Slide 1: H1-2023 Results: Presentation to Financial Analysts
H 1 - 2 0 2 3 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 10 AUGUST 2023
Slide 2: H1-2023 Results: Net Income at €128.8M – RoATE at 14.3%
H1-2023 RESULTS: NET INCOME AT €128.8M – ROATE STANDS AT 14.3% 01 02 03 04 05 H1-2023 H1-2023 C A P I TA L K E Y TA K E - APPENDICES HIGHLIGHTS R E S U LT S MANAGEMENT A W AY S & OUTLOOK Regulated documents posted by COFACE SA have been secured and authenticated with the blockchain technology by Wiz
Slide 3: Part 1: H1-2023 Highlights
coface FOR TRADE PART 1 H1-2023 HIGHLIC
Slide 4: Coface Reports €128.8M Net Profit in H1-2023; Solvency at 192%
COFACE REPORTS €128.8M NET PROFIT IN H1-2023; SOLVENCY AT 192% Turnover reached €960m y-t-d, up +11.1% at constant FX and perimeter › Trade Credit Insurance premiums growing by +11.2% driven by past client activity › Client retention at record highs (94.4%); pricing down (-2.0%) › Business informati
Slide 5: Managing Normalizing Environment
MANAGING NORMALIZING ENVIRONMENT C L I E N T AC T I V I T Y C U R R E N T S TAT U S (%) 13.8 • Exposure growth at +3% in H1-23 (€690bn) vs +13% in 2022 8.4 • Prevention actions up by 27% YTD vs 2019 (+66% in June) 6.1 • Client activity back to 2019 levels with lower metal and energy 2.8 2.8 prices o
Slide 6: CSR: Embedding Strategy and Setting Targets
CSR: EMBEDDING STRATEGY AND SETTING TARGETS* RESPONSIBLE RESPONSIBLE RESPONSIBLE DRIVING THE INSURER EMPLOYER ENTERPRISE C U LT U R E › Decreased GHG emissions of › Diversity & Inclusion: 88/100 in the Group Gender Index (+4 › Completed a carbon footprint › Upgraded from AA to AAA by MSCI / invest
Slide 7: Part 2: H1-2023 Results
coface FOR TRADE PART 2 H1-2023 RESULT,
Slide 8: Turnover Growth at 11.1% with Favourable Business Mix
TURNOVER GROWTH AT 11.1% WITH FAVOURABLE BUSINESS MIX 9.9% 11.1% Total revenue up +11.1% vs H1-22 pro forma at constant FX and perimeter In €m 960 874 › Trade credit insurance* premiums growing at +11.2% at constant FX Gross Earned Premiums due to past client activity and record high retention (GEP)
Slide 9: High Retention Across Regions, Activities Reflecting Local Context
HIGH RETENTION ACROSS REGIONS, ACTIVITIES REFLECTING LOCAL CONTEXT Western Europe Northern Europe Central Europe Mediterranean & Africa 16.5% 16.5% 6.7% 7.1% 1.8% 0.4% 12.7% 15.2% 267 237 194 187 200 167 90 91 H1-22 H1-23 H1-22 H1-23 H1-22 H1-23 H1-22 H1-23 Retention and activity. High retention and
Slide 10: Slowing Market Drives Reduced Activity, Improving Price & New Sales
SLOWING MARKET DRIVES REDUCED ACTIVITY, IMPROVING PRICE & NEW SALES production* New production rebounding at €63m driven by 86 mid-market engine. New 72 58 63 Still remaining close to pre-covid levels (€65m in H1-19). H1-20 H1-21 H1-22 H1-23 93.4% 93.9% 94.4% 92.4% Retention Retention rate at record
Slide 11: Gross Loss Ratio at 39.4%, Continuing Slow Normalization Under Way
GROSS LOSS RATIO AT 39.4%, CONTINUING SLOW NORMALIZATION UNDER WAY Loss ratio before reinsurance and including claims handling expenses, in % › Slow normalization is under way: 32.0 39.4 32.4 41.8 35.5 40.7 38.1 ‒ Number of claims increasing since mid-21, now nearing pre-Covid 31.5 level ‒ Large los
Slide 12: Loss Ratio Reflects Different Regional Economical Trends
LOSS RATIO REFLECTS DIFFERENT REGIONAL ECONOMICAL TRENDS Loss ratio before reinsurance, including claims handling expenses – in % 9%* 6%* 7%* Group North America Latin America Asia Pacific 112.4 63.7 51.8 72.3** 48.6 35.5 39.4 40.6 29.7 50.5 21.4 19.0 14.4 8.8 8.2 6.9 FY-20 FY-21 FY-22 H1-23 FY-20 F
