Slide 1: Q1-2022 Results: Presentation to Financial Analysts
Q 1 - 2 0 2 2 R E S U LT S P R E S E N TAT I O N T O F I N A N C I A L A N A LY S T S 28 APRIL 2022
Slide 2: Net income at €66.2m – RoATE stands at 13.2%
Q1-2022 RESULTS: NET INCOME AT €66.2M – ROATE STANDS AT 13.2% 01 02 03 04 Q1-2022 Q1-2022 K E Y TA K E - APPENDICES HIGHLIGHTS R E S U LT S A W AY S & OUTLOOK 2 Q1-2022 RESULTS | PRESENTATION TO FINANCIAL ANALYSTS | 28 APRIL 2022
Slide 3: Part 1: Q1-2022 Highlights
coface FOR TRADE PART 1 Q1-2022 HIGHL
Slide 4: Coface reports strong Q1-2022 with €66.2m net income
COFACE REPORTS STRONG Q1-2022 WITH €66.2M NET INCOME Turnover reached €431m y-t-d, up 12.8% at constant FX and perimeter › Trade Credit Insurance premiums growing by 14.7% driven by high client activity › Client retention at record highs (94.8%); pricing down (-2.7%) › Business information momentum
Slide 5: Focused on mitigating Ukraine / Russia risks
FOCUSED ON MITIGATING UKRAINE / RUSSIA RISKS M E A S U R E S TA K E N E X P O S U R E T O R U S S I A (€bn) 4.8 • Acted immediately on managing existing exposure and reducing risks Export • Worked closely with large international clients (more than 2.6 - 46% Domestic 75% of Coface activity related t
Slide 6: Part 2: Q1-2022 Results
coface FOR TRADE PART 2 Q1-2022 RESULT:
Slide 7: Turnover growth at 12.8% driven by TCI premiums up 14.7%
TURNOVER GROWTH AT 12.8% DRIVEN BY TCI PREMIUMS UP 14.7% 14.0% 12.8% Total revenue up 12.8% vs Q1-2021 at constant FX and perimeter In €m 431 378 › Trade credit insurance* premiums growing at 14.7% at Gross Earned Premiums constant FX due to strong client activity and record high (GEP) 361 retention
Slide 8: Client activity and robust retention drive revenue growth
CLIENT ACTIVITY AND ROBUST RETENTION DRIVE REVENUE GROWTH Western Europe Northern Europe Central Europe Mediterranean & Africa 7.1% 6.0% 13.1% 13.0% 22.0% 21.8% 9.5% 10.9% 117 93 107 75 81 82 37 45 Q1-21 Q1-22 Q1-21 Q1-22 Q1-21 Q1-22 Q1-21 Q1-22 Good retention and activity partially High retention a
Slide 9: Very high activity and confirmed competitive market
VERY HIGH ACTIVITY AND CONFIRMED COMPETITIVE MARKET production* 51 New production at €35m, in line New 35 40 35 with pre-Covid levels. Q1-19 Q1-20 Q1-21 Q1-22 Retention 94.0% 94.3% 93.8% 94.8% Retention rate at record level in a rate* more competitive market. Q1-19 Q1-20 Q1-21 Q1-22 2.9% Pricing is
Slide 10: Gross loss ratio at 28.9% below mid cycle despite Ukraine crisis
GROSS LOSS RATIO AT 28.9% BELOW MID CYCLE DESPITE UKRAINE CRISIS Loss ratio before reinsurance and including claims handling expenses, in % › Normalization is under way: 29.5 29.6 28.9 ‒ Frequency increasing since mid-21 16.9 ‒ Large losses increasing while still below average 10.5 ‒ Relatively limi
Slide 11: Low loss ratio across most regions, Ukraine mostly impacting CER
LOW LOSS RATIO ACROSS MOST REGIONS, UKRAINE MOSTLY IMPACTING CER Loss ratio before reinsurance, including claims handling expenses – in % 9%* 5%* 8%* Group North America Latin America Asia Pacific 72.3*** 63.7 60.1** 51.8 45.8 48.6 43.4** 35.9 28.9 24.5 21.4 14.4 8.8 4.8 6.9 0.9 FY-19 FY-20 FY-21 Q1
Slide 12: Loss ratio for the quarter stable over one year
LOSS RATIO FOR THE QUARTER STABLE OVER ONE YEAR Loss ratio before reinsurance (by quarter), including claims handling expenses – in % 9%* 5%* 8%* Group North America Latin America Asia Pacific 29.5 29.6 35.6 28.9 24.8 24.5 16.9 22.3 22.2 21.0 10.5 4.8 8.5 -0.3 2.6 1.3 0.9 1.3 1.6 -15.7 Q1-21 Q2-21 Q
Slide 13: Positive operating leverage while continuing to invest
POSITIVE OPERATING LEVERAGE WHILE CONTINUING TO INVEST 12.2% 10.6% In €m 196 195 184 185 174 44 46 Cost ratio before reinsurance, in % 42 42 39 External acquisition costs (commissions) 33.7 34.1 33.2 31.2 31.6 142 143 153 149 135 Internal costs Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q1-21 Q2-21 Q3-21 Q4-21 Q
Slide 14: Reinsurance results reflect past record low loss activity
REINSURANCE RESULTS REFLECT PAST RECORD LOW LOSS ACTIVITY Q1-21 Q1-22 › Premium cession rate is down to 27.3% as public schemes have Gross earned premiums 312.1 361.3 ended on June 30th 2021 Net earned premiums 160.1 262.9 › Claims cession rate is down to -2.4% as positive development of 48.7% Premi
Slide 15: Combined ratio normalizing but still distorted by public schemes
