Slide 1: ASX Market Announcements cover letter
24 August 2022 ASX Market Announcements ASX Limited 4th Floor, 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam, SCHAFFER CORPORATION LIMITED (ASX:SFC) INVESTOR PRESENTATION - FY22 RESULTS Please find attached SFC’s Investor Presentation for the 2022 financial year. The Board has authorised the docum
Slide 2: FY22 Full Year Results Presentation
FY22 Full Year Results Presentation JUNE 2022 Creating long-term shareholder value through the efficient operation of our businesses and growth in our investments
Slide 3: Disclaimer
Disclaimer This presentation has been prepared by Schaffer Corporation Limited ACN 008 675 689 (“The Company”). This presentation is for information purposes only and is not a prospectus or product disclosure statement, financial product or investment advice or a recommendation to acquire Schaffer C
Slide 4: Organisation Chart
Organisation Chart MANUFACTURING GROUP INVESTMENTS JANDAKOT – SOUTH CONNECT AUTOMOTIVE LEATHER (83% OWNED) SFC (100%), GOSH CAPITAL (83%) JANDAKOT - ▪ Finishing ▪ Company Owned Property ▪ 100% Owned - Slovakia - Victoria, Australia ▪ Syndicated Investment Property ▪ A large strategic asset located b
Slide 5: Group Consolidated Financial Performance
Group Consolidated Financial Performance Full Year Ending June ($m) FY22 FY212 $ change ▪ Net profit (NPAT1) excluding specific fair value revaluations4 Revenue $170.4 $196.3 was $26.4m (FY21: $29.6m), reflecting a good result from NPAT1 from: Automotive Leather and most of our investments. Automoti
Slide 6: Group Consolidated Financial Performance
Group Consolidated Financial Performance Full Year Ending June ($m) FY22 FY212 $ change Automotive Leather NPAT1 of $18.1m, a strong performance 1 Revenue $170.4 $196.3 in a challenging environment. NPAT1 from: 2 Delta after tax loss of $0.6m compared to prior year profit of Automotive Leather 1 $18
Slide 7: Change in NPAT – FY22 versus FY21
Change in NPAT1 – FY22 versus FY21 NPAT1 excluding HTG, UPD and Investment Property revaluations 1 Automotive Leather NPAT down $6.3m decreased by $3.2m 0.0 2 Delta NPAT down $1.6m – delays and project complexity. 3 +$2.5m after tax gain from sale of various syndicated properties +$11.0m -$13.2m man
Slide 8: Fully Franked Dividends
Fully Franked Dividends SFC is a consistent dividend payer ▪ The Board has declared a final fully franked dividend of $0.45 per share, for shareholders on record on 9 September 2022, payable on 23 September 2022 $0.90 $0.90 $0.80 $0.70 $0.45 $0.45 $0.35 $0.45 $0.40 $0.25 $0.25 $0.25 $0.26 $0.30 $0.2
Slide 9: Cash Generated
Cash Generated Full Year Ending ($m) June 2022 June 2021 1 Increase in Automotive Leather Working Capital NPAT 26.2 41.0 ▪ Investment in inventory ahead of expected increased sales volumes for FY23 Net unrealised pre-tax losses/(gains) – group investments1 2.7 (16.2) ▪ Buffer inventory to manage sup
Slide 10: Group Net Debt Decrease ($m)
Group Net Debt Decrease ($m) Net debt decreased due to: $0.9m ▪ $14.0m dividends paid o $12.3m SFC shareholders, $1.7m dividends paid to minorities $11.3m ▪ $8.8m new Group Investments ▪ $11.3m Capex and Property Development $36.1m o $5.2m for Jandakot Property $8.8m o $3.0m for Delta o $2.5m for Au
Slide 11: Group Net Debt Overview ($m)
Group Net Debt Overview ($m) MANUFACTURING GROUP INVESTMENTS Syndicated Automotive SFC Gosh Total Total All amounts in $m Jandakot Investment Leather Investments Capital Jun 22 Jun 21 Properties Type of Debt: Bank and other debt (8.9) (1.4) (1.0)3 (22.1) (6.6) (40.0) (38.6) Equipment finance (5.8) -
Slide 12: Automotive Leather
Automotive Leather A good performance in a challenging environment ($m) 1H22 2H22 FY22 FY21 The performance of the business, particularly in the second half, was good. Our Revenue $56.1 $79.9 $136.0 $165.2 management team performed well, minimising the impact of multiple challenges on profitability.
