TIDMFRP
RNS Number : 7302U
Fairpoint Group PLC
30 June 2009
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FAIRPOINT GROUP PLC
Trading Update
Fairpoint Group plc ("Fairpoint" or "the Group"), the leading provider of advice
and solutions to financially stressed consumers, today announces a trading
update in relation to the six month period ended 30 June 2009.
Trading Performance
The financial performance of the Group in the first half of 2009 was in line
with management expectations. Improvements delivered in the second half of 2008
have provided continued momentum through the first six months of 2009, leading
to gains in operational efficiency and cash generation. Overall profitability is
significantly improved on the same period in 2008 and bodes well for the
seasonally stronger second half of the year. The Board is confident that full
year results will be in line with market expectations.
* Continued operational improvements have resulted in historically high conversion
rates from a lower cost base. We have continued to be selective in marketing
channels used and this is generating strong year-on-year profit growth from
lower spend and lower lead volumes.
* Operating cash flow has improved further and the Group expects to see a
significant reduction in net borrowings from GBP8.6 million at 31 December 2008
to GBP6.5 million at 30 June 2009. The Board remains confident that the target
of reducing net borrowings to below one year's profit before tax adjusted for
brand amortisation will be achieved in the second half of 2009.
* Revenue diversification remains a priority with the debt management business
continuing to grow despite a high number of clients who previously may have
opted for a Debt Management Plan (DMP) now able to access a higher yielding
Individual Voluntary Arrangement (IVA).
* Creditor relationships are positive with IVA approval rates at Meeting of
Creditors exceeding 95% and a greater acceptance of the benefits of IVAs in
comparison to DMPs contributing to the improved IVA conversion rates.
* The Group is now focusing on growth and has put the first building block in
place with the relaunch of ClearStart and the roll out of innovative new debt
management structures to open up distribution options with creditors and debt
agencies.
Chris Moat, CEO of Fairpoint, commented:
"The first half of 2009 has seen the Group build on the operational turnaround
achieved in 2008 to deliver a materially improved result on the same period last
year. The Board looks forward to the remainder of 2009 with confidence".
Interim Results
Fairpoint will be announcing its interim results on 15 September 2009. There
will be an analyst presentation to discuss the interim results at 09:30 on 15
September 2009 at Financial Dynamics, Holborn Gate, 26 Southampton Buildings,
London, WC2A 1PB. Those analysts wishing to attend are asked to contact Yasmeen
Amorese at Financial Dynamics on +44 207 269 7418 or at yasmeen.amorese@fd.com
Enquiries:
Fairpoint Group Plc 0845 296 0137
Chris Moat, Chief Executive Officer 084 5296 0100
Andy Heath, Finance
Director 084 5296 0200
Oriel Securities
Tom Durie 020 7710 7600
Emma Ormond
Financial Dynamics
Nick Henderson 020 7269 7114
David Cranmer 020 7269 7217
This information is provided by RNS
The company news service from the London Stock Exchange
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