Coface posted a net income of €78 mn

Coface has reported H1 2022 income of €144.4m in its latest results. Turnover in the period of €895m. Trade Credit Insurance premiums were growing by 16.1%, growth that was driven by ‘high client activity’ in an inflationary environment. It also reported that net loss ratio had risen to 39.4% and net combined ratio stood at 66%.

In this increasingly uncertain environment, Coface has supported its clients more than ever amid a rebound in activity, while maintaining a conservative underwriting policy.

During the second quarter, the macroeconomic outlook shifted significantly due to the combined effect of the conflict in Ukraine and the actions of central banks, who have showed how determined they are to bring rampant inflation under control. Against this backdrop, Coface’s economists have downgraded the economic outlook for several countries and sectors.

Xavier Durand, Coface’s chief executive officer of Coface

Second-quarter 2022 results show an excellent Group operating performance amid a normalising risk environment. The rise in bankruptcies in different countries is uneven: while numbers have barely risen in some places, other countries (UK, Spain) have seen bankruptcies exceed their pre-pandemic levels, and the return of large claims.

Coface posted a net income of €78 million, which he called a record performance for a single quarter, despite taking into account the impact of crisis in Ukraine. Exposure to losses arising from Russia’s invasion of its neighbour, said Deutsche Bank in March, equated to €5bn.

Coface’s total exposure to Russia’s invasion of Ukraine equated to €5bn, with 95% Russia, and 5% Ukraine, which was equivalent to less than 1% of total group insured exposure, adding that these exposures would significantly decline in the following weeks.

This has resulted in Coface being able to deliver an annualised RoATE of 15.4% since the beginning of the year.

Factoring and information services confirmed their growth potential with respective increases of 11.6% and 15.5% during the first half of the year.

by Nataly Kramer