Codan have released their full year figures for 2023/24 as follows:

• Group revenue of $550.5 million, delivering underlying net profit after tax of $81.3 million

• Strong organic growth, further supplemented by the businesses acquired throughout the year (Eagle and Wave Central)

• All profitability metrics increased vs FY23, with EBIT and NPAT up 29% and 24% respectively vs pcp

• The business delivered organic EBIT growth of $22 million, up 24%.

• Investment directed towards strengthening people, processes and systems required to deliver future strategic growth initiatives

• Annual dividend of 22.5 cents, fully franked

• Strong Communications performance sustained:

o  Revenues of $326.9 million (+19% vs pcp); and

o  Expanding orderbook of $197 million (+21% vs pcp)

• Metal detection revenue up 25% vs pcp, with all divisions growing

•H2 FY24 NPAT of $43.2 (+13% vs H1 FY24 and +24% vs H2 FY23)

The FY24 figures are quite an increase on the FY23 figures with revenue and net profit up around 21% & 24%

I had estimated their FYNPAT at $80 Million and it came in above that at $81.3 Million

My current valuation of Codan is as follows:

There are around 181,307,400 SOI,

So With a NPAT of $81.3m gives us a NPAT per share of $0.4484

Now that there is good growth in the company again I have revised my PE to 25,

Assuming a PE of 25 gives a valuation of $1.60 Billion or $11.21 per share

My revised valuation is $11.21 per share

I hold Codan in my actual portfolio and in Strawman and am happy to do so as this is one stock I am happy to watch grow over time but it is over priced at $14.87 which is a PE 33 and too high for a stock only growing NPAT at 24%

Codan have released their half yearly results to the market

CODAN H1 FY24 RESULTS

H1 FY24 HIGHLIGHTS:

·        Group revenue of $265.9 million, up 26% versus prior corresponding period (“pcp”)

·        Net profit after tax of $38.1 million, up 24% versus pcp

·        Performance by Communications businesses in line with 10 to 15% revenue growth target range:

·        Communications revenues of $153.6 million, up 12.5% versus pcp, segment profit $37.8 million, up 9% versus pcp

·        Communications orderbook of $183 million, +12% versus 30 June 2023

·        Metal detection revenues up 49% versus pcp, with all divisions contributing to this growth

·        Net debt of $82.5 million at 31 December 2023, having funded $30.3 million for the Eagle and Wave Central acquisitions in the period

·        Earnings per share of 20.9 cents, up 22% versus pcp

·        Interim dividend of 10.5 cents, fully franked

The HY23 figures are quite an increase on the FY23 figures with revenue and net profit up around 25% with Minelab and the Africa operations improving quite a bit.

My current valuation of Codan is as follows:

Current assumed FYNPAT of $80 Million ($38.1m + $38.1m x 10%)

This is a growth stock and they have delivered significant revenue and earnings growth for a number of years apart from recent reduction in group revenue/ profits due to ongoing disruptions in Minelab’s African market but with this market now coming back and with recent acquisitions and strong R&D believe this will continue to improve over the next year or so.

There are around 181,307,400 SOI,

So With a NPAT of $80m gives us a NPAT per share of $0.44124

Now that there is growth in the company again I have revised my PE to 20,

Assuming a PE of 20 gives a valuation of $1.60 Billion or $8.82 per share

My revised valuation is $8.82 per share