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					                                       Annual Report 2008

Delivering an exceptional experience
for our customers, business partners
and employees
CPP–trusted partner for                              CPP is a rapidly growing international

                                                                                                        CPP Group Plc Annual Report 2008
businesses worldwide                                 marketing services business that
                                                     generates incremental revenue,
                                                     reduces costs and enhances customer
                                                     loyalty for its business partners by
                                                     providing outsourced customer-
                                                     management services and annuity-
                                                     based Life Assistance products.

                                                     04   Introduction
                                                     05   A selection of our major business partners
                                                     06   2008 highlights
                                                     09   Chairman’s statement
                                                     11   Group Chief Executive’s review
                                                     14   CPP Group board and senior management team
                                                     18   Business review – Northern Europe
                                                     22   Business review – Southern Europe
                                                     26   Business review – North America
                                                     30   Business review – Asia Pacific
                                                     34   Business review – New international markets
                                                     36   Corporate social responsibility
                                                     38   Financial review
                                                     40   Corporate governance statement
                                                     43   Summary Financial Statement
                                                          Independent auditors’ statement
                                                     45   Summary consolidated profit and
                                                          loss account
Front cover image:                                   47   Summary consolidated balance sheet
At CPP we handle all of our 16 million sales and
                                                     49   Consolidated cash flow statement
service calls locally. Pictured on the front cover
is a leading UK agent, activating a customer’s       50   Notes to the accounts
payment card on behalf of a business partner.        56   CPP Group addresses
Our Account Directors provide dedicated
support, ensuring that we maximise customer
engagement, revenue generation and reduced
cost for the benefit of our business partners.
Introduction                                                                                                          A selection of our major business partners

Since 2000, CPP’s expansion has been focused on             CPP’s in-house expertise includes research and
                                                                                                                      Abbey                                   Fiditalia

                                                                                                                                                                                                    CPP Group Plc Annual Report 2008
international growth and new product development,           customer insights, which track market trends
alongside consolidation of our presence in the UK           and consumer behaviour. Our data-management               Accord Italia                           Findomestic Banca
market. This has delivered consistently strong              and analytical expertise delivers accurate customer
business results, generated by established and              targeting and campaign effectiveness, alongside           Accordfin                               Fingerhut
new operations across Europe, USA and Asia.
We continue to build our business with recently
                                                            multi-channel marketing campaigns, with an
                                                            emphasis on telemarketing and contact centre
                                                                                                                      Allied Irish Bank (GB)                  First Trust Bank
launched operations in countries including Turkey           management. Complementary to this, our award-             Agos S.p.A.                             GE Money
and Malaysia, and have commenced trading in the             winning call centre training delivers improved
high-growth market of India.                                sales skills and overall performance, supported           Alliance & Leicester                    Gruppo Banca Popolare
In addition, CPP can now provide its multi-sector
                                                            by excellent customer service and policy
                                                            administration capabilities.
                                                                                                                      Alliance Bank Berhad                      dell’Emilia Romagna
business partners with a broader portfolio of Life                                                                    Alliance Data                           Hang Seng Bank
Assistance products designed to help consumers              We currently operate in 13 countries, working with
cope with the complexities and anxieties of modern          more than 200 business partners. During 2008 we           Banca Popolare di Milano                Hong Leong Bank Berhad
living. Our heritage is in the financial services sector,
but we have expanded beyond this to operate in
                                                            handled almost 12 million telemarketing calls, more
                                                            than four million customer service calls and mailed
                                                                                                                      Banco Popular                           HSBC
retail and mobile phone markets. Plans are already          over 55 million people worldwide.                         Banco Santander                         Intesa Sanpaolo Private Banking
in place to extend our reach further by delivering
products with travel and utility business partners.         We continue to invest in the design and deployment        Banesto                                 Kotak Mahindra Bank
                                                            of our core systems and processes to deliver a
New products were introduced to our portfolio               highly secure and robust technology platform in all
                                                                                                                      Bank Asya                               Linea
in 2008 to complement Card Protection, Identity             operations. In 2008, we enhanced our e-commerce           Bank of Ireland                         M&S Money
Protection, Legal Protection and mobile phone               capability, with online sales and service functionality
insurance. These include emergency assistance               for our products. We encourage business partners          Bank of Scotland (Ireland)              MBNA Europe
products, personal possessions cover and a broader          to integrate this into their core marketing activity.
range of packaged account and wholesale                     Our IT platform continues to receive ISO27001
                                                                                                                      Bankinter                               Meteor
programmes. More products are in development                certification for Information Security.                   Barclaycard                             National Australia Group
for commercial test and launch in 2009, including
home and mobile technology related products.                CPP is a valuable and trusted partner, offering a         Barclays                                Nationwide
                                                            unique combination of managed consumer products,
The sale of our products, through CPP and                   channel and distribution management and business          BBVA                                    Octopus Connect
business partner managed channels, generates
incremental income for our business partners
                                                            services. These provide our business partners with        Caja Madrid                             Offi – Te Abla
                                                            incremental annuity income, cost reduction benefits
through commissions. Our multi-channel                      and the ability to exploit new market opportunities.      Carrefour S.F                           Oney – Crediplus
management expertise, high customer engagement
model, effective renewal marketing activity and                                                                       Cetelem                                 RBS
high-quality customer services combine to deliver
industry-leading renewal rates and sustained
                                                                                                                      CIMB Berhad                             Santander Consumer Finance
income and profit.                                                                                                    Citibank                                Santander Totta
Our specialist knowledge and expertise, developed                                                            – Gruppo Monte                Standard Chartered Bank
over almost 30 years, enables us to design and
deliver bespoke marketing programmes to meet
                                                                                                                       dei Paschi di Siena                    Telecor
business partner and consumer needs. In many                                                                          Credial                                 Tesco Personal Finance
cases, business partners are contracting with CPP
to deliver channel marketing activity first, before                                                                   Crédito Agrícola                        T-Mobile
selecting a specific product for their customers.
This approach has driven growth in card activation
                                                                                                                      DenizBank                               UK Post Office
and safe-receipt inbound telemarketing campaigns                                                                      Egg                                     Ulster Bank
across CPP operations, sustained by the issue and
re-issue of credit and debit cards.                                                                                   Euphony                                 Wells Fargo
2008 highlights

CPP at a glance
In our key international markets payment fraud continues to rise,
affecting consumers and businesses around the world. Our 2,000
employees work with over 200 business partners, handling 16 million
sales and service calls in order to protect our 11 million customers.

Group financial highlights                                                          Group operational highlights

                                                                                                                                                                                              CPP Group Plc Annual Report 2008
Revenue                                    Operating profit (before goodwill        Total consumer sales and service calls:     Customer numbers:

                                                                                    16m                                         11m
                                           amortisation and exceptional items)

£m                                         £m

259.5                                      32.5
                                                                                    Number of business partners:                Employee numbers:

                                                                                    200                                         2000

150.7                                      19.2


                                                                                    Employee engagement scores (satisfied):     Customer satisfaction

                                                                                    82%                                         78%

                  04   05   06   07   08                   04   05   06   07   08

Gross Profit                               Cash flow from operating activities      International fraud figures

£m                                         £m
                                                                                    Region                   Country            2006                    2007      All fraud figures relate
104.9                                      35.6
                                                                                                                                                                  to losses through
                                                  34.7                              Northern Europe          UK (£m)            427                     535.2     counterfeit card fraud,
90.1                                                                                                         Ireland (Em)       –                       12.5      lost and stolen cards,
                                                                                                             Germany (Em)       56.8                    56.3      cardholder not present,
77.9                                                                                                         Turkey (YTLm)      20                      11.6      mail non-receipt and
69.2                                                                                Southern Europe          Spain (Em)         176.2                   191.3     card ID theft.
                                           21.8                                                              Italy (Em)         37.3                    38        (Source: UK – APACS
61.2                                              21.3
                                                                                                             France (Em)        252                     250       data, Ireland – Irish
                                           18.5                                                              Portugal (Em)      141.2                   157.4     Payment Services
                                                                                                                                                                  Organisation. All other
                                                                                    North / Latin America    USA ($m)           1,733.0                 2,120.3   countries – Euromonitor).
                                                                                                             Mexico (MX$)       1,070                   1,777
                                                                                    Asia Pacific             Hong Kong (HK$m)   33                      35.1
                                                                                                             Malaysia (RMm)     26                      23.1
                                                                                                             Singapore (S$m)    5                       5.3
                                                                                                             India (Rsm)        937                     1,188.1
                                                                                                             Taiwan (NT$)       258.7                   156.2
                  04   05   06   07   08                   04   05   06   07   08                            China (RMBm)       221                     271.3
                                                Chairman’s statement

                                                In a year when worsening economic conditions              That is why I take great pride in the many long-term

                                                                                                                                                                       CPP Group Plc Annual Report 2008
                                                posed a major challenge for businesses around the         relationships CPP has been able to forge with some
                                                globe, I’m pleased to report that 2008 was another        of the world’s leading blue-chip organisations over
                                                year of growth for CPP. This achievement is               the years. Some of these relationships have endured
                                                testament to the resilience of the CPP business           for more than 20 years. More than half of our top UK
                                                model and the creativity and unwavering dedication        business partner relationships have spanned 12 years
                                                of our leadership team, management and employees.         or more, and most contracts we sign are for between
                                                                                                          three and five years. Nearly all of the relationships
                                                It was undoubtedly a tough year for businesses            we develop are exclusive, so that only CPP products
                                                in most areas of the world, as the credit crunch          and services are offered to our partners’ customers.
                                                took hold and one by one economies dipped                 Such long and loyal relationships demonstrate the
                                                towards recession. GDP growth in countries from           quality of service we deliver and the value placed on
                                                the USA to China fell significantly from 2007 levels,     our products by some of the leading businesses in
                                                with developed economies the worst hit. All major         the world today.
                                                developed economies are now either in or close
                                                to recession, while growth in emerging and                Tangible benefits
                                                developing economies is slowing significantly.            CPP’s sustained growth over the past 29 years has
                                                                                                          been achieved by delivering tangible benefits to
                                                Continued growth                                          our business partners, including revenue growth,
                                                In these challenging circumstances CPP has                improved customer loyalty and access to market-
                                                continued its growth trajectory, which is an              leading products. The high-quality, reliable and
                                                indication of the strength of our business today.         responsive service we deliver helps our partners
                                                Our scale and our diversity, both in terms of             to retain customers for longer and builds strong
                                                products and geographical spread, help to protect         brand loyalty. We have also invested in technology
                                                the Group as a whole against adverse economic             to improve our interactions with business partners,
                                                conditions in different parts of the world.               including access to new distribution channels and
                                                                                                          to enhance the overall customer experience.
                                                That doesn’t mean that keeping the business
                                                growing hasn’t required hard work and immense             Fit for the future
                                                creativity from everyone at CPP. This year our            All forecasts for 2009 predict further global
                                                management team focused on increasing our                 economic slowdown, which will continue to test
                                                understanding of business partner needs and,              the ability of our business to endure difficult times.
                                                crucially, the needs of their customers.                  We recognise that the global recession will make
                                                                                                          life tough for our business, with margins under
                                                Long-term business partner relationships                  pressure across the Group.
                                                Central, as ever, to our success in all markets in 2008
                                                has been our relationships with business partners.        However, CPP is a robust business in good shape
                                                Since CPP was launched in 1980, the business has          and in a strong position to weather these economic
                                                been built on a business-to-business-to-consumer          storms. I have full confidence in the expertise and
                                                model. Our business partners are critical to CPP and      capability of our senior management team to
                                                that’s why building deep, loyal, mutually beneficial      navigate the business successfully through the
                                                and long-term relationships with them has been key        current and expected market challenges. The team
                                                to our success from day one. We believe it is             will closely monitor our performance in all markets
                                                fundamental for us to develop strong relationships        and industry sectors over the coming months and
                                                with high-quality business partners in order to build     years to ensure sustained and profitable growth.
                                                trust and confidence in our professional services,
                                                products and outsourced capability.

