European trade credit insurer Atradius remains cautious about business prospects for this year after turning in a strong set of financial results.

Global commerce faces disruption as trade deals come under increasing scrutiny, it warns.

“There is a significant amount of uncertainty [this year] for the outlook of global and regional trade,” Atradius says. “The expected renegotiation of numerous trade agreements across the world could potentially stall international trade growth.

“A side effect of this could be an increase in payment defaults as trade costs are expected to rise, putting pressure on some businesses to improve cash management.”

The insurer made a net profit of €211.8 million ($296.52 million) last year, up 18.8% from 2015, as income grew and expenses fell.

Overall revenue increased 2.5% to €1.76 billion ($2.46 billion) thanks to a 1.3% rise in insurance premium to €1.56 billion ($2.18 billion).

Investment income increased 24.9% to €44.97 million ($62.95 million).

Gross claims declined 2.9% to €701.1 million ($981.37 million) and gross insurance operating expenses eased 0.4% to €613.4 million ($858.69 million).

The combined operating ratio improved to 78% from 80.6%.