COMBINED RATIO NORMALIZING BUT STILL DISTORTED BY PUBLIC SCHEMES +14.5 ppts › Net combined ratio increased to 67.3% (vs 52.8% in Q1-21) as claims ratio has started to normalize which includes impact from In % 83.0 Russia / Ukraine 67.3 62.4 Net combined ratio 52.8 32.6 › Net combined ratio excluding
Slide 16: Public schemes' impact coming to an end
PUBLIC SCHEMES’ IMPACT COMING TO AN END … ON COMBINED RATIO (%) 100% 90% 80% 70% 60% 50% 40% 30% • Government schemes have lowered pre-tax profit by €199m since the beginning of the crisis Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Published w/o schemes (€6m in 2020, €160m in 2021 and €33
Slide 17: Financial portfolio: stabilising underlying investment yield
FINANCIAL PORTFOLIO: STABILISING UNDERLYING INVESTMENT YIELD €m Q1-21 Q1-22 Investment Real Estate Income from investment portfolio without gains on sales** 7.9 7.2 7% Equities Gains on sales and impairement, net of hedging*** 0.1 4.4 7% FX effect (0.6) 2.0 Other (1.7) (1.2) Loans, Deposit & Total B
Slide 18: Q1-2022 net income at €66.2m
Q1-2022 NET INCOME AT €66.2M Income statement items - in €m Q1-21 Q1-22 Current operating income 80.0 97.2 Other operating income and expenses (0.4) (1.2) › Operating income up 20.7% Operating income 79.6 96.1 Finance costs (4.9) (5.1) Share in net income of associates 0.0 0.0 Badwill/Goodwill 0.0 0
Slide 19: RoATE stands at 13.2%, up 1.0 ppt
ROATE STANDS AT 13.2%, UP 1.0 PPT Change in equity 66.2 (77.7) 2,141.0 (0.0) 5.9 2,135.5 In €m IFRS Equi ty Distribu tio n to Net income impact Revaluatuion reserve Treasury shar es, IFRS Equi ty attri butable to owner s shareh olders (financial instr uments currency translation attri butable to own
Slide 20: Part 3: Key Take-aways & Outlook
PART 3 KEY TAKE-AWAYS & OUTLOOK
Slide 21: Key take-aways & outlook
KEY TAKE-AWAYS & OUTLOOK Coface delivered a strong operating performance › Double digit growth in TCI (activity and retention) and business information product line › Operating income up 20.7% despite public schemes costs (€33m) and Ukraine crisis › Unchanged reserving policy Coface continues to clo
Slide 22: Part 4: Appendices
coface FOR TRADE PART 4 APPENDICES,»
Slide 23: Key figures (1/2)
KEY FIGURES (1/2) QUARTERLY AND CUMULATED FIGURES Income statements items in €m - quarterly figures Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 % % ex. FX* Gross earned premiums 312.1 326.7 330.7 343.2 361.3 +15.8% +14.7% Services revenue 65.9 63.4 59.6 66.3 69.5 +5.4% +3.8% REVENUE 377.9 390.1 390.4 409.5 430.8
Slide 24: Key figures (2/2)
KEY FIGURES (2/2) REVENUE BY REGION: QUARTERLY AND CUMULATED FIGURES Total revenue - by quarter - in €m Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 V% ex. FX* Northern Europe 82.2 84.7 83.5 81.1 93.0 +13.0% Western Europe 75.5 78.2 79.9 83.0 80.8 +6.0% Central Europe 36.6 38.8 39.9 41.0 44.6 +21.8% Mediterranean
Slide 25: Government scheme's impact on ratio
GOVERNMENT SCHEME’S IMPACT ON RATIO GOVERNMENT SCHEMES’ IMPACT ON RATIO (%) BY QUARTER (11.1) ppts (8.3) ppts (10.8) ppts +9.0 ppts +40.3 ppts +12.0 ppts 83.0 In % Net combined ratio 69.4 67.3 61.1 61.8 62.4 32.6 58.3 52.8 53.4 55.3 51.0 Net cost ratio 36.3 26.6 28.7 31.1 42.7 32.1 24.9 40.0 28.3 32
Slide 26: Combined ratio calculation
COMBINED RATIO CALCULATION In €k Q1-2021 Q1-2022 › Combined ratio before reinsurance Earned Premiums (B) (C) Gross earned premiums [A] 312,050 361,347 loss ratio before reinsurance + cost ratio before reinsurance (A) (A) Ceded premiums (151,978) (98,470) Net earned premiums [D] 160,072 262,877 › Com
Slide 27: Q1-22 results vs consensus
Q1-22 RESULTS VS CONSENSUS # of in M€ Consensus Q1-2022 Spread Comment replies Total revenue 5 417 431 +13.8 Revenue growth driven by TCI premiums on high client retention and client Gross Earned Premiums 5 349 361 +12.3 activity Net Earned Premiums 5 261 263 +1.9 NEP/GEP 5 74.7% 72.7% (2.0) ppts Re
Slide 28: Financial calendar & investor relations contacts
FINANCIAL CALENDAR & INVESTOR RELATIONS CONTACTS Calendar Own shares transactions Next Event Date Own shares transactions 2021 Annual shareholders meeting 17 May 2022 Liquidity Buy-back Date LTIP TOTAL % Total of Voting Agreement (cancellation) H1-2022 Results 28 July 2022 after market close (in sha
Slide 29: Important legal information
IMPORTANT LEGAL INFORMATION IMPORTANT NOTICE: Coface Group’s current beliefs, assumptions and expectations of its future performance, taking into account all information currently available. The Coface This presentation has been prepared exclusively for the purpose of the disclosure Group is under n