Slide 1: FY22 Full-year investor presentation
18 August 2022 Company Announcements Office Australian Securities Exchange Level 4 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam FY22 Full-year investor presentation Please find attached a copy of Codan Limited’s investor presentation dated 18 August 2022 for release to the market. Yours faithfull
Slide 2: FY22 Full Year Results and Update
FY22 FULL YEAR RESULTS AND UPDATE
Slide 3: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER Disclaimer This presentation has been prepared by Codan Limited (ABN 77 007 590 605) (Codan). The information contained in this presentation is for information purposes only and is not investment, financial product, legal or tax advice. This presentation contains summ
Slide 4: The business delivered record profits, despite very challenging circumstances
“The business delivered record profits, despite operating under very challenging circumstances.” Continuity of supply, despite global supply chain shortages and long lead times on key components Challenging business conditions in North Eastern Africa for the Minelab business Ukraine conflict impact
Slide 5: FY22 Full Year Summary
FY22 FULL YEAR SUMMARY • Codan group sales increased 16% to $506 million • Record underlying net profit after tax of $100.5 million, increased by 3% • More balanced and stable revenues across the Codan group • DTC and Zetron exceeded first year acquisition targets achieving $19 million and $15 milli
Slide 6: FY22 Full Year Group Sales
FY22 FULL YEAR GROUP SALES A strong year for Codan • 16% increase in sales over FY21 • Communications sales increased by 153% -20% • Driven by newly acquired businesses • Both DTC and Zetron exceeded year one EBITDA targets, achieving $19 million and $15 million respectively • Enter FY23 with strong
Slide 7: FY22 Dividend
FY22 DIVIDEND Final dividend 15.0 cents Full Year Dividend (Cents) • Final dividend 15.0 cents per share • Full year dividend 28.0 cents (Interim: 13.0 cents) • Increasing dividends reflect strength of business • Interim dividend will be paid • Record date 26 August 2022 • Payment date 7 September 2
Slide 8: FY22 Global Footprint
FY22 GLOBAL FOOTPRINT Europe and North American sales increased 81% on FY21 $85m $206m $19m $133m $15m $48m 7
Slide 9: Strategic Growth Plan
STRATEGIC GROWTH PLAN Transforming lives through innovation, wherever you are Continue diversification strategy • Geographic expansion • Leverage distribution channels • End-to-end solutions offering • Deliver more predictable revenue streams Continue to bring Continue to deliver world leading growt
Slide 10: FY22 Strategic Achievements
FY22 STRATEGIC ACHIEVEMENTS • Invested in excess of $40 million during FY22 across all businesses • Several new detectors on track for FY23 H1 release Invest in Ourselves • Strong pipeline of development projects • ~30% of employees are engineers • Successfully diversified segment sales – more balan
Slide 11: 5 Year Financial Summary
5 YEAR FINANCIAL SUMMARY Underlying Engineering Operating Sales ($m) NPAT ($m) Investment ($m) Cashflow ($m) 506 437 97 101 46 131 348 104 33 92 31 $39.7m invested 271 64 29 into inventory 230 23 during FY22 48% 46 62 40 48 52 31% 30% 23% 26% 26% 30% 31% 23% 54% FY18 FY19 FY20 FY21 FY22 FY18 FY19 FY
Slide 12: Sustainability
SUSTAINABILITY Innovation 60+ year history of innovation Social During FY22 the group established a An avid supporter of several charities, via direct sponsorships, charity events sustainability council dedicated to and product donations identifying, and managing risks, issues and opportunities that
Slide 13: Metal Detection
METAL DETECTION Metal Detection Sales Sales reduced after an unprecedented FY21, FY22 was Minelab’s second best year representing 11% increase over FY20 Gold Mining • Impacted by unstable business conditions in Northeast Africa • In-country business development activities have resumed post covid tra
Slide 14: Minelab Strategic Growth Plan
MINELAB STRATEGIC GROWTH PLAN Performance is everything Growth by Acquisition • Seek diversification and Strengthen Core Businesses complementary technologies • Leverage distribution channels • Territorial Expansion across key and E-Commerce Invest in Ourselves geographical markets - APAC, LATAM, Af
Slide 15: Communications
COMMUNICATIONS DTC and Zetron have strengthened the Communications business, with both acquisitions exceeding year one targets, achieving $19 million and $15 million EBITDA respectively, contributing 19% EPS growth Tactical Communications (including DTC) Communications Sales • Awarded and delivered
Slide 16: Tactical Communications Strategic Growth Plan
