Q4 2026 Codan Ltd Earnings Call

August 20, 2026

Speaker #1: Thing, and welcome to Codan's full-year FY26 results presentation. I'm Alfie Añedlo, Managing Director and CEO, and joining me today is CFO Michael Barton. As announced at our half-year results, Michael will be retiring at the end of August, after more than 22 years with Codan.

Alf Ianniello: Good morning, and welcome to Codan's full year FY26 results presentation. I'm Alf Ianniello, Managing Director and CEO, and joining me today is our CFO, Michael Barton. As announced at our H1 results, Michael will be retiring at the end of August after more than 22 years with Codan. Over this time, Michael has played a pivotal role in shaping Codan's financial discipline, capital allocation framework, and acquisition strategy. On behalf of the board and the broader team, I'd like to once again sincerely thank him for his contribution to Codan. I'm also pleased to confirm that Kayi Li, currently our Deputy CFO, will succeed Michael at the end of the month. Kayi has also been deeply involved in our financial strategy and operational execution, and we remain confident in our continued seamless transition.

Speaker #1: Over this time, Michael has played a pivotal role in shaping Codan's financial discipline, capital allocation framework, and acquisition strategy. On behalf of the board and the broader team, I'd like to once again sincerely thank him for his contribution to Codan.

Speaker #1: I'm also pleased to confirm that Kaye Lee, currently our Deputy CFO, will succeed Michael at the end of the month. Kaye has also been deeply involved in our financial strategy and operational execution, and we remain confident in our continued seamless transition.

Speaker #1: I believe Kaye's appointment is a strong demonstration of our succession planning and development processes in place at Codan. Kaye and I look forward to meeting with many of our investors at our results roadshow in the coming weeks.

Alf Ianniello: I believe Kayi's appointment is a strong demonstration of our succession planning and development processes in place at Codan. Kayi and I look forward to meeting with many of our investors at our results roadshow in the coming weeks. Questions are welcome throughout today's presentation and will be addressed at the close of the session, coordinated by Sam Wells and NWR. Research analysts can raise their hand via Zoom to ask a live question, while all other attendees are encouraged to submit questions using the Q&A function. Before we begin, please take a moment to review our standard notice and disclaimer. Today, we'll begin with full year performance highlights, followed by a detailed review of each of our three business units, DTC, Zetron, and Minelab.

Speaker #1: Questions are welcome throughout today's presentation, and we'll be addressed at the close of the session. Coordinated by Sam Wells and NWR. Research analysts can raise their hand via Zoom to ask a live question, while all other attendees are encouraged to submit questions using the Q&A function.

Speaker #1: Before we begin, please take a moment to review our standard notice and disclaimer. Today we'll begin with full-year performance highlights, followed by a detailed review of each of our 3 business units, DTC, Detron, and Minelab.

Speaker #1: We're also highlighting some select products that contributed meaningfully during the year, demonstrating how our grid-wide engineering investment is translating into commercial outcomes across business units.

Alf Ianniello: We also highlight some select products that contributed meaningfully during the year, demonstrating how our group-wide engineering investment is translating into commercial outcomes across business units. We'll then revisit our strategy and near-term priorities before closing with our outlook heading into FY27. For those newer to Codan, we are a global group of technology businesses focused on critical communications and detection. Our technologies are designed for mission-critical environments, keeping people connected, informed, and safe in demanding and often remote conditions. We operate across defense, public safety, gold detection, and recreational markets, supported by a global footprint and strong engineering capability. At our core, we focus on reliability, performance, and long-term customer relationships, particularly in environments where failure is not an option. Our strategy to build a stronger Codan remains consistent and disciplined. It is underpinned by sustainable organic growth, targeted and accretive acquisitions, continued engineering investment, and strong operational execution.

Speaker #1: We'll then revisit our strategy and near-term priorities before closing with our Outlook heading into FY27. For those newer to Codan, we are a global group of technology businesses focused on critical communications and detection.

Speaker #1: Our technologies are designed for mission-critical environments, keeping people connected, informed, and safe, in demanding and often remote conditions. We operate across defense, public safety, gold detection, and recreational markets, supported by a global footprint and strong engineering capability.

Speaker #1: At our core, we focus on reliability, performance, and long-term customer relationships, particularly in the environments where failure is not an option. Our strategy to build a stronger Codan remains consistent and disciplined.

