Coda Octopus Group, Inc. (‘Coda’), through its wholly owned subsidiaries, operates the marine technology business and the marine engineering business.
Segments
The company operates two distinct segments: the Marine Technology Business, and the Marine Engineering Business.
Marine Technology Business (Products Segment)
The company’s Marine Technology Business is a technology solution provider to the underwater market. It owns key proprietary and unique technology comprising its real-time volum...
Coda Octopus Group, Inc. (‘Coda’), through its wholly owned subsidiaries, operates the marine technology business and the marine engineering business.
Segments
The company operates two distinct segments: the Marine Technology Business, and the Marine Engineering Business.
Marine Technology Business (Products Segment)
The company’s Marine Technology Business is a technology solution provider to the underwater market. It owns key proprietary and unique technology comprising its real-time volumetric imaging sonar technology (Echoscope technology) and diving technology (Diver Augmented Vision Display - ‘DAVD’), both of which are applicable to the underwater market, and which are used in the commercial offshore and defense sectors. It also sells other proprietary subsea products, such as its geophysical hardware and software solutions, and inertial navigation systems. All innovations, design, development, and manufacturing of the company’s products are performed within the company. As part of the company’s patent strategy, it endeavors to actively protect its innovations by seeking patent protection where appropriate.
The company’s imaging sonar series is marketed under the names Echoscope and Echoscope PIPE and is used primarily in underwater construction, offshore renewables, offshore oil and gas, complex underwater mapping, salvage operations, dredging, bridge inspection, navigation of underwater hazards, port and harbor security, mining, commercial and defense diving, marine sciences sectors, and more broadly, applications for real-time 3D monitoring, inspection, and visualization underwater. Uniquely, the Echoscope technology is a single sensor for multiple underwater applications that can be used to image in 3D moving objects in zero visibility water conditions.
The company’s diving technology, marketed under the name ‘CodaOctopus DAVD’, addresses the global defense and commercial diving markets. It has two variants of the DAVD: the tethered and untethered variant. The tethered variant is used with a connection to a surface vessel, and the untethered variant is not connected to a surface mothership for air supply.
The DAVD solution has the potential to radically change how diving operations are performed globally because it delivers real-time information simultaneously to the divers underwater and their surface-based dive supervisors. The DAVD Head-Up Display (‘HUD’) is used as a data portal for the diver while underwater. Various types of information are displayed to the diver in the HUD in real-time, thereby obviating the need for voice instructions.
The DAVD untethered solution (‘DUS’) is designed for the Defense and Military market, where diving is performed without connection to a surface vessel. These divers are typically military divers performing special forces operations, mine detection and clearance, or reconnaissance and surveillance. Similar to the tethered variant, the DAVD HUD is used for displaying a range of mission-related information to the diver.
The DAVD’s concept of using a pair of glasses, which are capable of augmented reality display, inside the face mask, helmet, or other diving suits is protected by patent. The company has an exclusive license to exploit this utility patent.
The Marine Technology Business operates through the company’s wholly-owned subsidiaries, Coda Octopus Products, Inc. (Orlando), Coda Octopus Products Ltd (UK), Coda Octopus Products A/S (Denmark), and branch office Coda Octopus Products A/S in The Netherlands, and Coda Octopus Products (India) Private Limited (India).
Marine Engineering Business (Services Segment)
The company’s Marine Engineering Businesses are suppliers of embedded solutions and sub-assemblies, which they design, manufacture, and sell as components of mission-critical integrated defense systems. The Services Segment established its business in 1977 and has been supporting a number of significant defense programs of record for over 40 years, including Raytheon’s Close-In Weapon Support (CIWS) and Northrop Grumman’s Mine Hunting Systems Program (AQS-24) Program. The Services Segment’s business model entails engineering components for integration into broader defense programs, such as the CIWS program. Typically, it supplies prototype units that are validated for integration and thereafter, subject to meeting the acceptance criteria, these lead to contracts for manufacture, repair, and upgrade for the life of the program, which can span decades. The company enjoys sole source status for the parts that it designs and supplies into these programs. This business model ensures recurring and long-tail revenues. Coda Octopus Colmek, Inc. and Coda Octopus Martech Ltd qualify as small businesses. This opens opportunities under state requirements to collaborate with Prime Defense Contractors on these programs. A significant part of the revenues generated by the Marine Engineering Business is highly concentrated and is usually derived from a small number of prime defense contractors, such as Raytheon or Northrop. In any one financial year, between 20% to 30% of the company’s consolidated revenues may be derived from these customers either alone or collectively.