TACTICAL COMMUNICATIONS STRATEGIC GROWTH PLAN Communications that enable you to be connected when it matters most Growth by Acquisition • Strategically aligned StrengthenCore Strengthen CoreBusinesses Businesses • Expands the core (via technology solutions) • Military – Programs of Record • Penetrat
Slide 17: Zetron Strategic Growth Plan
ZETRON STRATEGIC GROWTH PLAN Be heard and have the power to respond Growth by Acquisition • Strategically aligned Strengthen Core Strengthen Core Businesses Businesses • Expands the core (via technology solutions) • Invest in front-end, go-to-market • Penetration of adjacent markets Invest Investini
Slide 18: Financial Results
FINANCIAL RESULTS s ii Ea CODAN
Slide 19: Record FY22 Performance
RECORD FY22 PERFORMANCE Underlying NPAT ($m) • Record sales and profits, despite challenging operating environment • More balanced and diversified sales portfolio across segments • Price increases contributed to gross margin improvement • Maintained excellent profitability margins in a high inflatio
Slide 20: Segment Result
SEGMENT RESULT Metal Detection Communications • Successfully diversified sales across Communications and Metal Detection segments, representing a 48% and 52% split in FY22 • Communications segment contribution has grown from 9% to 29% of total segment contribution in FY22 • Management remain focused
Slide 21: Engineering Investment
ENGINEERING INVESTMENT Strong pipeline of projects Engineering Spend ($m) Engineering by Business Unit Return on Equity1 9% of Sales 1Return on equity = rolling 12 month net profit after tax divided by average equity 20
Slide 22: FY22 H1 vs H2 Operating Cashflow
FY22 H1 VS H2 OPERATING CASHFLOW ($ millions) Customer Supplier & Net Paid Taxes H1 Operating Customer Supplier & Net Paid Taxes H2 Operating Receipts Employee Interest Cash Outflow Receipts Employee Interest Cash Inflow payments payments H1 H2 21
Slide 23: Outlook
OUTLOOK While general business conditions remain challenging, we continue to focus on building a more predictable and diversified sales base, delivering long term shareholder value. In relation to FY23 outlook • Sales and marketing initiatives and global business development activities have resumed
Slide 24: Appendix A - Business
_ Appendix A - Business 23
Slide 25: Codan Limited Overview
CODAN LIMITED OVERVIEW CODAN W@ CODAN NY COMMUNICATIONS MINELAB CODAN ZETRON. el TACTICAL COMMUNICATIONS ‘a Codan Company Ea CODAN
Slide 26: Global Overview
GLOBAL OVERVIEW Continuing to build a global technology business Sell to over 150 countries around the world $0.5 Bn Annual Sales 20% Net profit after tax margins Employees around 700+ the world 200+ Engineers globally 10 sites across the globe: AUSTRALIA BRAZIL CANADA DENMARK IRELAND CODAN LOCATION
Slide 27: Metal Detection: Products & Markets
METAL DETECTION Products & Markets RECREATION GOLD MINING COUNTERMINE Coin & Treasure, Gold Detectors Handheld Gold Detectors Landmine Detectors Key markets — Australia, USA, Key markets — Africa, Asia Market — countries impacted by Europe, Asia Pacific, Latin America war — past and present Users: U
Slide 28: Gold Prospecting/Mining, Recreational/Professional, Countermine
Gold Prospecting/Mining Recreational / Professional Countermine Surface Detection Fun & Adventure Mines & Triggers Gold Recovery Treasures to Monetise Tactical/MIL & Demining 27
Slide 29: Mineralization Meter
Mineralization Meter GOLD TOOLBOX / DEPTH COMPARISON For mustration purposes only 28
Slide 30: Markets Diversity Ensures Revenue Stability and Growth
MARKETS DIVERSITY ENSURES REVENUE STABILITY AND GROWTH Market Segment Market Segment Market Segment Market Segment Market Segment • Army • Safe Cities • Air • Wireless camera • NGO • Navy • Domestic Security • Ground • Remote production • Commercial • Airforce • Surface • Oil & Gas Customer Type Cus
Slide 31: Complete Tactical Communications Solutions Provider
COMPLETE TACTICAL COMMUNICATIONS SOLUTIONS PROVIDER Tactical Communications - Modern tactical battlefield communication includes voice, data & VIDEO, & increasing demand for high quality infrastructure-less comms 30
Slide 32: Supporting the Integrated Battlefield
SUPPORTING SUPPORTING THE THE INTEGRATED INTEGRATED BATTLEFIELD BATTLEFIELD MIMO MESH SENSORS HF VHF MULTIBAND UHF 31
Slide 33: Markets We Serve
Markets We Serve Primary Markets Public Safety Transportation Utilities Emergency Communications Centers | Police | Fire | EMS Air | Rail | Maritime | DOT Electric | Natural Gas | Water | Waste Domestic Security Natural Resources Institutional Oil & Gas | Mining | Forestry | Land Management Higher E
Slide 34: Public Safety Emergency Response
The Power The PowertotoRespond Respond & BE HEARD PUBLIC SAFETY EMERGENCY RESPONSE www.zetron.com 33