Speaker #1: It is underpinned by sustainable organic growth, targeted and accretive acquisitions, continued engineering investment, and strong operational execution. Diversification remains a key strength and is a key part of our results this year, with Minelab and communications both delivering excellent performance.

Alf Ianniello: Diversification remains a key strength and is a key part of our results this year, with Minelab and communications both delivering excellent performance. Over time, this approach is building a more resilient and diversified earnings base with improved visibility and quality. At a high level, the group's FY26 performance reflects disciplined execution of our strategic plan. The strength of our differentiated technology and product portfolio and our ability to capitalize on long-term structural growth opportunities across our target markets globally underpinned our outstanding performance. Our Communications segment continues to deliver high-quality growth, with revenue exceeding at the top end of our FY26 target range. Metal detection also delivered excellent performance, driven primarily by gold detector demand globally. Our strategy to invest heavily in engineering is what enables these outstanding results. This ongoing investment maintains our product and technical leadership across our businesses and drives our organic growth strategy.

Speaker #1: Over time, this approach is building a more resilient and diversified earnings base with improved visibility and quality. At a high level, the group's FY26 performance reflects disciplined execution of our strategic plan.

Speaker #1: The strength of our differentiated technology and product portfolio, and our ability to capitalize on long-term structural growth opportunities, across our target markets globally, underpinned our outstanding performance.

Speaker #1: Our communication segment continues to deliver high-quality growth, with revenue exceeding the top FY26 target range, metal detection also delivered excellent performance driven primarily by gold-detected demand globally.

Speaker #1: Our strategy to invest heavily in engineering is what enables these outstanding results. This ongoing investment maintains our product and technical leadership across our businesses, and drives our organic growth strategy.

Speaker #1: Turning to the numbers, at the group level, year-on-year revenue grew 30% to $875 million reflecting strong organic growth driven by ongoing high demand for unmanned systems and new gold-detected products, as well as a full-year contribution from CAGWorks.

Alf Ianniello: Turning to the numbers. At the group level, year-on-year revenue grew 30% to AUD 875 million, reflecting strong organic growth driven by ongoing high demand for unmanned systems and new gold detector products, as well as a full-year contribution from Kägwerks. EBIT and NPAT increased by 67% and 69% respectively, demonstrating continued improvement in operating leverage across the group, with both measures slightly above the guidance provided to the market on 29 April 2026. This reflects both revenue growth and improved product mix, particularly within Minelab and DTC. The board declared a fully franked final dividend of AUD 0.29 per share, taking full-year dividends to AUD 0.485 per share, up 70% year-on-year, consistent with our disciplined capital management approach. I will now hand over to Michael to step through the financial detail.

Alf Ianniello: Turning to the numbers. At the group level, year-over-year revenue grew 30% to AUD 875 million, reflecting strong organic growth driven by ongoing high demand for unmanned systems and new gold detector products, as well as a full-year contribution from Kägwerks. EBIT and NPAT increased by 67% and 69% respectively, demonstrating continued improvement in operating leverage across the group, with both measures slightly above the guidance provided to the market on 29 April 2026. This reflects both revenue growth and improved product mix, particularly within Minelab and DTC. The board declared a fully franked final dividend of AUD 0.29 per share, taking full-year dividends to AUD 0.485 per share, up 70% year-over-year, consistent with our disciplined capital management approach. I will now hand over to Michael to step through the financial detail.

Speaker #1: EBIT and EMPACT increased by 67% and $69% respectively, demonstrating continued improvement in operating leverage across the group. With both measures slightly above the guidance provided to the market on the 29th of April 2026.

Speaker #1: This reflects both revenue growth and improved product mix, particularly within Minelab and DTC. The board declared a fully-franked final dividend of $29 per share, taking full-year dividends to $48.5 per share, up 70% year-on-year, consistent with our disciplined capital management approach.

Speaker #1: I'll now hand over to Michael to step through the financial detail.

Speaker #2: Thanks, Alf. As highlighted, group revenue increased 30% year-on-year versus FY25. Strong revenue and profit contribution from both our communications and metal detection segments. Expenses increased during the year, primarily due to targeted investments in strengthening the group's go-to-market resources, product launch costs, systems, processes, and capabilities to further scale the organization.

Michael Barton: Thanks, Alf. As highlighted, group revenue increased 30% year-on-year versus FY25. Strong revenue and profit contribution from both our communications and metal detection segments. Expenses increased during the year, primarily due to targeted investments in strengthening the group's go-to-market resources, product launch costs, systems, processes, and capabilities to further scale the organization, and higher performance-related remuneration.

