Schaffer Corporation Limited (SFC), a diversified industrial company based out of Australia, has released its FY25 half-year financial results, showing steady profits in its Automotive Leather division despite a decline in revenue.
Founded in 1955 and listed on the Australian Stock Exchange (ASX) in 1963, Schaffer Corporation Limited (SFC) operates across three core divisions including building Materials, Automotive Leather, and Property.
With over 1,100 employees across three countries, the company has built a strong reputation for quality and innovation.
Schaffer’s Automotive Leather division is a globally competitive supplier of premium interior leather products to some of the biggest automotive brands, including Ford, Land Rover, Volkswagen/Audi, Toyota, Nissan
The division operates leather processing and finishing facilities in Victoria (Australia) and component cutting plants in China and Slovakia.
Schaffer Corporation’s Automotive Leather division, which is 83% owned by the company, has operations in Slovakia, Australia, China, and Germany. Despite revenue declining, profitability remained stable:
- Revenue: $84.1 million, down 9% from $92.8 million in 1H24
- Net Profit After Tax (NPAT): $7.8 million, unchanged from the previous year
The 9% drop in revenue was primarily due to:
- Delayed Launch of New Programs:
Some new automotive programs were postponed, impacting revenue. These launches are expected in mid-2H25. - Complexity of New Programs:
The latest automotive programs involve more intricate designs and tighter tolerances, which have increased production challenges. Schaffer anticipates improvements in efficiency during 2H25.
Schaffer’s key automotive clients have reported varied results, reflecting industry-wide challenges:
- Jaguar Land Rover (JLR):
Strong results, particularly for models using Schaffer’s leather (January 2025) - Mercedes-Benz:
Described the global market as challenging (January 2025) - Volkswagen (VW):
Called the market environment demanding (October 2024)
These insights indicate demand fluctuations in the automotive sector, which could impact Schaffer’s future sales.