The Services Segment operates through the company’s wholly-owned subsidiaries, Coda Octopus Colmek, Inc. (‘Colmek’), which is based in Salt Lake City, Utah, and which the company acquired in 2007, and Coda Octopus Martech Limited (‘Martech’), which is based in Portland, the United Kingdom, and which the company acquired in 2006.
Newly Acquired Third Business Unit into the Group’s Products Segment
On October 29, 2024, the company acquired Precision Acoustics Limited (hereinafter referred to as ‘PAL’), a company established under the laws of England. This company is a recognized leader in the ultrasound and acoustic measurement field. Specializing in acoustic hydrophone design and innovative acoustic materials, it provides a comprehensive range of products and solutions, with a primary focus on medical imaging and Non-Destructive Testing (NDT). NDT is used to validate the viability of structures, such as aircraft, ship hulls, wellheads, and other subsea structures. Its expertise extends to working closely with national and global standard-setting bodies, such as the National Physical Laboratory of the UK, contributing to the establishment of the primary measurement standards in the industry. This business was acquired to gain access to its expertise and leverage this across the group, including in the area of advancing the Echoscope technology.
For segment reporting purposes, this newly acquired company will be reported within the company’s Products Segment.
Therefore, the company’s Products Segment will now comprise PAL and its Marine Technology Business.
Marine Technology Business (‘Products Segment’)
The company’s Marine Technology Business develops proprietary solutions for both the commercial and defense subsea markets. The range of solutions which it offers to the market are complementary and include: Real-time volumetric imaging sonar; Diving Technology; Digital Audio Communications System; GNSS-Aided Navigation Systems (providing heading, pitch, yaw, and roll data at sea); and Geophysical Solutions (used in conjunction with sidescan and sub-bottom data acquisition).
These products and/or solutions are sold, rented, or leased into various marine sectors, such as Marine geophysical survey, Offshore Renewables (‘Wind Energy’), Underwater construction, inspection and monitoring, Diving Companies, Commercial and Defense Diving, Salvage and decommissioning, Oil and Gas (‘O&G’), Robotics, Commercial fisheries, Environmental, mammal and habitat monitoring, Underwater Defense Applications, Marine vehicles and robotics, Port and Harbor Security, law enforcement, and first responders, and Research and education.
Geophysical Range of Products
The Geophysical range of products is marketed under the brands DA4G, GeoSurvey, and Survey Engine. The company started its business in 1994 designing and developing the GeoSurvey software and hardware package for acquisition and processing of sidescan sonar and sub-bottom profiler data. For over two decades, the company’s GeoSurvey has been an industry-leading software package in the market for data acquisition and interpretation and provides feature-rich solutions and productivity-enhancing tools for the most exacting survey requirements. Designed specifically for sidescan and sub-bottom data acquisition, GeoSurvey has been purchased by numerous leading survey companies throughout the world and has been the workhorse for processing data for Oil & Gas companies for many years. The DA4G is the hardware acquisition system, and both GeoSurvey and Survey Engine are complementary software packages that are used for processing the data post-acquisition.
Inertial Positioning and Attitude Measurement Systems (‘Motion Products’)
The company has been selling its GNSS Aided Inertial Measurement Systems for over 15 years. The company’s current generation of F280 Series was released to the market in 2021 and is used to provide data on accurate positioning, heading, pitch, roll, and yaw at sea. The F280 Series is an advancement of the company’s F180 series and is highly complementary to its real-time Echoscope sonar series, and they are packaged together to provide a more comprehensive solution. The products within the F280 Series range can be sold with or without its Echoscope.