Michael Barton: Thanks, Alf. As highlighted, group revenue increased 30% year-over-year versus FY25. Strong revenue and profit contribution from both our communications and metal detection segments. Expenses increased during the year, primarily due to targeted investments in strengthening the group's go-to-market resources, product launch costs, systems, processes, and capabilities to further scale the organization, and higher performance-related remuneration.

Speaker #2: And higher performance-related remuneration. EMPACT margins improved to 20%, which was up 5% versus FY25, which more than offset the increase in expenses and reflected an improved product mix and a continuing improvement in operating leverage.

Michael Barton: NPAT margins improved to 20%, which was up 5% versus FY25, which more than offset the increase in expenses and reflected an improved product mix and a continuing improvement in operating leverage. Overall, the financial results reflect both strong performance and continued investment in capability. Codan finished FY26 with a very strong balance sheet. Net cash of AUD 36 million, which was an improvement of AUD 124 million versus the net debt position of AUD 88 million as at 31 December 2025. This reflected the accelerated growth in revenue throughout the second half and strong cash collections.

Speaker #2: Overall, the financial results reflect both strong performance and continued investment in capability. Codan finished FY26 with a very strong balance sheet, net cash of $36 million, which was an improvement of $124 million versus the net debt position of $88 million as at 31 December 2025.

Speaker #2: This reflected the accelerated growth in revenue throughout the second half and strong cash collections. The group balance sheet is in a very strong position, with substantial funding capacity including a $250 million undrawn debt facility and a further $150 million in accordion capacity available subject to bank approval.

Michael Barton: The group balance sheet is in a very strong position with substantial funding capacity, including a AUD 250 million undrawn debt facility and a further AUD 150 million in accordion capacity available subject to bank approval. These facilities provide Codan with financial flexibility to pursue our strategic inorganic growth opportunities. Our balance sheet remains a competitive advantage in executing on our strategy. Engineering investment during the half totaled AUD 78 million, representing approximately 9% of group revenue. This level of investment is consistent with our long-term approach and supports product development pipelines across both communications and metal detection. In communications, investment is focused on advanced tactical platforms, next generation radio waveforms, and the SALUS integrated command and control platform. Within Minelab, investment continues to support product refresh cycles and technology leadership globally. This sustained commitment to innovation underpins our organic growth trajectory.

Speaker #2: These facilities provide Codan with financial flexibility to pursue. In organic growth opportunities. Our balance sheet remains a competitive advantage in executing on our strategy.

Speaker #2: Engineering investment during the half totaled $78 million, representing approximately 9% of group revenue. This level of investment is consistent with our long-term approach and supports product development pipelines across both communications and metal detection.

Speaker #2: In communications, investment is focused on advanced tactical platforms, next-generation radio. Forms, and the SALUS integrated commander-control platform. Within Minelab, investment continues to support product refresh cycles, and technology leadership globally.

Speaker #2: This sustained commitment to innovation underpins our organic growth trajectory. Back to you, Alf, as we take a closer look at our three core businesses.

Michael Barton: Back to you, Alf, as we take a closer look at our three core businesses.

Speaker #1: Thanks, Michael. We'll now move on to the business units. Communications revenue grew 22% to $506.2 million slightly above the top end of the targeted FY26 15 to 20 percent range, driven primarily by strong demand for unmanned systems.

Alf Ianniello: Thanks, Michael. We'll now move on to the business units. Communications revenue grew 22% to AUD 506.2 million, slightly above the top end of the targeted FY26 15% to 20% range, driven primarily by strong demand for unmanned systems. The revenue from defense customers represented 58% of total communications revenue, up from 38% in FY25, underscoring the importance of this vertical to Codan and reflecting the global tailwinds of sovereignty and increased defense spending commitments. Communication segment profit increased by 45% to AUD 156 million, with segment profit margins expanding to 31%, up from 26% in FY25. This reflects strong revenue growth, product sales mix, and operating leverage. Pleasingly, the communications segment exceeded the achievement of 30% profit margin by 18 months.

Speaker #1: The revenue from defense customers represented $58% of total communications revenue, up from $38% in FY25. Underscoring the importance of this vertical to Codan and reflecting the global tailwinds of sovereignty and increased defense spending commitments.

