Codan shares surge 19% to record high after raising H1 profit outlook

Codan (ASX:CDA) shares have surged 19% to a record high of A$61.79 following the company's announcement that it has raised its first-half profit outlook. The Australian communications technology firm attributes this surge to strong demand from drone manufacturers, particularly in conflict regions such as Russia-Ukraine and the Middle East.

Codan's net profit after tax for the six months through December is now expected to reach at least A$160 million, more than double the A$71.2 million reported in the same period last year. The company's radio-frequency component, used in unmanned drones, is in high demand from about 50 drone manufacturers across the U.S. and Europe.

Additionally, Codan's Minelab metal-detection business has also performed well, boosted by sales of its Gold Monster 2000 and GPZ8000 detectors, particularly in Africa where the higher gold price has spurred demand from prospectors. However, Codan cannot provide a full-year profit forecast due to the unpredictable nature of demand from conflict regions beyond roughly three months.

The company is also addressing potential supply-chain constraints amid the elevated level of demand.

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