Results 2000

1
Results 2000
2
HIGHLIGHTS OF 2000

• Profits Ahead 15.7
• Branch Network Increased by 84
• Customers Increased by 131,000
• Receivables up 29
• Chief Executive Designate Appointed
• Both Divisions Re-focused

3
Around The Group
4
CONSUMER DIVISION Shopacheck

• Expansion Programme Continues
• Opportunistic Acquisitions
• Bad debts Stable
• Further Increase In Customers
• Office Lending Introduced

5
CONSUMER DIVISIONWelcome

• Further significant Growth
• SNAP Benefits
• Bad Debts In Line
• HP Market Flat

6
CONSUMER DIVISION Lewis

• New products Introduced
• Expanding Collection Force
• Purchased Debt Performing Well
• Internal Debt Transfers Refined
• Office Relocation

7
CORPORATE SERVICES DIVISIONCattles Commercial
Finance

• Profits On Target
• Margins Under Pressure
• Flexible Underwriting

8
CORPORATE SERVICES DIVISIONReedham Factors

• Market Remains Competitive
• Re-organisation in Manchester
• Deliberate Cut Back In New Business
• Oxford Performing Strongly
• Bad Debts Now Stabilised
• Profits Reduced

9
SUMMARY

• Sustained Period Of Growth
• Virtuous Circle Completed
• CEO Hand Over
• Clear Strategy To take Forward

10
Financial Performance
11
HEADLINES
12
PROFITS - CONSUMER
13
PROFITS - GROUP
14
FUNDING
15
BORROWINGS AND GEARING
16
NET CAR CONSUMER
17
NET CAR GROUP
18
BAD DEBT CHARGE
2000
1999
19
RETURN ON NET CAR
Average ()
20
The Future
21
Deliver 5-Year Plan
22
THE VISION
Cattles plc aims to be the first choice provider
of financial services to consumers within the
United Kingdom who either choose not to use, or
do not have access to, mainstream facilities and
to companies which require a personal and
flexible service
23
STRENGTHS

• Successful Track Record
• Well Tested Strategy
• Management Strength In Depth
• A Peoples Business

24
KEY FOCUS AREAS

• Finance and Profits
• Employee Development
• Serving Customers Needs
• Business Support

25
CORPORATE SERVICES DIVISION

• New Managing Director
• Move Towards One Corporate Business
• Rebranded - Cattles Invoice Finance (CIF)
• Regional Network of 4 Cloned CIF Offices
• Develop Product Range/Alliances
• One Stop Financing Working Capital

26
CONSUMER DIVISION

• Evolution Not Revolution
• Extension of Existing 5 Year Plan
• One Consumer Division Company
• 500 Branch Network
• Around 1,000,000 Customers

27
A GOOD START MADE

• Consumer Division Board
• Consumer Division Leadership Team
• SWOT Project - Showing The Way

28
MARKET CHARACTERISTICS

• Weekly Credit-Mature/Contracting
• Monthly Credit-High Growth/Lower Returns
• Withdrawal of Mainstream Financial Services
• Rising Job Insecurity

29
JOB INSECURITYTemporary Employment - 61 Increase
Source Office for National Statistics
30
TARGET MARKET
Target Market (Millions) 5.8 - Our Market 5.8
- Cant Serve 11.7 - Wont Serve 23.3

• Socio-Economic Group
• C2
• D
• E
• Total

• Nos of Adults (Millions)
• 8.7
• 9.3
• 5.3
• 23.3

680,000 To Date
Source Merill Lynch 1998
31
OPPORTUNITIES

• Expand Branch Network
• Cross Selling of Weekly/Monthly Products
• Develop New Business Collaborations
• SNAP - High Volume/Low Take-on Cost
• Further Contribution From IT Systems
• Realise Synergies/Cost sharing Efficiencies

32
OPPORTUNITIES

• Better Customer Retention
• Further Integration of Lewis
• Bulk Purchase of Debt
• New Training Centre/Career Development
• Increase Market Share

33
CONSUMER DIVISION
Consumer Division Branches
Customer Retention
1st Line Credit
Weekly Monthly Products
SNAP Credit Profiling
Traditional/Direct
Establish Customer Relationships
2nd Line Credit Bulk Rejects
Lewis
Re-habilitated Customers
3rd Party Debt Collection
34
SNAP

• Rapid Application Processing
• Automatic Link To Credit Bureau
• Automated Customer Profiling
• Higher Acceptance Rate
• Consistent Underwriting
• Fast Decision Making

35
SNAP COLLABORATIONSHigher Volumes/Lower Take-on
Costs

• National Retailers
• Mail Order
• Utilities
• Building Societies Banks
• In-House Credit Operations
• Other Finance Houses

36
SUMMARY

• 5-Year Plan Confirmed
• Evolution Not Revolution
• One Consumer Division Company
• One Corporate Business
• National 500 Branch Network
• Around 1,000,000 Customers
• Increase Market share