The first half of 2022 saw a significant increase in results for Promotica, which despite an unfavorable macroeconomic situation saw its core business expand also thanks to the three extraordinary operations carried out during the period. Sales revenues, therefore, amounted to € 45.17 million, 93.3% up compared to the previous fiscal year. EBITDA, on the other hand, amounted to € 2.77 million, compared to € 3.17 million in the first half of last fiscal year, a decrease of 12.5%. The EBITDA margin also decreased, equal to 6.1% vs 13.5% of 1H21A. Marginality is affected by the general increase in all cost items, in particular with regard to costs for raw materials and services. The NFP worsened, amounting to € 24.39 million.
In light of the results published in the half-yearly report for 1H22A, we are changing our estimates for the current year. In particular, we leave unchanged the estimates for FY22E revenues, equal to € 80.00 million, modifying exclusively the forecast on EBITDA, estimated at € 6.00 million in light of the increase in cost items, with an expected marginality of 7.5%. For subsequent years, we expect the revenues to increase up to € 97.00 million (CAGR 21A-25E: 34.2%) in FY24E, with EBITDA of € 14.00 million (corresponding to an EBITDA margin of 14.5%), up from € 2.04 million in FY21A (corresponding to an EBITDA margin of 5.2%).
We have conducted the valuation of Promotica’s equity value based on the DCF methodology. The DCF method (which in the calculation of the WACC includes for prudential purposes also a specific risk of 2.5%) provides an equity value of € 118.3 million. The target price is € 7.00 (prev. € 7.60) BUY rating and MEDIUM risk.
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