Economic conditions continued to deteriorate throughout the second quarter of 2009. Many companies’ sales contracted and their cash positions worsened, resulting in a significant increase in the number of corporate failures since the beginning of the year. The current crisis has also impacted Euler Hermes, with earned premiums eroded by the drop in insured sales linked directly to the very difficult economic conditions and a rise in claims, which weighed on group profitability”, said Wilfried Verstraete, Chairman of the Euler Hermes Group Management Board, adding that “despite this difficult environment, Euler Hermes posted a positive operating income for the first half of 2009.
- Turnover up by 1.1% (at constant scope and exchange rates)
- Technical result: -€59.5 million
- Operating income: €35.4 million
- Net income at breakeven.
The Group Management Board submitted the results for the first half of 2009 to the Euler Hermes Supervisory Board on 28 July 2009. The results have been reviewed by the auditors and the Audit Committee.
Key figures – First-half 2009
The first half of 2009 saw a continuation of the marked slowdown in the world economy. Euler Hermes expects the number of corporate failures to increase by a further 35% in 2009, following a 27% rise in 2008.
In this challenging environment, Euler Hermes recorded net income of €0.7 million in the first half of 2009, compared with €122.3 million in the first half of 2008.
Turnover
For the six months to 30 June 2009 the group’s turnover totalled €1,084.5 million, corresponding to a 1.1% increase over the first half of 2008 at constant scope and exchange rates
Although turnover continued to rise in new markets, historical markets in Europe and North America saw a sharp contraction in clients’ sales that weighed on earned premium volumes and was reflected in a 1% decline in turnover to end-June 2009.
In most countries, the downturn in clients’ sales, which was of exceptional magnitude in the second quarter of 2009, could not be offset by increases in premium rates or by higher group production levels.
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