Can Codan Sustain Its Rapid Growth Amid Market Challenges?
Codan Limited has reported a strong first-half FY26 trading update, with revenue up 29% and underlying net profit after tax soaring 52%, driven by robust metal detection and communications segments.
- Group revenue expected at $394 million, up 29%
- Underlying net profit after tax to exceed $70 million, a 52% increase
- Metal detection segment revenue grows 46%, led by African gold detector sales
- Communications segment revenue rises 19%, hitting upper growth targets
- Full audited results due 19 February 2026
Strong Half-Year Performance
Codan Limited (ASX, CDA) has delivered a robust trading update for the first half of fiscal year 2026, signalling strong momentum across its core business segments. Preliminary figures indicate group revenue of approximately $394 million, marking a 29% increase compared to the prior corresponding period. More impressively, the company expects underlying net profit after tax to exceed $70 million, representing a substantial 52% growth year-on-year.
Metal Detection Drives Growth
The standout performer was Codan’s metal detection division, which achieved revenue of around $168 million, up roughly 46% from the previous year. This surge was primarily fuelled by strong gold detector sales in the African region, a market known for its vibrant mining activity. Additionally, the segment saw double-digit growth in other key recreational markets worldwide, underscoring the global demand for Codan’s rugged and reliable detection technology.
Communications Segment Maintains Momentum
Codan’s communications segment also contributed significantly, with revenue reaching approximately $222 million, reflecting a 19% increase over the prior period. This growth aligns with the company’s guidance, which targeted a 15% to 20% increase for the half-year. The communications business continues to benefit from its reputation for delivering robust technology solutions designed to operate in some of the world’s harshest environments, supporting customers’ safety, security, and productivity needs.
Looking Ahead
While these results are preliminary and unaudited, they paint a promising picture for Codan’s FY26 trajectory. The inclusion of approximately $4 million in revenue from the legacy Minetec business adds a modest boost but does not overshadow the strong organic growth across Codan’s core segments. Investors will be keenly awaiting the full audited results, scheduled for release on 19 February 2026, to confirm these encouraging trends and gain further insight into the company’s strategic direction.
Bottom Line?
Codan’s strong half-year performance sets the stage for a potentially record-breaking FY26, but the full story awaits the February results.
Questions in the middle?
- Will Codan sustain its rapid growth in metal detection beyond the African market?
- How will the legacy Minetec business integrate and impact future earnings?
- What are the risks to the communications segment maintaining its upper-end growth trajectory?
