Euler Hermes revises its 2008 results to € 100 million

Following the bankruptcy of Woolworths Group (UK) and higher than expected claims development in 4th quarter, Euler Hermes revises its 2008 results to € 100 million

The Woolworths Group had to file for bankruptcy after unsuccessful negotiations with the banks last week. Since the beginning of this week the Euler Hermes Group has to register claims declarations on this risk, mainly in the UK and Germany, which will impact the Q4 results 2008. After a full review of all outstanding credit limits, Euler Hermes expects a global negative impact of 15 points on its Q4 loss ratio (+/- 52 million €).

This major claim comes in addition to a general worsening of the claims’ environment in the last quarter 2008. Euler Hermes estimates a negative result in Q4 2008 and reviews its outlook for its full year profit to between € 100 and 110 million.

Reduced consumer spending combined with tightening financial conditions will continue to maintain pressure on the liquidity of corporates and economies in general.

Euler Hermes does not expect any major improvement of the actual claims’ environment in the coming months.

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