                                                                                                          Hamish Ogston

As a provider of Life Assistance products and
services our New Product Development team
regularly meets to generate and develop new
and existing products as we seek to satisfy
business partner and consumer needs.
                                                Group Chief Executive’s review

                                                Group overview                                             We have signed two major business partners in

                                                                                                                                                                    CPP Group Plc Annual Report 2008
                                                As I reflect on 2008, CPP’s traditional focus on           Turkey: Bank Asya and DenizBank. These are both
                                                relationship building with business partners and           brands with strong customer relationships, providing
                                                on developing longer-life renewal income streams           a very good opportunity for CPP to promote our
                                                has served us well, particularly given the economic        products and services in this exciting market.
                                                turbulence experienced in most regions throughout          What’s more, I am delighted to report that at the
                                                the year. It was also another year of characteristically   end of 2008 we reached our first 50,000 policy
                                                challenging targets. I am pleased to report that           sales in this growing market.
                                                revenue and operating profit increased in all
                                                established regions, and revenue increased in our          Southern Europe, in particular Spain and Italy, has
                                                recently launched markets. Overall, Group revenue          suffered to some extent from the worldwide credit
                                                increased by 15% and operating profit (pre-goodwill        crunch. The final stages of the Insurance Mediation
Eric Woolley, Group Chief Executive, leads      amortisation and exceptional items) by 23% on 2007.        Directive have been implemented, which means
CPP’s Senior Executive team and has been                                                                   we now have greater clarity on legal and regulatory
the driving force behind the Group’s strategy   This performance represents sustained growth over          matters that have inhibited growth over the past
and growth over the past five years.            the past decade as the business continues to expand        18 months. In Portugal, negotiations with new
                                                internationally, working with business partners across     business partners have progressed well and new
                                                market sectors. We offer an increasingly diversified       campaigns will be introduced in 2009. In France,
                                                product portfolio to drive sales and marketing activity    revenue was up 30%, resulting in a profitable 2008.
                                                through multiple channels. Strong new income
                                                generation combined with industry-leading customer         Our North American business performed well during
                                                renewal rates and prudent, proactive cost                  the year, generating 7% revenue growth and,
                                                management and innovative solutions have all               following effective cost management, operating
                                                contributed significantly. Our overall financial result    profit figures that were ahead of budget and
                                                has also benefited from an increasing contribution         significantly up on last year. The team has continued
                                                of foreign currency sourced revenue and profit.            to grow customer enrolments, while lowering the
                                                                                                           cost of acquisition. Fingerhut has recorded strong
                                                Regional overview                                          enrolments each month since introducing our
                                                Our Northern European region has performed well,           jointly developed new web channel, and our work
                                                with good growth, achieving an increase in revenue         with First Premier is a good example of starting
                                                of 16%.                                                    small and building up through a close working
                                                                                                           partnership. The US business has made a good
                                                In the UK, we have performed robustly under the            recovery and we are expecting to see further
                                                circumstances and have laid strong foundations             improvements through 2009.
                                                for future revenue and profit, with new products
                                                scheduled for launch in 2009. We were successful           After an exciting five years since our launch in
                                                in signing new business partners for our innovative        Asia Pacific, CPP is now well established in Hong
                                                card activation and safe-receipt programmes, which         Kong, Singapore and Malaysia. Overall, the region
                                                break the mould of traditional outsourcing models.         delivered 36% revenue growth on 2007. Our
                                                It’s a model that sees the outsourcer reduce costs         expansion into Malaysia has produced impressive
                                                and generate incremental revenue, while delivering         results. After less than two years since launch,
                                                a high-quality customer service and supporting             Malaysia is now contributing 34% of Asia’s total
                                                customer loyalty. In most cases it is the cost             revenue. We are also successfully developing
                                                reduction benefits that really drive the development       partner-managed sales channels.
                                                of these channels.

                                                In Germany, we made significant progress with the
                                                introduction of an in-house telemarketing operation,
                                                which we believe will have a positive impact on our
                                                ability to win new business. New regulations relating
                                                to outbound telemarketing have come into force in
                                                Germany, and CPP’s inbound telemarketing and
                                                safe-receipt campaigns represent an innovative
                                                solution to this regulatory change.
Over the past ten years we have successfully            Given the current state of world economies, an
expanded into new international markets and 2008        internal initiative that continues to demand close
marked a significant stage in this growth strategy.     scrutiny is ‘Managing for Value’. We continue to
India formally launched in December with four           keep our overheads and cost base lean and remain
business partners selling Card Protection via a         focused on the effectiveness and allocation of
number of sales channels. Throughout 2008,              resources, so that we can return savings to our
a locally appointed management team has been            business partners by way of value. This also requires
developing the Mexican market, with commercial          an honest and direct dialogue with business partners
launch scheduled for the first half of 2009. And        and suppliers to ensure we achieve mutual benefits.
the Asia Pacific management team has been
investigating and planning our launch in China.         In recent years, CPP has developed software
Each of these markets offers sustainable high-volume    applications to support contact centre and
potential for multiple products and market sectors.     e-commerce interaction with current customers
Our capabilities and approach have been well            and prospects. This year we extended this capability
received by business partners in these regions and      to provide a secure sales portal that can be rapidly
we are investing in local management and resources,     deployed at business partner branches. Our
as well as leveraging Group capability and expertise.   telephony platform now provides customer-friendly
                                                        speech recognition technology which can be used
Group-wide initiatives                                  to automate key services at peak times, without
Throughout the year, improvements have been             impacting service levels.
made to customer sales and service and our overall
operating model. Monthly global dashboards were         We have completed ahead of schedule a major
introduced to monitor standard KPIs, enabling full      programme of activity to meet the new PCI
visibility of operational performance across the        (Payment Card Industry) compliance standards,
Group for both in-house and outsourced services.        which included a global migration of our database
This was supported by bi-annual Group operations        platform. We have also invested in a strategic
workshops, sharing best practice and developing         technology platform providing in-house data
strategic initiatives. Extracts from these global       cleansing and data-management capabilities,
dashboards are now made available to our business       which will improve our analytics capability, flexibility
partners online and off-line, providing a unique        and speed to market for acquisition, cross-sell and
perspective on real-time performance.                   renewal campaigns.

Performance-management processes have been              Business outlook
implemented globally. We can now analyse people         The external economic climate continues to cause
performance data across countries to identify           challenges across the Group. With increased
trends and develop best practice. This is a             pressure on the financial services market, we need
continuation of our work to develop coherent            to work harder than ever to continue our success
business values and people capabilities to support      and growth. We all know that difficult economic
a high-performing culture.                              conditions cause real pain in the community and
                                                        the workplace. However, economic cycles are,
CPP has invested in building an integrated HR           unfortunately, a fact of life and we must operate in
system with a phased programme of modules               all phases of the cycle with the same professionalism
to ensure the effective management of the full          and energy. It is the sign of a robust business that
employee cycle, from recruitment, induction and         it can outperform in all weathers.
training through to continuous development and
succession planning. Our range of HR initiatives        We have positioned the business in the marketing
ensures that talent management is at the heart          services sector, offering end-to-end bespoke
of our business.                                        customer-management solutions to business
                                                        partners, underpinned by our Life Assistance product
                                                        portfolio. While we will continue to make refinements
                                                        to the business model, we believe we have found a
                                                        strategic role that is international, durable and offers
                                                        substantial growth over the long term.

                                                                                                                   In-depth analysis of customer behaviour
                                                        Eric Woolley                                               and predictive modelling are used to improve
                                                                                                                   the effectiveness of our customer acquisition
                                                                                                                   and retention activity.
        CPP Group board and senior management team

                                                                                                                                                                                                                                             CPP Group Plc Annual Report 2008
1   2              3                    4                     5                   6                  7                    8                  9                     10                  11                   12                    13

        1 Hamish Ogston                                           5 Tim Kelly                                             8 Mike Kneafsey                                          11 Ignacio Mier
        Non-Executive Chairman                                    Non-Executive Director                                  Group Consumer Sales and Services Director               Managing Director, Southern Europe
        Hamish founded CPP in 1980 and became                     Tim is Chairman of the Group Remuneration               Mike has more than 20 years’ experience of sales         Ignacio has extensive knowledge of the finance,
        Non-Executive Chairman in 1999.                           Committee and is a sales and marketing professional     and marketing in the financial services industry.        tourism and insurance sectors in Spain. Since
                                                                  with experience in numerous markets around the          Before joining CPP he was Regional Managing              joining CPP in 1995 Ignacio has further developed
        2 Eric Woolley                                            world. He has worked for many leading companies,        Director for retail banking at Barclays Plc in the       and grown the CPP Spanish operations and has
        Group Chief Executive                                     including Unilever, Coca Cola and Diageo. Tim was       North of England, Scotland and Northern Ireland,         overseen the opening of additional operations in
        As Group Chief Executive, Eric is responsible for         COO for RHM from 2003 to 2007 and part of the           leading a team of 5,000 staff. Prior to this, Mike       Italy, Portugal and France. He is responsible for
        developing and executing the Group’s business             management team that took the company from              spent 17 years at HSBC, holding senior-management        these countries as Managing Director, Southern
        strategy across Europe, North America and Asia.           private equity to a successful IPO in 2006. Tim is      positions in its branch and contact centre businesses    Europe, based in Madrid.
        Eric joined CPP in 2003 from an oil services              now COO for Premier Foods, the UK’s largest food        and with First Direct, before becoming Sales and
        company, Expro International Group Plc, where he          company, which acquired RHM in 2007 and is Board        Service Director for M&S Money.                          12 Dave Pearce
        was Group Finance Director. Prior to this, Eric was       member of Premier Plc.                                                                                           Managing Director, North America
        Group Finance Director of Vp Plc. Before working                                                                  9 Richard Coates                                         Dave joined CPP in 2005, bringing with him
        in industry, Eric spent several years with Credit         6 Shaun Parker                                          Group Marketing Director                                 extensive senior management experience gained
        Suisse First Boston.                                      Group Finance Director                                  An experienced marketing professional, Richard           in the retail and financial sectors – experience that
                                                                  Shaun is responsible for the Group’s Finance and        has led the marketing function at CPP for the past       will aid the development and performance of the
        3 Colin Lloyd                                             Legal/Compliance functions. Prior to joining CPP        five years. Prior to joining CPP, Richard was Director   CPP Group across the North American region.
        Non-Executive Director                                    in 2003 Shaun worked for a number of blue-chip          of Marketing and Strategic Planning for a major hotel    Prior to joining CPP, Dave led marketing, consumer
        Colin is current Chairman of the Fundraising              organisations, including ICI Plc, Mars Inc. (Pedigree   brand, and previously held positions with a number       research and strategic planning at Liberty Enterprises
        Standards Board, the UK government-funded                 Petfoods) and Diageo Plc. Here he was CFO               of high-profile US-owned marketing agencies.             and retail marketing at Wells Fargo Home Mortgage.
        self-regulatory body for the charity sector. He is also   Guinness North America, prior to leading a cross-       Richard’s responsibilities at CPP extend across
        past CEO and subsequently the first President of the      functional team that completed the integration          corporate strategy, business planning, brand strategy,   13 Grace Tsang
        Direct Marketing Association (UK), Chairman of the        of the Seagram Wines and Spirits business.              product portfolio, channel and market development.       Managing Director, Asia Pacific
        Telephone Preference Service, past President of the       Shaun has extensive international experience            His qualifications include an MBA from Leeds             Grace is responsible for the development and
        Institute of Sales Promotion and Non-Executive            gained in the UK, Germany and USA.                      University Business School.                              performance of CPP across the Asia Pacific region,
        Chairman of Motivcom Plc. In 1970, Colin founded                                                                                                                           including Hong Kong, Singapore, Malaysia, China
        KLP Group Plc, which became the largest promotion         7 Neil Hamilton                                         10 Stephen Kennedy                                       and Taiwan. Prior to joining CPP in 2008, Grace was
        marketing services company in the world.                  Group IT and Business Services Director                 Managing Director, Northern Europe                       Regional Director at Prudential Asia Corporation,
                                                                  Since joining CPP in 2002, Neil has been responsible    Stephen is responsible for the performance of the        responsible for the direct-marketing channel across
        4 Peter Morgan                                            for the definition and implementation of a new IT       UK business, as well as the development of the Irish,    Asia. Grace brings with her almost 20 years’
        Non-Executive Director                                    platform capable of meeting the Group’s ambitious       German and Turkish markets. He joined CPP in 2005        experience in marketing and direct distribution from
        Peter is a Chartered Accountant and is Chairman           growth plans. Prior to joining CPP, Neil was Group      from HFC Bank where he was a Director of several         the retail financial services sector in Asia, gained at
        of the Audit Committee. Until 2003 he was a partner       IT Director for the business process outsourcing        business units. These ranged from branch networks        HSBC, AIG and Prudential.
        in Deloitte and Touche, dealing predominantly             division of Hays Group Plc. Before Hays, Neil was       in the UK and Europe to lending and central sales
        with entrepreneurial high-growth businesses,              Head of IT Services for Perot Systems and has held      operations, which included Hamilton Direct Bank,
        many of which were private-equity backed or had           a variety of other IT-management positions.             Marbles Loans and all group telemarketing activities.
        public listings. During his career, Peter was also
        responsible for managing the London audit and
        assurance department, chairing a committee
        overseeing the firm’s technical and training functions
        and for developing marketing activity for rapidly
        growing companies.
CPP conducts regular mystery shopping
at our business partner’s retail shops in order
to ensure we are fully compliant and treat
customers fairly, in line with the Financial
Services Authority’s regulations.
                                                                                                                                                                  Business review: Northern Europe