Slide 13: Automotive Leather continued
Automotive Leather continued Challenges continued ▪ The launch of a renewed program was delayed while the previous model ended on time, leaving a two-month gap in our sales. The launch of the new model has now commenced and is in ramp-up stage, although at a slower rate than usual. This could tempor
Slide 14: Automotive Leather continued: Investment in increased capacity
Automotive Leather continued Investment in increased capacity Management took the strategic decision, having renewed and won new programs, to get the business ready for growth in Europe. Sales volumes should increase from FY23 onwards. This year’s sales volumes should benefit from the launch of the
Slide 15: Automotive Leather continued: Risks
Automotive Leather continued Risks ▪ Current global economic uncertainties, including a global economic slowdown ▪ Continued currency volatility ▪ The energy crisis in Europe and potential impact on our OEM production volumes and our costs ▪ Inflationary price pressures, particularly on raw material
Slide 16: Automotive Leather continued: Outlook
Automotive Leather continued The current and longer-term prospects of the Automotive Leather division remain strong. As announced previously, our European operations have successfully renewed key programs with Jaguar Land Rover and won new programs with Mercedes and Audi. These should see our Europe
Slide 17: Group Investments
Group Investments Pre-Tax Net Equity Value1 (including syndicated property debt) of $187.7 Pre-Tax Net Equity Value1 $million million or $13.78/share 14.5% p.a. Over the past five years: growth $191.7 $187.7 over past $20.6 ▪ Pre-Tax Net Equity Value1 has increased by 5 years4 $162.6 $23.4 $92 milli
Slide 18: Group Investments
Group Investments NPAT2 of $11.7m (FY21: $6.8m) excluding specific revaluations5 - A strong Full Year ($m) FY22 FY213 performance from most of our investments: Revenue $ 17.2 $14.6 ▪ sale of land at Beachside, North Coogee (23 lots) – in total 43 of 52 lots have been sold over the past 18 months. 9
Slide 19: Investment in Harvest Technology Group (ASX: HTG)
Investment in Harvest Technology Group (ASX: HTG) The current valuation of HTG is $8.9m1 (FY21: $26.9m) compared to our original investment of $3.3m. ▪ $2m in a 5-year convertible note earning 9% p.a., convertible at $0.022/share plus ~$1.3m in shares ▪ HTG has transformed itself into a technology c
Slide 20: Investment in Updater
Investment in Updater The current value of our Updater investment is ~$6.8m compared to our investment of $6.4m across multiple investment rounds over the past ~8 years. Updater is the industry leader of the US relocation sector, utilising proprietary software to simplify and automate the moving pro
Slide 21: Group Investments – Property
Group Investments – Property IBM Building West Perth, WA Hometown Cannington, WA Home Space, Tamworth, NSW 39 Dixon Rd Rockingham, WA Parks Centre Bunbury, WA Full Year Results Presentation JUNE 2022 20
Slide 22: Jandakot – South Connect
Jandakot – South Connect Aerial View – February 2022 Full Year Results Presentation JUNE 2022 21
Slide 23: South Connect - Jandakot Logistics Estate
South Connect - Jandakot Logistics Estate A large strategic property asset located between two freeways and 15 minutes south of the Perth CBD. South Connect – Jandakot Logistics Estate is well located to benefit from the increased demand for logistic and “last-mile” warehousing driven by the rapid g
Slide 24: Delta
Delta Full Year ($m) FY22 FY21 Summary Revenue $17.3 $16.5 ▪ Delta incurred a loss of $0.6m (FY21: +$1.0m) Segment NPAT ($0.6) $1.0 ▪ Continued construction program delays by contractors. o Design and engineering complexity on a large project. o Ongoing labour challenges and inflationary pricing pre
Slide 25: Group Outlook – 1H23
Group Outlook – 1H23 Outlook Risk Factors ▪ The current environment remains volatile and challenging, with many ▪ Currency volatility potential risks that could impact our outlook. ▪ Broader economic uncertainties, including an economic slowdown ▪ Automotive Leather o Our OEMs continue to report str
Slide 26: Non-IFRS Financial Information
Non-IFRS Financial Information As at Schaffer Corporation Limited results are reported under Reconciliation of Net Debt excluding lease liabilities for leases previously classified as operating leases ($000’s) International Financial Reporting Standards (IFRS) as issued by the Jun 2022 Jun 2021 Inte
Slide 27: Appendix I - Group Investments – Pre-Tax Net Equity Value
Appendix I - Group Investments – Pre-Tax Net Equity Value 1,2,3 FY17 FY18 FY19 FY20 FY21 FY22 FY22 FY22 Pre-Tax Net Equity Value1,2 ($m) ($m) ($m) ($m) ($m) ($m) Per Share % of Portfolio Property: Used by SFC Operations $19.6 $11.4 $11.4 $9.7 $9.7 $9.7 $0.71 5% Property: Rental Income $19.9 $37.5 $3
Slide 28: Appendix II - Group Investments – Property Portfolio
Appendix II - Group Investments – Property Portfolio SFC Share of Notional Tax on Current Lettable SFC Ownership SFC Share of Net Equity Value Address Description Ownership Structure Land Size (sqm) Market Value Capital Gain Area (sqm) % Debt ($m) After Tax ($m) ($m) ($m) Property used by SFC Operat
Slide 29: Appendix II - Group Investments – Property Portfolio
Appendix II - Group Investments – Property Portfolio SFC Share of Notional Tax on Current Lettable SFC Ownership SFC Share of Net Equity Value Address Description Ownership Structure Land Size (sqm) Market Value Capital Gain Area (sqm) % Debt ($m) ($m) ($m) ($m) Development Sites - Lot 706 Jandakot