Coface records a very good start to the year with a net income of €61.2m
Coface applied IFRS 17 and IFRS 9 accounting standards starting on 1 January 2023. All comparisons are made using the 2022 pro forma IFRS 17 figures presented on 27 April 2023.
Turnover: €475m, up 11.4% at constant perimeter and FX
- Trade Credit insurance rose 10.9% at constant FX, driven by increased client activity and growth in fee and commission income (+12.8%)
- Client retention stood at record highs (95.7%); the price effect was still negative (-1.5%) but less so than Q4-22
- Information services rose 15.0% at constant FX, while factoring climbed 13.1%
Net loss ratio at 40.6%, up by 0.3 ppt; net combined ratio at 66.3%, improved by 1.7 ppt (+10.3 ppts compared to Q1-22, excluding the impact of government schemes)
- Gross loss ratio at 40.7%, up 9.2 ppts in a risk environment that is still slowly normalising
- Net cost ratio down by 2.1 ppts to 25.7% as a result of positive operating leverage, an improved product mix and high reinsurance commissions
Net income (group share) at €61.2m, up 17.0% compared to Q1-22
Annualised RoATE1 at 13.6%
Payment of the 2022 dividend of €1.522 approved at the General Meeting of 16 May 2023
Unless otherwise indicated, change comparisons refer to the pro forma IFRS 17 results as at 31 March 2022.
Xavier Durand, Coface’s Chief Executive Officer, commented:
“Coface maintained its growth trend with an 11.4% increase in turnover and a record customer retention rate. Other activities, including service revenues (information sales, debt collection and fee and commission income) continued to grow double digits, once again proving the solidity of Coface's business model.
While helping moderate inflation, ongoing monetary tightening by the main central banks also revealed weaknesses in a financial system that had become accustomed to very low rates. Fears arising from the bankruptcies of US regional banks will likely lead to a general reduction in the corporate credit supply.
The first quarter of 2023 is also the first to which the IFRS 17 and IFRS 9 accounting standards were applied. These standards did not cause any major changes to the assessment of Coface's financial performance, which remains strong. Under this new accounting framework, Coface posted a 17% increase in net income to €61.2m and a net combined ratio of 66.3% for an annualised return on tangible equity of 13.6%, above mid-cycle targets.
Lastly, following the general meeting of 16 May, a dividend of €1.52 per share (which corresponds to 80% of our 2022 earnings) was paid on 24 May 2023.”
For more detailed information, download the full press release below.
1 Return on average tangible equity.
2 The proposed payment was approved at the General Shareholders’ Meeting on 16 May 2023. The ex-dividend date and payment of the dividend took place on 22 and 24 May 2023 respectively