                                                                                                                                                                  CPP regional summary                                      products, achieving significant revenue growth in

                                                                                                                                                                                                                                                                                     CPP Group Plc Annual Report 2008
                                                                                                                                                                  Despite the credit crunch and the subsequent              2008 over the previous year. This has been driven
                                                                                                                                                                  financial crisis, CPP’s Northern European region –        by new product variants with Bank of Ireland, Bank
                                                                                                                                                                  consisting of operations in the UK, Ireland, Germany      of Scotland (Ireland) and new contracts with AIB (GB).
                                                                                                                                                                  and Turkey – collectively delivered £181.1m in revenue,   We also launched our first safe-receipt programme
                                                                                                                                                                  representing a 16% increase on 2007. This was fuelled     for Ireland with Ulster Bank. We will be launching
                                                                                                                                                                  by increased Identity Protection sales in the UK as       Identity Protection early 2009 with key business

                                                                                                                                                                  the market continued to grow, as well as increased        partners in Ireland and investigating the packaged
                                                                                                                                                                  inbound telemarketing call volumes across the region.     accounts market.
                                                                                                                                                                  To achieve this, we invested heavily in technology
                                                                                                                                                                  and a new customer contact centre in Chesterfield,        Germany
                                                                                                                                                                  as well as establishing an in-house telemarketing         Following revenue growth in 2008, we relocated the
                                                                                                                                                                  unit in Hamburg.                                          German office from Regensburg to Hamburg. This
                                                                                                                                                                                                                            not only put CPP Germany at the heart of the financial
                                                                                                                                                                  UK                                                        district, but enabled us to access a broader
                                                                                                                                                                  CPP UK’s maturity and diversified nature enabled it       employment pool – providing the conditions necessary
                                                                                                                                                                  to resist the worst aspects of the external market        to develop an in-house telemarketing capability.
                                                                                                                                                                  turmoil at the end of 2008. The UK business recorded      Existing business partners Barclaycard Germany,
                                                                                                                                                                  growth across its core financial services sector from     Santander and LBB generate the largest volume, with
                                                                                                                                                                  both retail and wholesale products, while reducing        outbound campaigns focusing on the partner product
                                       Stephen Kennedy                                                                                                            the cost of outsourcing services to business partners     and Card Protection. A new contract with Postbank
                                       Managing Director,                                                                                                         and focusing on customer retention.                       for outsourced telemarketing has already been signed.
                                       Northern Europe                                                                                                                                                                      Further inbound and outbound telemarketing
                                                                                                                                                                  Key accomplishments in 2008 included winning new          contracts will be confirmed in 2009 as we seek to
                                                                                                                                                                  card activation and safe-receipt contracts with Tesco     take advantage of new marketing legislation.
                                                                                                                                                                  Personal Finance and National Australia Group, and
                                                                                                                                                                  new product contracts with ASDA. Packaged current         Turkey
                                                                                                                                                                  account product lines also grew in 2008, including        Increased demand from Turkish banks to drive income
Regional economic overview                                                                                  4 year turnover                                       a major contract win with Abbey. The growth of            from cross-sell products, as net interest margins from
The financial crisis across Northern Europe                                                                                                                       inbound telemarketing activity for business partners      credit cards have declined, has led to our partners
reached unexpected proportions in the latter                                                                £m
                                                                                                                                                                  resulted in the opening of CPP’s third UK contact         DenizBank and Bank Asya promoting Card Protection
half of 2008. Commodity price increases
boosted headline inflation, depressing
                                                                                                           181.1                                                  centre during the summer. We now have more than           through inbound and outbound telemarketing
                                                                                                                                                                  800 sales, service and claims agents over our three       channels. The performance through telemarketing,
consumption and damaging consumer                                                                                                                                 UK locations.                                             in particular, has been very positive and by the end
confidence. Growth is expected to stagnate                                                                                                                                                                                  of 2008 we had sold our first 50,000 policies. Based
in the near term in most advanced European                                                                                                                        Consumer Sales and Service delivered strong               on this success, new partners will be announced
economies as house price booms deflate and                                                                  156.0
                                                                                                                                                                  revenue growth while transforming its sales approach      throughout 2009. As with most international markets,
banks curb credit availability to steady their                                                                                                                    from advised to non-advised and strengthening its         we are starting to see increased business partner and
reserves. As a knock-on effect, general market                                                                                                                    senior operations team.                                   consumer concern about identity theft. As a result,
growth is expected to slow down significantly                                                                                                                                                                               we will investigate and pilot a variant of Identity
in European economies. As a result of the                                                                   135.7
                                                                                                                                                                  Product innovation continued throughout the year.         Protection in Turkey during 2009.
economic climate, card issuers have tightened                                                                                                                     We signed a joint venture agreement with Mapfre
their credit scoring for credit card customers,                                                                                                                   Asistencia in November 2008 to create Home 3              Outlook
leading to a fall in new card issuance and                                                                  117.2                                                 Assistance, a new and differentiated home-assistance      There is no question the economic and regulatory
reduced credit limits. Furthermore, consumers                                                                                                                     service. There were also enhancements to Identity         outlook has got tougher in the UK. However, our
are reacting by cutting back on credit card                                                                                                                       Protection and the launch of One Call, a pure             outsourced sales and services channels are growing
use in favour of debit cards and cash.                                                                                                                            assistance variant of Card Protection designed for        very strongly and complement our business partners’
                                                                                                                              05   06   07     08                 non-regulated sales channels. Building on successes       ambitions to reduce costs in their own operations.
                                                                                                                                                                  in Southern Europe and the USA, we also piloted
                                                                                                                                                                  Your Law in the UK in October. The use of mobile          Moreover, there are exciting opportunities through
                                   Bankable                      Real                   Debit                   Debit     Credit           Credit       Mobile
                                                                                                                                                                  technology as a platform for product sales and service    product and technology innovation to leverage our
                                  Population                     GDP                    cards                   cards     cards             cards        phone
                                       2008                     2009                    2008                    2009       2008             2009    subscribers   continues to be of significant interest and further       business partners’ distribution channels even further.
                                   (Age 15+)                                                                 forecast                    forecast                 developments are planned in 2009.
UK                                   50.3m                    -3.2%                     75m                   74.9m      67.3m           66.5m          76.1m                                                               Our business in Turkey is also performing well due to
                                                                                                                                                                  Ireland                                                   new business partner relationships. In Germany the
Ireland                                3.3m                   -4.0%                    2.9m                      3.1m     2.3m               2.4m        5.4m     Eighteen months after opening our new office in           provision of outsourced services presents new
Germany                              70.9m                    -2.4%                   91.2m                   91.7m       3.8m               3.9m     102.4m      Dublin, we have steadily grown the Irish business         commercial opportunities hitherto untapped. Overall,
Turkey                               53.9m                    -1.5%                  58.9m                    61.6m      44.3m           49.8m         65.8m      across Card Protection and mobile phone insurance         the outlook in Northern Europe remains positive.
Source: Economist 2009, APACS 2007/08, Netsize Guide 2009, CIA Factbook 2008, Euromonitor 2008, Datamonitor 2008.
                                                                                Providing our employees with coaching,
                                                                                via their line manager ensures they have
                                                                                the right skills and knowledge to provide
                                                                                excellent customer service on behalf of
                                                                                our business partners.

Revenue:               CASE STUDY: T-Mobile

                       T-Mobile’s relationship with CPP goes back over
                       many years to the days of the Pocket Phone Shop.
                       Initially, CPP device insurance was sold solely
                       through the retail stores, but as the relationship has
                       developed, insurance is now sold through telesales,
                       customer service (loyalty and retention), business
Increase in revenue:   (loyalty and retention) and online channels.

                       The company’s retail estate is spread across four
                       territories and consists of 291 stores with
                       approximately 2,000 staff. Training on insurance
                       features and benefits is part of the induction process
                       for new starters. Each individual’s competency is
                       assessed and verified before they are allowed to sell
UK agents:             insurance to customers.

800                    To strengthen the commercial relationship CPP
                       introduced Regional Insurance Managers, who help
                       T-Mobile’s Territory, Area and Store Managers to
                       increase the rates of insurance attachment on the
                       devices sold and ensure that compliance training
                       is properly executed. CPP also plays a key role at
                       the T-Mobile contact centres. In this way, CPP goes
                       beyond the standard delivery of a typical service
                       provider in this industry.

                       CASE STUDY: Tesco Personal Finance
                       CPP has won two major contracts to provide Tesco
                       Personal Finance with Life Assistance products in
                       the form of Card Protection and Identity Protection.
                       These will drive significant policy growth and income
                       generation for the company.

                       Tesco Personal Finance and CPP rolled out a
                       significant call-to-confirm programme, using
                       professional and motivated agents to drive sales
                       of both products. CPP and Tesco also launched a
                       promotion to offer 1,000 Clubcard points to every
                       customer purchasing an Identity Protection Alert
                       policy during Q4 2008. These programmes
                       demonstrate CPP’s ability to coordinate multiple
                       campaigns as part of a wider, integrated multi-
                       channel marketing initiative.

                       Mark Thompson, Head of Insurance Operations
                       at Tesco Personal Finance, says: “As we are no
                       longer part of the RBS group, it is more important
                       than ever to establish and grow within the Tesco
                       brand. Working with CPP has allowed us to see our
                       potential within the Life Assistance market and also
                       quantified the opportunity moving forward. I am
                       looking forward to working with CPP on a number
                       of initiatives in the near future.”
                                                                                                                                         Business review: Southern Europe

                                                                                                                                         CPP regional summary                                      The training provided by CPP, combined with

                                                                                                                                                                                                                                                             CPP Group Plc Annual Report 2008
                                                                                                                                         The Southern European region reported a 16%               our operational expertise, have added real value
                                                                                                                                         increase in revenue to £45.3m. Foreign currency           to our business partner relationship.
                                                                                                                                         translation gains helped to boost this figure. This
                                                                                                                                         is a good performance considering the challenges          During 2008, Southern Europe significantly
                                                                                                                                         associated with the consumer market generally and         reinforced its activity on Legal Protection, with major
                                                                                                                                         also the implementation of the insurance Mediation        campaigns for Fiditalia and Barclays. Two emerging

                                                                                                                                         Directive. This new legislation affected all countries,   issues in Italy are mobile payments and identity theft,
                                                                                                                                         particularly Spain and Italy, as CPP and our business     both of which are starting to attract consumer and
                                                                                                                                         partners responded to new requirements for the            media attention. We will track these with interest
                                                                                                                                         marketing of insurance policies in the financial          and consider the feasibility of introducing Identity
                                                                                                                                         services sector.                                          Protection in the near future.