Speaker #1: Communications segment profit increased by 45% to $156 million, with segment profit margins expanding to 31%, up from 26% in FY25. This reflects strong revenue growth, product sales mix, and operating leverage.

Speaker #1: Pleasingly, the communications segment exceeded the achievement of 30% profit margin by 18 months. Auditable increase by 50% year-on-year and by 29% versus December 2025 to $380 million, at 30th of June.

Alf Ianniello: Order book increased by 50% year on year and by 29% versus December 2025 to AUD 380 million at 30 June, driven by a strong uplift in order intake across both DTC and Zetron and providing strong revenue visibility into FY27. DTC delivered another exceptional result in FY26, underpinned by defense and unmanned systems applications demand across all geographies. Revenue from the high growth unmanned sector more than doubled to approximately AUD 215 million. Throughout the H2, we saw continued acceleration in unmanned revenue across both conflict regions and non-conflict defense and security programs in the US and Europe. Within DTC, product innovation included ongoing development, multi-waveform radios, along with enhancements to the existing BlueSDR range, aimed at offering improved network visibility, spectrum monitoring software, and alternative antenna solutions.

Speaker #1: Driven by a strong uplift in order intake across both DTC and Zetron, and providing strong revenue visibility into FY27. DTC delivered another exceptional result in FY26, underpinned by defense and unmanned systems applications demand across all geographies, revenue from the high-growth unmanned sector more than doubled to approximately $215 million.

Speaker #1: Throughout the second half, we saw continued acceleration in unmanned revenue across both conflict regions and non-conflict defense and security programs in the US and Europe.

Speaker #1: Within DTC, product innovation, included ongoing development, multi-waveform radios, along with enhancements to the existing Blue SDR range, aimed at offering improved network visibility, spectrum monitoring software, and alternative antenna solutions.

Speaker #1: This innovation led to DTC securing its first orders for the solar radios into multiple programs of records for the US military initiatives to drive sovereignty.

Alf Ianniello: This innovation led to DTC securing its first orders for the sale of radios into multiple programs of records for the US military initiatives to drive sovereignty. Lastly, at the end of July, Codan completed the acquisition of Adaptive Dynamics, which we'll elaborate on in a couple of slides. We include on the next slide an overview of the BlueSDR family of products. DTC's BlueSDR radios are suitable for a huge range of unmanned platforms in all domains across air, land, and sea. In the air domain, which is by far the largest by volume of units sold, the BlueSDR range finds applications on platforms from small rotary motor drones through to much larger strategic surveillance platforms.

Speaker #1: Lastly, at the end of July, Codan completed the acquisition of Adaptive Dynamics, which we'll elaborate on in a couple of slides. We include on the next slide an overview of the Blue SDR family of products.

Speaker #1: DTC's Blue SDR radios, a suitable for huge range of unmanned platforms in all domains across air, land, and sea. In the air domain, which is by far the largest by volume of units sold, the Blue SDR range finds applications on platforms from small rotor motor drones through to much larger strategic surveillance platforms.

Speaker #1: The US Department of War drone categorization system consists of five broad groups from Group 1, the smallest and typically the lowest cost tactical drones, through to Group 5, large multi-million dollar strategic platforms, often deployed at ranges of thousands of miles.

Alf Ianniello: The US Department of War drone categorization system consists of five broad groups from Group 1, the smallest and typically the lowest cost tactical drones, through to Group 5, large multimillion-dollar strategic platforms, often deployed at ranges of thousands of miles. DTC's sweet spot today stretches from the high end of Group 1 through to Group 3. The acquisition of Adaptive Dynamics will help us to compete with very high-end and high-priced military radios typically deployed in this space by delivering increased resistance to jamming and interference. Our BlueSDR radios have been proven to be highly effective in both conflict and non-conflict defense environments for their secure and resilient waveforms and their ability to withstand the harshest field conditions. Turning to the acquisition of Adaptive Dynamics, which was first announced in May.

Speaker #1: DTC's sweet spot today stretches from the high end of Group 1 through to Group 3, the acquisition of Adaptive Dynamics, where help us to compete with very high-end and high-priced military radios, typically deployed in this space by delivering increased resistance to jamming and interference.

Speaker #1: Our Blue SDR radios have been proven to be highly effective in both conflict and non-conflict defense environments, for their secure and resilient waveforms and their ability to withstand the harshest field conditions.

Speaker #1: Churning to the acquisition of Adaptive Dynamics, which was first announced in May, ADI is a US-based engineering company specializing in the development, anti-jamming, and interference mitigation technologies critical to the resilience of tactical communications.

