Media & Press

Declining turnover is often identified as the initial sign of corporate distress, but a new study from Euler Hermes shows it is not as reliable as it seems. Instead, the study highlights three other indicators that can provide warning signs up to four years before an acute insolvency risk for European small and medium enterprises (SMEs) and midcaps.

TRIBRating is a service developed through the Euler Hermes collaboration with Moody’s Investors Service, formed in late 2016. Launched in 2017 and already operational in Germany, France, Italy and Spain. TRIBRating is now being introduced in Switzerland as the fifth country of its wider European rollout.

A new study, jointly produced by Euler Hermes Economic Research and Euler Hermes Rating, focuses on Working Capital as a key indicator of the financial situation and behavior of corporates. It complements previous studies that pointed out the reactivating of self-discipline of corporates in their Days Sale Outstanding (DSO), and the unusual accumulation of inventories by corporates, giving an enlarged view on the financial situation and behavior of corporates.

After two years of strong growth, the world economy is “back to purgatory” due to global uncertainties, the US-China trade feud and the drawbacks of financial repression, according to Euler Hermes’ international macroeconomic scenario for 2019 and 2020.