Update: Discussions with Business Partners (6498E)
11 April 2011 - 4:00PM
UK Regulatory
TIDMCPP
RNS Number : 6498E
CPPGroup Plc
11 April 2011
CPPGroup Plc
Update: Discussions with Business Partners
On 28 March 2011, CPPGroup ("CPP" or "the Group") announced that
it is in discussions with the FSA in relation to certain issues
surrounding the sale of the Group's Card Protection and Identity
Protection products in the UK. Further to this announcement, one of
the Group's business partners, Barclaycard, has decided to stop
sales in the call to confirm channel operated by the Group whilst
it completes a review of this channel.
In the call to confirm channel, which is similar to the card
activation channel, CPP products (both Card Protection and Identity
Protection) are offered to Barclaycard customers who call in to
confirm receipt of their newly issued credit card.
The Group will continue to offer Card Protection to Barclaycard
customers who currently hold the Identity Protection product and
who call the Group's customer service department. Barclaycard will
also continue to offer Identity Protection and Card Protection to
its customers in all their existing channels.
Sales to Barclaycard customers in the call to confirm channel
are currently less than 2% of Group revenue. The impact on
underlying operating profit in 2011 and 2012 will be immaterial
although reduced sales in 2011 and 2012 will have an adverse impact
on the profitability beyond 2012 as the renewals revenues (upon
which CPP pays a smaller commission to its Business Partners) will
also be lower.
The Group has over 200 Business Partners and has been encouraged
by the support received in connection to the ongoing discussions
with the FSA. CPP remains actively engaged with its business
partners and is working with them to respond appropriately to the
current situation, and any product sales as have been suspended by
business partners other than Barclaycard have to date been at
levels which are not material to the Group. Whilst the Group
believes that new business volume uncertainty may remain whilst the
FSA investigations progress, the Board continues to believe in the
ongoing relevance and consumer appeal of its products and
services.
The Group continues to work with the FSA in relation to its
ongoing investigation. At this stage the Group cannot provide any
further information on the likely outcome of those discussions, nor
on the potential consequences on the operations and/or financial
position of the Group. In common with all our business partners,
CPP looks forward to a swift conclusion to the FSA's investigation
so as to remove any ongoing uncertainty. Further announcements will
follow once the Group has further clarity on the FSA's findings and
conclusions.
Enquiries
CPPGroup
Eric Woolley, Group Chief Executive
Shaun Parker, Chief Financial Officer
Tel. +44 (0)20 7353 4200 (today)
Tel: +44 (0)1904 544702 (thereafter)
Tulchan Communications
John Sunnucks
David Allchurch
Tel. +44 (0)20 7353 4200
Notes to editors:
CPP is a leading international Life Assistance business with
operations in 15 countries in both developed and developing
markets. CPP's products and services are designed to meet consumer
needs across a range of requirements, in particular relating to
credit and debit card ownership, personal identity, mobile
telephones, travel and the home. The Group primarily focuses on
providing customer assistance during stressful life events such as
losing or having a wallet, purse, mobile telephone or keys stolen,
as well as support in the event of identity theft.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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