                                                                                                                                         Spain                                                     Portugal
                                                                                                                                         Spain recorded a positive year with a 10% increase        New contracts were signed with major business
                                                                                                                                         in revenue over 2007. Although growth was not as          partners including Santander Totta, Unicre,
                                                                                                                                         strong as in previous years, it was a good                Crédito Agrícola and new campaigns were
                                                                                                                                         performance delivered in tough trading conditions.        launched with Barclaycard and Oney-Crediplus
                                                                                                                                         We introduced new variants of Card Protection to          for Card Protection. As with our other Southern
                                                                                                                                         drive volume, as well as implementing price increases.    European businesses, improvements have been
                                       Ignacio Mier                                                                                                                                                made to Card Protection with Plus and Premier
                                       Managing Director,                                                                                During 2008, the business built on its established        variants introduced – both positively received by
                                       Southern Europe                                                                                   outbound welcome call programmes by increasing            existing and prospective business partners.
                                                                                                                                         inbound card activation campaigns on behalf of            Work is now underway to investigate the potential
                                                                                                                                         several business partners, including Santander and        launch of Legal Protection in 2009.
                                                                                                                                         Carrefour. To satisfy the new legal requirements,
                                                                                                                                         we created a new company, Key Line Auxiliar,              France
                                                                                                                                         enabling us to expand our in-house inbound                Our primary business relationship in France is with
Regional economic overview                                                        4 year turnover                                        campaigns, further leveraging our distribution and        Cetelem and, as a result of new Card Protection
Whilst regional economic growth remained                                                                                                 sales expertise. What’s more, we recognise that           variants being introduced in 2008, France delivered
reasonably strong overall, the main Southern                                      £m
                                                                                                                                         in-house campaigns tend to perform better than            a 30% increase in revenue. As with all European
European economies experienced downturns
in their business cycles towards the end of
                                                                                  45.3                                                   those that are outsourced.                                markets, consumer concern about identity theft and
                                                                                                                                                                                                   fraud is increasing, as is media interest. Given CPP’s
2008. Domestic demand softened and labour                                         39.1
                                                                                                                                         The management team has driven improvements               expertise and leadership in UK and North American
conditions became susceptible to this                                                                                                    in customer retention by improving process                markets, we are currently investigating the feasibility
weakening demand. The outlook for Southern                                                                                               efficiency in relation to customer engagement,            of introducing a fraud and identity protection product
Europe is subdued, marked by falling demand                                       31.2
                                                                                                                                         collections effectiveness and improved data quality.      designed specifically to meet the needs of French
in the domestic and external markets and                                                                                                 This will benefit what are already high renewal           business partners and consumers.
exacerbated by a lack of consumer and                                                                                                    rates, generating extended customer lifetimes
business confidence. Growth through 2009 is                                       21.3                                                   and increased income for business partners.               Outlook
expected to slow as tighter lending conditions                                                                                                                                                     Operations throughout the region will intensify their
and the high rate of inflation act as a drag on                                                                                          Italy                                                     sales activity in the coming year, while building
consumer spending and investment growth.                                                                                                 CPP Italy now works with the majority of consumer         relationships with the key finance sector associations.
                                                                                                                                         credit brands, providing a strong business base from      We plan to maximise the opportunities created by
                                                                                                                                         which to expand into new market sectors. Despite          Single Euro Payment Area (SEPA) and Carta Si
                                                                                                                                         declines in the credit card market and total cards        migration in Spain and Italy, as well as developing
                                                                                                                                         issued, the business delivered a 36% revenue growth.      identity protection products for countries across the
                                                                                                    05   06   07     08
                                                                                                                                         The local management team has provided support
                                                                                                                                         to business partners such as Barclaycard and              Inbound sales activity will be intensified, and we will
                                   Bankable                       Real    Debit       Debit     Credit           Credit        Mobile – Gruppo Monte dei Paschi di Siena              be exploring new scenarios with business partners to
                                  Population                      GDP     cards       cards     cards             cards         phone
                                       2008                      2009     2008        2009       2008             2009     subscribers   who are selling our products, in particular Card          help us develop and refine our products. At the same
                                   (Age 15+)                                       forecast                    forecast                  Protection, with inbound customer service functions.      time, strict cost controls and the enhancement of our
Spain                                38.4m                      -2.4%    31.4m      31.4m      22.3m               28.6m       51.1m     Group Banca Popolare di Milano has introduced             processes and technical solutions will help to see us
                                                                                                                                         Card Protection through multiple channels,                through the difficult economic conditions.
Italy                                 50.7m                     -2.5%    44.5m      48.7m      13.7m               16.3m      89.8m      including its branch network, welcome calls
France                                50.4m                     -1.8%    59.7m      61.4m       5.9m               6.0m       57.8m      and positive option. Mobile phone insurance
Portugal                               8.9m                     -2.0%    17.2m      17.6m       8.1m                9.2m       14.1m     was introduced in 2008 with focused distribution.
Source: Economist 2009, Netsize Guide 2009, Euromonitor 2008.
Increase in revenue:        CASE STUDY: Grupo Santander

                            During our ten-year relationship with Grupo
                            Santander across Southern Europe, CPP has evolved
                            from being a provider of card-related protection
                            products to a strategic supplier of revenue-generating
                            marketing services.

Revenue growth in Italy:    Building on our initial relationship in Spain, we now

                            partner Santander Consumer Finance in Italy and
                            Portugal, as well as Santander Totta in Portugal.
                            We work with the group in the UK via our business
                            agreements with Abbey, Alliance & Leicester
                            and GE Money. In Spain, we work with all of the
                            company’s card-issuing entities – Banco Santander,
                            Santander Consumer Finance, Accordfin, Banesto
Revenue growth in France:   and Openbank. The products we provide are Card

                            Protection (Plus and Premier), Legal Protection and
                            mobile phone insurance.

                            Ignacio Narvarte Ichazo, Director of Payment
                            Methods at Banco Santander in Spain, says:
                            “Santander has had a close relationship over ten
                            years with CPP, with the common aim that is most
                            profitable for both: that of offering more and better
                            services to our customers with each passing day.”

                            Following several successful sales campaigns across
                            the region, we are now focusing on card activation
                            programmes. Since these were launched in 2003
                            CPP has handled almost 7.5 million calls and carried
                            out six million activations. We have made 1.2 million
                            outbound calls and sold more than 750,000 Card
                            Protection, 55,000 Legal Protection and 6,000 mobile
                            phone insurance policies.

                            Ines Castrillo, Director of New Business and Card
                            Activation at Santander Consumer Finance, says:
                            “Through the collaboration with CPP, we have
                            transformed a card activation management channel
                            into a sales activity channel that hinges on our
                            marketing plan, thereby providing fundamental
                            backing for all of our card campaigns and added
                            value from bringing in CPP’s products. All of this is
                            achieved while taking great care over the quality of
                            customer service and reducing exposure to fraud.”

                            CPP’s capacity to offer tailor-made solutions
                            and our novel portfolio have made us the
                            international reference point for highly valued
                            marketing services and product innovations for
                            the entire Santander group.

                                                                                     As part of CPP’s end-to-end marketing service
                                                                                     to business partners, one of our suppliers designs
                                                                                     branded direct mail acquisition collateral for new
                                                                                     customer acquisition.
                                                                                                                                          Business review: North America

                                                                                                                                          CPP regional summary                                        Core to CPP’s consumer-focused strategy is a

                                                                                                                                                                                                                                                              CPP Group Plc Annual Report 2008
                                                                                                                                          Following 18 months of management focus                     passionate belief in the warmth and effectiveness
                                                                                                                                          on business partner requirements, new product               of the customer experience. We believe this is
                                                                                                                                          innovation, campaign effectiveness and cost                 an important differentiator and the key to growing
                                                                                                                                          reduction, the North American team has achieved             our business.
                                                                                                                                          revenue of £29.7m, up 7% on 2007.
                                                                                                                                                                                                      Expertise in managing outsourced marketing

                                                                                                                                          Servicing business partners through                         campaigns on behalf of business partners does
                                                                                                                                          relentless consumer focus                                   not come easily. Our team managers are supported
                                                                                                                                          Our market positioning is based upon a co-operative         by a full staff of trainers, a quality-assurance team
                                                                                                                                          business model. CPP operates as an extension of             and closed-loop reporting. Each step is continually
                                                                                                                                          each business partner’s team, executing qualitative         analysed and fine tuned to improve CPP’s total
                                                                                                                                          and quantitative consumer research, developing              value equation.
                                                                                                                                          new products that support consumer needs,
                                                                                                                                          implementing marketing campaigns to drive                   The introduction of enhanced data analytics and
                                                                                                                                          sales and managing key aspects of the consumer              propensity modelling, list quality and customer
                                                                                                                                          experience. A core part of the North American               segmentation has increased the return on investment
                                                                                                                                          business approach has been to structure its model           for CPP and our business partners. In 2008, our
                                                                                                                                          around fewer, yet more strategic business partners,         conversion rates grew 20%, while the cost-to-acquire
                                                                                                                                          including Alliance Data, Fingerhut and Wells Fargo.         dropped 21%, in spite of increased handling times.
                                       Dave Pearce
                                       Managing Director,                                                                                 Product development                                         Outlook
                                       North America                                                                                      Understanding consumer “need states” and                    Despite a very difficult economic environment and
                                                                                                                                          developing new products in co-operation with                expected falls in new and re-issued credit cards, our
                                                                                                                                          our partners has led to the introduction of several         pipeline and new client prospects remain strong.
                                                                                                                                          successful products. With the Fingerhut
                                                                                                                                          management team, CPP has developed Emergency                We are pleased to have secured a new contract
                                                                                                                                          Line and Legal Line, offering consumers protection          with HSBC USA, with new products planned for
Regional economic overview                                                         4 year turnover                                        against unforeseen emergencies and legal                    formal launch in September 2009. We expect to sign
The economic outlook and external market                                                                                                  challenges. Both products have simplified the               agreements with new US partners early in the year.
environment for the United States has yet                                          £m
                                                                                                                                          way consumers seek assistance in times of need,
to stabilise following the recent inauguration                                     30.5
                                                                                                                                          at an affordable annual price.
of President Obama. There are three key areas
that need to be addressed before the country
can return to sustainable levels of growth:                                               29.7                                            The introduction of LifeStyle Perks on behalf of
                                                                                                                                          Alliance Data and distributed via its high-street partner
resolution of the credit crunch, an improvement                                                                                           brands, such as Victoria’s Secret and Eddy Bauer,
in the declining housing market and recovery                                                                                              has been made possible by extensive co-operation to
of consumer discretionary spend. Longer term,                                                                                             develop features that provide travel and entertainment
recovery is realistically forecast to occur in                                                                                            discounts, retail savings, return shipping, refunds and
2010. However, with so many variables not                                          27.7
                                                                                                                                          petrol and grocery discounts to help consumers save
yet clearly understood it is very difficult to                                                                                            money. This product is an exclusive for Alliance Data,
gauge the length and depth of any downturn                                                                                                sold through many channels, including its own
and the longer-term impact of any potential                                                                                               customer service contact centre.
rescue package.
                                                                                                                                          Campaign management
                                                                                                                                          CPP North America’s front-end conversion and
                                                                                                                                          back-end persistency have steadily improved
                                                                                                     05    06   07   08                   throughout 2008. Consumers are recognising the
                                                                                                                                          relevance of our products to their daily lives,
                                                                                                                                          connecting with our telemarketing team thanks to
                                   Bankable                       Real     Debit       Debit      Credit           Credit       Mobile
                                                                                                                                          guided scripts, experiencing excellent customer
                                  Population                      GDP      cards       cards      cards             cards        phone
                                       2008                      2009      2008        2009        2008             2009    subscribers   service through our contact centres and finding value
                                   (Age 15+)                                        forecast                     forecast                 in each product.
USA                                 243.3m                      -2.0%    421.6m    442.8m        771.1m          815.9m       271.6m

Source: Economist 2009, Euromonitor 2008, Netsize Guide 2009.
Revenue growth:             CASE STUDY: Fingerhut

                            CPP North America launched a collaborative
                            research project with Fingerhut to gather consumer
                            insights that would help to refine our product offers.
                            The result was a series of new products specifically
                            developed for Fingerhut customers. These were
                            launched over the course of a year and exceeded
Conversion rates grew by:   expectations for both response and persistency.

                            Bev Campbell, Vice President Enhancement
                            Services at Fingerhut, says: “The Fingerhut customer
                            is unique, and we quickly realised that the more
                            widely available products were not a fit for our
                            customer base. CPP invested the resources to meet
                            our objective of tailoring products to the Fingerhut
Cost to acquire dropped:    customer with great success.”

21%                         CPP North America and Fingerhut are excited
                            about the outlook for 2009 as we move into a
                            second round of research and product development.
                            Our collaboration extends to developing new
                            channels too. As a result, customers are retaining
                            their products for longer and revenue has increased
                            for both CPP and Fingerhut.

                            CASE STUDY: Wells Fargo
                            In late 2007, CPP North America and business
                            partner Wells Fargo Card Services acknowledged
                            a need to improve the performance of our outbound
                            telemarketing programme. A series of challenging
                            discussions resulted in an agreement to implement
                            changes that have transformed our relationship.
                            Mike McDonald, Senior Vice President of Wells
                            Fargo Card Services and Consumer Lending, says:
                            “I applaud CPP’s efforts to make this a win, win,
                            win business relationship not only for CPP and Wells
                            Fargo but for our customers as well.”

