January 29, 2025 Coda Octopus Group Reports Fiscal 2024 Financial Results ORLANDO, FL, Jan. 29, 2025 (GLOBE NEWSWIRE) -- Coda Octopus Group, Inc. (Nasdaq: CODA) today reported its audited financial results for its fiscal year ended October 31, 2024 (FY2024). Annmarie Gayle, CODA's Chairman and CEO, commented: "I am pleased with our overall financial performance in FY2024 as we increased revenue, gross profit margins, operating income, net income and earnings per share. We are also very pleased with the valu ...

Business Segments - Coda Octopus Group operates two segments: Marine Technology Business and Marine Engineering Business, with a focus on underwater technology solutions[13]. - The Marine Technology Business includes proprietary technologies such as Echoscope and Diver Augmented Vision Display (DAVD), which are used in various underwater applications[14][15]. - The Services Segment has been supporting significant defense programs for over 40 years, with 20% to 30% of consolidated revenues derived from a small number of prime defense contractors[20]. - The Marine Engineering Businesses, including Coda Octopus Colmek and Coda Octopus Martech, operate as subcontractors to prime defense contractors, focusing on high reliability and quality in defense programs[76][77]. Technology and Innovation - The Echoscope technology is recognized as the only acoustic imaging sonar capable of providing real-time 4D imaging of moving objects in zero visibility conditions[28]. - The DAVD tethered version is now operational across nine naval commands within the US Navy, marking its transition from R&D to operational status[32]. - The new generation of DAVD HUD technology features a 200% increase in resolution and an expanded field of view, enhancing compatibility with specialized dive equipment[35]. - The Echoscope PIPE technology generates real-time 3D, 4D, 5D, and 6D images, significantly enhancing underwater monitoring capabilities[55][57]. - The DAVD system enhances diver safety and operational efficiency by providing real-time data and high-quality communication, addressing challenges in low visibility environments[70]. - Coda Octopus aims to leverage its R&D to enhance product offerings and expand market share in underwater imaging and acoustic technologies[96]. - Coda Octopus has advanced its sonar technology and filed several significant patent applications, including innovations related to 5D and 6D technologies[110]. - The company has been awarded a significant patent for predicting and adjusting cable laying using sonar imaging, which is crucial for the Offshore Renewables Market[110]. Acquisitions and Market Expansion - The company acquired Precision Acoustics Limited on October 29, 2024, to enhance its capabilities in ultrasound and acoustic measurement, particularly for advancing Echoscope technology[23]. - Coda Octopus acquired Precision Acoustics Limited (PAL) on October 29, 2024, enhancing its capabilities in ultrasound and acoustic measurement, particularly in medical imaging and Non-Destructive Testing (NDT)[74]. - Coda Octopus Products Limited established subsidiaries in Australia, New Zealand, Denmark, and India to expand market presence and recruit resources for software development[44][45]. - The acquisition of PAL on October 29, 2024, is expected to increase R&D expenditures as the company aims to leverage PAL's expertise for new product development[115]. Financial Performance - Consolidated revenue for FY 2024 was $20,316,161, a 5.0% increase from $19,352,088 in FY 2023[194]. - Marine Technology Business generated $12,806,603, accounting for 63.0% of consolidated revenues, with a 5.7% increase from $12,119,066 in FY 2023[197]. - Services Business revenue increased by 3.8% to $7,509,558, representing 37.0% of consolidated revenues[200]. - Revenue from rentals in the Marine Technology Business surged by 84.1% to $2,328,781, offsetting a 14.6% decline in outright product sales[199]. - Total operating expenses for the consolidated entity rose by 2.9% to $10,588,974 in FY 2024[194]. - The company’s Echoscope technology generates significant revenue, with no direct competitors offering similar real-time 3D/4D/5D imaging capabilities[92]. - Revenue from the Americas decreased by 20.0% to $7,287,561 in FY 2024, down from $9,110,498 in FY 2023[178]. - US Operations revenue decreased by 33.4% to $2,838,857 in FY 2024 from $4,263,883 in FY 2023 due to reduced funding under Defense Programs[205]. Challenges and Risks - The ongoing war in Ukraine has redirected defense spending towards land-based applications, reducing opportunities for the Services Business[169]. - The geopolitical landscape, particularly trade restrictions with China, is expected to significantly impact revenues and growth strategy[168]. - The company is facing significant increases in raw material costs and operational expenses due to inflation and skill shortages[172][173]. - The company anticipates continued impacts on business until a new Federal Budget is approved, affecting Q1 2025 financial results[195]. - The company does not expect to pay cash dividends in the foreseeable future, focusing on retaining earnings for business expansion[144]. Certifications and Compliance - The company holds ISO 9001:2015 and Cyber Essentials Plus certifications, ensuring compliance with quality and cybersecurity standards[73]. - Coda Octopus has established a Cyber Security Management Committee to oversee cybersecurity risk management and compliance with certifications[130]. - The company has a competitive Patent Reward Scheme to incentivize employees to contribute to its patent portfolio[111]. Employee and Operational Insights - Coda Octopus employs approximately 103 employees, with a majority having backgrounds in science, technology, and engineering[122]. - Coda Octopus operates from multiple locations, including a 16,000 square foot facility in Salt Lake City, Utah, which includes manufacturing and R&D[132].

