AMSTERDAM, March 7, 2017 /PRNewswire/ --
Continued strong contributions across the Group
Highlights:
Atradius' aim is to lead our customers into the future by strengthening their credit and cash management to support growth of their businesses. We continue investing in new technologies and taking advantage of opportunities in the markets. Our strategy is anchored by our distribution network of brokers and agents who deliver quality services that make a difference and where our people and global footprint play a key role.
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Isidoro Unda, Chairman of the Management Board of Atradius commented, "2016 was another strong year for Atradius. We were successful in making improvements to our operations to the benefit of our cost structure and also enabling us to further enhance our operational efficiency and effectiveness. Year after year we are committed to delivering our customers and business partners quality service, regularly updated buyer information, collections support and prompt reimbursement of claims. This resulted in a very high customer retention rate of 93%."
Key figures (in EUR ,000): 2016 2015 % change
Insurance premium revenue 1,557,588 1,537,005 1.3%
Service and other income 203,079 180,754 12.4%
Total revenue 1,760,667 1,717,759 2.5%
Gross claims and gross operating
expenses (1,314,538) (1,337,813) -1.7%
Investment income 44,968 36,016 24.9%
Operating income before reinsurance 424,045 364,616 16.3%
Reinsurance result (140,062) (102,958) 36.0%
Income tax expense (62,792) (69,949) -10.2%
Result after tax 211,772 178,221 18.8%
Gross claims ratio
(gross claims / total insurance
revenue) 41.60% 43.50% -4.4%
Gross expense ratio
(gross expenses / total insurance
revenue) 36.40% 37.10% -1.9%
Gross combined ratio 78.00% 80.60% -3.2%
Shareholders' equity 1,625,470 1,500,249 8.3%
Total Revenue
Atradius' total revenue grew 2.5% to EUR 1,761 million in 2016 compared to EUR 1,718 million in 2015. At a constant exchange rate this marked a 3.4% increase. Europe, Asia and Oceania showed encouraging revenue growth, consistent with our expansion ambitions in these regions. The business line for multinationals (Global), Bonding and Instalment Credit Protection performed well delivering increased revenues.
Claims
Gross claims ended at EUR 701.1 million in 2016, down 2.9% from EUR 721.7 million in 2015 despite a steady inflow of medium sized claims influenced by a weakened insolvency outlook in many markets. All Atradius business lines contributed to the improvement.
Expenses
Gross insurance operating expenses decreased 0.4% to EUR 613.4 million in 2016 from EUR 616.1 million in 2015, with an improvement in the expense ratio compared to 2015.
Investment result
The net investment result, including the share of income of associated companies, ended at EUR 45.0 million, an increase of 24.9% compared to 2015. The impact of the persistent low yield environment was partially offset by increased dividend income and the revaluation of our existing 45% stake in Graydon after the acquisition of the remaining 55%, adding EUR 19.9 million of non-recurrent profit.
Operating income before reinsurance
Operating income before reinsurance improved 16.3% to EUR 424.0 million from EUR 364.6 million in 2015.
The positive developments in claims and expenses resulted in an excellent gross combined ratio of 78.0% compared to 80.6% in 2015.
Reinsurance result
The Reinsurance result of EUR 140.1 million in 2016 was 36.0% lower than that of 2015 (EUR 103.0 million) largely due to lower claims recoveries following the decrease in gross claims.
Consolidated net income
The result for the year after taxes of EUR 211.8 million marked an 18.8% increase over the 2015 result for the year of EUR 178.2 million. In addition to the improvement in the operating income with better claims and expense ratios, there was a positive contribution from the service segment.
Solvency ratio
Atradius consolidates with Grupo Catalana Occidente. The overall Group, including Atradius, has a very strong capital position with an estimated coverage ratio to insurance risk of approximately 200% at 31 December 2016.
Outlook
There is a significant amount of uncertainty in 2017 for the outlook of global and regional trade. The expected renegotiation of numerous trade agreements across the world could potentially stall international trade growth. A side effect of this could be an increase in payment defaults as trade costs are expected to rise, putting pressure on some businesses to improve cash management. This should also increase the need for information and collections services to better monitor creditworthiness of buyers and collect overdue debts.
Isidoro Unda concludes, "Every year businesses are challenged with new potential hurdles to increasing profits and managing payment risks. At Atradius, we have a strong corporate culture that is focused on ensuring we are able to meet our customers' expanding needs for securing their receivables. We do this by expanding our credit insurance, bonding, credit information and collections capabilities into new markets, by constantly improving availability of information about buyers and by innovating to deliver new services to our customers."
About Atradius
Atradius provides trade credit insurance, surety and collections services worldwide through a strategic presence in more than 50 countries. Atradius has access to credit information on over 200 million companies worldwide. Its credit insurance, bonding and collections products help protect companies throughout the world from payment risks associated with selling products and services on trade credit. Atradius forms part of Grupo Catalana Occidente (GCO.MC), one of the leading insurers in Spain and worldwide in credit insurance.
For further information:
Atradius Corporate Communications
Christine Gerryn
Tel.: +31-20-553-2047
E-mail: [email protected]
http://www.atradius.com
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