                            Highlights of the changes include more list
                            modelling, leads hygiene and file segmentation
                            strategies, new management of the outbound
                            telemarketing programme, higher vendor
                            expectations and a price increase. Our success
                            enabled us to add new portfolios and a client-
                            managed channel to increase the overall critical
                            mass of our programmes. More recently we worked
                            on a series of changes to our billing and retention
                            processes to improve profitability.

                            For 2009 we are embarking on a joint consumer
                            research and new product development process that
                            will take our relationship to the next level. The recent
                            acquisition of Wachovia by Wells Fargo offers a            CPP’s Group Research function regularly present
                            further opportunity to grow our business together.         customer insight, including customer satisfaction
                                                                                       results to colleagues across the business, in order
                                                                                       to drive a continuous process of improvement.
                                                                                                                                        Business review: Asia Pacific

                                                                                                                                        CPP regional summary                                     On a regional basis, Malaysia contributed an

                                                                                                                                                                                                                                                           CPP Group Plc Annual Report 2008
                                                                                                                                        Having become established in three countries in the      impressive 34% of total revenue and 55% of new
                                                                                                                                        region – Hong Kong, Singapore and Malaysia – CPP         policies. Our business here enjoyed stellar acquisition
                                                                                                                                        Asia achieved strong growth in 2008. Revenues grew       growth of 246% over the previous year.
                                                                                                                                        by 36% and the number of live policies increased by
                                                                                                                                        46%. Retention is an important part of our strategy      The Malaysian management team continues to drive
                                                                                                                                        and welcome-call programmes have been developed          growth and best-in-class outbound telemarketing in

                                                                                                                                        for new customers to register their card details with    the region, based on welcome calls which encourage
                                                                                                                                        us. These programmes proved a great success, with        customer registration and product interaction.
                                                                                                                                        registration rates above 80%, effectively improving      Our highly skilled on-site contact centre management
                                                                                                                                        retention rates by more than 5% in Hong Kong, 7%         team has ensured that we deliver against business
                                                                                                                                        in Singapore and 10% in Malaysia.                        partner expectations.

                                                                                                                                        Hong Kong                                                Outlook
                                                                                                                                        In Hong Kong, we have successfully worked with           2009 is expected to be a more challenging year
                                                                                                                                        Citibank to expand our distribution channels from        for all businesses in the region. Despite the economic
                                                                                                                                        outbound telemarketing and roadshows to new              downturn and business challenges, CPP Asia
                                                                                                                                        card welcome pack inserts and inbound card               remains positive about achieving growth through
                                                                                                                                        activation programmes. This strategy demonstrated        executing our launch strategy in new markets, such
                                                                                                                                        the tremendous potential for selling Card Protection     as China, and deepening our partner relationships
                                       Grace Tsang                                                                                      through various non-intrusive channels. The              in existing markets.
                                       Managing Director,                                                                               approach has positively impacted overall response
                                       Asia Pacific                                                                                     rates, registration and renewal rates. Our multi-
                                                                                                                                        channel approach, together with aggressive
                                                                                                                                        outbound telemarketing programmes, has boosted
                                                                                                                                        performance in acquiring new policies.

                                                                                 4 year turnover                                        Singapore
Regional economic overview                                                                                                              In August we launched a new identity protection
2008 proved to be a challenging year for Asia.                                   £m
                                                                                                                                        product, ID Protect, with Citibank. It is Asia’s first
Most Asian economies were hit hard by the
economic downturn in the fourth quarter of
                                                                                 3.4                                                    one-stop identity protection and fraud resolution
                                                                                                                                        service. The product sets a new benchmark for
2008, with GDP falling significantly in Hong                                                                                            identity protection in Asia by combining the best
Kong, Singapore and Taiwan. The region’s                                                                                                of CPP’s expert identity fraud resolution experience
extensive trade and financial links with the rest                                2.5                                                    with Credit Bureau, Singapore’s credit monitoring
of the world meant that it could not avoid the                                                                                          services, and Citibank’s distribution network.
effects of global financial turbulence for long.                                                                                        ID Protect brings valuable benefits to Citibank’s
Asian governments have now deployed the full                                                                                            customers and generates an additional revenue
armoury of fiscal and monetary stimuli, with                                                                                            stream for the bank.
interest rate cuts in all countries to try to
kick-start economic recovery. The economies of                                                                                          Malaysia
Hong Kong, Singapore, South Korea and Taiwan                                                                                            In 2008, two of the top-ten commercial banks in
are expected to contract further in 2009, while                                  0.9                                                    Malaysia, HSBC and CIMB, partnered with CPP
the bigger, but less open economies of China,                                                                                           to sell Card Protection. As a result, we are now in
India and Indonesia should hold up better.                                                                                              partnership with six of the 17 card issuing banks
                                                                                                                                        in the country. To support the two new partnerships,
                                                                                                                                        we provided the banks’ agents with extensive
                                                                                                   05   06   07     08
                                                                                                                                        training in channel marketing strategies, agent
                                                                                                                                        productivity, effective operations and how to build
                                                                                                                                        a stronger sales culture. In less than a year, the two
                                   Bankable                      Real    Debit       Debit     Credit           Credit        Mobile
                                                                                                                                        banks have contributed a remarkable 30% of our
                                  Population                     GDP     cards       cards     cards             cards         phone
                                       2008                     2009     2008        2009       2008             2009     subscribers   new business in the Malaysian market.
                                   (Age 15+)                                      forecast                    forecast

Hong Kong                               6.1m                   -4.7%    14.5m      14.8m      14.2m               14.7m      10.6m
Malaysia                             18.8m                     -0.3%    18.9m      20.7m      11.0m               12.6m      26.9m
Singapore                              3.8m                    -7.2%    10.0m      10.8m       7.2m               8.7m         6.5m

Source: Economist 2009,Euromonitor 2009, Netsize Guide 2009.
Revenue up:                      CASE STUDY: HSBC Malaysia

                                 Most of HSBC Bank Malaysia’s products are sold
                                 via face-to-face channels at card originations,
                                 inbound and outbound telemarketing channels.
                                 As one of the pioneers in the Asia Pacific region,
                                 HSBC Bank Malaysia’s inbound contact centre
                                 plays an important role in generating revenue for
Live policies increased:         the Bank as it has the capability to cross-sell other

                                 value-added products as well, such as Card
                                 Protection as part of their service delivery exercise.

                                 CPP Asia’s approach is working closely with its
                                 partners and offering ongoing support for their
                                 distribution channels. We assist HSBC Bank
                                 Malaysia in targeting different customer segments
Malaysia acquisitions grew by:   and selling techniques.

246%                             “We are delighted to work with CPP Asia. Lost
                                 Card Protection has high relevance to our customer
                                 needs with combined channel strategies, making
                                 Lost Card Protection a strong addition to our product
                                 suite. As consumers add to their wallet credit cards,
                                 debit cards and stored-value cards, their need for
                                 protection will greatly increase,” says Jon Chivers,
                                 Head of Sales & Distribution, Personal Finance
                                 Services of HSBC Bank Malaysia.

                                 CPP Asia will continue to work closely with HSBC
                                 Bank Malaysia in 2009 to provide incremental and
                                 sustainable revenue to both parties.

                                                                                          Mapping the customer journey and process
                                                                                          flows has helped drive web servicing
                                                                                          enhancements to deliver a better customer
                                                                                          sales and service experience.
                                                                                                                                                               Business review: New international markets

                                                                                                                                                               CPP regional summary                                      Outlook

                                                                                                                                                                                                                                                                               CPP Group Plc Annual Report 2008
                                                                                                                                                               One of CPP’s key growth strategies is to continue         CPP continues to expand internationally, tailoring
                                                                                                                                                               expanding the international franchise of Card             products and services to suit local market
                                                                                                                                                               Protection, entering new territories to build             requirements, leveraging Group expertise and
                                                                                                                                                               a sustainable multi-product, multi-services               developing best practice across new and established
                                                                                                                                                               business. We have targeted launches in several            countries in all regions.
                                                                                                                                                               high-potential markets.

                                                                                                                                                                                                                         Debit cards in circulation – India:

                                                                                                                                                               India is expected to be one of the world’s top-five
                                                                                                                                                               national economies within the next 15 years. Today
                                                                                                                                                               there are over 300 million mobile phone users and
                                                                                                                                                               80 million internet users in the country. Significant
                                                                                                                                                               growth is forecast across all major market sectors.

                                                                                                                                                               CPP started trading here in December 2008, having
                                                                                                                                                               established partnership agreements with four
                                                                                                                                                                                                                         Credit cards in circulation – China:

                                                                                                                                                               business partners: Citibank, HSBC, Kotak Mahindra
                                                                                                                                                               Bank and Standard Chartered Bank. Campaigns to
                                                                                                                                                               promote Card Protection have been implemented
                                                                                                                                                               across multiple sales channels, including outbound
                                                                                                                                                               and inbound telemarketing and positive option.
                                                                                                                                                               E-commerce and email marketing activities are
                                                                                                                                                               in progress. We expect a number of contract wins
                                                                                                                                                               with new business partners in early 2009. New             Credit/debit cards in circulation – Mexico:

                                                                                                                                                               campaigns with these partners will drive significant
                                                                                                                                                               sales volume and growth throughout 2009.

Regional economic overview                                                                                                                                     With almost 100 million credit cards in circulation,
All countries in which CPP is developing                                                                                                                       China presents CPP with an unprecedented growth
new operations appear well placed to deal                                                                                                                      opportunity in 2009 and beyond, building upon our
with the current macroeconomic conditions,                                                                                                                     existing Asian presence. We have established our
although they will undoubtedly be affected                                                                                                                     Chinese business entity and a local office in
to some degree as a consequence of their                                                                                                                       Shanghai, and we are progressing towards our
integration within the global economy.                                                                                                                         first policy sales in 2009.
Levels of GDP are unsurprisingly expected
to slow and dip marginally before returning                                                                                                                    Taiwan
to and, in some instances, surpassing previous                                                                                                                 We will continue to execute our market entrance
levels of growth. In China and India this growth                                                                                                               strategies in preparation for launch in Taiwan.
is expected to be a key government focus,                                                                                                                      This is a market with more than 35 million credit
perhaps at the expense of inflation and other                                                                                                                  cards in circulation, where there is fierce competition
economic measures, while Mexico will look                                                                                                                      among card issuers.
to contain inflation and public debt.
                                                                                                                                                               Following several months of research and field-based
                                                                                                                                                               planning by our new country Managing Director,
                                                                                                                                                               CPP’s Group Board approved the market entry plan
                                                                                                                                                               for Mexico in October 2008. This venture has been
                                                                                                                                                               made possible by Group and country collaboration
                                                                                                                                                               across CPP and its business partners. Several
                                   Bankable                       Real                   Debit                    Debit      Credit     Credit       Mobile
                                                                                                                                                               international and local banks are already in
                                  Population                      GDP                    cards                    cards      cards       cards        phone
                                       2008                      2009                    2008                     2009        2008       2009    subscribers   discussions with us. With more than 80 million credit
                                   (Age 15+)                                                                   forecast               forecast                 and debit cards in circulation, together with a young
India                               791.4m                      5.0%                 106.0m                   132.5m        36.7m     43.7m        320.5m      but established card protection market, Mexico is
                                                                                                                                                               a territory with high growth potential for CPP.
China                            1,098.9m                       6.0%               1,878.3m                2,216.4m         160.1m    253.7m       694.5m
Mexico                                76.4m                    -1.4%                   53.8m                           –    28.8m      33.1m        77.5m
Taiwan                                18.9m                    -3.5%                   11.2m                    10.6m       35.2m     35.0m         24.6m
Source: Economist 2009, Euromonitor 2008, Netsize Guide 2009, I.E. Market Research Estimates/NCC 2008, CIA Factbook 2007.
Corporate social responsibility

