CPPGroup Plc Statement re Pre Close announcement (8576T)
19 December 2012 - 6:00PM
UK Regulatory
TIDMCPP
RNS Number : 8576T
CPPGroup Plc
19 December 2012
CPPGROUP PLC
19 DECEMBER 2012
PRE CLOSE ANNOUNCEMENT
CPPGroup Plc ("CPP" or the "Group") today publishes the
following statement prior to entering its close period for the year
ended 31 December 2012.
Trading performance
The Group has continued to trade profitably and the Board
continues to expect that the 2012 full year results will be in line
with current market expectations.
Group operating performance has continued the trends outlined in
the Group's Interim Management Statement, published on 26 October
2012. As previously indicated, Group revenue and underlying
operating profit will decline for the full year principally as a
result of reduced new and renewal retail revenue streams in the
UK.
Trading in the UK continues to be impacted by lower revenue
streams due to the Group's restricted ability to sell its full
range of products. We are encouraged that our UK product
development initiatives are at an advanced stage and pilot launches
will commence shortly. In our international operations, both North
America and Latin America continue to grow revenue. Performance in
Southern Europe continues to decline and although Asia Pacific has
returned to revenue growth, as a consequence of challenging trading
conditions this market is taking longer to develop than
expected.
FSA
As announced on 15 November 2012, the Group's on-going
engagement with the FSA regarding its investigation has resulted in
an agreed position, with Card Protection Plan Limited ("CPPL")
agreeing to the publication of a Final Notice detailing significant
historic failings, the phased payment of a penalty and a Voluntary
Variation of Permission with regard to CPPL and Homecare Insurance
Limited.
We continue to have constructive discussions with the FSA and
certain of the Group's larger Business Partners, regarding the
form, structure, details and timing of customer redress. These
discussions continue to include consideration of the use of a
solvent Scheme of Arrangement as a vehicle for providing redress.
The amount of redress which will require to be paid to customers is
uncertain. The Group expects to materially increase the provision
it has made for customer redress and associated costs in light of
current estimates. The provision for the FSA fine will also be
increased by GBP8.5 million to reflect the final agreed fine of
GBP10.5 million. Whilst the fine will be fully provided for in the
2012 accounts, it will be paid in instalments during 2013 and
2014.
Financial position
The Board continues to assess and actively pursue a range of
financing options. A number of alternative financing and strategic
options are under consideration with a view to putting funding in
place in advance of the maturity of the Group's current debt
facilities due on 31 March 2013. Alternative financing or strategic
options are necessary to secure the future viability of the
Group.
Outlook
Moving into 2013, the current outlook for the Group reflects the
significant challenges and uncertainties that the business is
facing. As previously indicated we anticipate that a combination of
factors, most notably redress-related costs and anticipated revenue
decline in the UK, is expected to have a substantial adverse impact
on our performance in 2013 and beyond until revenue is generated
from alternative channels. The Group is considering the most
appropriate approach to reduce its cost base to mitigate some of
the adverse profit impact from lower revenue and redress-related
costs.
Paul Stobart, Chief Executive Officer, commented:
"The Group has made progress with the FSA and on deploying our
new customer focused strategy as we reshape our business for the
future. The closure of the FSA's investigation during the period
was an important milestone, which removes an element of uncertainty
for the business and our stakeholders.
Our performance, nonetheless, continues to be affected by the
on-going challenges of our operating environment, which will remain
difficult moving into 2013 and beyond. However, the continuing
demand for our products and the actions we are taking to rebuild
our business and reputation, combined with enhanced governance and
risk management across the Group, will provide us with a platform
to move the business forward."
A conference call for investors and analysts will be held on 19
December 2012 at 8:00 a.m. (GMT), dial in details for which are as
follows:
Dial in: +44 (0)20 3140 0668
Participant ID: 444366#
For enquiries contact:
Investor Relations
CPPGroup Plc
Paul Stobart, Chief Executive Officer
Shaun Parker, Chief Financial Officer
Tel: +44 (0)1904 544702
Helen Spivey, Head of Corporate and Investor Communications
Tel: +44 (0)1904 544387
Media
Tulchan Communications: David Allchurch; Martin Robinson
Tel: +44 (0)20 7353 4200
Notes to Editors
CPPGroup Plc (CPP) is an International Assistance business
operating across 16 geographical markets with more than 200
Business Partners worldwide. Via its Business Partners, CPP
provides Life Assistance products to consumers, which includes
annually renewed and packaged products that provide assistance and
insurance across a wide range of market sectors helping our
customers to live life and worry less.
For more information on CPP visit www.cppgroupplc.com
Cautionary statement
This trading statement contains certain forward-looking
statements. These statements are made by the directors in good
faith based on the information available to them up to the time of
approval of the trading statement but such statements should be
treated with caution due to the inherent uncertainties, including
both economic and business risk factors, underlying any such
forward-looking information. Subject to the requirements of the UK
Listing Authority's Disclosure and Transparency Rules and Listing
Rules, CPPGroup Plc undertakes no obligation to update these
forward-looking statements and it will not publicly release any
revisions it may make to these forward-looking statements that may
result from events or circumstances arising after the date of this
trading statement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
TSTFMMMZMRGGZZZ
Cppgroup (LSE:CPP)
Historical Stock Chart
From Jun 2024 to Jul 2024
Cppgroup (LSE:CPP)
Historical Stock Chart
From Jul 2023 to Jul 2024