Core Insights - Coda Octopus Group, Inc. reported a strong financial performance for FY2024, with increases in revenue, gross profit margins, operating income, net income, and earnings per share [2][7][31] - The company successfully executed its first acquisition under its M&A strategy, acquiring Precision Acoustics Limited, which is expected to enhance its technological capabilities and market position [2][15] - Despite challenges in Defense Programs due to funding constraints, the company demonstrated resilience and continued to invest in growth strategies, particularly in its Echoscope and DAVD technologies [3][9][14] Financial Performance - Total revenue for FY2024 was approximately $20.3 million, a 5.0% increase from $19.4 million in FY2023 [7] - Gross profit increased to $14.2 million, with a gross margin of 69.8%, up from 67.3% in FY2023 [7] - Operating income rose by 30.8% to $3.6 million, with an operating margin of 17.6% [7] - Net income after taxes was $3.6 million, a 16.7% increase from $3.1 million in FY2023 [7] - Diluted earnings per share increased to $0.32 from $0.28 in FY2023 [7] Strategic Developments - The DAVD untethered system (DUS) is a key growth opportunity, targeting military divers and supported by a Navy-funded Hardening Program [4] - The company achieved a milestone by delivering a new generation Augmented Reality DAVD Head-Up Display (HUD), featuring a 200% increase in resolution [4] - Progress was made in integrating the Echoscope into various Defense undersea vehicle programs, with successful tests conducted with the Naval Information Warfare Center [5][6] Acquisition and Market Position - The acquisition of Precision Acoustics Limited is aimed at leveraging its technology for advancing Echoscope capabilities and entering new markets [15] - The company is focusing on increasing its share in the Defense Underwater Vehicles market, which is transitioning to new generation vehicles [14] - Positive feedback from Prime Defense Contractors indicates a growing acceptance of the Echoscope technology in defense applications [14]

Core Viewpoint - Coda Octopus Group, Inc. will host a conference call on January 29, 2025, to discuss its fiscal year 2024 results, with a press release to be issued prior to market opening on the same day [1][2]. Company Overview - Coda Octopus Group, Inc. is a leader in real-time 3D/4D/5D and 6D imaging sonar technology, providing solutions for subsea intelligence and augmented reality diving technology [1][4]. - The company was founded in 1994 and supplies hardware and software solutions, including proprietary imaging sonars marketed as Echoscope and Echoscope PIPE [4]. - The Echoscope PIPE sonar generates real-time images of underwater objects, even in zero visibility conditions, and is utilized in various applications such as underwater mapping, salvage, search and rescue, and marine construction [4]. Product Innovations - The newly launched Diver Augmented Vision Display (DAVD) technology integrates topside control with a diver's HUD system, enhancing communication and visualization during diving operations [5]. - DAVD technology allows operations in zero visibility conditions by integrating with the company's Echoscope sonar technology [5]. Defense Sector Involvement - Coda Octopus Group operates two defense engineering businesses, Coda Octopus Martech Ltd and Coda Octopus Colmek, which supply sub-assemblies for mission-critical programs as subcontractors [6]. - These businesses provide services including concept design, prototype manufacturing, and post-sale support, leading to potential repeat orders [6]. Recent Acquisition - The company acquired Precision Acoustics Limited on October 29, 2024, enhancing its capabilities in the MHz ultrasound market and subsea product manufacturing [7]. - Precision Acoustics is recognized for its expertise in acoustic Non-Destructive Testing (NDT), which is crucial for validating the integrity of various structures [8].

Core Viewpoint - Coda Octopus Group, Inc. will host a conference call on January 29, 2025, to discuss its fiscal year 2024 results, with a press release to be issued prior to market opening on the same day [1] Group 1: Conference Call Details - The conference call is scheduled for January 29, 2025, at 10:00 AM Eastern Time [2] - U.S. dial-in numbers are provided for participants, along with an international number and conference ID [2] - A replay of the call will be available after 2:00 PM Eastern Time on the same day until February 12, 2025 [3] Group 2: Company Overview - Coda Octopus Group, founded in 1994, specializes in underwater/subsea market solutions, including proprietary real-time imaging sonar technologies [4] - The company’s Echoscope PIPE® sonar generates real-time 3D/4D/5D images in zero visibility conditions, applicable in various sectors such as offshore renewables and defense [4] - The recently launched Diver Augmented Vision Display (DAVD) technology enhances diving operations by integrating topside control with diver HUD systems [5] Group 3: Recent Developments - The company acquired Precision Acoustics Limited on October 29, 2024, expanding its capabilities in the MHz ultrasound market and subsea product manufacturing [7] - Coda Octopus Group also operates two defense engineering businesses, providing sub-assemblies for mission-critical programs [6]