Real-Time Volumetric Imaging Sonars (ranging from 3D/4D, 5D, and 6D)
The company designs, develops, and supplies what is the world’s most advanced series of real-time volumetric imaging sonar (Echoscope and Echoscope PIPE). This is the culmination of over 25 years of research and development. The company’s sonar innovations are multi-tiered and extend to hardware, firmware, and software, all of which co-exist and are co-dependent on each other. In other words, hardware, firmware, and software operate as subsystems to each other.
The capability of the company’s volumetric imaging sonars covers a broad breadth of activities underwater, particularly for any form of real-time monitoring in 3D, underwater construction, salvaging, placements, decommissioning, obstacle avoidance, complex underwater mapping, and real-time 3D navigation in zero visibility conditions. Uniquely also, using a single sensor (the company’s Echoscope PIPE) range, it can provide different data outputs to the various parts of the survey team, thus reducing the number of different sensors required on these underwater projects, and ultimately reducing the costs associated with these operations.
5D and 6D Sonars Innovations
5D and 6D imaging sonars are new to the subsea market and constitute an innovation by the company. It has several patent applications pending for these innovations.
5D Sonars (Echoscope PIPE)
The advancement that the company has made with its 5D Sonars is the ability to process and utilize much more of the data that is acquired and processed by the company’s volumetric imaging sonars. Prior to this, due to limitation of processing technologies, there was an upper limit to the amount of data its antecedent sonars could acquire and process. This meant that in the previous generation of sonars (3G and 4G series), when a signal was emitted, it returned a single range and intensity value per beam. In the company’s 5D Sonars, it returns multiple range and intensity values per beam (Full Time Series data). This new capability provides more information about the underwater environment.
6D Sonars (Echoscope PIPE)
The company’s 6D Sonars process and utilize much more of the data acquired by the sonar. 6D Sonars generate multiple real-time 3D full-time series images. In the previous generation of sonars (3G and 4G series), it could image and display one 3D image in real-time. The company’s PIPE technology generates multiple 3D images simultaneously in real-time using different sonar/acoustic parameters, such as different beamforming methods, frequency, range, field of view, pulse length, and other acoustic filters or shading. This allows for different data sets to be provided to different parts of the survey team in real-time.
Echoscope Sonar Hardware
The Echoscope technology can also map the seabed (and is superior to the multibeam for complex mapping and inspection of complex underwater structures), and in addition, can image moving objects underwater in 3D. The Echoscope is therefore the primary tool of choice for inspecting and monitoring in real-time 3D all types of underwater operations and is the only choice in poor visibility conditions. In addition, the Echoscope, in many instances, enables the user to monitor underwater operations from a surface vessel, replacing the Remotely Operated Vehicles (ROVs), thus bringing considerable cost savings to the company’s customers.
Echoscope Software
The Echoscope technology is used in conjunction with the company’s internally developed software (USE, Construction Monitoring System (CMS), 4G USE, and 4G USE DAVD Edition). The software is a critical component of the capabilities and features of its sonar series.
The company’s software development capability is an important part of its strategy to maintain its lead in designing, manufacturing, and selling state-of-the-art real-time volumetric imaging sonars and its DAVD System. It also allows the company to be responsive to its customers’ requirements for new features and capabilities around its solutions.
The company has now launched its fourth-generation multi-sensor software platform, which is marketed under the name ‘4G USE’. The company has also filed several provisional patents around its 4G USE, which is a multi-sensor platform allowing users to bring in and utilize a variety of sensor data, including sonar, positioning, camera, lidar, video processing, and other sources of point cloud data, and seamlessly merging above and below the water data captured from the sonar and camera. It is also the platform for its DAVD software, and this module is marketed under the brand 4G USE DAVD Edition.
Diver Augmented Vision Display (DAVD) System – Diving Technology
Funded by the Office of Naval Research (‘ONR’) through its Future Naval Capabilities (FNC) program, and in close collaboration with NAVSEA 00C3 and Naval Surface Warfare Center, Panama City Division (‘NSWC PCD’), the company has developed a diver see-through integrated information display system (DAVD).