Slide 13: Risks Under Control Post LatAm Large Case
RISKS UNDER CONTROL POST LATAM LARGE CASE Loss ratio before reinsurance (by quarter), including claims handling expenses – in % 9%* 6%* 7%* Group North America Latin America Asia Pacific 165.8 180.7 68.7 41.8 40.7 38.1 47.2 41.2 48.1 49.7 31.5 32.5 35.5 31.8 27.7 29.2 13.9 14.3 15.0 19.1 0.0 -2.0 -1
Slide 14: Operating Leverage and Continued Investments
OPERATING LEVERAGE AND CONTINUED INVESTMENTS 7.7% 10.2% 215 220 209 211 In €m 189 195 Cost ratio before reinsurance, in % 53 50 52 50 46 47 External costs 31.6 35.1 30.6 29.6 29.4 29.8 (commissions) 162 170 159 159 143 148 Internal costs Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q1-22 Q2-22 Q3-22 Q4-22 Q1
Slide 15: Reinsurance Results Benefit from Past Very Low Loss Activity
REINSURANCE RESULTS BENEFIT FROM PAST VERY LOW LOSS ACTIVITY H1-22 H1-23 › Premium cession rate at 27.1% Gross earned premiums 733.2 803.1 › Claims cession rate at 25.4% in line with premium cession rates Net earned premiums 531.4 585.4 with limited impact from non proportional treaty on large loss
Slide 16: Net Combined Ratio at 65.5%
NET COMBINED RATIO AT 65.5% 2.2 ppts In % 63.4 65.5 › Net combined ratio increased to 65.5% (vs 63.4% in H1-22) 57.2 26.8 25.2 reflecting risk normalization and some large cases Net combined ratio 26.5 Net cost ratio › Cost ratio down 1.6 ppt vs H1-22 with good cost discipline in 36.6 40.3 Net loss
Slide 17: Financial Portfolio: Increased Underlying Income with Higher Rates
FINANCIAL PORTFOLIO: INCREASED UNDERLYING INCOME WITH HIGHER RATES €m H1-23 Investment Real Estate Income from investment portfolio without gains on sales** 31.9 Equities 7% FVPL and gains on sales and impairement, net of hedging*** (9.0) 3% FX effect (17.4) Other (4.1) Loans, Deposit & other Net in
Slide 18: H1-2023 Net Income at €128.8M of Which €67.7M in Q2-2023
H1-2023 NET INCOME AT €128.8M OF WHICH €67.7M IN Q2-2023 Income statement items - in €m H1-22 H1-23 Current operating income 192.6 185.5 › Net earned premiums up by +10.1% at €585m on growing revenues Other operating income and expenses (4.3) (0.7) Operating income 188.3 184.8 › Operating income dow
Slide 19: RoATE Stands at 14.3%, Up 1.6 ppt
ROATE STANDS AT 14.3%, UP 1.6 PPT Change in equity In €m 2,018.6 (227.0) 128.8 16.6 (11.9) 1,925.3 IFRS Equi ty a ttributable to Distribu tio n to Net income impact Revaluation reserve Treasury shar es, cur rency IFRS Equi ty a ttributable to owners of the paren t shareh olders (financial instr umen
Slide 20: Part 3: Capital Management
coface FOR TRADE PART 3 CAPITAL MANAG
Slide 21: Solid Balance Sheet
SOLID BALANCE SHEET H1-2023 simplified balance sheet In €m Financial strength 7,718 7,718 Goodw ill & intangible assets 236 129 Net profit of the year › Fitch: AA-, stable outlook 1,925 rating affirmed on 23 November 2022 1,796 Shareholders’ equity Insurance investments 2,963 Financing liabilities ›
Slide 22: Robust Solvency Over Time
ROBUST SOLVENCY OVER TIME H1-2023 estimated Solvency ratio above target range Low sensitivity to market shocks market sensitivity tested through instantaneous shocks 201%* (9.7 ppts) 11.7 ppts (8.1 ppts) 196%* 192%* 192%* (2.8 ppts) 30/06/2023 SCR cover 192% 194% +100 bps Interest rates (1) 187% 175
Slide 23: Solvency Required Capital as at 30 June 2023
