Revenues reach £110m at CPP in year of ‘reinvention’

Listed CPP Group has reported revenue growth in a year of “reinvention” as it concentrates on growth it markets outside of the UK.

The group, which specialises in ID and credit card theft protection and a range of life assistance products, last year moved its head office functions to Leeds from York. It is the second consecutive year of revenue growth for the firm, which had previously faced several years of reputational and financial damage.

Reporting on the the year to 31 December 2018, CPP Group saw revenues rise 13% to £110m from £97m in the previous year. However, underlying pre-tax profit dropped 16% from £4.2m in 2017 to £3.5m.

2018 we saw the creation of the firm’s new UK business  – which is separate from its UK back book. CPP Group said that this, for the first time in six years, enabled the Group to develop and build a regulated sales business in the UK.

Chairman Sir Richard Lapthorne said: “The reduction in our legacy UK business in recent years has created the need for the Group to reinvent itself and build on its considerable expertise in supplying products and services that give peace of mind to our customers, and to develop and grow in markets outside the UK. This reinvention is gathering momentum and in 2018 we saw our customer numbers in India reach nearly 6 million, an increase of 4.7 million customers (376%) since 2016.

“To add to our overseas operations we opened a new business in Bangladesh, where our B2B2C marketing model launched successfully with its first business partner. 

“This performance in our growth markets and the investments we are making are expected to provide the platform for continued annual growth in turnover for the years ahead.”

 Sir Richard added that the group had been concentrating on shaping its long term cost base “to match the patterns of the digital age.”

He added: “Our EU businesses now operate as partner facing entities with a single support hub in Spain. In the UK back book business we have implemented a significant reduction in costs which will seek to maintain margins in line with the ongoing decline in its turnover. In India we have added an investment in a majority stake in Globiva, one of India’s fastest growing business process management (BPM) companies, which gives us an in-house option for the rationalisation of back office cost structures. Equally, new product development has become a system integration activity, accessing and linking available applications, cutting both time and cost in bringing new concepts to market.”

Sir Richard said that India “was the star performer last year” and that CPP needed to ensure future growth by adding value to the existing partner base. China has now completed its new IT platform to conform with Chinese data residency requirements. 

During the first quarter of 2019, a new company in Singapore was incorporated to provide a South East Asia commercial hub. Sir Richard added: “The formalisation of our EU hub leaves us ideally placed to effectively respond to the eventualities of Brexit, which we do not anticipate having a significant impact on the day-to-day operations of the Group.”

CEO Jason Walsh added that the business had  an “unrelenting emphasis on operational efficiency and cost control, and reinvesting the benefits from this into developing our growth markets, business partnerships and technology solutions.”

He added: “During 2018 we have undertaken extensive restructuring activities across our traditional European markets of Spain, Germany, Italy, Portugal and the UK. This action realigns the cost base and has enabled us to create significant operational efficiencies and plan for the impact of Brexit through the formalisation of an EU operating hub in Madrid.”

 Walsh added: “2018 has been a year of continued strong progress for the business. We have stayed true to the core principles of our strategy and have delivered strong revenue growth and fundamentally shifted the dynamics of the business. We have the platform to seize the opportunities that exist with our partners to provide them with the products and services we excel in.

“We are looking to the future with increasing confidence and expect further strong strategic and operational progress in 2019.”