DAVD is a complete end-to-end diver management solution incorporating, as a key element, a high-resolution, fully transparent glass head-up display, HUD, integrated directly inside the diving helmet (for hard hat surface air supply diving) or full-facemask (for tethered and untethered defense, commercial, and recreational diving applications) or diving suits. In October 2024, the company released to the US Navy for evaluation its new generation of Augmented Reality DAVD HUD. The new generation of the DAVD HUD is much smaller and has a higher resolution and therefore offers great flexibility for use in helmets and facemasks for diving. This new generation removes some of the form factor barriers which limited the types of helmets or masks that could be used with the company’s previous generation of the DAVD HUD. The delivery of the new generation of DAVD HUD is a key milestone under the funded DUS Hardening Program.
Newly Acquired Business Unit - Precision Acoustics Limited (‘PAL’)
PAL, which is UK-based, was acquired into the group on October 29, 2024. This company is a recognized leader in the ultrasound and acoustic measurement field. Specializing in acoustic hydrophone design and innovative acoustic materials, it provides a comprehensive range of products and solutions, with a primary focus on medical imaging and Non-Destructive Testing (NDT).
PAL has the requisite accreditations for its business, including being Lloyds Register accredited to ISO 9001:2015 and Cyber Essentials certification.
Marine Engineering Businesses (‘Services Segment’)
The company’s Marine Engineering Businesses comprise Coda Octopus Colmek, Inc., which is based in Salt Lake City, and Coda Octopus Martech Limited, which is based in the United Kingdom.
They largely operate as subcontractors to prime defense contractors, and their engineering solutions typically constitute sub-components designed for integration into larger defense programs of record where high levels of reliability and quality are essential prerequisites for securing and maintaining these agreements with their customers. Typically, they prototype subassemblies for their customers, and after going through various acceptance tests, including first article inspection approvals, they are then awarded the manufacturing contracts.
In order to grow, the Marine Engineering Business relies on increasing the number of new programs it attracts annually.
In addition, the company is increasingly combining its engineering capabilities with its product offerings. This enables the company to offer systems that are complete with installation and support to maximize the utilization of its collective expertise to advance its technologies.
Coda Octopus Martech Limited (‘Martech’)
Martech, which is UK-based, operates in the specialized niche of bespoke design and manufacturing services mainly to the United Kingdom defense and subsea industries. Its services are provided on a custom subcontract basis where high quality and high integrity devices are required in small quantities. Its skill set includes both hardware and software design.
Martech enjoys pre-approvals to allow it to be shortlisted for certain types of government contracts. Much of the more significant business secured by Martech is through the formal government or government contractor tendering process. Martech has the requisite accreditations for its business, including being Lloyds Register accredited to ISO 9001:2015 and Cyber Essentials Plus certification.
Coda Octopus Colmek, Inc. (‘Colmek’)
Colmek, which is USA-based, is a supplier of embedded solutions and sub-assemblies, which it designs, manufactures, and sells into mission-critical integrated defense systems, such as the Close-In-Weapons System (CIWS). This business was established in 1977 and has been supporting several significant US defense programs for over 40 years, including Raytheon’s CIWS and Northrop Grumman’s Mine Hunting Systems Program (AQS-24). Colmek’s business model entails designing sub-assemblies, which are components of broader defense programs. Colmek is the sole source for the parts that it supplies to these programs. This business model ensures recurring and long-tail revenues since it continues to supply parts, typically for the life of the program, which can span decades. Its work scope typically extends to both hardware and software design.
Colmek has the requisite accreditations for its business, including being Lloyds Register accredited to ISO 9001:2015 and NIST (National Institute of Science and Technology) 800-171 certification.
Sales and Marketing
The Marine Technology Business markets its products through its internal sales team, website, industry events, such as trade shows, webinars, live demonstrations of the technology, industry relationships, and a network of non-exclusive agents in foreign countries, such as Japan, China, Korea, and South Africa.
PAL markets its products through its internal sales team, its website, and a network of non-exclusive agents in Japan, China, India, and Korea.
Colmek markets its products through its internal sales team, website, industry events, and agents in the US and Canada.
Martech markets its products through its internal sales team, website, and industry events.
GNSS Aided Inertial Positioning and Attitude Measurement Systems (‘Motion Products’)
A small percentage of the company’s revenue is generated from its F280 Series.
