City news: CPP hit by impact of mis-selling; Premier Farnell making progress

TROUBLED CPP Group today said has seen a 41% decline in revenue over the past year following its heavy punishment for mis-selling insurance products.

The York-based insurer, which specialises in ID and credit card theft protection, was fined £10.5m by the Financial Conduct Authority in 2012 for mis-selling insurance products and is paying out £65.8m in compensation to customers. Earlier this year, it was announced that seven million customers who were mis-sold insurance would receive a pay-out. 

Chief executive Brent Escott, said that costs have been reduced by £15m in the last 12 months but CPP continues to face major challenges with live policies down by 600,000 since the end of 2013.

He said: “We continue to make good progress. Our priority is to strengthen the group as we develop our longer term strategy for growth and move forward with a more stable foundation. We are focused on completing the process to review claims and, where appropriate, pay redress, managing our costs and continuing to make the improvements and changes required as we rebuild, improve, modernise and evolve.”
 
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TECHNOLOGY products distributor Premier Farnell today said it had made a positive start to the year as its markets saw improvement.

In an interim management statement for the period from February 3 to May 14, the group said that sales grew 2% year-on-year and
and 2.2% excluding sales of its Raspberry Pi children’s computer product.

The group said that gross margin in the first quarter is expected to be consistent with the fourth quarter of last year.

It said sales in Europe were more robust than the UK where they were broadly flat while Asia Pacific continued to be strong and sales in the Americas were up 0.8% despite the severe winter.

Premier Farnell said: “We remain focused on developing our Americas business into a digital enterprise and optimising its financial performance over the medium term.”

Laurence Bain, chief executive, commented: “The year has begun positively as the group benefited from our investments and
the gradual improvement in our markets. At the full year results, we outlined that we are investing in our strategy whilst optimising our business in line with market conditions. We continue to expect a year of further progress in achieving our strategic goals with our full year expectations remaining unchanged.”