Chairmans Statement

Profit before tax in the year to June 2008 of €20.7 million and earnings per share of 48.3 cent both represent increases of 7.1% over the preceding year

Highlights

Profitability and shareholder value

• Profit before tax of €20.7 million, up 7%
• Earnings per share of 48.3 cent, an increase of 7%
• Final Dividend proposed of 2.5 cent

Operational performance

• Revenue of €257.6 million for year, representing growth of 32% year on year
• Gross profit of €52.5 million, up 22 % on the year to June 2007
• Net cash balances of €37.5 million at 30 June 2008 (€29.6 million at 30 June 2007)
• Conversion ratio of 39.4%, down from 44.8% in the preceding year

It has been a year of two very different halves for the Group. In January we reported profit before tax for the six months to 31 December 2007 of €11.7 million, up 45% on the corresponding six months in the previous year and net fee income (gross profit) of €27.4 million. Earnings per share in the first six months to December 2007 amounted to 27.4 cent.

The Group has been operating in a changing and more difficult environment, reflecting a significant decline in employment growth in Ireland and an increase in the numbers on the live register. It is the nature of our business that we are exposed at an early stage to the effects of downturns in the markets and sectors in which we operate. As a result, in the six months to 30 June 2008 our fees from the permanent placement business have fallen by 18% to €11.1 million, compared with €13.5 million in the first six months of our fiscal year. The Gross profit of €13.6 million generated in the six months to June 2008 from our temporary business is slightly behind the first six months gross profit of €14.3 million.

A key performance measure for the Group is the conversion ratio of gross profit to profit before tax and amortisation. This was 39.4% in the year to June 2008, down from 44.8% in the year to June 2007. This reduction reflects the Group's continuing investments in the development of the business in new markets, particularly in Central Europe. Although conversion ratios are lower in the development stage, we expect that our newly developed and growing businesses will make a significant contribution to Group profits in the future.

Cost management in CPL has been a significant factor in the profitable growth achieved in recent years. We have a flexible cost base and will continue to ensure that the size and structure of our organisation is appropriate to market conditions, while allowing us to continue to take advantage of opportunities to expand our business organically and by acquisition.

John Hennessy
Chairman

05 September 2008