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Coface Sa — H1 2015 Earnings Presentation

23 slides from Coface Sa's earnings presentation, Jul 29, 2015

  1. Slide 1: H1-2015 results

    H1-2015 results Coface posts €66m net profit in spite of an increase in claims in emerging countries July 29th, 2015 (Limited examination by Statutory Auditors)

  2. Slide 2: Important legal information

    Important legal information IMPORTANT NOTICE: This presentation has been prepared exclusively for the purpose of the disclosure of Coface Group’s H1-2015 results, released on July 29th, 2015. This presentation includes only summary information and does not purport to be comprehensive. The Coface Gro

  3. Slide 3: Slight recovery, although fragile and bearing risks

    Slight recovery, although fragile and bearing risks… …especially in emerging economies • Growth is still robust in the US and relies on well oriented fundamentals GDP Growth (%, Coface forecasts) 13.4% • Gradual recovery in the Eurozone, at very different 13.0% paces from one country to another 11.

  4. Slide 4: H1-2015 Results

    H1-2015 Results 2014 comparative has been restated - IFRIC 21* Operating income Total turnover and premiums Net combined ratio and net income (group share) Growth vs. H1 2014* +5.1% +2.1%1 +6.8% +2.8%1 +10.2% +5.1%1 (4.8)% (7.5)%1-3 (4.2)% (6.0)%1 (3.0)% (4.0)%1-3 +3.9ppts. 79.7% 81.9% 760 78.0% H1

  5. Slide 5: Commercial performance

    Commercial performance €m €m 87  production1 76 76 66 61 63 • New production continues to evolve at a New 50 sustainable level H1- 2012 H2- 2012 H1- 2013 H2- 2013 H1- 2014 H2- 2014 H1- 2015 89.2% 90.6% 89.1%  Retention rate1-3 • Consistent client loyalty H1-2013 H1-2014 H1-2015 0.4%  Price effect

  6. Slide 6: Turnover and Premiums

    Turnover and Premiums Total turnover GEP NEP Earned fees +5.1% +2.1%* +6.8% +2.8%* +10.2% +5.1%* +2.2% +0.2%* 721 736 12.4% Q1 2015 565 581 €m 12.1% 448 426 H1-2014* H1-2015* H1-2014* H1-2015* H1-2014* H1-2015* H1-2014* H1-2015* H1 2015 Fees / GEP 12.1%* Growth Growth * * at constant FX and perimete

  7. Slide 7: Turnover by region

    Turnover by region Northern Europe Western Europe Central Europe Mediterranean and Africa Turnover (5.8)% (4.7)% Turnover (1.0)% (2.8)% Turnover +0.9% +0.6% Turnover +17.8% +16.3% €m €m 182 €m €m 171 238 236 56 57 130 111 H1-2014 H1-2015 H1-2014 H1-2015 H1-2014 H1-2015 H1-2014 H1-2015 Asia Pacific N

  8. Slide 8: Loss ratio evolution

    Loss ratio evolution Gross loss ratio evolution1  52.8% • Increase of the loss ratio compared 51.5% 51.1% 48.9% 49.8% 47.4% 48.6% to previous quarters due to increase 45.2% in claims, especially in some FY 2012 FY 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 emerging countries Current year

  9. Slide 9: Costs evolution

    Costs evolution Internal costs growing at Slight increase in expenses slower pace than premiums Total expenses €m 5.6% 342 361 68 79 2.8%* 2.8% 274 282 1.2%* GEP Internal costs H1-2014 H1-2015 H1-2014 (Restated - IFRIC 21) vs. H1-2015 growth Internal costs External acquisition costs at constant FX a

  10. Slide 10: Reinsurance result

    Reinsurance result Ceded premium / GEP Reinsurance impact 25% 22% H1 2014 H1-2015 -26 -36 H1-2014 H1-2015 Ceded claims / Total claims  • The levels of cession for premiums 21% 22% and for claims are converging • Larger risk transfer to reinsurers H1-2014 H1-2015 Financial analysts presentation H1-2

  11. Slide 11: Net combined ratio

    Net combined ratio Evolution in net combined ratio H1 2015 Net combined ratio : +3.9 ppts. 2014 Net combined ratio : 79.7% 81.9% 81.9% 78.0% 86.0% 86.4% +2.8 ppts.* 29.8% 77.7% 78.2% 76.4% 77.5% 27.0% 33.9% 32.1% 25.4% 28.7% 29.0% 27.7% 50.9% 52.0% 52.3% 49.5% 47.4% 52.1% 49.8% 54.3% +1.1 ppts. Q1-2

