The company released a trading update after market close today. The headlines are pretty dismal and I suspect the market will react savagely tomorrow. Revenue is down 10% and underlying NPAT is down 35%.

The metal detection business, with its biggest market in war torn North East Africa, and with the disappearance of the Russian market, continues to struggle, despite a continuous pipeline of new product developments which we are always told are well received.

The communications business is the rising star, accounting for well over 50% of revenue now. Revenue in this segment increased 14% and profit margin improved from 21% to 25%. (Still less than the detection profit margin of 32%). The forward order book of $163m is 60% of the entire FY23 revenue for this segment.

I still have great faith in the management of the company, and admire the way they have pivoted the business to a more predictable and growing source of revenue. No doubt there will be more short term pain for rusted on shareholders such as myself, but there is still a lot to like for those willing to be patient.