Agreed @Solvetheriddle

I wasn't expecting good news re Sudan and what continues to be reported there but they continue to make progress replacing it with other market detector growth and the Comms businesses. So if Sudan does come back one day it would be a boost.

Thanks @Karmast.They are plugging along nicely. This is a bottom drawer stock for me, with little intervention required on my end, but I remain bullish about their short to medium term outlook even with the state of the macro environment.

@Solvetheriddle I think the real win here is their continued diversification. What was initially a good-quality business with cyclicality is starting to shift -- more than 60% of their revenues now coming from comms, with a much more stable and reliable base. The market will appreciate this over time.

Later on in the chat, there was also a question re: cash flows. Alf stated they are going to get back to that "normal Codan cash flow situation", generating cash and not having to invest heavily in inventory. I interpret that as we are likely to see another decent half reported by Codan. On a current P/E of 15, and P/S of 2.8x, shares remain attractively priced in my opinion. At the end of the interview Alf spoke about the importance of Codan continuing to grow. If they continue to do so steadily and consistently we will continue to see the share price re-rate.

Places like Sudan will provide a margin kick when/if they come good. The beauty is Codan is no longer reliant on this occurring. Those that backed up the truck when the share price was under $4.00 will have done very well for themselves in five + years I think.

All good points @Rocket6, @Karmast and @Solvetheriddle and I think I see it in a similiar way.

I am actually pretty impressed with the management of CDA, they copped a bit of flack around Sudan and not knowing what was going on there during 2022. Some of this was fair, but in my opinion a lot this was a hindsight pile on due to a declining share price. The timeline as I see it is that they had a massive left field shock, on top of the covid disruptions, in the form of Sudan and they have responded to it with some pretty sensible longer term moves.

I am largely viewing Sudan as permanently lost and consider that it was a very nice bonus to cashflow over the 2 yr post covid annomaly period. This helped give them the cashflow to make the communications acquisitions. This period is now over, and the buisness didn't seem to panic and instead just repositioned itself for the next period of growth. I will be keeping an eye on margins in the communications side of the buisness as I am expecting these will improve over time, although probably wont get near the Minetec levels.

Expanding the communication side of the buisness looks like a good decision and the aquisitions are performing ahead of expectations. The expansion of minelab into South America and India look like they will give a good payback as we move forward. In the presentation Alf says that India has gone from doing $46K/month to $146K/month and he thinks this will become a million dollar buisness (I am assuming this means $12m/yr). So no replacement for Sudan, but nothing to sneeze at either. Good commentary around the cash flow and I too am expecting a solid report coming up. I think any uncertainty around the CEO transistion I think have been resolved and Alf appears to be well in control of their operations.

@Rocket6 good points, i have contemplated that the change in mix with more comms could argue for a higher multiple. as the businesses prove themselves. which of course would be a positive. my read on inventory is that it is coming down but is a work in progress