At CPP, we are clear about the meaning of Corporate    Employees and workplace
Social Responsibility (CSR) – it is how we manage      Keen to ensure our employees feel CPP is a good
our business processes to produce a positive           place to work and that everyone contributes to our
outcome in our local communities. Our CSR              success, we launched our new engagement survey
programme is integral to our day-to-day operations,    in the UK in March 2008. The results showed that
since responsible business practice is our licence     55% of employees felt engaged and 82% satisfied;
to operate. It means we conduct our business in        an encouraging result, but with potential for
a professional, ethical and fair manner with all our   improvement. The engagement survey will be rolled
stakeholders, including employees, customers,          out across the Group in 2009. Our ultimate aim is
business partners and suppliers.                       to ensure that employee engagement contributes
                                                       to advocacy – one of our business ambitions.
While CPP actively supports good causes through
our Community Foundation programme, and last           In 2008, our Success Behaviour Index (SBI) was
year directly funded 20 local groups with grants       rolled out Group-wide, giving employees an
of up to £750, our CSR programme also plays an         opportunity to improve their performance and
important part in supporting our business ambitions    develop stronger working relationships through
and building relationships with key stakeholders.      a 360° employee questionnaire.
Our CSR framework is based on four key principles:
the community, our employees and the workplace,        Marketplace
the marketplace and the environment.                   Treating Customers Fairly (TCF) lies at the heart of
                                                       what we do, with six clearly communicated promises
The community                                          influencing every area of our business. TCF is critical
We recognise that employee engagement goes             for CPP, not only because we are a regulated
hand-in-hand with personal and professional            business, but because it makes good business sense,
development and, in 2008, our UK business              helping to retain satisfied customers for longer.
increased the number of employee volunteers            It also ensures that we deliver positive results for
working in the local community.                        our business partners through incremental revenue
                                                       generation and improved customer loyalty.
Building links with education and young people
is at the heart of our award-winning community         This philosophy also applies to our suppliers. Our
outreach programme. Our initiatives include hosting    Supplier of the Year award publicly recognises the
teacher development days, delivering specialist        contribution that suppliers make to our business.
workshops, providing classroom volunteers and
supporting disadvantaged children. We also             Environment
geographically expanded our UK school workshops        CPP seeks to develop an ethos of environmental
programme beyond our core areas in 2008, building      responsibility across the Group. Initiatives include
on past successes. Our patronage of community-         energy efficiency, recycling, minimising the use of
based football and rugby programmes also saw           paper and reducing waste.
thousands of children benefit from professional
coaching, diet and exercise instruction.               We are working hard to meet the standards set out
                                                       under Carbon Reduction Commitment regulations.
In Spain, employees worked with the Red Cross          We work closely with The Carbon Trust to ensure
to donate mobile phones for projects in developing     that our plant, energy-management and monitoring
countries, donated toys for children with cancer,      systems are effective and efficient. Year-on-year
worked with the Randstad Foundation to develop         energy usage is falling in spite of business growth.
training courses for unemployed women aged over
45 and with the Stela Project to bring people with     All CPP employees are encouraged to reduce
Down’s Syndrome and other intellectual handicaps       their own carbon footprint by using public transport,
into the workplace.                                    cycling, walking or car-sharing.

In North America, we have built on our excellent       Enhancing our reputation
partnership with The Fraser Centre, a Minnesota-       Our commitment to CSR runs throughout the
based non-profit organisation that helps people        business and has been recognised externally for the
with special needs.                                    positive outcomes it delivers. While we want to be
                                                       a good corporate citizen, our CSR programme is also       Investing in young people lies at the heart of our
                                                       motivated by a desire to attract and retain talented      community relations programme. Here one of
                                                       employees, manage risk, build relationships with key      our employees works with school children at a
                                                       stakeholders and, ultimately, protect our reputation.     local enterprise competition organised by CPP.
Financial review

                                          CPP Group turnover grew by 15% to £259.5m                  Goodwill amortisation and exceptional items               Cash flow and balance sheet

                                                                                                                                                                                                                          CPP Group Plc Annual Report 2008
                         Shaun Parker     in 2008 (2007: £225.2m) despite the increasingly           Charges for goodwill amortisation and exceptional         With the exception of Asia where the Group
                         Group Finance    challenging economic environment. The main driver          items totalled £6.5m (2007: £11.3m). Amortisation of      is investing in developing the market, each region
                         Director         of this performance was continued organic growth           the US goodwill results in a charge of £0.8m for the      contributed positively to an overall operating
                                          in our developed markets of the UK, Spain and Italy.       year (2007: £0.7m). Exceptional items of £5.7m include    cash flow (before ESOP payments) of £47.6m
                                          Revenues grew by 7% in the USA (2007: (9.1)%)              £0.8m relating to the capital restructuring and £4.9m     (2007: £35.6m). After capital expenditure of
                                          as price increases implemented in 2007 were                relating to the Employee Share Option Scheme.             £8.7m this improved cash flow supported dividend
                                          successfully rolled out. The Group’s developing                                                                      payments of £15.4m (2007: £7.1m) and taxation
                                          business in Asia continued to grow strongly at 37%         Profit before tax                                         of £6.2m (2007: £7.0m).
                                          with Malaysia revenues exceeding £1m less than             In 2008, the Group incurred net interest costs of
                                          two years after launch. Revenues in Germany also           £7.2m (2007: net interest income £0.2m). The higher       The capital restructure resulted in refinancing costs
Group operating profit (before goodwill
                                          passed the £1m mark as our business grew by 175%           interest cost results from the increased level of debt    of £6.5m and loan interest of £7.2m in addition to
amortisation and exceptional items):

                                          to £1.1m (2007: £0.4m). The first pilot Card Protection    required to support our capital restructuring. After      the capital repayment. The exercise of 50% of the
                                          campaigns were launched in India in December               accounting for goodwill amortisation, exceptional         employee share options under the 2005 ESOP
                                          2008, bringing the number of countries in which            items and interest income, the Group reports profit       scheme resulted in costs of £12.9m. Proceeds from
                                          CPP markets its products to 13.                            before tax of £18.8m (2007: £15.4m)                       the debt raising amounted to £120m, and a
                                                                                                                                                               scheduled capital repayment of £3.8m was made in
                                          Operating performance                                      Taxation                                                  September. As a result, net cash flow for 2008 was
                                          Group operating profit (before goodwill amortisation       The Group’s effective tax rate for 2008 was 32%           £14.6m (2007: £1.8m). Cash conversion remained high
Operating margin (pre-exceptionals):      and exceptional items) of £32.5m was 22% higher            (2007: 30%). The taxation of profits arising in           at 120% (2007: 114%). At the balance sheet date,

                                          than 2007 (£26.5m).                                        overseas jurisdictions with a higher tax rate (such       Group leverage (net debt/EBITDA pre-exceptional
                                                                                                     as Spain and Italy) has been mitigated by utilising       items) was 2.2.
                                          Against a backdrop of increasing economic                  brought-forward trading losses in the US. Given the
                                          turbulence, the Group successfully increased the           range of tax rates across the territories in which        The Group’s net asset position in 2007 was £28.0m.
                                          number of live retail policies in issue by 0.3m to 9.5m.   CPP operates, there is no targeted effective tax rate,    As a result of the restructure, this position moved to
                                          Revenue growth also benefited from the roll out of         however the rate is expected to remain constant for       a net liability position of £(65.5)m at the end of 2008.
                                          price increases across business partners and the           the forseeable future.
                                          renewal book, particularly in the UK and USA where                                                                   Reserves are adversely impacted by the return of
                                          we introduced enhanced products with a higher price        Capital restructure                                       capital to the shareholders (£86.5m). This return
                                          point. The planned shift of the portfolio mix towards      During 2008, the Group was restructured to enable         of capital and reorganisation was reflected in the
                                          higher priced and higher margin Identity Protection        capital to be returned to shareholders. As part of this   creation of a merger reserve of £(85.3)m. Share
                                          products in the UK, driven in part by our investment       restructure, the Group put in place new debt facilities   capital and retained earnings amounted to £18.1m
                                          in a third UK contact centre in Chesterfield, also         which are expected to support the Group’s funding         at the balance sheet date.
                                          enhanced revenue and gross margin.                         requirements for the medium term. £86.5m of capital
                                                                                                     was returned to shareholders, whilst five-year term       Treasury and foreign exchange
                                          The Group increased operating margin (pre-                 loans of £120m together with a committed revolving        Under the loan agreements, covenants in respect
                                          exceptionals) to 12.5% (2007: 11.8%). We increased         credit facility of £10m were secured from a club          of leverage, interest cover, cash flow cover and
                                          the commission paid to our business partners to            of five major banks. The restructure, including the       absolute capital expenditure are tested and reported
                                          maintain our competitiveness. We more than                 establishment of a new Group holding company,             to the lending banks on a quarterly basis.
                                          compensated for this by managing our portfolio             is accounted as a merger, leading to the creation         Performance was well within the agreed covenants
                                          profitability and by improving cost efficiency through     of a merger reserve on the Group’s balance sheet.         at the end of September and December 2008.
                                          a continued focus on the Managing for Value                                                                          Current forecasts and projections show that there
                                          programme. The USA in particular drove down                Capital expenditure                                       is significant covenant headroom in the future.
                                          cost per order by improving conversion rates and           Capital expenditure of £8.7m (2007: £5.5m) was
                                          customer retention performance. The Group also             significantly higher than the previous year as a result   Foreign exchange had a material impact on the
                                          benefited from its geographic diversity, with GBP          of the investment of £2.8m in IT systems, telephony       cash flow of the Group in 2008 and on the translation
                                          profits and margins benefiting from the strengthening      and leasehold improvements at the Group’s third           of Group results. Through its overseas operations
                                          euro and US dollar.                                        UK site in Chesterfield. Other significant capital        the Group has exposure to the euro and the US dollar,
                                                                                                     investments included relocating the German office         both of which have strengthened against the pound,
                                          The Group continued to invest in new markets               from Regensburg to Hamburg, which includes an             making a positive impact on Group results.
                                          during 2008. Highlights include the launch of Card         80 seat contact centre and telemarketing facility,        Operating profit and cash flow have been positively
                                          Protection in India, together with preparations for        as well as investment in software systems to improve      impacted by £1.6m and £2.8m respectively. It is
                                          2009 launches in China and Mexico.                         the Group’s data management and customer                  Group policy not to hedge the translation exposure,
                                                                                                     analytics capabilities.                                   however material transactional exposures and
                                                                                                                                                               balance sheet exposures are hedged as they arise,
                                                                                                                                                               either through natural hedges or through appropriate
                                                                                                                                                               financial instruments.
Corporate governance statement

                                                                                                                  Talent Development lies at the core
                                                                                                                  of our business. One-to-one training
                                                                                                                  ensures employees offer world-class
                                                                                                                  sales and servicing.
CPP operates in a complicated, regulated world            The Group has an appropriate organisational
and an appropriate governance system is required          structure, culture and processes for planning,
to maintain growth and value. The board and               executing, controlling and monitoring business
executive management remains committed to                 operations (including: profitability, capital &
meeting the highest standards of governance               liquidity positions) to achieve its objectives.
and business conduct across all of its worldwide          Lines of responsibility and delegations of authority
operations, consistent with provisions of the             across the Group are documented. Business units
Principles of Good Governance and Code of Best            prepare three-year strategic plans, annual budgets
Practice (The Combined Code).                             and cash flows. Monthly performance against
                                                          plan and variance explanations are actively
The board is responsible for the Group’s system           monitored by the board and executive management
of internal control and, together with the appropriate    at consolidated Group and business unit levels.
committees, regularly reviews its effectiveness,
including any outsourced activities. Internal control     The Group has a dedicated Risk & Audit function
systems are designed to manage rather than                which has carried out a risk-based programme
eliminate the risk of failure to meet business            of internal audit reviews. This has confirmed that
objectives, material misstatement or financial            effective internal controls and risk mitigation is in
loss. In seeking to minimise the exposure to risks,       place. Where remedial actions are necessary, these
materiality of the risks to be managed, the               are captured in AIMS (Audit Issues Management
particular environment and the cost effectiveness         System) and tracked by senior executives.
of mitigation are assessed.

The board of directors has clearly identified and
communicated the following: The matters reserved
specifically for its decision and approval; the
responsibility and authority delegated to its Audit,
Nomination & Remuneration Committees; executive
management’s responsibilities for the management
of the Group’s worldwide operations; its risk policy
and mechanisms for reporting to the board.

The Group’s risk policy sets out the approach to
risk management, risk governance responsibilities,
risk appetite and risk assessment methodology.
Responsibility for execution of the policy at the local
level rests with regional management teams and their
local boards of directors. Senior executives, who
form the Risk Management Group, play an integral
oversight role in compliance with risk policy.

In recognition of the need for greater guidance
and operational consistency across regions as well
as maintenance of high standards of business
conduct, a series of policy standards and operating
principles is maintained across the Group (these
include: financial planning & reporting, accounting
& treasury, codes of business conduct [incl. risk
management, compliance & information security]
and employee procedures).
                                                   Summary Financial Statement
                                                   For the year ended 31 December 2008

An employee of our fulfilment supplier, DST
International, checks CPP literature prior to it
being sent out to our customers – part of our
managed services capability we provide for
business partners.

