Slide 1: IFRS 17 Pro Forma Presentation to Financial Analysts
IFRS 17 PRO FORMA 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 27 APRIL 2023
Slide 2: IFRS 17 Pro Forma Numbers
IFRS 17 PRO FORMA NUMBERS 01 02 03 04 05 IFRS 17 IFRS 17 C A P I TA L K E Y TA K E - APPENDICES PRO FORMA PRO FORMA MANAGEMENT A W AY S HIGHLIGHTS R E S U LT S Regulated documents posted by COFACE SA have been secured and authenticated with the blockchain technology by Wiztrust. You can check the au
Slide 3: Part 1: IFRS 17 Pro Forma Highlights
PART 1 IFRS 17 PRO FORMA HIGHLIGHTS
Slide 4: Today's Highlights
TODAY’S HIGHLIGHTS IFRS 17 has been implemented by Coface since 1st January 2023 › Q1-2023 will see the first live application of the new norm › Numbers presented today result from the retroactive application of IFRS 17 norms to 2022 business (pro forma) › This is providing some useful references fo
Slide 5: Coface's Strategy Remains Unaffected by IFRS 17
COFACE’S STRATEGY REMAINS UNAFFECTED BY IFRS 17 O U R S TAT E O F M I N D W H E N I M P L E M E N T I N G OUTCOME IFRS 17 • Reserving philosophy remains broadly unchanged • Unchanged strategy: Build to Lead assumptions and through the cycle targets remain for the current business plan: • Apply simpl
Slide 6: Part 2: IFRS 17 Pro Forma Results
PART 2 IFRS 17 PRO FORMA RESULTS
Slide 7: Less Than 1% Difference on Turnover
LESS THAN 1% DIFFERENCE ON TURNOVER 15.6% 13.4% Total revenue under IFRS 17 are at €1,799m 1,812 1,799 In €m 1,568 › Differences are limited to two main effects › Netting of inward commissions reducing revenues by €31m Gross Earned Premiums (GEP) 1,527 1,516 › Coverage period extension increasing re
Slide 8: Main Difference Is in Asia Pacific Due to Fronting Business
MAIN DIFFERENCE IS IN ASIA PACIFIC DUE TO FRONTING BUSINESS Western Europe Northern Europe Central Europe Mediterranean & Africa 13.6% 12.7% 12.3% 11.3% 14.3% 13.4% 11.9% 13.8% 481 485 429 360 360 372 373 317 332 156 179 182 FY-21 FY-22 FY-2022 FY-21 FY-22 FY-2022 FY-21 FY-22 FY-2022 FY-21 FY-22 FY-
Slide 9: 2022 Annual Gross Loss Ratio at 35.5%
2022 ANNUAL GROSS LOSS RATIO AT 35.5% Loss ratio before reinsurance and including claims handling expenses, in % 5.5 0.7 35.5 31.2 -1.9 41.8 34.2 32.4 35.5 35.5 32.2 29.5 31.2 31.5 28.9 Q1-22 Q2-22 Q3-22 Q4-22 FY-22 Q1-22 Q2-22 Q3-22 Q4-22 FY-22 IFRS 4 IFRS 17 Loss Ratio Impact FTA Impact Commission
Slide 10: Annual Regional Loss Ratios Show Limited Differences
ANNUAL REGIONAL LOSS RATIOS SHOW LIMITED DIFFERENCES Loss ratio before reinsurance, including claims handling expenses – in % 9%* 6%* 8%* Group North America Latin America Asia Pacific 72.3*** 63.7 60.1** 51.8 50.5 48.6 43.4** 45.8 35.5 35.9 21.4 23.4 14.4 39.8 9.9 31.2 6.9 8.8 19.0 8.2 FY-19 FY-20
Slide 11: Some Large Cases and Russian Reserves Reallocation During Q4-22
SOME LARGE CASES AND RUSSIAN RESERVES REALLOCATION DURING Q4-22 IFRS 17 Loss ratio before reinsurance (by quarter), including claims handling expenses – in % 9%* 6%* 8%* Group North America Latin America Asia Pacific 68.7 47.2 165.8 41.8 35.5 19.1 31.5 32.5 41.2 -2.0 13.9 14.3 0.0 15.0 -15.7 -52.3 Q
Slide 12: Lower Costs and Cost Ratio Under IFRS 17
LOWER COSTS AND COST RATIO UNDER IFRS 17 15.0% 12.6% 851 819 In €m 228 740 223 215 220 External costs 201 170 195 205 195 189 51 (commissions) 167 54 47 43 46 50 40 40 573 649 649 177 176 Internal costs 149 149 155 155 169 168 FY-21 FY-22 FY-22 Q1-22 Q2-22 Q3-22 Q4-22 IFRS 4 IFRS 17 V% V% ex. FX Gro
Slide 13: Reinsurance Differences Mostly Related to FTA Impact
REINSURANCE DIFFERENCES MOSTLY RELATED TO FTA IMPACT 12M-21 12M-22 12M-22 Gross earned premiums 1,312.6 1,527.5 1,515.7 › Premium cession rate at 27.0% Net earned premiums 800.5 1,117.1 1,106.9 39.0% › Claims cession rate at 18.4%, higher than under IFRS 4 Premium cession rate 26.9% 27.0% › In futur
