Bologna (Italy), June, 2020

CRIF outlook: in 2020, the impact of COVID-19 is expected to lead to a 23% drop in company margins

Cash flows will essentially be cut in half, with peaks of 90% for companies operating in sectors with high levels of working capital.


Italy is beginning the so-called phase 3 of its lockdown easing following the COVID-19 emergency, with the gradual relaxation of the restrictions introduced for the containment of the pandemic. While from a medical perspective the reduction in infections and deaths appears clear, the economic and financial effects on businesses can only be partially seen at this time and are expected to manifest themselves over a much longer period.

Forecasts of the economic and financial performance of italian companies

Analyzing the overall picture, CRIF’s forecasts, made using CRIBIS data on Italian non-financial enterprises, estimate an average decrease in turnover in 2020 of more than -10%. The long-term nature of the crisis, which has been particularly acute for some product sectors, will mean that the closing of the gap in 2021 with respect to the pre-crisis context will only be partial, with an estimated cumulative loss of turnover over the entire two-year 2020-2021 period in the order of -3%.

Even more significant is the expected impact on operating profit, affected by the combined effect of months of lockdown and the time required for a full resumption of activities, both from an operating point of view and in terms of final demand, especially in sectors characterized by a high fixed cost base. CRIF estimates a decrease in EBITDA of around -23% in 2020 compared to 2019. In this case too, a significant, but not full recovery, is expected in 2021.

The marked economic slowdown will also have significant effects on the financial profile of Italian companies, due to the decline in margins and an increase in the receivable collection period in many supply chains. The cash flows of Italian businesses will essentially be cut in half, with peaks of 90% for companies operating in sectors with high levels of working capital.

“If, in addition to the difficulties that businesses will face in the coming months, there is also a need to cover financial debt due to mature in 2020, significant financial requirements will emerge in many sectors. In order to deal with this, the measures launched by the Italian Government in terms of payment holidays for existing credit exposures and access to bank loans with the support of government guarantees will play a significant role”, commented Simone Mirani, General Manager Operations at CRIF Ratings.