                                                   The directors have pleasure in presenting the                Respective responsibilities

                                                                                                                                                                          CPP Group Plc Annual Report 2008
                                                   Summary Financial Statement of CPP Group Plc and             of directors and auditors
                                                   its subsidiaries (‘the Group’) for the year ended 31         The directors are responsible for preparing the
                                                   December 2008. This Summary Financial Statement              annual report in accordance with United Kingdom
                                                   does not contain sufficient information to allow as full     law. Our responsibility is to report to you our opinion
                                                   an understanding of the results and state of affairs         on the consistency of the Summary Financial
                                                   of the Group as would be provided by the full annual         Statement within the annual report with the full
                                                   statutory financial statements. Members requiring            annual accounts, and its compliance with the relevant
                                                   more detailed information have the right to obtain,          requirements of section 251 of the Companies
                                                   free of charge, a copy of the company’s last full            Act 1985 and the regulations made thereunder.
                                                   financial statements and reports from its registered
                                                   office at Holgate Park, York, YO26 4GA.                      We also read other information contained in the
                                                                                                                annual report as described in the contents section,
                                                   This Summary Financial Statement was approved by             and consider the implications for our report if we
                                                   the board of directors on 16 March 2009 and signed           become aware of any apparent misstatement or
                                                   on its behalf by:                                            material inconsistencies with the Summary
                                                                                                                Financial Statement.

                                                                                                                Basis of opinion
                                                                                                                We conducted our work in accordance with bulletin
                                                   Eric Woolley                                                 1999/6 The Auditors’ Statement on the Summary
                                                   Chief Executive Officer                                      Financial Statement issued by the Auditing Practices
                                                                                                                Board for use in the United Kingdom. Our report
                                                                                                                on the company’s full annual financial statements
                                                   Independent auditors’ statement                              describes the basis of our audit opinion on those
                                                   to the members of CPP Group Plc                              financial statements.
                                                   We have examined the Summary Financial Statement
                                                   which comprises the summary consolidated profit              Opinion
                                                   and loss account, the summary consolidated balance           In our opinion, the Summary Financial Statement
                                                   sheet and the summary consolidated cash flow                 is consistent with the full annual accounts of CPP
                                                   statement.                                                   Group Plc for the year ended 31 December 2008
                                                                                                                and complies with the applicable requirements of
                                                   This report is made solely to the company’s                  section 251 of the Companies Act 1985, and the
                                                   members, as a body, in accordance with section               regulations made thereunder. We have not
                                                   251 of the Companies Act 1985. Our work has been             considered the effects of any events between the
                                                   undertaken so that we might state to the company’s           date on which we signed our report on the full
                                                   members those matters we are required to state to            annual financial statements (5th March 2009) and
                                                   them in an auditors’ report and for no other purpose.        the date of this statement.
                                                   To the fullest extent permitted by law, we do not
                                                   accept or assume responsibility to anyone other than
                                                   the company and the company’s members as a body,
                                                   for our audit work, for this report, for our audit report,
                                                   or for the opinions we have formed.                          Deloitte LLP
                                                                                                                Chartered Accountants and
                                                                                                                Registered Auditors

                                                                                                                16 March 2009
                                                                     Summary Financial Statement
                                                                     CPP Group Plc Summary consolidated profit and loss

Despite challenging
                                                                     For the year ended 31 December 2008

                                                                                                                                                                                                                                                               CPP Group Plc Annual Report 2008
                                                                                                                                                           2008              2008               2008              2007               2007              2007
                                                                                                                                                            £m                £m                 £m                £m                 £m                £m
                                                                                                                                                        Before          Goodwill                Total          Before           Goodwill               Total

economic conditions
                                                                                                                                                      goodwill       amortisation                            goodwill        amortisation
                                                                                                                                                   amortisation               and                         amortisation                and
                                                                                                                                                            and       exceptional                                  and        exceptional
                                                                                                                                                    exceptional             items                          exceptional              items
                                                                                                                                         Note             items           (note 3)                               items            (note 3)

group revenue
                                                                     Turnover                                                                1          259.5                     –          259.5              225.2                    –           225.2
                                                                     Cost of sales                                                                      (154.6)                   –          (154.6)            (135.1)                  –           (135.1)

                                                                     Gross profit                                                                       104.9                    –           104.9               90.1                   –             90.1

increased in 2008
                                                                     Administrative expenses                                                             (72.4)               (6.4)           (78.8)             (63.6)             (11.3)            (74.9)

                                                                     Operating profit                                                        3            32.5               (6.4)             26.1              26.5              (11.3)             15.2
                                                                     Share of operating loss in joint venture                                              (0.1)                –               (0.1)                –                 –                  –
                                                                     Interest receivable and similar income                                                 1.4                 –                1.4               0.9                 –                0.9

by 15%
                                                                     Interest payable and similar charges                                                  (8.6)                –               (8.6)             (0.7)                –               (0.7)

                                                                     Profit on ordinary activities before taxation                                        25.2               (6.4)             18.8              26.7              (11.3)             15.4
                                                                     Tax on profit on ordinary activities                                    6             (7.6)              1.6               (6.0)             (7.3)              2.7               (4.6)

                                                                     Profit on ordinary activities after taxation                                         17.6               (4.8)             12.8              19.4                (8.6)            10.8

                                                                     The figures on pages 45, 47, 49 and 50 to 55 are not the company’s statutory financial statements for the years ended 31 December 2008 and 2007, but are extracted from them.

                                                                     Statutory financial statements for the year ended 31 December 2008 and 2007 have been filed with the Registrar of Companies. The auditors have reported on these financial statements;
                                                                     their reports were unqualified and did not contain statements under s237 (2) or (3) Companies Act 1985.

10 year turnover








                   99   00   01   02   03   04   05   06   07   08
                                         Summary Financial Statement
                                         CPP Group Plc Summary consolidated balance sheet

Profits increased
                                         As at 31 December 2008

                                                                                                                               CPP Group Plc Annual Report 2008
                                                                                                            2008       2007

by 23% in 2008
                                                                                                   Note      £m          £m

                                         Fixed assets
                                         Goodwill                                                          13.1       10.6
                                         Tangible assets                                             7     24.9       22.9
                                         Investment in joint venture                                        0.5          –

                                         Current assets

                                         Stocks                                                             0.2        0.1
                                         Debtors                                                     8     35.1       36.6
                                         Cash held on short term deposit                                   16.6        9.5
                                         Cash at bank and in hand                                          26.6        9.2

                                                                                                           78.5       55.4

                                         Creditors: Amounts falling due within one year              9     (75.9)     (55.0)

                                         Net current assets                                                 2.6        0.4

                                         Total assets less current liabilities                             41.1       33.9

                                         Creditors: Amounts falling due after more than one year    10    (100.8)         –

                                         Provisions for liabilities                                 12      (5.8)      (5.9)

                                         Net (liabilities)/assets                                         (65.5)      28.0

                                         Capital and reserves
Operating profit (before goodwill        Called up share capital                                             0.1       0.1
amortisation and exceptional items)      Merger reserve                                                    (85.3)      1.6
                                         ESOP reserve                                                        1.7       9.7
                                         Profit and loss account                                            18.0      16.6

32.5                                     Equity shareholders’ (deficit)/funds                       13    (65.5)      28.0





                04   05   06   07   08
                                         Summary Financial Statement
                                         CPP Group Plc Consolidated cash flow statement

In 2008 net cash inflow
                                         For the year ended 31 December 2008

                                                                                                                                                    CPP Group Plc Annual Report 2008
                                                                                                                                  2008     2007
                                                                                                                           Note    £m       £m

from operating activities
                                         Net cash inflow from operating activities (below)                                        34.7     35.6

                                         Returns on investments and servicing of finance                                           (6.0)    0.2

totalled £34.7m
                                         Taxation                                                                                  (6.2)    (7.0)

                                         Capital expenditure and financial investment                                              (8.7)    (5.5)

                                         Equity dividend paid                                                                     (15.4)    (7.1)

                                         Net cash (outflow)/inflow before the use of liquid resources and financing                (1.6)   16.2

                                         Net cash outflow from the management of liquid resources                                  (7.1)    (2.4)

                                         Financing                                                                                23.3     (12.0)

                                         Change in cash                                                                      2    14.6      1.8

                                         Reconciliation of operating profit to net cash inflow from operating activities

                                                                                                                                  2008     2007
                                                                                                                                    £m       £m

                                         Operating profit                                                                         26.0     15.2

                                         Depreciation                                                                               7.2     6.1

                                         Amortisation of goodwill                                                                   0.8     0.7
Cash flow from operating activities      (Decrease)/increase in ESOP reserve                                                       (8.0)    9.5

                                         Decrease/(increase) in debtors                                                             7.7     (1.5)
35.6                                     Increase in creditors                                                                      1.1     4.0

       34.7                              (Decrease)/increase in provisions                                                         (0.1)    1.6

                                         Net cash inflow from operating activities                                                34.7     35.6

21.8   21.3


                04   05   06   07   08
Notes to the accounts

1 Turnover                                                                                          3 Operating profit

                                                                                                                                                                                                                                                                                                  CPP Group Plc Annual Report 2008
                                                                                   2008     2007                                                                                                                                                                      2008               2007
                                                                                    £m       £m                                                                                                                                                                        £m                 £m

Analysis of turnover by geographical location                                                       The operating profit is stated after charging/(crediting)
United Kingdom                                                                   179.8    155.5
Continental Europe                                                                46.6     39.6     Depreciation                                                                                                                                                        7.2                6.1
North America                                                                     29.7     27.7     Amortisation of goodwill                                                                                                                                            0.8                0.7
Asia Pacific                                                                       3.4      2.4     Exceptional operating items (see below)                                                                                                                             5.7              10.5
                                                                                                    Government grants                                                                                                                                                  (0.5)                 –
                                                                                 259.5    225.2     Operating leases – other                                                                                                                                            2.3                1.8
                                                                                                    Exchange loss/(gain)                                                                                                                                                0.1               (0.1)
By class of business
Assistance                                                                       215.6    190.2     Auditor’s remuneration for audit services pursuant to legislation
Insurance                                                                         43.9     35.0       – Audit of company subsidiaries                                                                                                                                   0.3               0.3
                                                                                                      – Company audit fees                                                                                                                                                –                 –
                                                                                 259.5    225.2     Group non audit fees                                                                                                                                                0.2               0.4

                                                                                                    Exceptional items of £5.7m (2007: £10.5m) consist of costs in relation to the evaluation of strategic options and similar costs, £0.8m (2007: £1.1m) and total ESOP costs for the year,
                                                                                                    £4.9m (2007: £9.5m). Additional ESOP costs have arisen as a result of treating 50% of the 2005 ESOP scheme as cash settled rather than equity settled. Included within the £0.8m
2 Analysis of changes in net funds/(debt)                                                           that relates to the evaluation of strategic options and similar costs, is £0.1m (2007: £0.2m) which is also disclosed within other non-audit services under Auditors’ remuneration.
                                                                                                    Included within prepayments in 2007 was a further amount of £0.7m in relation to non-audit services connected with a subsequent issuance of debt. The balance for 2008 of £1.0m
                                                                        Debt                        is disclosed within bank loans and amortised over the life of the capitalised debt financing costs.
                                                                   financing   Exchange
                                                2007   Cash flow       costs   movement     2008
                                                 £m         £m          £m          £m       £m
                                                                                                    4 Employee information
Cash at bank and in hand                         9.2       14.6           –         2.8    26.6
                                                                                                                                                                                                                                                                      2008               2007
                                                                                                                                                                                                                                                                       £m                 £m
                                                 9.2       14.6           –         2.8    26.6
                                                                                                    Wages and salaries                                                                                                                                                45.6               37.0
Current asset investments                        9.5        7.1           –          –      16.6    Social security costs                                                                                                                                              5.1                4.0
Debt due within one year                           –      (11.8)        1.4          –     (10.4)   Other pension costs                                                                                                                                                2.3                1.6
Debt due after one year                            –     (107.5)        3.6          –    (103.9)
                                                                                                                                                                                                                                                                     53.0               42.6
                                                18.7     (97.6)        5.0         2.8    (71.1)
                                                                                                    Total Directors’ emoluments                                                                                                                                        0.9                0.8

                                                                                                                                                                                                                                                                     2008              2007
                                                                                                                                                                                                                                                                   Number            Number

                                                                                                    Average number of employees during the year                                                                                                                     1,814              1,685

