Sheela Foam Ltd

Despite persistent headwinds in the consumer durables sector our mattress business delivered commendable growth. This was driven on our two-pronged strategy of aligning existing channels and our strategic pivot towards high-potential new channels, notably e-commerce and rural expansion. We are confident that the business is now structurally stronger and well-positioned to deliver improved earnings and Sustainable value as we move forward.

In FY25, our consolidated revenue grew by 15% year-on-year to R3,439 crore. Consolidated EBITDA stood at R286 crore, while with a Profit After Tax (PAT) of R97 crore, resulting in an EBITDA margin of 8.3% for the year. On a standalone basis, the business generated revenue of R2,588 crore and a net profit of R112 crore (PAT).

While net earnings were subdued by elevated finance and depreciation costs for Kurl-on acquisition, our core operational performance remained strong. With a clear focus on deleveraging and continued top-line expansion, we are confident that all business segments are now optimally working in the right trajectory.

On the international front, our Australian operations demonstrated improved profitability, driven by effective pricing strategies. In Spain, we achieved a 15% increase in volumes, although fluctuations in raw material prices and lower overhead absorption weighed on revenue. As raw material prices stabilise, we anticipate both margins and topline to improve.

Our strategic investments in adjacent growth segments continue to deliver promising outcomes. Furlenco recorded full-year profitability in FY 2024-25, with Annual Recurring Revenue (ARR) reaching R300 crore in March 2025. Notably, the Acquired Subscriber Base surpassing 1 Lac+ is an indicator of strong customer traction and increasing market penetration. Expansion into key cities such as Indore, Kolkata and Ahmedabad, along with product lines tailored for the Gen Z demographic, further reinforces a robust growth trajectory. Staqo, our IT initiative, achieved an impressive 61% year-over-year revenue growth, accompanied by healthy EBITDA margins of 28%. The business successfully onboarded several clients across the public sector, MSMEs and private enterprises, solidifying its position as a trusted technology partner of choice.

In FY 2024-25, we continued to fortify our position in the Indian branded mattress market. The integration of Kurlon into Sheela Foam has significantly expanded our operational reach, improved channel efficiency and unlocked substantial cost advantages.

We made considerable progress in deepening our market presence. During the year, we added nearly 400 exclusive showrooms and onboarded 1,700 new dealers, reinforcing our retail network across the country. Our Small-Town Initiative (STI) has now extended its reach to more than 4,000 towns, supported by a network of STI-specific distributors. We are also steadily growing our presence in Multi-Brand Outlets and distributor-owned showrooms under both our flagship brands.

Our Comfort Foam business delivered strong growth in terms of both volume and value. The Technical Foam segment maintained a stable performance, reinforcing its dominance in the auto lamination space.

Subsequently, we are expanding into high-potential categories such as aviation insulation, ceramic filters, acoustic solutions and footwear insoles. Our furniture cushioning line, leveraging the strength of the Kurlon brand, continued its gain momentum, particularly across North and West India. These developments are enabling us to unlock synergies, diversify our portfolio and expand our footprint across both B2B and retail categories.

At Sheela Foam, sustainability guides our decisions, shapes our operations and reflects our long-term commitment to the communities and ecosystems we serve. We continue to take meaningful steps towards building a more sustainable future. From optimising energy and water usage to implementing responsible waste management practices,every initiative is designed to reduce our overall carbon footprint. Our adoption of compressed foam packaging, for instance, has reduced transportation-related emissions. Also, by reusing foam waste in the production of rebonded foam and mattresses, we are diverting significant waste from landfills.

Our manufacturing facilities are equipped with eco-friendly technologies such as the Variable Pressure Foaming (VPF) system, which allows us to produce high-quality foam with a lower environmental footprint. We have also implemented water recycling systems, including the reuse of treated water from our Sewage Treatment Plant (STP) for non-potable applications such as gardening and flushing. Our corporate office operates out of a LEED-certified building, a symbol of the responsible and forward-looking ethos that guides us.

As we step into FY2025-26, we will continue to build a stronger, more agile organisation. We will deepen our brand's reach, strengthen our partnerships and drive innovation across all product categories. Our efforts to improve cost efficiency, embrace digital tools and extend our rural presence will continue to drive momentum. We are confident that the groundwork laid this year, through thoughtful integration, expansion and operational efficiency has set the stage for a new phase of scalable, profitable growth.

Lastly, I would like to take this opportunity to extend my heartfelt gratitude to our shareholders, employees, partners and customers. Your trust and continued support fuel our ambition and challenge us to keep raising the bar. It is your belief in our journey that inspires us to lead, innovate and deliver value.

Executive Chairman Sheela Foam Limited