• Automotive Leather profits declined due to JLR cyberattack
• Delta incurred small loss amid reduced government infrastructure spending
• South Connect Jandakot to commence first building construction in Feb 2026
• Total investment portfolio valued at $219 million or $16.12 per share

Schaffer Corporation Limited (ASX: SFC) reported first half statutory net profit after tax (NPAT) of $5.0 million, down from $12.7 million in the prior corresponding period. The results reflect a challenging half for both the Automotive Leather and Delta divisions. Automotive Leather profits decreased to $4.6 million, impacted by a cyberattack at Jaguar Land Rover (JLR) which resulted in a temporary production shutdown. Delta incurred a small loss of $0.3 million after last year's extraordinary profit of $4.2 million, due to a significant decrease in West Australian government spending on large civil infrastructure projects. On a positive note, South Connect Jandakot, a valuable Group asset, will commence construction of its first building in February 2026. The pre-tax, net equity value of the total investment portfolio was $219.0 million or $16.12 per share, compared to $227.3 million or $16.73 per share in June 2025. The decrease was primarily due to a cash reduction from dividend payments and a one-month delay in receiving an Automotive Leather dividend. The Board has declared an interim fully franked dividend of $0.45 per share, matching last year's interim and final dividend.

Subject to the risks identified, Automotive Leather profitability for the second half should be higher than 1H26, and Delta profitability should be around break even in the second half.

The company's investments are revalued each period, which may result in profit volatility, both up and down.