CPPGROUP PLC

Earnings Release • May 16, 2012

INTERIM MANAGEMENT STATEMENT 16 MAY 2012 CPPGROUP PLC

exchange. CPPGroup Plc ("CPP" or the "Group") today publishes its Interim Management Statement
("IMS"), for the period from 1 January 2012 to the date of publication. Unless stated otherwise, comparative references are to the equivalent period in 2011 and exclude the impact of foreign

include shifting the operating model to one of growth through customer focus, supported by
strengthened management discipline and enhanced governance, and ensuring that the agreement we have reached with the FSA is effected to the satisfaction of all stakeholders the key management priorities announced at the Group's preliminary results in March. During this period, whilst the FSA investigation continues, CPP has made further progress on These

Group summary

Despite the challenges presented by the ongoing FSA investigation the Group's operating performance continues to be in line with current market expectations.

preliminary results announcement and is compared against the period in 2011 prior to the announcement on 28 March 2011 of the FSA investigation and subsequent suspension of identity Protection sales in the UK. This is the information will pre-date the impacts of the FSA investigation. Group revenue has declined by 4% for the period, which continues the trend indicated in our

part of this a voluntary redundancy programme has been completed in the UK in the period Year to date underlying operating profit margin has decreased 2.9% to 11.3% due to a
decline in the UK's Card Protection and Identity Protection revenue streams coupled with a
short-term increase in the cost base. The Grou

changes to renewal packs. Renewal rates have decreased 0.4% from the year end to 75.0%, impacted by the expected decline in Card Protection and Identity Protection renewal rates in the UK resulting from

Northern Europe

includes a revenue decline of 9% in the UK as a result of reduced Identity Protection revenue, is currently participating in a tender for the continuation of the contract beyond September UK has extended its Mobile Phone Insurance contract with T-Mobile to September 2012 and mitigated by the growth of our Packaged Account and wholesale activities. In the period the reduced Card Protection revenue streams, the impact of which have been marginally where the prior period benefitted from sales prior to the FSA announcement, and also Northern Europe revenue has decreased 8% compared to the same period in 2011. This

Southern Europe and Latin America

growth for the period, albeit from a low base in the prior period, and we continue to invest in Southern Europe continues to be impacted by the challenging economic conditions, which
have resulted in a revenue decline of 5% for the region for the period, including a 12% our newest market, Brazil. decrease in Spain. Our main Latin American market, Mexico, has experienced strong revenue

North America

North America continued its strong performance from 2011 into 2012 with revenue increasing
25% in the period. The revenue growth is through increased monthly bill volumes as a result
of maturing relationships with existing implemented in the prior period

Asia Pacific

Asia Pacific continues to be a market where we believe there is potential for significant growth
and revenue increased 11% for the period led by renewals performance with existing reduction in operating losses for the period. proceed as planned and the change in revenue mix in the region has contributed to a Business Partners in India and China. Our progress in these substantial markets continues to

Home₃

to strengthen with policy volumes increasing 6% since the year end Development of our Home 3 joint venture continues, including the expanded migration of
ScottishPower customers to Home 3 in the period. Other customer relationships also continue

Financial position

position represents a decline of £7.6 million the year end which was expected and is the result of voluntary redundancy payments in the UK and working capital movements The Group remains in a positive net funds position at 30 April 2012 of £4.3 million. This

FSA investigation

offer redress to customers where appropriate. direct sales of its Card Protection and Identity Protection products made since 2005, and to renewal process and conduct a Past Business Review ("PBR") under FSA supervision of processes and product design in the UK. It was agreed that CPP would make changes to its relation to the scope of actions necessary to address certain failings in CPP's sales As announced on 24 February 2012 the Group reached an agreement with the FSA in

Prior to launch and to test operational processes, a pilot customer contact exercise will be
undertaken. This is expected to commence shortly with the wider PBR to begin following its completion

not mark the end of the investigation for which the timing and outcome remain uncertain. As noted in the preliminary results announcement in March, the agreement with the FSA does