  12. Slide 12: Investment income

    Investment income Progressive portfolio diversification 1 Equities Investment 8% Real Estate 3% Loans, Deposit & other financial Total Prudent and proactive investment strategy 22% € 2.46bn1 Bonds 67% €m H1 2014 H1 2015 2 Income from investment portfolio 20.1 32.6 Investment management costs (1.9)

  13. Slide 13: Shareholders' equity

    Shareholders’ equity Changes in equity €m (76) 1,727 1,725 18 66 (6) Total IFRS Equity Distribution to Net income Revaluation reserve Currency translation Total IFRS Equity Dec 31, 2014 shareholders impact (financial differences June 30, 2015 (IFRIC21 restated) instruments AFS) Return on Average Tan

  14. Slide 14: State public guarantees activity in France: uncertainties unveiled

    State public guarantees activity in France: uncertainties unveiled Agreement in principle with the French State – post closing event Main Elements of the Agreement in principle reached today with the French State  The public guarantees activity is valorized at €89,7m: Coface will perceive a €77.2m

  15. Slide 15: Investor Relations

    Investor Relations Shareholder composition • COFACE SA is a société anonyme (joint-stock corporation), with a Board of Employees Issuer 0.25% Directors (Conseil d’Administration) incorporated under French Law • Registered No. 432 413 599 with the Nanterre Trade and Companies Natixis Registered 41.24

  16. Slide 16: Annexes

    Annexes

  17. Slide 17: H1-2015 - Key Figures

    H1-2015 - Key Figures % H1-2014 H1-2015 vs. % Income statement items - in €m H1-2014 Restated H1-2015 H1-2014 Restated like-for-like 1 IFRIC 21* IFRIC 21* Consolidated revenues 723.6 723.6 760.3 +5.1% +2.1% of which gross earned premiums 564.8 564.8 603.0 +6.8% +2.8% Underwriting income after reinsu

  18. Slide 18: Q2-2015 - Key Figures

    Q2-2015 - Key Figures % Q2-2014 Q2-2015 vs. % Income statement items - in €m Q2-2014 Restated Q2-2015 Q2-2014 Restated like-for-like 1 IFRIC 21* IFRIC 21* Consolidated revenues 353.6 353.6 370.7 +4.8% +1.8% of which gross earned premiums 277.3 277.3 296.1 +6.8% +2.8% Underwriting income after reinsu

  19. Slide 19: Bridge table

    Bridge table From Operating income to Operating income excluding restated items Q1-2014 Q1-2014 Q2-2014 Q2-2014 H1-2014 H1-2014 in thousand euros Q1-2015 Q2-2015 H1-2015 published IFRIC 21 published IFRIC 21 published IFRIC 21 Operating income 53,413 52,601 60,508 50,267 50,507 42,091 103,680 103,10

  20. Slide 20: Overview of net combined ratio calculations

    Overview of net combined ratio calculations Adjusted Net Earned Premiums Adjusted net operating expenses H1-2014 H1-2014 In €k H1-2014 Restated H1-2015 In €k H1-2014 Restated H1-2015 IFRIC 21 IFRIC 21 A Gross Earned Premiums 564,782 564,782 603,037 Total operating expenses 341,244 341,816 360,932 Ce

  21. Slide 21: Financial strength acknowledged by rating agencies

    Financial strength acknowledged by rating agencies  Coface is rated ‘AA-’ by Fitch Ratings and ‘A2’ by Moody’s, both with a stable outlook  The positive assessments by the two agencies is based on 3 key drivers: 1. Coface's strong competitive position in the global credit insurance market 2. Robus

  22. Slide 22: A strengthened and experienced management team

    A strengthened and experienced management team CEO Jean-Marc Pillu 15 years of experience in insurance industry & former General Manager of Euler Hermes Working for Coface since 2010 Group central functions CFO Corporate Secretary Human Resources Manager Carine Pichon Carole Lytton Cécile Fourmann 1

  23. Slide 23: Corporate governance

    Corporate governance Board of Directors Laurent MIGNON Chairman CEO of Natixis BPCE (Marguerite Non independent members Jean ARONDEL Jean-Paul DUMORTIER BERARD-ANDRIEU) ► BPCE ► BPCE ► BPCE Laurent ROUBIN Pascal MARCHETTI ► BPCE ► BPCE Sharon MACBEATH Olivier ZARROUATI Eric HÉMAR Independent members

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