Key Highlights

• Codan reported its FY26 results on 20 August 2026.

• Earnings Per Share were 96.5 cents, and the fully Franked Dividend was 48.5 cents per share, up 70% on FY25.

• Communications Revenue rose 22% to A$506.2 million, and segment profit rose 45% to A$156.0 million, with the Margin widening to 31% from 26%.

• Defence made up 58% of segment revenue, up from 38% in FY25, and unmanned revenue more than doubled to A$215 million.

What drove Codan's encouraging result for the year to 30 June 2026? The answer is Demand for unmanned radio systems in its communications Business and a run of new products in its Minelab metal detection arm. For Codan (ASX:CDA), a technology company that designs radios and metal detectors, both segments grew encouragingly in FY26, and management signalled that growth should continue into FY27.

The central development: record growth in both segments

Codan reported its FY26 results on 20 August 2026. Earnings per share were 96.5 cents, and the fully franked dividend was 48.5 cents per share, up 70% on FY25. Net cash was A$35.7 million at 30 June 2026.

Why does it matter? The jump in profit came from operating leverage, with profit growing faster than revenue, and from a shift in mix toward higher-margin products.

What the company does and how it earns revenue

Codan has two main businesses. The Communications segment, which includes DTC and Zetron, supplies radio systems and communications technology to defence, government and commercial customers. The Metal Detection segment, branded Minelab, makes detectors for gold prospecting, treasure hunting, humanitarian demining and security uses. Revenue comes from product sales, so growth depends on order flow, new product launches and the resilience of end markets.

Financial results and operating performance

Communications revenue rose 22% to A$506.2 million, and segment profit rose 45% to A$156.0 million, with the margin widening to 31% from 26%. Defence made up 58% of segment revenue, up from 38% in FY25, and unmanned revenue more than doubled to A$215 million. The order book rose 50% to A$380 million. Reports the growth mainly to encouraging demand for unmanned radio systems.

Minelab revenue rose 42% to A$362 million and segment profit rose 65%. Four new products were launched in FY26, including the GPZ8000 gold detector, which the company has highlighted as a driver. After year end, Codan completed the Acquisition of US-based Adaptive Dynamics.

Outlook and market reaction

Codan said the Communications segment is targeting revenue growth of around 20% in FY27, with the first half expected to be significantly more encouraging than the first half of FY26. Minelab expects a full year of contribution from its recent launches, and early first-half conditions were described as positive, with encouraging demand for the GPZ8000 and Gold Monster 2000.

On 21 September 2026 the shares reached an early high of A$51.64 and closed that session at A$51.43, a record, giving a Market Value of about A$9.13 billion.

Reading the numbers

Three points help put the FY26 figures in context. First, the order book of A$380 million gives some visibility over near-term Communications revenue, although orders can be rescheduled and are not the same as delivered revenue. Second, the net cash position of A$35.7 million is modest relative to annual earnings, so acquisitions such as Adaptive Dynamics may be funded from Cash Flow or facilities rather than a large cash reserve. Third, a dividend of 48.5 cents against earnings per share of 96.5 cents implies that roughly half of earnings were paid out, which is the author's arithmetic rather than a company statement.

Sector conditions and competitive position

Demand for unmanned systems has risen as defence forces and governments invest in drones and uncrewed platforms, and these systems need reliable communications links. Codan's radios and related technology serve that need, but defence budgets and procurement timing can be uneven, so order books can swing between periods. The jump in defence from 38% to 58% of segment revenue shows how quickly mix can change.

In metal detection, Minelab competes with other specialist manufacturers. Its position rests on technology, particularly in gold detection, and Brand recognition among prospectors. Demand in this segment is influenced by the gold price, consumer spending and product cycles. A encouraging gold price tends to encourage prospecting, although that link is not guaranteed.

Material risks and what to watch

Customer concentration in defence and government is one risk: large orders can be delayed or cancelled, and the sector can be affected by budget decisions and export rules. Technology risk is another, since competitors may develop alternatives to Codan's radios or detectors, and product cycles need continual investment.

Currency is relevant too, because a large portion of sales are made in foreign currencies, so Exchange Rate movements can affect reported results. Integration risk applies to acquisitions such as Adaptive Dynamics. Demand in the Minelab segment depends on consumer conditions and gold prices, and the encouraging FY26 comparison makes further growth harder.

Expectations are a further consideration. The company's FY27 target of around 20% growth in Communications and the market's encouraging reaction mean that any shortfall could be noticed.

Sustaining that growth will depend on orders, execution and market conditions, all of which investors can track through the company's regular announcements and results.