Amsterdam, 16 Septembre, 2005 - Atradius today reported a 25.4% increase in profit after tax to € 53.8 million for the first half of 2005 compared to € 42.9 million in the first half of 2004.

Amsterdam, 16 September, 2005 - Atradius N.V., a global leader in credit insurance and credit management, today reported a 25.4% increase in profit after tax to € 53.8 million for the first half of 2005 compared to € 42.9 million in the first half of 2004. The increase in profits was driven by a 5% improvement in turnover, a reduction in reinsurance ceded premiums and a reduction in operating costs.

Wilfried Verstraete, Chief Executive Officer of Atradius, stated; "The changes we made in our operating strategy including the restructuring, improvements in our cost structure and product innovation are beginning to pay off. We have further improved our customer service and the results of the first half demonstrate that our externally focused approach does produce profitable growth."

Financial Highlights

• Net profit increased 25.4% to € 53.8 million (H1 2004: € 42.9 million). 
• Turnover improved 5.0% to € 611.2 million (H1 2004 € 582.0 million). 
• Pretax profit rose 25.2% to € 75.4 million (H1 2004: € 60.2 million). 
• Gross expense ratio improved to 40.1% (€ 254.2 million versus H1 2004 258.5 million).
• Equity increased 7.4% to € 560.5 million (Year end 2004: € 522.1 million) largely the result of retained earnings.   

Operating Activities

The 25.2% improvement in pretax profits in Atradius’ core operating activities reflects a 4.8% increase in gross earned premium driven by the Company’s increased risk appetite, a 51.8% increase in recoveries and collections revenue to €12.9 million, and slightly lower operating expenses resulting from the restructuring announced at the end of 2004. This was partially offset by the increased net claims ratio, (43.1% versus a historically low 39.2% in the first half of 2004) which also reflects the increased risk appetite. 

Factoring

In July 2005, Atradius announced the signing of an agreement for the sale of the Atradius Factoring business to Fortis, including a separate commercial agreement that will allow both companies to use each other’s European networks in a cooperative marketing effort focused on Factoring and Credit Insurance. The closing of the sale is expected in October of this year, pending regulatory approvals.

Factoring has been carried as a discontinued operation. The profit for discontinued operations is included in the Company’s net result. 

Investment Income

Investment income of € 30.2 million in the first half of 2005 was 25.4% lower than in the first half of 2004. As a result of the restructuring of the investment portfolio, higher capital gains were realised in 2004. 

Restructuring

The restructuring is on track with a net decrease of 200 employees over the last six months. This decrease has been achieved despite the start up of new activities in Asia and Eastern Europe. 

Wilfried Verstraete concluded, "We continue to focus on building sustainable growth in both turnover and in profits. We increased our risk appetite in the second half of 2004 to help drive growth, however competition is intensifying. We therefore have higher growth hurdles to clear in the second half of 2005. New products, improvements in existing offerings and greater attention to service are proving to be very effective in our drive for growth. Continuing these initiatives will play an important role in our ability to attract and retain customers."