Codan Limited · ASX:CDA
Codan — H1 FY2006 Earnings Presentation
27 slides from Codan's earnings presentation, Feb 27, 2006
Slide 1: Investor Presentations: Half Year Results to 31 December 2005
Investor Presentations Half Year Results to 31 December 2005 Codan wishes to advise that the attached Investor Presentation will be delivered to public forums as follows. Everybody is welcome. Sydney Monday 27 February 2006 at 10.30am Shangri-La Hotel, The Rocks Melbourne Tuesday 28 February 2006 at
Slide 2: Codan Limited Half-Year Results Investor Presentation
Codan Limited Investor Presentation - Half-Year Results to 31 December 2005 27th & 28th February, 1st March 2006 New Products and Investment for Growth Mike Heard David Hughes Managing Director Chief Finance & Information Officer
Slide 3: Contents
Contents Company Overview Products Customer types Half Year Results Financial Results and Dividend Summary Outlook Environment Key Business Factors Second Half Questions New Products and Investment for Growth
Slide 4: Codan—The Company & Business
Codan—The Company & Business Australian company founded in 1959 Serving global markets for communications and broadcast products Listed in November 2003 Actual HY 06 Revenue $56.6m, Net Profit After Tax $4.3m Exports in excess of 90% of revenue, to over 150 countries Over 450 staff and 500 customers
Slide 5: Operations
Operations Design, manufacture and market our own core products Design and manufacturing in Adelaide, Brisbane and Melbourne Sales and Customer Services Offices in Australia, UK, USA, China and India Distributors, dealers, agents and service centres worldwide Head Office, finance, HR and commercial
Slide 6: Products
Products Codan provides value-added products for: Communications HF Radio Satellite Communications Digital Microwave Radio Television broadcasting (Codan Broadcast) Niche products for international niche markets Products for government, businesses and aid organisations Printed Circuit Boards (IMP Pr
Slide 7: Products
Products Codan is a “standard products” business not an “engineering projects” business Production line manufacturing of products of standard design Different models and variants Associated accessories New Products and Investment for Growth
Slide 8: Products: HF Radio
Products HF Radio New Products and Investment for Growth
Slide 9: Products: HF Radio
Products HF Radio Radio transceivers, modems and accessories for land vehicle installed, base station and backpack applications New Products and Investment for Growth
Slide 10: Codan New Manpack HF Radio
Codan New Manpack HF Radio Lightweight Waterproof Excellent Radio Performance New Products and Investment for Growth
Slide 11: Products: C and Ku Band Satcom
Products C and Ku Band Transceivers, Block Up Converters and solid state Satellite Communications high power amplifiers for satellite communications earth stations New Products and Investment for Growth
Slide 12: Codan New Release Satcom Product Family
Codan New Release Satcom Product Family Codan Ku-Band Transceiver Codan Ku-Band BUC New Products and Investment for Growth
Slide 13: Products: Digital Microwave Radio
Products Digital Microwave Radio Digital Microwave Radio (DMR) links for terrestrial communications including cellular telephone networks New Products and Investment for Growth
Slide 14: The New Codan Digital Microwave Radio Product Family
The New Codan Digital Microwave Radio Product Family Codan 8800 – Indoor Unit Codan 8800 - Outdoor Unit New Products and Investment for Growth
Slide 15: TV Broadcast Products
TV Broadcast Products • 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 New Products and Investment for Growth
Slide 16: PROVIDEO Interface Products and TALIA Routers
PROVIDEO modular interface products TALIA routers, control panels and audio monitoring bridges
Slide 17: Customer types
Customer types Many government organisations—first and developing worlds Law enforcement and emergency service agencies Aid and humanitarian (NGO) agencies UN agencies Businesses—first and developing worlds Telecommunications service providers Telecommunications systems integrators TV and video broa
Slide 18: Financial Results First Half FY06
Financial Results First Half FY06 6 Months Ended 31 December 2005 2004 $’m $’m Revenue Communications Products 50.8 57.5 Other 5.8 3.6 Total Revenue 56.6 61.1 EBIT 5.8 10.8 Interest (0.3) 0.1 Net profit before tax 5.5 10.9 Tax (1.2) (2.7) Net profit after tax 4.3 8.2 Net Profit after tax after AIFRS
Slide 19: Principal Impacts to Profit and Loss
Financial Results First Half FY06 Principal Impacts to Profit and Loss Exchange rate impact on Revenue of A$6.5m, on EBIT of A$4.8m, and on NPAT of A$3.4m EBIT also affected by an increase in expenditure to support the launch of new products Price / Volume effect in Satcom market
Slide 20: Satcom Results First Half FY06
Financial Results First Half FY06 Satcom First Half First Half FY05 FY06 US$ Revenue US$13.9m US$16.9m Units Sold 910 Units 1200 Units Average Selling US$15.3k US$14.1k Price Underlying Satcom growth half year on half year 32% in units, 22% in USD revenue
Slide 21: Interim Dividend
Financial Results First Half FY06 Actual Actual Interim Dividend Dec 2005 Dec 2004 Earnings per ordinary share (cents) (on issued capital at 31 December 2005 fully diluted) 2.7 5.5 Interim dividend (cents) per ordinary share 2.5 2.5 Franking 100% 100% Record date 20 March 2006 Payment date 3 April 2
Slide 22: Balance Sheet First Half FY06
Financial Results First Half FY06 Dec 2005 June 2005 Dec 2005 June 2005 $m $m $m $m CURRENT ASSETS CURRENT LIABILITIES Cash 4.7 1.5 Accounts Payable 13.5 20.2 Receivables 17.2 22.8 Other 0.0 0.1 Inventories 17.3 15.4 Borrowings 15.2 3.4 Other 2.3 1.7 Provisions 3.6 5.4 41.5 41.4 32.3 29.1 NON-CURREN
Slide 23: Summary of Key Issues
Financial Results First Half FY06 Summary of Key Issues Impact of exchange rate Increased expense; new products launch Satcom price / volume considerations Capital expenditure program almost finished Working capital increase; new product introductions New Products and Investment for Growth
Slide 24: Outlook: Environment
Outlook Environment General recovery in world telecommunications The effect of the environment of world security concerns remains difficult to predict Now unhedged in our US dollar exposure, full impact taken in first half New Products and Investment for Growth
Slide 25: Outlook – Key Business Factors
Outlook – Key Business Factors Market penetration by new HF, Satcom, DMR and Broadcast product families - growth opportunities for all Improving performance in China and domestic US markets Direct cost reductions to improve margins Overhead cost reductions; nearing the end of this round of new produ
Slide 26: Outlook – Second Half
Outlook – Second Half Strong orders on hand to start the second half providing a good platform for improved revenue and profit. Performance in second half still depends on order intake later in the period Second half performance is unlikely to reach that of the same period last year Confidence in lo
Slide 27: Thank you for your support of Codan
Thank you for your support of Codan Any Questions? New Products and Investment for Growth