• Strong performance from Automotive Leather and Delta divisions
• Continued growth in Total Group Investments, including South Connect Jandakot
• Challenges in Automotive Leather division due to supply chain disruptions and economic slowdown

Schaffer Corporation Limited (SFC) reported a good financial year in 2025, with Group Revenue up 2% to $230 million and Manufacturing profits increasing 7%. The Automotive Leather division saw profits increase 7% to $16.3 million, driven by higher sales volumes, despite delays in program launches and a two-month slowdown by a major customer. Delta's profitability was strong at $4.9 million, up from $4.5 million in the prior year. The Group's statutory net profit after tax of $24 million also included a $3.3 million profit from Group Investments and a $3.0 million profit from the South Connect Jandakot project, which saw its pre-debt value increase to $100.2 million. The pre-tax net equity value of Total Group Investments increased almost 8% to $227 million, representing $16.73 per share. The company generated $28 million in cash and returned $15.5 million to shareholders and minority investors in the form of dividends. However, the Automotive Leather division faced challenges, including a two-month shutdown at a major customer due to a cyberattack, as well as a slowing of sales volumes and a challenging economic environment. The Delta division is also expected to report a small loss in the first half of fiscal year 2026 due to a more competitive operating environment. The company remains cautious about economic and geopolitical risks, including potential semiconductor chip shortages, a global economic slowdown, and adverse currency volatility.

For Automotive Leather, 1H26 profits should be around $3.5 million compared to $7.8 million for 1H25. For Delta, performance for 1H26 is likely to be a small loss.

The company's primary focus is the development of the South Connect Jandakot project, with plans to commence construction of the first warehouse in early 2026. The company remains conscious of the risk factors mentioned, including semiconductor chip shortages, a global economic slowdown, adverse impact from tariffs, currency volatility, and geopolitical risks.