SOLVENCY REQUIRED CAPITAL AS AT 30 JUNE 2023 192%1 PARTIAL INTERNAL MODEL 2,451 19 524 €m 1,333 (163) 1,278 49 242 Operational risk (134) 164 Tier 3 1,037 242 Tier 2 Counterparty risk 1,908 Tier 1 310 Market risk Non-life underwriting risk 1,037 1,037 809 SCR components Diversification Tax adjustmen
Slide 24: Part 4: Key Take-Aways & Outlook
PART 4 KEY TAKE-AWAYS & OUTLOOK
Slide 25: Key Take-Aways & Outlook
KEY TAKE-AWAYS & OUTLOOK Coface continues to deliver good results, in line with recent years, in a changing environment › Double digit growth in both TCI (retention and past activity) and business information › Net combined ratio under IFRS 17 at 65.5% › Annualized RoATE (Return on Average Tangible
Slide 26: Part 5: Appendices
coface FOR TRADE PART 5 APPENDICES,»
Slide 27: Key Figures (1/2)
KEY FIGURES (1/2) QUARTERLY AND CUMULATED FIGURES Income statements items in €m - Quarterly figures Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 % % ex. FX* Gross earned premiums 359.2 374.0 403.5 379.0 395.3 407.8 +9.0% +11.4% Services revenue 68.8 71.6 70.1 73.0 79.8 76.8 +7.3% +8.1% REVENUE 428.0 445.6 47
Slide 28: Key Figures (2/2)
KEY FIGURES (2/2) REVENUE BY REGION: QUARTERLY AND CUMULATED FIGURES Total revenue by quarter - in €m Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 V% ex. FX* Northern Europe 94.7 92.8 92.7 92.9 102.2 97.9 +6.9% Western Europe 79.8 87.0 103.9 88.9 96.6 97.7 +11.7% Central Europe 46.9 42.6 48.5 43.9 45.0 46.1
Slide 29: Exposure in Emerging Markets Maintained at a Stable Share
EXPOSURE IN EMERGING MARKETS MAINTAINED AT A STABLE SHARE Evolution of TCI exposure1 per H1-2023 total TCI exposure1 – Top 10 Advanced vs Emerging markets (in €bn) countries vs. others (in %) Germany 12.3% USA Dec-20 81% 19% 486 France 36.7% 10.4% Italy Dec-21 80% 20% 588 Spain UK Dec-22 79% 21% 667
Slide 30: Combined Ratio Calculation
COMBINED RATIO CALCULATION In €k H1-22 H1-23 › Combined ratio before reinsurance Earned Premiums (B) (C) Gross earned premiums [A] 733,156 803,113 loss ratio before reinsurance + cost ratio before reinsurance (A) (A) Ceded premiums (201,707) (217,743) Net earned premiums [D] 531,449 585,370 › Combin
Slide 31: Q2-23 Results vs Consensus
Q2-23 RESULTS VS CONSENSUS # of in M€ Consensus Q2-23 Spread Comment replies Total revenue 6 481 485 +3.7 TCI premiums grow with retention and client activity Gross Earned Premiums 6 403 408 +5.2 Good performance from specialties Net Earned Premiums 6 293 298 +4.9 NEP/GEP 6 72.8% 73.0% +0.3 ppt No s
Slide 32: Management Team
MANAGEMENT TEAM GROUP MANAGEMENT COMMITTEE GROUP EXECUTIVE COMMITTEE Xavier DURAND Hugh BURKE Matthieu GARNIER Chief Executive Officer CEO Asia Pacific Information Services Director › +30 years of international experience in › +20 years of international exp. › +20 years of exp. in financial regulate
Slide 33: Corporate Governance as of 30 June 2023
CORPORATE GOVERNANCE AS OF 30 JUNE 2023 Board of directors AUDIT & ACOUNTS COMMITTEE Bernardo SANCHEZ INCERA Chairman Age: 62 › 3 members: 2 independents incl. the chairman (independent) › Laetitia Leonard-Reuter (Chm.) › Board member › Isabelle Laforgue › David Gansberg Isabelle LAFORGUE Laetitia L
Slide 34: Financial Calendar & Investor Relations Contacts
FINANCIAL CALENDAR & INVESTOR RELATIONS CONTACTS Calendar Own shares transactions Next Event Date Own shares transactions Liquidity Buy-back 9M-2023 Results 14 November 2023 Date LTIP TOTAL % Total of Voting Agreement (cancellation) Investor Day 5 March 2024 – Paris (in shares) # Shares rights 30/06
Slide 35: 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