Slide 14: Net Combined Ratio at 67.6% Under IFRS 17
NET COMBINED RATIO AT 67.6% UNDER IFRS 17 67.6 3.8% 67.6% 64.9% -1.0% -0.1% › The impact of first time application (FTA) is the primary driver of different combined ratios › Reclassification of inward commissions reduces the ratio by 1% Combined Ratio Impact FTA Inward Other Combined Ratio FY-22 IFR
Slide 15: FY-2022 Net Income at €240.4m
FY-2022 NET INCOME AT €240.4M Income statement items - in €m 12M-21 12M-22 12M-22 Current operating income 316.0 422.6 366.8 Other operating income and expenses (3.2) (9.1) (9.5) › Lower operating income on higher cost ratio related to First Time Operating income 312.9 413.5 357.2 Application leadin
Slide 16: RoATE Pro Forma Under IFRS 17 Stands at 12.7%
ROATE PRO FORMA UNDER IFRS 17 STANDS AT 12.7% Change in equity 2,229.5 (224.0) 240.4 (264.9) In €m 37.6 2,018.6 IFRS 17 Equi ty Distribu tio n to IFRS 17 pro forma Revaluation reserve Others (incl. IFRS 17 IFRS 17 Equi ty attri butable to owner s of shareh olders net income (financial instr uments e
Slide 17: Part 3: Capital Management
coface FOR TRADE PART 3 CAPITAL MANAG
Slide 18: FY-2022 Balance Sheet Under IFRS 17 / IAS 39
FY-2022 BALANCE SHEET UNDER IFRS 17 / IAS 39 2022 simplified balance sheet In €m I F R S 4 / I AS 3 9 I F R S 1 7 / I AS 3 9 8,451 8,451 Goodw ill 239 283 Net profit of the year 7,586 7,586 & intangible assets 1,960 Goodw ill 239 240 Net profit of the year 1,677 & intangible assets 2,019 Shareholder
Slide 19: Build to Lead – Targets Still Well on Track Under IFRS 17
BUILD TO LEAD – TARGETS STILL WELL ON TRACK UNDER IFRS 17 COMBINED RATIO PAY-OUT RATIO IFRS 4 IFRS 17 <80% +2.7 +14 >80% 79.8% 100% 100% 64.6% 64.9% 67.6% 94% 80% 2020 2021 2022 2022 2020 2021 2022* 2022* BUILD TO LEAD * The proposed distribution is subject to approval by the general shareholders me
Slide 20: Part 5: Key Take-aways
PART 5 KEY TAKE-AWAYS
Slide 21: Key Take-aways
KEY TAKE-AWAYS Coface’s strategy remains unaffected by IFRS 17 › Reserving philosophy remains broadly unchanged › Undiscounted current underwriting year loss ratios are almost identical › Build to Lead assumptions and through the cycle targets remain › Faster prior year development recognition under
Slide 22: Part 6: Appendices
coface FOR TRADE PART 6 APPENDICES,»
Slide 23: Key Figures (1/2)
KEY FIGURES (1/2) QUARTERLY AND CUMULATED FIGURES IFRS 4 IFRS 17 Income statement items in €m / Quarterly figures Q1-22 Q2-22 Q3-22 Q4-22 Q1-22 Q2-22 Q3-22 Q4-22 Gross earned premiums 361.3 392.7 398.1 375.3 359.2 374.0 403.5 379.0 Services revenue 69.5 71.4 70.1 73.5 68.8 71.6 70.1 73.0 REVENUE 430
Slide 24: Key Figures (2/2)
KEY FIGURES (2/2) REVENUE BY REGION: QUARTERLY AND CUMULATED FIGURES IFRS 4 IFRS 17 Total revenue by quarter - in €m Q1-22 Q3-22 Q3-22 Q4-22 Q1-22 Q2-22 Q3-22 Q4-22 Northern Europe 93.0 91.9 92.4 95.0 94.6 92.9 92.6 92.9 Western Europe 80.8 93.3 96.8 88.7 79.9 86.9 103.9 88.9 Central Europe 44.6 44.
Slide 25: Combined Ratio Calculation
COMBINED RATIO CALCULATION FY-2021 FY-2022 FY-2022 In €k IFRS 4 IFRS 4 IFRS17 › Combined ratio before reinsurance Earned Premiums Gross earned premiums [A] 1,312,637 1,527,464 1,515,663 (B) (C) Ceded premiums (512,098) (410,339) (408,812) loss ratio before reinsurance + cost ratio before reinsurance
Slide 26: Financial Calendar & Investor Relations Contacts
FINANCIAL CALENDAR & INVESTOR RELATIONS CONTACTS Calendar Own shares transactions Next Event Date Own shares transactions 2022 Annual shareholders meeting 16 May 2023 Liquidity Buy-back Date LTIP TOTAL % Total of Voting Agreement (cancellation) (in shares) # Shares rights Q1-2023 Results 25 May 2023
Slide 27: 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