CPP loses 300k customers in four months
TROUBLED credit card insurer CPP Group has seen its revenues fall 38% on last year, and has lost another 300,000 UK customers since the end of June.
The York-based company said in an interim statement covering the end of June to date that the fall in revenue reflects the challenges of its operating environment, primarily in the UK.
In July, it finalised £36m of long-term refinancing, to be used for both working capital and to pay compensation to customers after it was fined £10.5m last November by the Financial Services Authority for mis-selling insurance products.
The group said that annual renewal rates have declined a further 0.6% since the end of June to 70.7% while its live policy base reduced by 300,000 in the same four month period, with 7.6 million UK policies in total.
CPP expects UK renewals to continue to decline in the short-term because of continued publicity and communication with cutomers around compensation.
Brent Escott, who was appointed as the new chief executive in September, said: “Our immediate priority is to strengthen the group as we enter the next phase of our development.
“We are working towards rebuilding CPP’s reputation and repositioning our business model to provide longer-term stability, continuing the improvements required to operate in a regulated environment and create a sustainable business proposition for the long-term.”
CPP made an underlying operating loss from continuing operations of £3.5m in the six months to June 30, compared to a £14m profit for the same period last year on revenue of £99.7m, down from £136.9m last time.
