September 24, 2013

Marco Preti, CEO CRIBIS D&B

Payments Study

Turkey

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D&B's Global Economic Outlook 2013 to 2017

2

Italia

D&B Global Outlook

• Positively, no breakup of the European area

is anticipated in the forecast period.

• However, the region will experience below-

trend growth in 2013 and very uneven

growth until 2017.

• Payment and credit risk will remain

elevated until 2014 at least, especially in

southern European member states.

• Deteriorating: France, Greece, Italy,

Poland, Spain, UK (16 out of 30 in total).

• Improving: None.

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Italy - Gross Domestic Product Growth rate

3

Source: Istat

-2.1%

• Italian economy still in contraction in 2013

• Gross Investments are the weakest component of internal demand

• Consumptions at minum level

• Decresing in spendig power and investment of families

• Production capacity in reduction in many sectors

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GDP - Europe

4

• GDP has decreases in

Euro Zone since 2010 (-

1,7% versus IIq 2010).

• Decreasing in

consumptions and

investments level

• Loans to companies in

contraction especially in

mediterranean countries

(Spain, -14%, Italy -4%

in2013).

• General decrease of

consumption level of

families

• USA economy is facing a

slight recovery with

+2,5% in GDP (Iq 2013)

GDP Area Euro DE ES FR IT

2013-II -0.5 0.5 -1.6 0.3 -2.1

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Unemployment Rate

5

2012 (%) 2013 (%)

EU (27 countries) 10.5 10.9

EU (15 countries) 10.7 11.2

Germany 5.4 5.3

Spain 25.6 26.3

France 10.3 11.0

Italy 10.7 12.0

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Payments Worldwide December 2012

6

Payments on due date (Payment s Study 2013)

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Payments in Europe - 2012

7

Payments on due date (Payments Study 2013)

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Who pays badly?

8

2010

Punta più bassa

More than 30 days of delay (Payments Study 2013)

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Payments in Italy 2010 – 3Q 2013

9

2010

Punta più bassa

Variation III Q 2013/2010 (Payments Study 2013)

Payment delay has become

standard payment

terms

Polarization of behaviours

Today payments are the center of a

company strategy

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Payments in Italy 2010- 3Q 2013 - Sectors

10

D&B Paydex has decreased in all sectors.

Retail trade is the most suffering one (-10.83% vs 2010) followed by Mining industries (-6,84% vs 2010).

D&B Medium Paydex 2010

D&B Medium Paydex 2013

The D&B Paydex It’s a score that evaluates the historic payment performance to suppliers

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Polarization of the market: more failures and insolvencies

11

• 3728 faliures in 2Q 2013

• + 20% vs 2012

• +56% vs 2009

(Falilures Analysis)

Il the last 12 months

36% of insolvencies

have been provocated by

historic clients

(Observatory on Credit

Management)

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Payment and reputation

12

Payments

Customer

management

Credit collection

Financial Trustwor.

Supplier Credit

Cash Manag.

Banks

Planning

Payments are the

center of the company

financial processes.

They are the mirrow of

the trustwothiness of

one company.

Payments mean

REPUTATION

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Payments and bad reputation

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Insurances

•High insurance costs

•Higher insurance premium

Suppliers

•Higher prices

•Inadequate promotional support

•No investments in loyalty programs

Banks

•Lower credit access

•Higher interests

•More guarantees

Partner

•Difficulties in making agreemets

•Difficulties in finding companies available to make conjoint invetments

Paymets are the

face of a company

and stakeholders

behavoiurs are a

direct

consequence

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What companies must be wondering

14

• Do I know about my clients reputation?

• Am I financing only clients with a good reputation?

• Am I sure to know promptly if one of my clients begins to have a

bad reputation?

• Do the other companies trust my clients?

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Payments and collection: an example

15

Gradual deterioration of D&B Failure Score

In 2009 D&B Failure Score was already under the mean of the sector (41,8)

Protest or

failure

Companies with protests or failed in Hotel/ Restaurant

/ Catering sector (IIIq 2012)

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What about the future?

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Source: Deutsche Bundesbank

Anaysis 2002 - 2009

Analysis on German balance

sheets (2002 – 2009): the first

source of financing in the short

term is Trade Credit, composed

for 2/3 by timing of payments

towards suppliers

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In the future? Investing on the best clients

17

Fonte: Deutsche Bundesbank

Analisi statistica 2002 - 2009

Before Credit Crunch, Italian companies

had a high Trade credit level. Trade

credit level represents a sales leverage

and doomed to increase its weight on

companies’ balance sheets.

Managing the payment leverage is

becoming more and more strategic.

Companies have to invest on their top

clients.

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Commercial Debt – Italy

18

Source: Analysis on Balance Sheets of Italian companies - CRIF Decision Solutions

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Thanks for your attention

Marco Preti

CEO CRIBIS D&B

CRIBIS D&B Community

@cribisdnb cribisdnb