                                                                                                    5 Dividends

                                                                                                                                                                                                                                                                      2008               2007
                                                                                                                                                                                                                                                                       £m                 £m

                                                                                                    Dividends paid – 49.94p per ordinary share (2007: 7.46p)                                                                                                         15.4                 7.1
6 Taxation on profit on ordinary activities                                                                                                                                                7 Tangible fixed assets

                                                                                                                                                                                                                                                                                                                                                                                CPP Group Plc Annual Report 2008
                                                                                                                                                               2008              2007                                                                                                              Freehold
                                                                                                                                                                £m                £m                                                                                                               land and        Leasehold           Computer        Furniture and
                                                                                                                                                                                                                                                                                                   property      improvements           systems          equipment      Total
                                                                                                                                                                                                                                                                                                        £m               £m                 £m                   £m      £m
The tax charged on profit on ordinary activities for the year was as follows
Current tax:
                                                                                                                                                                                           At 1 January 2008                                                                                             7.3                4.9              37.2                 5.9   55.3
UK corporation tax at 28.5% (2007: 30%)                                                                                                                          4.5               6.8
                                                                                                                                                                                           Additions                                                                                                       –                0.1               8.0                 0.6    8.7
Double taxation relief                                                                                                                                          (2.8)             (1.7)
                                                                                                                                                                                           Disposals                                                                                                       –                  –                 –                   –      –
                                                                                                                                                                                           Exchange adjustments                                                                                            –                0.3               1.4                 0.3    2.0
UK corporation tax after double taxation relief                                                                                                                  1.7               5.1
Overseas corporation tax                                                                                                                                         2.8               2.7
                                                                                                                                                                                           At 31 December 2008                                                                                          7.3                5.3              46.6                 6.8    66.0
                                                                                                                                                                 4.5               7.8
                                                                                                                                                                                           Accumulated depreciation
Adjustment in respect of prior year UK corporation tax                                                                                                          (0.2)             (0.2)
                                                                                                                                                                                           At 1 January 2008                                                                                             1.1                2.6              24.3                 4.4   32.4
                                                                                                                                                                                           Provided during the year                                                                                      0.2                0.5               5.8                 0.7    7.2
Total current tax                                                                                                                                               4.3               7.6
                                                                                                                                                                                           Disposals                                                                                                       –                  –                 –                   –      –
                                                                                                                                                                                           Exchange adjustments                                                                                            –                0.2               1.1                 0.2    1.5
Deferred tax:
UK deferred tax                                                                                                                                                  1.9              (2.7)
                                                                                                                                                                                           At 31 December 2008                                                                                          1.3                3.3              31.2                 5.3    41.1
Overseas deferred tax                                                                                                                                           (0.3)                –
                                                                                                                                                                                           Net book value
                                                                                                                                                                 1.6              (2.7)
                                                                                                                                                                                           At 31 December 2008                                                                                          6.0                2.0              15.4                 1.5    24.9
Adjustment in respect of prior year UK deferred tax                                                                                                              0.1              (0.2)
Adjustment in respect of prior year overseas deferred tax                                                                                                          –              (0.1)
                                                                                                                                                                                           At 31 December 2007                                                                                          6.2                2.3              12.9                 1.5    22.9
Total deferred tax                                                                                                                                               1.7              (3.0)    Included in freehold land and property is freehold land at its cost value of £0.8m, which is not depreciated.

Total recognised tax charge for the year                                                                                                                        6.0               4.6      Depreciation: Tangible fixed assets are stated at cost, net of depreciation and any provision for impairment. Depreciation is provided to write off the cost of all fixed
                                                                                                                                                                                           assets over their expected useful economic life, with the exception of freehold land which is not depreciated. The principal annual rates used for this purpose are:
The standard rate of corporation tax in the UK was 30% up to 31st March 2008 and then 28% from 1st April 2008 giving an average rate for the year of 28.5%. The current tax change for
                                                                                                                                                                                           Freehold property: 2.5% straight line
the year is higher than that resulting from applying the standard rate of corporation tax in the UK of 28.5% (2007: 30%). The differences are explained in the following reconciliation:
                                                                                                                                                                                           Computer systems: 25% straight line
                                                                                                                                                                                           Furniture and equipment: 25% straight line
                                                                                                                                                                                           Leasehold improvements: Over the life of the lease
                                                                                                                                                               2008              2007
                                                                                                                                                                £m                £m

Profit on ordinary activities before tax                                                                                                                      18.8              15.4
Add: Share of joint venture's operating loss before tax                                                                                                        0.1                 –
Group profit on ordinary activities before tax                                                                                                                18.9              15.4

Tax on profit on ordinary activities at standard rate                                                                                                            5.4               4.6

Factors affecting the charge for the period:
Movements on deferred tax assets not recognised                                                                                                                 (1.6)             (1.3)
Overseas tax losses                                                                                                                                              0.7               0.6
Expenses not deductible for tax purposes                                                                                                                         1.4               0.8
Effect of change in tax rates                                                                                                                                      –               0.2
Higher tax rates on overseas earnings                                                                                                                            0.2               0.3
Movement in short term timing differences                                                                                                                       (2.0)              2.6
Depreciation in excess of capital allowances                                                                                                                     0.4               0.1
Prior year items                                                                                                                                                (0.2)             (0.3)

Current tax charge for the year                                                                                                                                 4.3               7.6
8 Debtors                                                                                                                                                                  12 Provisions for liabilities

                                                                                                                                                                                                                                                                                              CPP Group Plc Annual Report 2008
                                                                                                                                                                      As                                                                     Deferred   Equalisation   Insurance
                                                                                                                                                                restated                                                                     taxation       reserve       claims      Total
                                                                                                                                                         2008      2007                                                                           £m            £m           £m        £m
                                                                                                                                                          £m         £m

                                                                                                                                                                           As at 1 January 2008                                                  0.4            3.0         2.5        5.9
Trade debtors                                                                                                                                             9.9     12.3     Provisions utilised in the year                                         –              –        (2.5)      (2.5)
Deferred tax asset                                                                                                                                        1.2      2.9     Additional provisions made in the year                                  –            0.9         1.5        2.4
Other debtors                                                                                                                                             7.5      4.0
Called up share capital not paid                                                                                                                          0.1      0.1     As at 31 December 2008                                                0.4           3.9          1.5       5.8
Prepayments                                                                                                                                              16.4     17.3

                                                                                                                                                         35.1     36.6     13 Reconciliation of the movement in equity shareholders’ funds

9 Creditors: Amounts falling due within one year                                                                                                                                                                                                                                   restated
                                                                                                                                                                                                                                                                           2008       2007
                                                                                                                                                                                                                                                                            £m          £m
                                                                                                                                                         2008      2007
                                                                                                                                                          £m        £m
                                                                                                                                                                           Profit for the financial year after taxation                                                    12.8      10.8
Bank loans and overdrafts                                                                                                                                10.5        –     Dividends                                                                                      (15.4)      (7.1)
Trade creditors                                                                                                                                          14.0     11.2     Exchange gain                                                                                    3.9        0.1
Corporation tax                                                                                                                                           1.9      3.9     Movement on ESOP reserve                                                                        (8.0)       9.5
Other creditors including tax and social security                                                                                                         6.1      5.0     Shareholder payment and associated cost                                                        (86.9)         –
Accruals                                                                                                                                                 25.4     21.3     Increase in share capital                                                                          –        0.1
Deferred income                                                                                                                                          18.0     13.6
                                                                                                                                                                           Movement in equity shareholders’ funds                                                         (93.6)     13.4
                                                                                                                                                         75.9     55.0     Equity shareholders’ funds at 1 January                                                         28.1      14.7

The bank loan has been shown net of capitalised debt financing costs of £1.4m.                                                                                             Equity shareholders’ (deficit)/funds at 31 December                                           (65.5)      28.1

10 Creditors: Amounts falling due after more than one year

                                                                                                                                                         2008      2007
                                                                                                                                                          £m        £m

Bank loans and overdrafts                                                                                                                               100.8         –

The bank loan has been shown net of capitalised debt financing costs of £3.6m.

11 Borrowings

                                                                                                                                                         2008      2007
                                                                                                                                                          £m        £m

Bank loans                                                                                                                                              116.3         –

Due within one year                                                                                                                                      11.9         –
Due between one and two years                                                                                                                            11.0         –
Due between two and five years                                                                                                                           93.4         –

                                                                                                                                                        116.3         –

The bank loans are secured by fixed and floating charges on the assets of the Group. The bank loan's interest rate profile is two-thirds hedged by an
interest rate swap to convert it to a fixed rate from a floating rate, a requirement of the loan agreement, and from a three month to one month LIBOR
swap. The financial instruments' fair value as at 31st December 2008 were £(3.8)m and £(0.3)m respectively.
CPP addresses

CPP Group                              Ireland                                  Spain

                                                                                                                                                                                                     CPP Group Plc Annual Report 2008
international headquarters             1st Floor                                Parque Empresarial Alvento
CPP Group Plc                          Plaza 212, Suite 6                       Via de los Poblados 1
Holgate Park                           Blanchardstown Corporate Park            Edif. B, 2ª Planta
York                                   Dublin 15                                28033 Madrid
YO26 4GA                               Tel: +353 (0)1 899 1711                  Spain
United Kingdom                (business)   Tel: +34 91 121 16 00
Tel: +44 (0)1904 544500                                                         Fax: +34 91 121 16 16
Fax: +44 (0)1904 544933                Italy                                                 Centro Direzionale Colleoni
                                       Via Paracelso, 22                        Turkey
China                                  20041 Agrate Brianza                     Kore Sehitleri Cad. No: 31
Suite 531, 5th Floor,                  Milan                                    Engin Is Merkezi Kat: 3 Zincirlikuyu
Standard Chartered Tower               Italy                                    34394 Sisli
No. 201, Shi Ji Avenue                 Tel: +39 039 657801                      Istanbul
Pudong                                 Fax: +39 039 6894 293                    Turkey
Shanghai 200120                                       Tel: +90 212 274 6646
China                                                                           Fax: +90 212 274 9626
Tel: +86 (0) 21 6182 6780              Malaysia                       
Fax: +86 (0) 21 6182 6740              Suite 2, A-11-3 Northpoint Offices
                                       Mid-Valley City                          United Kingdom
France                                 No. 1 Medan Syed Putra Utara             Holgate Park
120 rue Jean Jaurès                    59200 Kuala Lumpur                       York
92300 Levallois-Perret                 Malaysia                                 YO26 4GA
France                                 Tel: +603 2168 5600                      United Kingdom
Tel: +33 1 47 30 56 20                 Fax: +603 2168 5799                      Tel: +44 (0)1904 544500
Fax: +33 1 47 30 56 28                                 Fax: +44 (0)1904 544933                                                       (consumer)
                                       Mexico                          (business)
Germany                                Guillermo González Camarena
CPP GmbH                               No. 1000 Piso 1                          Centurion Court
Große Elbstraße 39                     Centro Ciudad Santa Fe                   Centurion Way
22767 Hamburg                          México, D.F. C.P. 05120                  Watling Way
Germany                                Tel. (55) 5081-8455                      Wilnecote
Tel: +49 40 76 99 67 0                 Fax. (55) 5261-0893                      Tamworth
Fax: +49 40 76 99 67 111                                                        Staffordshire                       Portugal                                 B77 5PN
                                       Avenida da Liberdade, 40-7°              United Kingdom
Hong Kong                              1269-041 Lisbon                          Tel: +44 (0)1827 275023
14/F Chung Nam Building                Portugal                                 Fax: +44 (0)1827 275030
1 Lockhart Road                        Tel: +351 213 241 730
Wanchai                                Fax: +351 213 479 688                    Chesterfield
Hong Kong                                    Future Walk
Tel: +852 3653 0000                                                             West Bars
Fax: +852 3653 0050                    Singapore                                Chesterfield                        80 Raffles Place,                        S49 1PF
                                       #37-01 UOB Plaza,                        United Kingdom
India                                  Singapore 048624                         Tel: +44 (0) 1246 648110
115-117 Bestech Chambers (1st Floor)   Tel: +65 6333 6986                       Fax: +44 (0) 1246 648197
Sushant Lok Phase – I                  Fax: +65 6333 8637
Gurgaon – 122002                                       USA
Haryana                                                                         5100 Gamble Drive, Suite 600
India                                                                           St. Louis Park
Tel: +91 1244 0939 00                                                           MN 55416
Fax: +91 1244 0410 04                                                           USA                                                                Tel: +1 952 541 5800
                                                                                Fax: +1 952 541 5973
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