Slide 1: Investor Presentation: FY12 full year results and acquisition of Daniels Electronics
For personal use only Investor Presentation FY12 full year results and acquisition of Daniels Electronics Donald McGurk Managing Director and CEO Michael Barton Chief Financial Officer 5 September 2012
Slide 2: Important Notice and Disclaimer
Important Notice and Disclaimer For personal use only Disclaimer This presentation (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 ad
Slide 3: Overview: Annual results
Overview For personal use only Annual results Record reported net profit of $23.1 million Underlying net profit increased by 19% to $27.9 million Continued growth of metal detector sales and major new product release Major new Radio Communications products released Acquisition of Minetec b
Slide 4: Overview (cont.): Acquisition of Daniels Electronics and capital raising
Overview (cont.) For personal use only Acquisition of Daniels Electronics and capital raising Codan has acquired 100% of Daniels Electronics Ltd (Daniels), a leading North American based designer, manufacturer and supplier of land mobile communications systems ― Delivers on Codan’s stated strategy
Slide 5: Best-in-Class Electronic Solutions Directed at Global Markets
Best-in-Class Electronic Solutions Directed at Global Markets For personal use only Codan is a leading designer and manufacturer of radio communications, communications metal detection and mining technology products ― Founded in 1959 ― Head office in Adelaide, South Australia with 500 staff worldw
Slide 6: Delivering on Strategic Objectives
Delivering on Strategic Objectives For personal use only Divestment of non-core business, satellite communications assets Diversification Acquisition of Minetec, a provider of Acquisition communications and technology solutions to the mining sector Tiime for return Risk Acquisition of Daniels
Slide 7: Radio Communications
Radio Communications For personal use only Over 50 years of experience in developing high frequency radio solutions and support Product offering includes portable, vehicular and base station receivers and associated accessories ― Solutions vary from basic voice communications to data, email, GPS
Slide 8: Radio Communications (cont.)
Radio Communications (cont.) For personal use only FY12 result commentary FY13 objectives Sales and profitability for radio communication products increased over prior year Integrate Daniels business ― Margin performance improved due to higher value-add solutions C Consolidate lid t presence i
Slide 9: Daniels Electronics Limited
Daniels Electronics Limited For personal use only Daniels has a 60-year history as a leading designer designer, manufacturer and Daniels LMR products supplier of land mobile radio (LMR) communications ― Predominantly serves public safety, natural resource, transportation and other commercial marke
Slide 10: Transaction Rationale
Transaction Rationale For personal use only Opportunity to offer LMR to Codan’s current customer base especially emerging markets Ability to leverage distribution networks Interoperability and low power consumption technologies are ideal for emerging international markets and North-American di
Slide 11: Markets and Distribution
Markets and Distribution For personal use only Existing High Frequency (HF) radios provide long range communications Sales by b industry ind str segmentation (CY11) without the need for intermediate infrastructure Commercial 4% LMR systems provide short to medium range communications for areas w
Slide 12: Markets and Distribution (cont.)
Markets and Distribution (cont.) For personal use only Codan’s Codan s global distribution network can significantly enhance the sale of Daniels products 12
Slide 13: Markets and Distribution (cont.): Land mobile radio market
Markets and Distribution (cont.) For personal use only Significant market opportunity for Codan in the emerging world Land mobile radio market Significant growth opportunity $14 Current installed base is primarily analogue Africa – transition to digital will drive growth $12 Many countries con
Slide 14: Metal Detection
Metal Detection For personal use only “World’s World s best metal detection technologies” technologies New release CTX3030 Products and systems for the consumer, mine clearance and artisanal gold mining markets Accelerated level of new product development to drive future growth Continue to g
Slide 15: Metal Detection (cont.)
Metal Detection (cont.) For personal use only FY12 result commentary FY13 objectives Strong divisional result Well positioned for another strong year ― Sales and profitability increased by 7% and 13% respectively over prior year Business development has resulted in increased sales of gold dete
Slide 16: Mining Communications and Technology
Mining Communications and Technology For personal use only Recently R l acquired i d Mi Minetec represents strong strategic i fifit with i h Codan’s C d ’ core competencies i Perth-based provider of enterprise-wide communications and technology solutions for the mining sector Specialised under
Slide 17: Mining Communications and Technology (cont.)
Mining Communications and Technology (cont.) For personal use only FY12 result commentary FY13 objectives Sales of $9.3 million delivered contribution of $0.5 million in the six months to Successfully commission 30 June 2012 technology to key customers Scale-up the business to meet Industry-
Slide 18: FY12 Annual Result
FY12 Annual Result For personal use only Total revenue of $179 $179.4 4 million (5 (5.8% 8% increase over FY11) Driven by increase in sales in Metal Detection division and acquisition of Mining Communication and Technology Division Decrease in revenue for Communication Products division due to
Slide 19: FY12 Profit and Loss
FY12 Profit and Loss For personal use only Reported net profit of $23.1 $23 1 million is a record for the company (6 (6.2% 2% increase over FY11) Underlying net profit of $27.9 million (19.1% increase on FY11) Final dividend of 5.5 cents per share, fully franked, bringing full year dividend to
Slide 20: Capital Position
Capital Position For personal use only Strong balance sheet position with significant debt facilities available ― Net borrowings decreased by $10 million with strong cash flows in the second half, the sale of Satellite Communications assets and acquisition of Minetec ― Require substantial investme
Slide 21: Key Ratios
Key Ratios For personal use only U d l i earnings Underlying i per share h (cents) ( t ) Di id d per share Dividend h (cents) ( t ) 18.8 17.0 9.5 9.0 14.3 8.0 6.5 65 7.9 FY09 FY10 FY11 FY12 FY09 FY10 FY11 FY12 Return on equity (%)1 Gearing (%)2 48.1% 48.0% 36.9% 34.2% 31.9% 26.1% 20 4% 20.4% 16.9% %