Codan Limited (ASX: CDA) FY16 Results - Margin Improvements Deliver 66% Increase in Underlying NPAT

CDA had a strong 2H16, resulting in the company reporting a revenue increase of 17.8% in FY16 on the pcp. EBITDA and NPAT increased 40.1% and 21.7%, respectively. The Minelab division performed better than expected over the period and continues to be the greatest revenue contributor to the company. The Radio Communications division had a stronger than expected 2H16, resulting in a marginal increase in revenue. There was however a significant improvement in margins which resulted in a 14.5% increase in the contribution for the division. The margin improvement came from new products introduced throughout the year and the restructure of the distribution network. The positive results have resulted in an increase to IIR earnings expectations for FY17 and revising our valuation upwards. See report for further details.