Resilient performance; continued strategic progress and recommencement of dividends
CPP Group, the multinational provider of personal protection and insurance products and services, is pleased to announce its full year results for the 12 months ended 31 December 2020.
- Group revenue increased by 2% to £141.1 million (2019: £138.4 million)
- Revenue from Ongoing Operations increased by 5% to £130.1 million (2019 restated: £123.9 million).
- Adjusted EBITDA increased by 17% to £10.3 million (2019: £8.7 million). Start-up losses from our investment in business growth projects totalled £3.1 million (2019: £3.3 million) resulting in an EBITDA of £7.2 million (2019: £5.4 million).
- Operating profit increased to £3.3 million (2019: £1.6 million).
- Profit before tax increased to £2.0 million (2019: £1.1 million).
- Cash balance of £21.9 million as at 31 December 2020 (2019: £22.0 million).
- Recommencement of dividend payment – the first since 2011, with a proposed final dividend of 25 pence per ordinary share.
- Effective response to COVID-19 with continued new business wins and pipeline growth in a challenging economic environment.
- Strong recovery in India, the Group’s main market, with a better than expected return of partner and consumer confidence in the second half.
- Resilient performance of the renewal books in our UK and EU markets, and an encouraging performance in our Turkish operation.
- Partner base grew 10%, demonstrating our value in times of wider economic uncertainty.
- Customer numbers grew 11% to 11.7 million, showing continued consumer demand for our products and services despite the impact of COVID-19.
- Operational restructuring commenced in Q1 2021 to generate efficiencies in our Spain, Mexico and Malaysia businesses.
Jason Walsh, Chief Executive at CPP Group, said:
“While we saw major disruption from COVID-19 in the second quarter, the response of our teams, resilience of our model, and improving conditions in key markets meant we were able to deliver a robust performance in the second half and solid numbers for the full year.
The business is built on the strength of its partnerships and during the year we were not only able to maintain our base but grow it. This demonstrates the value large-scale firms attach to our offering as a means to enhance their competitive advantage in times of heightened economic uncertainty. The rate of recovery from the pandemic will vary by territory and we recognise the need to continue managing the situation with care. However, there are positive signs across our key markets that give us confidence in our ability to continue to deliver progress.
The reinstatement of the dividend is an important moment for CPP. After many years of reorganisation and investment, the Group is now positioned for what we expect to be a period of continued growth, underpinned by our businesses in India, Turkey, and the UK. With the support of a robust balance sheet and solid cash generation, the Board are confident that the time is right for a stronger focus on shareholder returns in which the dividend has a key role.
While the Group currently does not generate positive EPS – leading to an uncovered dividend on that basis – future profit growth and progressive normalisation of the tax position will allow movement towards traditional conventional dividend cover to follow. The Board has thus proposed the final dividend at a level which it is confident can be grown in the years ahead.”