAAP financial information; rather it should be used in conjunction with financial statement information contained in our Consolidated Financial Statements prepared in accordance with GAAP.

The accompanying notes to selected financial and statistical data have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures. More information on certain of these non-GAAP financial measures can be found in the company's Annual Report on Form 10-K for the fiscal year ended December 30, 2007 and its subsequent filings on Form 10-Q for the fiscal quarters ended March 30, 2008 and June 29, 2008.

APAC - E

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SOURCE: APAC Customer Services, Inc.

APAC Customer Service, inc.
Andrew B. Szafran, 847-374-1949ABSzafran@APACMail.com
or
Investor Relations: Lippert/Heilshorn & Associates Harriet Fried / Jody Burfening, 212-838-3777HFried@lhai.com

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