A barometer of a weaker economy Protektor supplies footwear to many sectors (including HoReCa, industry, construction, medical sector) and is, in a sense, a barometer of the economy both in Poland (approx. 17% of revenues) and Western Europe (approx. 72% of revenues), because the forecast economic slowdown on these markets is discounted on an ongoing basis in the Group's quotations. With the outbreak of the war in Ukraine, and thus the likely increase in defense spending in most of the neighboring countries, the optimism of investors expecting an increase in orders in the military footwear segment was stimulated. Unfortunately, the results for the first quarter significantly cooled down expectations, revealing the problems faced by most enterprises this year, i.e. an increase in costs and a decline in margins at all levels. The results for the second quarter of 2022 showing an increase in revenues (+13.4 y / y), including more than a twofold increase in the sales of GROM military footwear, restored optimism.
Objectively reviewing Protector results for H1 2022 and include the condition of all industries receiving the Group's products, as well as taking into account the increase in risk premium for the country, we adjust our previous forecasts and lower the target price from PLN 3.6 to 2.9 at the end of 2022 year.
This report was prepared for the Warsaw Stock Exchange SA within the framework of the Analytical Coverage Support Program 3.0. This is a translation of the Polish analytical report.
Analysts
Artur Wizner Tel.: +48 (22) 53 95 548
