Credit Manager Magazine 9/2021

56 CREDIT MANAGER MAGAZINE WRZESIEŃ / SEPTEMBER 2021 BUSINESS Euler Hermes is the global leader in trade credit insurance and a recog- nized specialist in the areas of sure- ty, debt collection, fraud insurance, structured trade credit and political risk. Our proprietary intelligence net- work analyses daily changes in cor- porate solvency representing 98% of global GDP. We give companies the confidence to trade, and be paid. We compensate your company in the event of a bad debt, but more impor- tantly, we help you avoid bad debt in the first place. Whenever we provide trade credit insurance, surety bonds or other finance solutions, our priori- ty is predictive protection. And when the unexpected arrives, our AA cred- it rating (Standard and Poor’s) means we have the resources, backed by Allianz, to provide compensation to maintain your business. 1 Germany France UK Profitability (ROCE) EBIT / (Net Financial Debt + Equity) 7% 6% 7% Capitalization Equity / Total Assets 20.6% 23.2% 21.9% Interest Coverage EBIT / Interest Expense 0.8 1.1 0.9 to 1.9%. Furthermore, the resilience of prof- itability (see Figure 9) plays a significant role. Looking at direct subsidies (including partial unemployment schemes) and tax deferrals, state support covered fully the losses in val- ue added of non-financial corporates from 2020. In addition, a majority of corporates have made significant efforts to keep cost pressures in check. Interestingly we note that some UK SMEs managed to reach EBIT- DA-margins levels that they could reach in 2019 (see Figure 10). 2 See our report European corporates: Cash-rich sectors get richer Figure 4 – Average current ratios for SMEs in 2019 and 2020 Figure 6 – DSO, change in 2020, SMEs vs large corporates Figure 7 – Average debt-to-equity ratios for SMEs in 2019 and 2020 Sources: Euler Hermes, Allianz Research Sources: Euler Hermes, Allianz Research Sources: Euler Hermes, Allianz Research