Alf Ianniello: ADI is a US-based engineering company specializing in the development of anti-jamming and interference mitigation technologies, critical to the resilience of tactical communications. A highly strategic acquisition for DTC. ADI meaningfully enhances DTC's US-based technical capabilities in unmanned systems and strengthens its ability to compete for the next generation US and allied defense programs, which require secure communications, electronic warfare resilience, and AI-enabled integration in contested electromagnetic environments. ADI also provides us with a strong team of people and capability, which will continue to be integrated into our DTC North American team. We also anticipate the ability to cross-sell in time into public safety markets. We look forward to updating the market further as we continue to integrate this business. In the H1 FY26, Zetron was impacted by a temporary slowdown in federal procurement and contracting cycles in the United States.

Speaker #1: A highly strategic acquisition for DTC. ADI meaningfully enhances DTC's US-based technical capabilities in unmanned systems and strengthens its ability to compete for the next-generation US and allied defense programs which require secure communications, electronic warfare resilience, and AI-enabled integration in contested electromagnetic environments.

Speaker #1: ADI also provides us with a strong team of people and capability which will continue to be integrated into our DTC North American team. We also anticipate the ability to cross-sell in time into public safety markets.

Speaker #1: We look forward to updating the market further as we continue to integrate this business. In the first half of FY26, Zetron was impacted by a temporary slowdown in federal procurement and contracting cycles in the United States, second half revenue was broadly in line with the first half as guided in the trading update we released on the ASX on the 29th of April.

Alf Ianniello: H2 revenue was broadly in line with the H1, as guided in the trading update we released on the ASX on 29 April 2026. Positively, order intake strengthened towards the end of the H2, resulting in a 25% increase in Zetron's order book as of 30 June 2026 versus 30 June 2025. Key wins included a $19 million contract with one of the largest utilities on the East Coast, an $11 million mission-critical services contract with the UK Emergency Services Network, and an AUD 8 million radio communications modernization contract for a major provider of the underground transport services in London. Zetron also continued to receive strong order intake from its hosted services, Iowa contract, which now services more than 80% of all public safety answering points across the state.

Speaker #1: Positively, order intake strengthened towards the end of the second half, resulting in a 25% increase in Zetron's auditable as of the 30th of June 2026 versus the 30th of June 2025, key wins included a $19 million contract with one of the largest utilities on the East Coast, a $11 million mission-critical services contract with the UK Emergency Services Network, and an $8 million radio communications modernization contract for a major provider of the underground transport services in London.

Speaker #1: Zetron also continued to receive strong order intake from its hosted services, Iowa contract, which now services more than 80% of all public safety answering points across the state.

Speaker #1: Looking forward, product development activity remains focused on SELUS, which is designed to provide a unified cloud-based software and services platform for Zetron's command and control applications.

Alf Ianniello: Looking forward, product development activity remains focused on CELAS, which is designed to provide a unified cloud-based software and services platform for Zetron's command and control applications. On the next slide, we include further detail regarding the features of the CELAS platform. At its core, CELAS is designed to provide a unified interface and experience for the control room personnel. We believe this will enable the most optimal responses to be made during the most stressful events and emergencies. Providing a unified control room service in the form of a modular application maintains Zetron market leading interoperability while minimizing the time it takes to respond to a call. Customers will be able to choose when and how they move to CELAS, either on-premise, via the cloud, or a hybrid solution. Customers can also receive expanded enhanced services and support from managed services or lifecycle solutions frameworks.

Speaker #1: On the next slide, we include further detail regarding the features of the SELUS platform. At its core, SELUS is designed to provide a unified interface and experience for the control room personnel.

Speaker #1: We believe this will enable the most optimal responses to be made during the most stressful events and emergencies. Providing a unified control room service in the form of a modular application maintains Zetron market-leading interoperability while minimizing the time it takes to respond to a call.

Speaker #1: Customers will be able to choose when and how they move to SELUS. Either on-premise via the cloud or a hybrid solution. Customers can also receive expanded enhanced services and support for a managed services or lifecycle solution frameworks.

Speaker #1: We believe SELUS will generate meaningful value for Zetron across multiple dimensions. These include growing reoccurring revenue via hosting and managed services solutions, achieving higher customer lifetime value through cost-selling opportunities, and margin expansion via a software-led model and scalable cost base.

