Slide 1: Codan Limited Investor Presentation: Full Year Results to 30 June 2007
Codan Limited Investor Presentation For personal use only Full Year Results to 30 June 2007 Monday 20 August 2007 10:30am (Adelaide CST) To view webcast, access via www.codan.com.au Link available on the home page Mike Heard Managing Director & CEO James Mattsson Company Secretary Michael Barton Gro
Slide 2: Contents
Contents For personal use only Company and Business Overview Operations Products Customers Financial Results Outlook Questions ß à
Slide 3: Company and Business Overview
Company and Business Overview For personal use only Australian electronics design and manufacturing company serving global markets for communications and TV broadcast products Niche products for international niche markets; products for government, business and aid organisations Exports 90% of reven
Slide 4: Operations
Operations For personal use only Head office in Adelaide 350 staff Design and manufacture in Adelaide and Melbourne Sales and customer service offices in Adelaide, UK, USA, China, India and Germany 500 communications and broadcast customers worldwide ß à
Slide 5: Products
Products For personal use only Codan offers high value-added electronic hardware products for: Communications HF Radio Satellite Communications Digital Microwave Radio Television broadcasting (Codan Broadcast) Codan also manufactures and imports printed circuit boards (PCBs) for its own use and sale
Slide 6: HF Radio
For personal use only HF Radio ß Products à
Slide 7: Products: HF Radio
Products HF Radio For personal use only Radio transceivers, modems and accessories for land vehicle installed, base station and backpack applications. ß à
Slide 8: Manpack HF Radio
Products Manpack HF Radio For personal use only ß à
Slide 9: Products: Satellite Communications
Products Satellite Communications For personal use only C and Ku Band Transceivers, Block Up Converters and solid state high power amplifiers for satellite communications earth stations. ß à
Slide 10: Satellite Communications Transceivers and BUCs
Products Satellite Communications Transceivers and BUCs For personal use only ß à
Slide 11: Products: Digital Microwave Radio
Products Digital Microwave Radio For personal use only Digital Microwave Radio (DMR) links for terrestrial communications including cellular telephone networks ß à
Slide 12: Digital Microwave Radio
Products Digital Microwave Radio For personal use only ß à
Slide 13: Products: Broadcast
Products Broadcast For personal use only Interface Equipment Signal Routers Monitoring Equipment Equipment for the management, conversion, distribution and monitoring of digital and analogue, video and audio signals in a TV broadcast studio. ß à
Slide 14: Products: Broadcast
Products Broadcast For personal use only PROVIDEO modular interface products TALIA routers, control panels and audio monitoring bridges ß à
Slide 15: Customers
Customers For personal use only Law enforcement and security agencies Emergency service agencies Military forces Several other government agencies UN and NGO aid and humanitarian organisations Businesses Telecommunications service providers and systems integrators TV and video broadcasters and produ
Slide 16: Financial Results Full Year FY07: Profit and Loss
Financial Results Full Year FY07 Profit and Loss For personal use only Audited 2007 Audited 2006 $m % $m % Revenue Total Communications Products $111.0 $106.7 Total Other $10.6 $10.6 Total Revenue $121.6 100% $117.3 100% EBITDA $24.2 19.9% $20.0 17.1% Depreciation ($3.1) ($3.2) Amortisation of defer
Slide 17: Key Issues – Profit and Loss
Financial Results Full Year FY07 Key Issues – Profit and Loss For personal use only NPAT growth 32% from revenue growth of 3.7% § HF revenue down somewhat due to contraction in the company’s current market segment § Satellite communications revenue up significantly; improved market share from the su
Slide 18: Reconciliation - Net Profit Before Tax
Financial Results Full Year FY07 Reconciliation - Net Profit Before Tax For personal use only 16 14 4.0 1.8 12 2.9 1.9 10 0.5 $A Millions 8 15.9 Gross margin improvement includes 6 11.6 some benefit from price increases and so the total benefit realised 4 from the profit improvement programs exceeds
Slide 19: Balance Sheet
Financial Results Full Year FY07 Balance Sheet For personal use only June 2007 June 2006 June 2007 June 2006 $m $m $m $m CURRENT ASSETS C URRENT LIABILITIES Cash 5.9 1.4 Accounts Payable 12.7 15.1 Receivables 15.7 22.0 Other - - Inventories 14.1 17.3 Borrowings 2.4 12.9 Other 1.9 1.9 Provisions 5.3
Slide 20: Key Issues – Balance Sheet
Financial Results Full Year FY07 Key Issues – Balance Sheet For personal use only Good working capital management and low capital expenditure on property, plant and equipment Excellent cash generation of $25.7 million Retired $9.2 million of debt Paid $10.5 million dividends Surplus of cash over bor
Slide 21: Dividend
Financial Results Full Year FY07 Dividend For personal use only Actual Actual 2007 2006 Earnings per ordinary share (cents) 6.9 5.2 Interim dividend (cents) per ordinary share 3.0 2.5 Final dividend (cents) per ordinary share 3.5 3.5 (payable October, fully franked) Total dividend (cents) per ordina
Slide 22: Business Environment in FY08
Outlook Business Environment in FY08 For personal use only Contraction in Codan’s current HF market segment Other market segments quite sound Strong uptake of Codan’s newer satellite communications products Strong currency headwind; 100% of net exposure to USD hedged at average of 83.8 US cents ß à
Slide 23: Key Initiatives in FY08
Outlook Key Initiatives in FY08 For personal use only Continuing improvements in productivity and efficiency Major market launches in HF radio, digital microwave radio and TV broadcast products to stimulate growth Continued activity with respect to potential acquisitions ß à
Slide 24: Continuing improvements in FY08
Outlook Continuing improvements in FY08 For personal use only Restructuring and other profit improvement programs delivered $4m profit before tax improvement in FY07 Targeting an additional $2m profit before tax from productivity and efficiency improvements in FY 08 Continuous improvement is enshrin
Slide 25: Market Launches in FY08
Outlook Market Launches in FY08 For personal use only In the first half of FY 08: HF radio launch into a global military market segment Digital microwave radio launch in Africa, Middle East, Eastern Europe and CIS TV broadcast router products launch in North America and Europe ß à
Slide 26: Acquisitions
Outlook Acquisitions For personal use only Very active on several communications products opportunities aimed at delivering medium to long term benefit This endeavour takes time and requires caution Only the right acquisitions at the right price These activities could increase or decrease profitabil
Slide 27: Summary and Guidance
Outlook Summary and Guidance For personal use only Orders in July and August to date are good Many variables will affect performance in FY08 Guidance remains that NPAT could decline in FY08; too early to make an accurate forecast Noting the current orders and cash position the maintenance of a fully
Slide 28: Corporate Growth Objective
Outlook Corporate Growth Objective For personal use only Good underlying growth in FY06 and FY07 negated by continued substantial strengthening of the Australian dollar Significant increases in productivity and efficiency have reduced this impact in FY07 and will continue to do so in FY08 Ongoing or
Slide 29: Questions?
For personal use only ß à Questions?
Slide 30: Thank you for your support of Codan
For personal use only Thank you for your support of Codan ß à