Group 1 - Coda Octopus (NASDAQ: CODA) is a producer of marine technology products and services, indicating a focus on a niche market with potential for growth [2] - The company has shown strong performance, attracting interest from investors looking for small, high-growth potential stocks [2] - The investment strategy involves a buy and hold approach with tranche purchases, suggesting a methodical investment style aimed at long-term gains [2] Group 2 - The service provided by Shareholders Unite includes a portfolio and watchlist of small companies with high growth possibilities, emphasizing a diversified investment approach [2] - The analyst has a beneficial long position in CODA shares, indicating confidence in the company's future performance [3] - The article expresses personal opinions of the analyst, highlighting an independent analysis of the stock without external compensation [3]

Financial Data and Key Metrics Changes - Revenue in Q3 2024 increased by 12% to $5.5 million compared to $4.9 million in Q3 2023 [12][5] - Gross profit rose to $4 million, with a consolidated gross margin of 73.9%, up from 68.8% in Q3 2023 [14] - Operating income increased by 61.2% to $1.4 million, with an operating margin of 25.4% compared to 17.6% in Q3 2023 [16] - Net income after taxes was $1.3 million or $0.11 per diluted share, compared to $1 million or $0.09 per diluted share in Q3 2023 [16] Business Line Data and Key Metrics Changes - Marine Technology Business revenue increased by 6.5% to $3.1 million from $2.9 million in Q3 2023 [12] - Marine Engineering Business revenue saw a significant increase of 19.8% to $2.4 million from $2 million in Q3 2023 [12][6] - Gross margin for Marine Technology Business improved to 82.9% from 82.1% in Q3 2023, while Marine Engineering Business gross margin increased to 62.6% from 50% [14][16] Market Data and Key Metrics Changes - Sales to North America decreased significantly, attributed to the US Presidential election cycle, with a reported decline of approximately 35.9% year-over-year [22][13] - Despite the decline in North American sales, there was strong revenue growth outside the US, indicating resilience in the commercial marine market [22] Company Strategy and Development Direction - The company aims to embed its technologies into defense programs to secure recurring sales, focusing on long-term shareholder value [18] - The strategy includes advancing the DAVD program for adoption by special forces and returning the Engineering Business to pre-COVID revenue levels [19] - The company is actively pursuing an acquisition to enhance capabilities, with a target identified and due diligence underway [17][31] Management's Comments on Operating Environment and Future Outlook - Management noted a slowdown in order placements for US Defense Programs due to funding gaps related to the election cycle, but expressed confidence in overall results [5] - The company is optimistic about the future, citing increased utilization of rental assets and ongoing interest in its technologies from various defense sectors [18][19] - Management highlighted the importance of the commercial marine market as a buffer against defense market fluctuations [22] Other Important Information - The company has $25.2 million in cash and cash equivalents with no debt, reflecting a solid financial position [16] - Marketing expenses increased by approximately 180% as part of a strategy to shift focus from R&D to business development [15] Q&A Session Summary Question: Near-term pressure on business segments due to election cycle - Management acknowledged a 35.9% decline in sales from the Americas, attributing it to the election cycle, but noted resilience in commercial marine revenue [21][22] Question: Update on DAVD adoption and commercial opportunities - Management reported ongoing discussions with commercial offshore providers and excitement about the DAVD technology, despite slower adoption than desired [25][26] Question: Progress on Thermite program and election impact - Management confirmed ongoing pre-production orders for the Thermite program, with no expected impact from the election [27] Question: Market opportunity for ship hull scanning - Management described the ship hull scanning market as a "white space" with significant global potential, emphasizing ongoing trials and stakeholder interest [28][29] Question: Details on acquisition target - Management indicated the acquisition would be all cash, aimed at expanding group capabilities rather than segment expansion [33][31] Question: Update on digital audio product - Management expects purchase orders for the digital audio product in September, following successful safety assessments [35] Question: Sales exposure to China - Management confirmed ongoing sales to China, primarily in offshore renewables, but noted increasing challenges due to geopolitical factors [38][39]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to ______________ Commission File Number 001-38154 CODA OCTOPUS GROUP, INC. (Exact name of registrant as specified in its charter) Delaware 34-2 ...

ORLANDO, FL, July 09, 2024 (GLOBE NEWSWIRE) -- Coda Octopus Group, Inc. ("CODA" or the "Company") (Nasdaq: CODA), a global market leader in 4D/5D/6D imaging sonar technology for real time subsea intelligence and cutting-edge diving and communications technology, today reported that its Salt Lake City based Defense Engineering Services Business, Coda Octopus Colmek, recently received one of the orders that had been expected and delayed during the first six months of fiscal 2024. This order has a contract val ...

Coda Octopus Group, Inc. (NASDAQ:CODA) Q2 2024 Earnings Conference Call June 12, 2024 10:00 AM ET Company Participants Geoff Turner - IR Annmarie Gayle - Chair and Chief Executive Officer Gayle Jardine - Interim-CFO Conference Call Participants Brian Kinstlinger - Alliance Global Partners William Bremer - Vanquish Capital Partners Operator Good morning. Welcome to Coda Octopus' Group Second Quarter 2024 Earnings Call. My name is Sheri and I will be your operator today. Before this call, Coda Octopus issued ...