Graham Leaming: Skellerup CEO on the company lifting its full-year profit outlook based on strong US demand

Another positive sign for the economy. 

Kiwi manufacturer Skellerup —who makes everything from gumboots to industrial rubber products— has lifted its annual profit forecast to as much as $65 million. 

They credit stronger than expected US demand for the increase. 

CEO Graham Leaming told Mike Hosking they thought tariffs and the conflict in the Middle East might drive inflation and dampen demand in the US market, but that hasn’t materialised. 

He says demand remains strong, and the things they manufacture and sell are often pretty critical to customers, so they were able to adjust prices in response to tariffs and increases to the cost of raw materials. 

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Episode Transcript

Speaker 1 (00:00):
Scaler Up gave us all good news yesterday they lifted
their annual profit forecast. The reason seems to be America
demand is robust and tariffs didn't really seem to make
that much of an impact ground Leaving as the Scaler
Up CEO, he's back with us, Graham morning to you.

Speaker 2 (00:12):
Good morning, Mike.

Speaker 1 (00:13):
Terriff's talk us through Why haven't they affected you? Have
you sold through them?

Speaker 2 (00:18):
Yeah? A couple of things, Mike, I guess Firstly, when
we last gave our guidance in February, the terraffs was
still at a high rate than they are now, so
in fact this stuff we released our half yr results.
They dropped back to ten percent when the IPA terrafts
were reduced or removed and replaced whether what they called
the section one two two terrasts. So terarrats were a

(00:39):
little bit lower, but also demands held up more strongly
in the market than we thought it might. We thought
the tariff impact the Middle East in conflict, they might
drive inflation and might dampen demand for US in the
US market, but that hasn't materialized. Demands continued to remain
main strong, and the nature of what we manufacture and
sell is often critical to our customers, and so we

(01:02):
are able to adjust prices and response to tariffs and
raw material CRIST increases as well.

Speaker 1 (01:06):
That's interesting because we got an inflation readout of America
this morning. What's your read on America as I mean,
it seems fantastically resilient.

Speaker 2 (01:16):
Yeah, certainly that's the case for US, Mike. It's our
largest market and our fastest growing market for a number
of years, so it's one that we've continued to put
more people into more resources at the front end in
the US. Importantly, I think we're viewed as a US business,
which is quite important, and the range of applications and
products that we sell are often very important to the

(01:41):
applications that our customers using them.

Speaker 1 (01:43):
In our dollar helping.

Speaker 2 (01:46):
At the margins, the dollar has helped a little bit.
Of course, it's a risk that we heat, so the
hedging we have in places is slightly above what the
spot rights have been, but neat net at the margins,
it's been a slot positive effective for US and ay
for twenty six as well. Well.

Speaker 1 (02:03):
Congratulations and make the good news keep on coming. Grind Leaming,
who is a scalar up so they do at I mean,
everyone thinks of scalar Up as gum boots, of course,
which is true they are, but they do potable water
and waste water and dairy and marine applications, so they've
got a lot of stuff going on these days. For
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(02:24):
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