Alf Ianniello: We believe CELAS will generate meaningful value for Zetron across multiple dimensions. These include growing recurring revenue via hosting and managed services solutions, achieving high customer lifetime value through cross-selling opportunities, and margin expansion via a software-led model and scalable cost base. Additionally, we are confident that CELAS will enable Zetron to equally serve Tier 4 through to Tier 1 customers, leading to a substantial expansion in our obtainable market. Turning to Minelab. Minelab's full year results were exceptional, with revenue up 42% to AUD 362 million and segment profit of AUD 162.4 million, up 65% versus FY25. As guided in the trading update, Minelab delivered a stronger H2 with 15% revenue growth in H2 FY26 when compared with H1 FY26, supported by successful product releases. Segment profit margin increased to 45%, up from 39%, driven by revenue growth, product mix, and operating leverage.

Speaker #1: Additionally, we are confident that SELUS will enable Zetron to equally serve Tier 4 through to Tier 1 customers, leading to a substantial expansion in our obtainable market.

Speaker #1: Turning to Minelab, Minelab's full-year results were exceptional. With revenue up 42% to $362 million, and segment profit of $162.4 million, up 65% versus FY25.

Speaker #1: As guided in the trading update, Minelab delivered a stronger second half with 15% revenue growth in H2, FY26, when compared with H1, FY26. Supported by successful product releases, segment profit margin increased to 45%, up from 39%, driven by revenue growth, product mix, and operating leverage.

Speaker #1: Minelab successfully launched four new products in FY26 in the goal of recreational and countermine markets. Including the new flagship, GPZ 8000 Gold Detector, the Gold Monster 2000, the Vanquish 60, and countermine's MDS 20 Detector.

Alf Ianniello: Minelab successfully launched four new products in FY26 in the gold, recreational, and countermine markets, including the new flagship GPZ 8000 gold detector, the Gold Monster 2000, the VANQUISH 60, and Countermine MDS-20 detector. These launches reflect Minelab's global technology leadership across its detection platform. Minelab's rest of the world achieved significant growth, increasing revenue by 32%, driven by the strong uptake of the GPZ 8000 as well as the Gold Monster 2000. Substantial growth in the VANQUISH range and a meaningful expansion in distribution footprint and retail presence in Australia and North America with additional in-store placement across key retail channel partners. Minelab Africa delivered another outstanding performance, with revenue increasing in all regions to approximately AUD 184 million, up 60% versus FY25. The Gold Monster 2000 was launched successfully, exceeding business case expectations.

Speaker #1: These launches reflect Minelab's global technology leadership across its detection platform. Minelab's rest of the world achieved significant growth, increasing revenue by 32%, driven by the strong uptake of the GPZ 8000 as well as the Gold Monster 2000.

Speaker #1: Substantial growth in the Vanquish range and a meaningful expansion in distribution footprint and retail presence in Australia and North America, with additional in-store placement across key retail channel partners.

Speaker #1: Minelab Africa delivered another outstanding performance with revenue increasing in all regions to approximately $184 million. Up 60% versus FY25. The Gold Monster 2000 was launched successfully, exceeding business case expectations.

Speaker #1: A key near-term priority is driving adoption of the GPZ 8000 across Africa, with training and grassroots activation activities continuing in FY27 as market awareness and adoption builds.

Alf Ianniello: A key near-term priority is driving adoption of the GPZ 8000 across Africa, with training and grassroots activation activities continuing in FY27 as market awareness and adoption builds. This slide describes the GPZ 8000 in more detail, including key features and enhancements relative to the 7000 model. Resounding customer feedback for the GPZ 8000 is that it represents a significant advancement in performance, particularly in highly challenging ground conditions. Minelab continues to invest in product innovation and engineering to reinforce its leading position in recreational and specialist detection markets. Now I'd like to move on to the strategy update section of today's presentation. Our strategy remains anchored in three core pillars. First, investing in ourselves, strengthening systems, processes, people, and product innovation. Second, strengthening our core businesses, expanding addressable markets, improving revenue quality, and increasing reoccurring revenue components.

Speaker #1: This slide describes the GPZ 8000 in more detail, including key features and enhancements. Relative to the 7000 model. Resounding customer feedback for the GPZ 8000 is that it represents a significant advancement in performance, particularly in highly challenging ground conditions.

Speaker #1: Minelab continues to invest in product innovation and engineering to reinforce its leading position in recreational and specialist detection markets. Now I'd like to move on to strategy update section of today's presentation.

