Danish fog protection an export success

The Danish-based fog protection manufacturer Protect A/S has just posted impressive results, recording a 28% gross profit increase for 2010 as well as an increase in profit before tax of 45%. According to managing director Poul Dalsgaard, the results can, among other factors, be ascribed to an export boom, which means that exports currently account for 70% of the company's sales.

The Danish company Protect manufactures fog cannons for burglary protection. In just nine years, the company has expanded so heavily that it now ranks among the world's largest fog cannon manufacturers. Fog is used in combination with electronic burglar alarms to protect the valuables of companies and private individuals. The expansion is clearly evident from the company's recently published financial statements.

Continued expansion and earnings

At last year's ordinary general meeting (2009 financial year), Protect thus presented a record increase in sales of almost 50% and a growth in profits of 66% on the previous financial year.

At the ordinary general meeting just held, Protect was still able to present an additional increase in gross profit of 28% (from DKK 6.5 to DKK 8.3 million) and a profit before tax up by 45% (from DKK 2.2 to DKK 3.2 million). The solvency ratio is 37% (2010).

Increased exports and cost management

"Since we established the company, we have focused on both the Danish market and the export markets. Today, Protect's fog cannons are sold in more than 40 countries. In the most recent financial year, we have also targeted the Spanish-speaking countries: Spain and a number of South American countries which show a tremendous potential," says Poul Dalsgaard, managing director of Protect, and continues:

"In addition, we have focused even more on cost management in the company, which has enabled us to increase sales by 30% with the same sales and marketing staff of only ten employees."

In addition to the Spanish-speaking countries, Poul Dalsgaard also mentions Italy and the UK as major growth markets in the previous year. Last year, in the wake of the financial crisis, Protect sustained losses on a couple of key accounts in the UK, but with a new distributor and its own sales force in the UK, far better results have been achieved this year in this huge market.

Agreements with large international chains

"In the UK, we have concluded agreements with a number of interesting customers, e.g. Sainsbury's and Tesco, one of Europe's largest supermarket chains, as well as the Post Office, which has post offices and cash machines all over the UK. In several countries, McDonald's and the wholesale chain METRO have opted for Protect fog protection, while e.g. 7-Eleven, Q8 and the supermarket chain KIWI minipris have chosen Protect fog protection in Denmark," explains Protect's managing director.

Only fog cannons on the market to meet new European requirements
In April 2010, the new European CENELEC standard for fog cannons was introduced. And Protect is the only manufacturer whose fog cannons have been tested and approved according to the new standard at an accredited test institute. The fog cannons have also been approved according to the insurance companies' national standards in, among other countries, the Netherlands, Denmark and Norway.

The approvals are important and critical for our collaboration with authorities and insurance companies. Following the approval in Norway, several insurance companies have demanded that high-risk shops like jeweller's, opticians and camera shops have CENELEC-approved fog protection installed as fog is the only way of keeping burglars away from the valuables until the police or security personnel arrive. And in a country as large as Norway with very long response times, this is important."

Small decrease in number of burglaries

Denmark saw a drop in the number of burglaries in the 2002-2005 period, after which it increased considerably from 2006 to 2009. In the last quarter of 2010, the Danes witnessed a 14% decline on the same period the year before, which means that Denmark is back at the 2008 level, but far above the 2001-2008 level.

"Many businesses and private home have valuables which are easily accessible to burglars and easy to sell to handlers of stolen goods. It is a sad development which is generally difficult to put an end to. You have to make it as hard as possible for the burglars, so that your business or home does not become the weakest link of the chain," is the advice offered by Poul Dalsgaard.

In his opinion, the reason for the large number of burglaries in businesses and homes is that the most obvious targets for burglaries and robberies, banks and petrol stations, have been made cash-less or have been secured with locked cash registers, which means that burglars and robbers target less secure places.

"At the recent ordinary general meeting, the shareholders expressed their gratitude to employees and management for the year's results - so we will follow the same strategy in 2011," concludes Poul Dalsgaard.