Company Reports

Codan is guiding fiscal 2027 sales growth in its communications segment of 30%-40% from fiscal 2026, on higher sales to active conflict zones. First-half fiscal 2027 group net profit after tax is guided to at least AUD 160 million, more than double a year ago. Shares rose as high as 24% on Sept. 30.

We think Codan’s expansion in the communications sector supports long-term growth, with diverse and stable earnings contributions from its command center product.

Codan's fiscal 2026 EBIT rose 67% to AUD 244 million on 30% revenue growth, driven by strong demand across its communications and metal detection businesses, and margins expanded to 31% and 45%, respectively, on operating leverage. Shares rallied 12%.

We think Codan’s expansion in the communications sector supports long-term growth, with diverse and stable earnings contributions from its command center product.

Codan now expects fiscal 2026 EBIT of approximately AUD 235 million, up 60% from fiscal 2025, on higher sales and better margin, mostly for its unmanned drone radio product. Shares rose 15%.

We think Codan’s expansion in the communications sector supports long-term growth, with diverse and stable earnings contributions from its command center product.

We think Codan’s expansion in the communications sector supports long-term growth, with diverse and stable earnings contributions from its command center product.

Codan's first-half fiscal 2026 EBIT of AUD 100 million was 52% higher than the prior year. Most of the gain was in the metal detection business, with a profit of AUD 76 million, up 86%, and in the communication business, the profit of AUD 58 million was 17% higher. Shares were flat on the day.

In a trading update, Codan says it expects fiscal 2026 first-half revenue of approximately AUD 394 million and underlying net profit after tax of at least AUD 70 million, representing growth of approximately 29% and 50%, respectively, compared with the same period last year. Shares rose about 17%.

We think Codan’s expansion in the communications sector supports long-term growth, with diverse and stable earnings contributions from its command center product.

At its AGM, Codan reported a solid start to fiscal 2026. Elevated gold prices are driving higher African sales of its metal detection equipment, and geopolitical tensions and technology upgrades boost communication equipment sales, used by military. The share price has more than doubled in 2025.

Codan's fiscal 2025 EBIT rose 28% to AUD 146 million. The result was driven by an outstanding year for the communications and metal detection businesses. Margins expanded for both segments, with EBIT up 34% and 26%, respectively. Shares rallied 11% on the result.

We think Codan’s expansion in the communications sector supports long-term growth, with diverse and stable earnings contributions from its command center product.

Codan's share price has risen more than 50% since early April. The company's main products are communication devices suitable for attaching to drones, command center technology, and metal detection equipment. Its broad customer base includes military and gold prospectors.

We initiate coverage on Codan with a fair value estimate of AUD 19.50 per share. We assign Codan a narrow moat rating, Medium Morningstar Uncertainty Rating, and Exemplary Capital Allocation Rating. Shares are about 17% undervalued, and we think the market has not fully factored in the considerable growth trajectory for its Zetron command center software.

We think Codan’s expansion in the communications sector supports long-term growth, with diverse and stable earnings contributions from its command center product.