Speaker #1: Our strategy remains anchored in three core pillars. First, investing in ourselves. Strengthening systems, processes, people, and product innovation. Second, strengthening our core businesses, expanding addressable markets.

Speaker #1: Improving quality and increasing reoccurring revenue components. And thirdly, disciplined capital allocation, pursuing strategically aligned and accretive acquisitions, that enhance capability, scale, and market penetration.

Alf Ianniello: Thirdly, disciplined capital allocation, pursuing strategically aligned and accretive acquisitions that enhance capability, scale, and market penetration. Together, these pillars support sustainable, diversified earnings growth. We made significant progress against each of these strategic pillars in FY26, as outlined in the slide. Our near-term objectives are focused on executing key initiatives across each business. In DTC, we are focused on the integration of Adaptive Dynamics electronic warfare capabilities, ongoing investment in the dismounted soldier ecosystem, and continued investment in our next generation and multi-waveform strategy. In Zetron, we are seeking to complete the launch of our end-to-end services-based emergency response platform, expand market share via Zetron's next generation computer-aided dispatch solution in the UK, and completing and advancing the development of our SALUS cloud-based platform.

Speaker #1: Together, these pillars support sustainable, diversified earnings growth. We made significant price progress against each of these strategic pillars in FY26 as outlined in the slide.

Speaker #1: Our near-term objectives are focused on executing key initiatives across each business. In DTC, we are focused on the integration of adaptive dynamics electronics warfare capabilities, ongoing investment in the dismounted soldier ecosystem, and continued investment in our next-generation and multi-waveform strategy.

Speaker #1: In Zetron, we are seeking to complete the launch of our end-to-end services-based emergency response platform, expand market share via Zetron's next-generation computer-aided dispatch solution in the UK, and completing an advancing the development of our SELUS cloud-based platform.

Speaker #1: In Minelab, we are focused on accelerating market growth via the four new detector launches in FY26, advancing North America and European retail expansion, and targeting e-commerce and channel engagement strategies.

Alf Ianniello: In Minelab, we are focused on accelerating market growth via the four new detector launches in FY26, advancing North America and European retail expansion, and targeting e-commerce and channel engagement strategies. All these initiatives support both near-term performance and long-term structural improvement. This year, as guided by Codan's core values, we introduced quarterly value awards, a chance to formally recognize people across the business who are living our values day to day. It's been a great addition to our culture. On community, we've continued our longstanding support for a range of organizations: Variety, Youth Opportunities, KickStart for Kids, Hutt Street Centre, and Catherine House. These are partnerships we're generally proud of. From an education perspective, we've deepened our investment in STEM through university scholarships, student mentoring, and industry engagement. This year, we awarded the inaugural Codan Founder's PhD scholarship, which is a significant milestone for us.

Speaker #1: All these initiatives support both near-term performance and long-term structural improvement. This year, as guided by CODAN's core values, we introduced quarterly value awards, a chance to formally recognize people across the business who are living our values day to day.

Speaker #1: It's been a great addition to our culture. On community, we've continued our long-standing support for a range of organizations. For IT, youth opportunities, Kickstart for Kids, Hutch Street Center, and Catherine House.

Speaker #1: These are partnerships we're generally proud of. From an education perspective, we've deepened our investment in STEM to a university scholarships, student mentoring, and industry engagement.

Speaker #1: And this year, we awarded the inaugural CODAN Founders PhD Scholarship, which is a significant milestone for us. And we also continued our support for Yalari and Indigenous education scholarships.

Speaker #1: And on the environmental side, Minelab's Clean Sweep campaign has been a real standout. Using our detector community to help the environmental stewardship. It's a great example of what our products can do beyond their primary purpose.

Alf Ianniello: We also continued our support for Yolŋu and Indigenous education scholarships. On the environmental side, Minelab's Clean Sweep campaign has been a real standout, using our detector community to help the environmental stewardship. It is a great example of what our products can do beyond their primary purpose. Underpinning all of this are our four values you see at the bottom of the slide: customer-driven, trust and integrity, high-performing, and can-do. These are not just words on the wall. They shape how we run the business every day. Next, I would like to turn to our outlook section, looking at our view into FY27. The group continues to deliver on the strategy of building a stronger Codan. Our strategic pillars of investing in people and systems, product development, strengthening Codan's position in core markets, expanding in new geographies, and disciplined capital allocation will continue to guide our focus in FY27.