In the field of GNSS-aided inertial positioning and attitude sensing equipment, where the company’s product addresses a small segment of the overall market, it has several principal competitors: Teledyne Technologies Inc., Kongsberg Gruppen, iXblue, Applanix, and SBG Systems. The company sells its MOTION range as part of its equipment suite to complement its Echoscope real-time 3D sonar range, as well as supplying it individually. The development and introduction of the company’s F280 Series of GNSS Aided Inertial Positioning and Attitude Measurement System constitutes the company’s new generation of Motion Products and gives it the opportunity to increase its market share.
Real-Time 3D/4D/5D and 6D Volumetric Sonar
A significant portion of the company’s revenue is generated from its Echoscope technology.
In the field of Real-Time 3D/4D/5D imaging, the company is unaware of other companies offering a similar product. In this context, it is important to understand some of the intellectual property, including know-how and capabilities the company brings to this field, which include: Acoustic Projector/Transmitter design, manufacturing, and testing; Acoustic Receiver Array design, manufacturing, and testing; Acoustic encapsulation and sensitivity measurement; Acoustic Projector/Transmitter beam pattern and sensitivity measurement; Pressure housing design and manufacture (sonar systems); 3D/5D/6D real-time digital beamforming (on-device); 1D and 2D digital beamforming; Broadband beamforming; Signal processing; Active high-frequency sonar systems; Passive mid-frequency sonar systems; Data acquisition and recording hardware and software; and Real-time 2D and 3D sonar visualization rendering and processing software.
Companies, such as Kongsberg Gruppen, R2Sonic, LLC, Tritech International Ltd., the United Kingdom, BlueView Technologies Inc., USA (now a part of Teledyne Technologies Incorporated), and Norbit Group AS Norway and Kraken Robotics are examples of companies offering imaging sonar solutions (such as multibeam sonars, SAS sonars, and/or 2D scanning sonars), but none of these sonar offerings are directly comparable or competitors to the company’s real-time volumetric 3D/4D/5D and 6D sonar solutions, as their scanning sonar, single beam, or multibeam sonars are not real-time 3D imaging sonars and therefore cannot image moving targets underwater.
Diver Augmented Vision Display System (‘DAVD’)
A material portion of the company’s revenue is generated from its DAVD technology.
There are various diving systems in the market that provide a combination of different aspects of the company’s DAVD system, but no systems that directly compete in the form of embedded fully transparent glasses mounted internally within the diver helmet or mask for visual display of a range of data and augmented reality information, which can be directly consumed by the diver underwater. This concept is protected by US Patent 10,877,282.
The DAVD system provides a unique diver-centric system with localized and external sensors to provide increased safety, scene awareness, and vital communication in the form of Digital Audio, Ultra-Low-Light Video, Text, and technical instruction, as well as access to a complete media hub for effective communication between the diver and supervisor. The DAVD system provides the following capabilities:
Fully transparent high-definition head-up display mounted internally within supported dive helmets and dive masks, including Kirby Morgan KM37, KM37SS, KM97, and SL17 helmets, as well as the Interspiro Divator MK II, OTS Guardian, and Dräger Panorama Nova Dive.
Fully integrated 1st person perspective digital low-light camera with advanced video processing and real-time edge enhancement for the diver and dive supervisor.
Fully integrated noise-cancelling digital audio at source, replacing legacy communications.
Integrated diver head tracking for accurate 3D scene visualization with full support for subsea positioning systems for accurate diver positioning.
Telemetry information on demand, including dive timers, depth and compass heading, live position lat/long (when connected to external diving positioning system), waypoint range and bearing, as well as external dive computer data.
Instant digital voice and text communication between dive supervisor and diver, including auto and pre-defined messaging.
Transmit unlimited on-demand media to the diver, including images, instructional videos, technical drawings, and other assets to assist in live operations.
Creation and transfer of unlimited step-by-step mission instructions with text, video, and image support for common diver tasks and operations.
Full mixed-reality 3D display for the diver using live sonar, pre-surveyed sonar data, and 3D models.
Diver's HUD display fully adjustable between 2D mode and 3D mode with 1st person and 3rd person perspective.
There are several diver-related products and sensors that can be worn by the diver, such as telemetry systems, navigational aids, dive computers, video and sonar systems, and probes and sensors, such as magnetic and thickness. Each of these systems typically has an independent display, usually on the device or wrist worn.
