In This Article:
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Group Revenue: Approximately $550 million, up 21% year-over-year.
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EBIT: $114 million, a 29% increase from the previous year.
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NPAT: $81 million, up 24% compared to last year.
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Communications Revenue: $327 million, a 19% increase from FY23.
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Minelab Revenue: $220 million, a 25% increase from FY23.
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Net Debt: Increased by $24 million to $75 million as of June 2024.
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Dividend: Fully franked dividend of $0.225 per share for FY24.
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Engineering Investment: $57 million, approximately 10% of revenues.
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Communications Segment Profit Margin: 25%.
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Minelab Segment Profit Margin: Increased to 35% from 32% in the prior year.
Release Date: August 22, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Codan Ltd (ASX:CDA) reported a strong FY24 with group revenue of approximately $550 million, up 21% from the previous year.
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The company achieved an EBIT growth of 29% to $114 million, with organic EBIT growth of $22 million, up 24%.
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The communications segment saw a revenue increase of 19% to $327 million, with a forward order book growth of over 20%.
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Minelab's revenue increased by 25% to $220 million, driven by new product releases and expansion in North America and Europe.
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Codan Ltd (ASX:CDA) successfully integrated acquisitions Zetron UK and Wave Central, contributing $31 million in revenues and meeting year one expectations.
Negative Points
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Net debt increased by just under $24 million to $75 million, partly due to acquisitions and product development investments.
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Operating leverage in the communications segment was impacted by geopolitical issues in Africa and the normalization of a large project from FY23.
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The company incurred approximately $2 million in integration and acquisition-related expenses during FY24.
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The African market remains challenging, with Sudan still largely disrupted, affecting Minelab's regional performance.
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There is an elevated cost base due to acquisitions and business success, which may impact return on investment and future cost management.
Q & A Highlights
Q: Can you elaborate on Zetron's performance and its positioning in the US and UK markets? A: Alfonzo Ianniello, CEO, explained that Zetron has grown well above the overall communications business due to its full command and control solution, which is a competitive advantage. The market is fragmented at the lower end, and Zetron's integrated solution is appealing to customers. In the US, Zetron is well-entrenched, and in the UK, the focus is on converting opportunities as the market is addressed.