Speaker #1: Underpinning all of this are our four values you see at the bottom of the slide. Customer-driven, trust and integrity, high performing, and can do.

Speaker #1: These aren't just words on the wall. They shape how we run the business every day. Next, I'd like to turn to our Outlook section, looking at our view into FY27.

Speaker #1: The group continues to deliver on the strategy of building a stronger CODAN. Our strategic pillars of investing in people and systems, product development, strengthening CODAN's position in core markets, expanding geographies, and disciplined capital allocation will continue our focus in FY27.

Alf Ianniello: Next, I would like to turn to our outlook section, looking at our view into FY27. The group continues to deliver on the strategy of building a stronger Codan. Our strategic pillars of investing in people and systems, product development, strengthening Codan's position in core markets, expanding in new geographies, and disciplined capital allocation will continue to guide our focus in FY27.

Speaker #1: Market conditions remain positive across both cost and metal detection. Elevated defense spending and ongoing geopolitical tensions globally continue to generate strong demand for unmanned systems.

Alf Ianniello: Market conditions remain positive across both comms and metal detection. Elevated defense spending and ongoing geopolitical tensions globally continue to generate strong demand for unmanned systems, while Minelab benefits from demand for its market-leading products and a favorable gold price. Some constraints are emerging across certain parts of the global electronic supply chain, which we are monitoring for any impact to Codan operations. The communications business targets long-term sales growth of between 10% to 15% per annum. As demonstrated over FY24 to FY26, this target growth range can be exceeded. As a result of unprecedented levels of demand we are experiencing primarily in unmanned systems, we expect the H1 of FY27 to significantly exceed the H1 of FY26.

Speaker #1: While Minelab benefits from demand for its market-leading products and a favorable gold price. Some constraints are emerging across certain parts of the global electronic supply chain, which we are monitoring for any impact to CODAN operations.

Speaker #1: The communications business targets long-term sales growth of between 10 to 15 percent per annum. And as demonstrated over FY24 to 26, this target growth range can be exceeded.

Speaker #1: As a result of unprecedented levels of demand we're experiencing, primarily in unmanned systems. We expect the first half of FY27 to significantly exceed the first half of FY26.

Speaker #1: Given the strong start to the year, subject to related supply chain constraints resulting from ongoing auto momentum, we are currently targeting full-year FY27 revenue growth in the order of 20 percent.

Alf Ianniello: Given the strong start to the year, subject to related supply chain constraints resulting from ongoing order momentum, we are currently targeting full year FY27 revenue growth in the order of 20%. Minelab is well-positioned for FY27 with a full 12-month contribution from recently launched products. Early H1 market conditions have been positive, with strong demand, in particular for the new GPZ 8000 and Gold Monster 2000 detectors. As a result, both Africa and Rest of the World are currently tracking broadly in line with H2 of FY26 revenue run rates. Overall, Minelab's H2 FY26 average monthly run rate was approximately AUD 32 million, 15% higher than H1 FY26.

Speaker #1: Minelab is well-positioned for FY27, with a full 12-month contribution from recently launched products. Early first half market conditions have been positive, which strong demand in particular for the new GPZ 8000 and gold monster 2000 detectors.

Speaker #1: As a result, both Africa and rest of the world are currently tracking broadly in line with H2 of FY26 revenue run rates. Overall, Minelab's H2 FY26 average monthly run rate was approximately 32 million, 15 percent higher than H1 FY26.

Speaker #1: With a strong balance sheet and disciplined approach to capital allocation, the group remains well-positioned to continue to invest in product innovation and capability and to pursue future acquisitions that fit our product and technology roadmaps.

Alf Ianniello: With a strong balance sheet and disciplined approach to capital allocation, the group remains well-positioned to continue to invest in product innovation and capability, and to pursue future acquisitions that fit our product and technology roadmaps, and enhance the quality, resilience, and the diversification of our earnings. We look forward to providing a further update at the annual general meeting on 20 October 2026. With that, this draws us to the end of our formal presentation session. We can now move to Q&A session with Sam. Thank you very much.

Speaker #1: And enhance the quality resilience and the diversification of our earnings. We look forward to providing a further update at the annual general meeting on the 20th of October, 2026.

Speaker #1: And with that, this draws us to the end of our formal presentation session. We can now move to Q&A session with Sam. Thank you very much.

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Q4 2026 Codan Ltd Earnings Call

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