Codan Posts 30% Revenue Growth and 69% Profit Surge in FY26

Strong Financial Performance Across Segments

Codan Limited (ASX:CDA) has reported a standout FY26 performance, with revenue climbing 30% to $875 million and net profit after tax surging 69% to $175 million. Earnings per share rose sharply to 96.5 cents, reflecting the company’s ability to capitalise on structural growth in its target markets.

The Communications segment, which includes DTC and Zetron, delivered 22% revenue growth to $506 million, exceeding the top end of its 15-20% target range. Defence customers accounted for 58% of Communications revenue, up from 38% last year, highlighting Codan’s growing footprint in sovereign and allied defence programs. Segment profit jumped 45% to $156 million, with margins expanding to 31%, surpassing the FY27 margin target by 18 months. The order book swelled 50% to $380 million, driven by strong demand across unmanned systems and public safety.

Metal Detection Strength and Product Innovation

Minelab, Codan’s metal detection business, posted an exceptional 42% revenue increase to $362 million, with segment profit up 65% to $162 million. The segment’s profit margin improved to 45%, supported by a favourable product mix and operating leverage. Key product launches including the flagship GPZ8000 gold detector and the Gold Monster 2000 resonated strongly in global markets, particularly Africa where revenue grew 60%. The company continues to expand its retail footprint in Australia and North America, underpinning future growth.

Balance Sheet Strength and Strategic Acquisition

Codan ended FY26 with net cash of $35.7 million, a dramatic turnaround from net debt of $88.2 million at the end of December 2025. This was driven by strong second-half revenue growth and disciplined cash collections. The company maintains substantial funding capacity, including a $250 million undrawn debt facility and a further $150 million in accordion capacity subject to bank approval, positioning Codan for future acquisitions and organic growth.

In July 2026, Codan completed the acquisition of Adaptive Dynamics, a US-based engineering firm specialising in anti-jamming and interference mitigation technologies critical for tactical communications. This move is expected to enhance Codan’s US-based technical capabilities and strengthen its position in next-generation defence programs requiring secure, resilient communications in contested electromagnetic environments.

Executive Remuneration Aligned with Performance

Executive pay packages were adjusted in FY26 to reflect market competitiveness and company performance. CEO Alf Ianniello’s fixed remuneration increased to $1.375 million, with short-term incentives (STI) raised to 62.5% of fixed pay and capped at 125%. The CEO elected to take 60% of his STI in equity, aligning his interests with shareholders. Long-term incentives (LTI) and Superior Performance Incentive Rights (SPIR) plans are tied to ambitious earnings per share (EPS) growth and relative total shareholder return (RTSR) targets over three years, reinforcing a focus on sustained value creation.

Positive Outlook for FY27

Looking ahead, Codan targets around 20% revenue growth in FY27, driven by continued momentum in Communications and a full-year contribution from recently launched Minelab products. Early FY27 trading has been strong, particularly in unmanned systems, despite some supply chain constraints. Minelab’s new detectors are tracking well in key markets, with Africa and Rest of World regions maintaining robust sales run-rates.

Codan’s disciplined capital allocation and strong balance sheet provide flexibility to pursue further acquisitions that complement its technology and product roadmap. The Board will update shareholders further at the Annual General Meeting in October 2026.