Video systems generally provide no direct benefit to the diver and are intended for topside visualization. The DAVD provides video data to the diver directly.
Newly Acquired Business Unit, PAL
PAL sells several products, some of which are customized for the customer’s specific application.
Single Element Transducers Market
PAL supplies single element transducers. There are many suppliers of ultrasonic transducers, including Olympus, USA, Imasonic, Besançon, France, Vermon, France, Sonatest, UK, Waygate Technologies, USA, as well as numerous smaller organizations in China. However, these competitors offer commercial-off-the-shelf (COTs) products, whereas PAL offers custom design single element transducers based on its customers’ specifications, and therefore competition is limited for this specialist customization capability.
Automated Measurement Systems Market
PAL supplies Automated Measurement Systems. Its main competitors in this area are Onda Corporation, Sunnyvale, CA, USA, Acertara Acoustic Laboratories, Longmont, CO, USA, and Gampt, Merseberg, Germany. These companies offer acoustic measurement systems that are comparable with the PA UMS system. However, PAL faces less competition for its Automated Measurement Systems since its focus is on customization to its customers’ specifications.
Passive Acoustic Materials Market
PAL supplies passive acoustic materials. Competition is limited as it has a license from the UK National Physical Laboratory to distribute a wide range of ultrasonic absorbers and encapsulants incorporating NPL’s intellectual property.
Measurements and Calibration Market
As a provider of measurements and calibration services in the UK, PAL’s main competitor is the National Physical Laboratory (NPL), UK, which is the only provider of ISO17025 accredited hydrophone calibration services, in addition to the ultrasonic power calibration service. They also provide ultrasonic and underwater acoustic field characterization services. However, there is a long-established collaboration between PAL and NPL, and both organizations act as supplier and customer of each other. Elsewhere, numerous notified bodies or national measurement institutions (TuV, Germany; SGS, France; GUM Poland; PTB, Germany) offer some specific measurement services.
Marine Engineering Businesses
Through the company’s marine engineering operations, Coda Octopus Colmek, Inc. and Coda Octopus Martech Limited, it is involved in custom engineering for the defense industry in the United States and in the United Kingdom and is dependent on subcontracting from the major prime contractors. Martech and Colmek compete with larger contractors, such as the primes, in the defense industry. Typical among these are Ultra Electronics, BAE Systems, Thales, Raytheon, and Northrop Grumman, all of whom are also partners on various projects.
Intellectual Property
The company owns the registered trademarks listed below, and they are used in conjunction with the products that the company markets and sells:
Coda, Octopus, CodaOctopus, CodaOctopus & Design, Octopus & Design, F180, F280, F280 Series, Echoscope, Echoscope 4G, Echoscope 5D, 5D Echoscope, Echoscope 6D, 6D Echoscope, Echoscope PIPE Ping-Pong Echoscope Sonar, Ping-Pong Echoscope, Ping-Pong Sonar, Echoscope Sequencer 4G Underwater Survey Explorer, 4G USE, Echoscope Sequencer, Survey Engine, Dimension, DAseries, GeoSurvey, CodaOctopus Air, CodaOctopus Vantage, CodaOctopus UIS, CodaOctopus USE, Sentiris, Thermite, PA, and PA Precision Acoustics.
In addition, the company has registered several internet domain names, including www.codaoctopus.com, www.codaoctopusgroup.com, www.colmek.com, www.martechsystems.co.uk, www.codaoctopusmartech.com, and www.acoustics.co.uk.
Government Regulation
The company is also subject to compliance with the U.S. Foreign Corrupt Practices Act and other applicable U.S. and foreign laws prohibiting corrupt payments to government officials and other third parties.
The company is dependent on government funding for a significant part of its revenue generation. To secure certain types of defense contracts, it needs, as a prerequisite, to meet Defense Federal Acquisition Regulations on security (including regulations on the type of IT system that must be in place, receiving, handling, and storing certain classes of materials).
The company is also required to maintain certain accreditations, including ISO 900 accreditation, Cyber Essentials, Cyber Essentials Plus, and NIST (National Institute of Science and Technology).
History
Coda Octopus Group, Inc. was founded in 1994.
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