Outlook

the short-term revenue impact this will have across the Group. to move forward with renewed focus as a more customer focussed business, notwithstanding relation to the Group's agreement with the FSA in the UK which will ultimately allow the Group The short-term outlook for CPP will continue to be determined by the ongoing activity in

in the UK and as a result there are currently no sales of Card Protection or Identity Protection
in the UK through CPP channels. These factors combined will, as previously announced,
adversely impact revenue and profit gro uncertainty. Renewal rates are expected to be adversely impacted by changes to renewal
packs and publicity surrounding the Group. The call to confirm channel has now been closed from alternative channels. work to address, where possible, the concerns of Business Partners during this period of significant adjustment as a result of the impact of the FSA investigation, and we continue We auticipate that trading will continue to be difficult in the NN which undergo a period o $\vec{c}$

product and channel initiatives will start to contribute positively in the UK in the first half of Our Packaged Account and Mobile Phone Insurance business is expected to continue to
grow and although we continue to expect that UK profit in 2012 will be lower than 2011, new reduction in overhead run rate as the year progresses 2013. The voluntary redundancy programme completed in the period will contribute to a

Whilst Southern Europe continues to experience challenges arising from the economic
situation, elsewhere our international prospects remain promising with robust revenue growth
expected to continue in North America and Asi developing markets

maintaining a net funds position and having a history of good underlying cash generation on operations. This performance is further underpinned by a strong financial platform with the Group The Group's operating performance continues to be in line with current market expectations

Paul Stobart, Chief Executive Officer, commented

largely unaffected by the FSA investigation in the UK, announced on 28 March 2011. The "It has been a challenging start to the year against a comparative period in 2011 which was reached with the regulator is carried out effectively. with the FSA, and I have made it my first priority to ensure that the agreement we have short-term outlook for the business will continue to be determined by the ongoing situation

and customers alike. We firmly believe that our operating model of growth through customer
focus, supported by strengthened management discipline and enhanced governance, will
help us navigate the short-term challenges in that customers truly value our products. I have confidence that we are providing effective propositions to customers and that our ongoing product innovation, underpinned by a culture of customer service excellence, will build our presence and relevance for Business Partners "The longer-term opportunities for CPP remain considerable, and importantly it is very clear business for the long-term."

which are as follows: A conference call for analysts will be held on 16 May 2012 at 8:00 a.m., dial-in details for

Participants ID: 667084# Dial in: +44 (0)20 3140 0668

For enquiries contact:

Shaun Parker, Chief Financial Officer
Tel: +44 (0)1904 544702 Paul Stobart, Chief Executive Officer

Martin Robinson David Allchurch John Sunnucks Tel: +44 (0)20 7353 4200 Tulchan Communications

Note to editors

16 geographical markets in both developed and developing countries. Card Protection was
the first product the Group introduced 30 years ago. Since then CPP has launched Mobile plumbing, drainage, gas, electrical and other home-related emergencies. the provision of Packaged Accounts where we source products and services to create a
tailored 'package' for bank account customers. We also provide a range of travel support Phone Insurance, Legal Assistance and Identity Theft Protection. CPP is also prominent in lounges worldwide. Our Home 3 joint venture with Mapfre Asistencia provides assistance for services such as translation and lost-and-found luggage services as well as access to airport CPPGroup Plc ("CPP") is a leading international Life Assistance business with operations in

Cautionary statement

purpose. This IMS has been prepared solely to provide additional information to shareholders as a
body to meet the relevant requirements of the UK Listing Authority's Disclosure and
Transparency Rules. The IMS should not be relied

forward-looking statements and it will not publicly release any revisions it may make to these
forward-looking statements that may result from events or circumstances arising after the
date of this IMS. The IMS contains certain forward-looking statements. These statements are made by the directors in good faith based on the information available to them up to the time of approval of directors in good faith based on the in including both economic and business risk factors, underlying any such forward-tooking
information. Subject to the requirements of the UK Listing Authority's Disclosure and
Transparency Rules and Listing Rules, CPP underta