Coface sees €142.3mn net income in H1’24, welcomes Rathman to Board

Credit insurer Coface has reported its first half of 2024 results with an improved combined ratio of reinsurance and a net income of €142.3 million, up 10% compared to the same period the year prior.

For H1 2024 the insurer also recorded a consolidated turnover of €923 million down -3.1% at constant FX and perimeter.

According to the firm, credit insurance premiums decreased by -5.3%, mainly due to a decline in inflation and the absence of a rebound in client activities. While client retention is still high, at 92.8%, it is down when compared to H1 2023.

Gross earned premiums went down 6.1% to $754.3 million from the $803.1 million reported in the first half of 2023. At $922.7 million revenue saw a 3.8% in H1 2024 compared to H2 2023’s $959.7 million.

Underwriting income saw a slight decrease of 1.9% in H1 2024, to $195.0 million compared to the $198.8 million reported in the same period the year prior.

Pricing effect remained negative, at -1.4%, in line with historical trends, Coface also noted. The period saw renewed double-digit growth in information services (+16.9% at constant FX) and debt collection (+20.3% vs. a low base); factoring down -2.6% but up 1.0% in Q2 2024.

In H1 2024 Coface also saw its net loss ratio improve, to 35.0% from 40.3% reported in H1 2023. At 63.4%, its net combined ratio also saw improvement, compared to 65.5% reported in the same period the year prior.

Both gross loss ratio and net cost ratio improved in H1 2024, to 32.5% and 28.4% respectively. Improvement in gross loss ratio had stable opening reserving and high reserve releases while net cost ratio growth reflects lower revenues, offset by a better product mix, while investment continues.

Xavier Durand, Coface’s Chief Executive Officer, commented: “Our results reflect the disciplined execution of our strategy and a still sluggish economic environment. The continuing decline in inflation and the lack of a rebound in our clients’ activities are reflected in a fall in our insurance revenues of 5.3%, from a record high comparison basis.

“In line with our strategic priorities, our service revenues (information services, debt collection) once again recorded double-digit growth, limiting the decline in our overall turnover to 3.1%. Our combined ratio was resilient at 63.4%, an excellent level, due to our successful risk management. We benefited from the past rise in interest rates to record an increase in financial income.”

Durand concluded: “Our net income rose once again, to €142.3m, which corresponds to a return on average tangible equity of 15.3%, well above our mid-cycle targets. Our solvency ratio remains very high, at 195%, which provides our clients with a high level of security while enabling us to seize growth opportunities as they arise.”

As Coface reported its H1 2024 results, it it also announced the addition of Marcy Rathman, Chief Environmental, Social and Governance Officer of Arch Capital Services LLC (Arch), as a non-independent director to its Board of Directors.

She will take the place of Chris Hovey who leaves Coface’s Board to focus on his other professional responsibilities within Arch, according to the announcement.

Rathman has been part of Arch since December of 2000 when she joined its legal team and served as an attorney for Arch for close to 20 years, supporting the General Counsel and many of the company’s governance and compliance policies.

In 2022, she was promoted to EVP, Chief Environmental, Social and Governance Officer of Arch Capital Services LLC. The executive was initially named Senior Vice President, Chief ESG Officer in May 2019.

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