On this page of StockholderLetter.com we present the latest annual shareholder letter from STRATTEC SECURITY CORP — ticker symbol STRT. Reading current and past STRT letters to shareholders can bring important insights into the investment thesis.

 •  9/16/2026 Letter Continued (Full PDF)
 •  9/7/2023 STRT Stockholder Letter
 •  9/20/2024 STRT Stockholder Letter
 •  9/11/2025 STRT Stockholder Letter
 •  More "Auto Parts" Category Stockholder Letters
 •  STRT Benford's Law Stock Score = 84

STRT Shareholder/Stockholder Letter Transcript:

Nasdaq: STRT
Strattec is a global automotive access company that designs and delivers safe, secure,
and highly engineered access solutions for the automotive and mobility industries. Built on
generations of access and security engineering expertise, Strattec partners closely with
OEMs to create differentiated, system level access experiences for end consumers.
Strattec   s portfolio spans the access journey from Permission, enabling secure vehicle
entry through advanced mechanical and electronic systems; to Motion, delivering
effortless, reliable powered access that enhances everyday usability; and through to Hold,
providing precision  engineered latching solutions that give drivers confidence through
proven strength, safety, and durability trusted by OEMs worldwide.
As access becomes increasingly intelligent, connected, and central to vehicle experience,
Strattec   s strategy is to expand its market share, further diversify its customers and
geographic reach while becoming the most trusted access partner to drive long term
growth across global automotive and mobility markets.

WE ENGINEER THE ACCESS EXPERIENCE
Permission
Lock and Key
Motion
Power Access
Hold
Latches
Our Purpose
Every product that Strattec delivers is built on the belief
that access does more than allow     it empowers. We
create the ultimate access experience; it feels effortless
and makes an impact when it matters.
Our Vision
To be the most trusted, global leader in safe and secure
access solutions for the automotive and mobility
industries by creating the ultimate access experience for
consumers.
Our Mission
We deliver innovative, highly engineered access
solutions for the automotive and mobility industries and
collaborate with our customers to provide value for
consumers as we continue to advance Strattec   s
transformation as a creative and agile organization.

Letter to Shareholders from the President and CEO
Dear Fellow Shareholders,
Fiscal 2026 was a year of progress as we continued to reshape
Strattec into a more resilient, higher-performing business. Our team
successfully managed through a fluid and dynamic automotive
environment marked by softer North American production levels, an
evolving tariff environment, foreign exchange pressure and customer
cancellations of certain EV programs.
Despite these challenges, we delivered sales growth, expanded our
gross margin and generated meaningful cash flow from operations.
We remained focused on the fundamentals within our control:
disciplined pricing, aligning our cost structure to revenue, improving
operational performance, investing in our people and modernizing the
tools and processes that support our business. While the near-term
market backdrop remains challenging, we believe the actions we are
taking today are strengthening Strattec and better positioning us to create long-term value for our
customers, employees and shareholders.
Delivering Stronger Financial Performance
Fiscal 2026 results reflected the progress of our transformation. Sales increased to $579.4 million, a
record for the Company, and included $11 million in pricing captured during the year. Gross margin
expanded 150 basis points to 16.5% supported by pricing actions, restructuring savings and continued
operational improvement. Adjusted EBITDA 1 increased 15.3% to $50.5 million and adjusted EBITDA
margin expanded 100 basis points to 8.7%. Importantly, earnings per diluted share grew to $5.00, a 9%
increase over the prior year.
We generated cash from operations of $46.3 million and ended the year with $108.2 million in cash and
cash equivalents and no debt. Our strong balance sheet provides important flexibility as we invest in our
operations, product innovation and customer relationships, while also supporting disciplined capital
allocation and the evaluation of acquisition or partnership opportunities that can strengthen our longterm position.
Our performance is especially meaningful given the macroeconomic challenges we faced. Through
disciplined commercial actions, operational execution and prudent cost management, our team
continued to protect and improve the underlying economics of the business.
Improving Operational Performance
During the year, we continued to build a more efficient and scalable operating model. We moved the test
lab from Milwaukee to our Auburn Hills location, freed up 91,000 square feet, or about 26%, of production
space in our Milwaukee facility, right sized our manufacturing operations by reducing headcount by an
additional 7%, and added 16 new automated assembly stations. This additional automation brought our
total number of automated assembly stations to 9%. This, of course, means we have a lot of
1
Adjusted EBITDA is a non-GAAP financial measure. Refer to    Use of Non-GAAP Financial Metrics and Additional
Financial Information    and the accompanying reconciliation to the most directly comparable GAAP measure.

opportunities in front of us. These actions are designed to improve quality, productivity and margin
performance while supporting customer programs.
We also strengthened the management systems that underpin disciplined execution, including
commercial pipeline management, financial consolidation, benefits administration and expense
reporting. These investments improve visibility, accountability and decision-making and provide the
platform needed for future growth.
Investing in Our Team and Culture
A stronger company begins with a stronger team. During fiscal 2026, we made meaningful investments
in our talent, leadership capabilities and culture.
We introduced a refreshed Strattec brand and established culture pillars centered on Innovation,
Collaboration and Accountability. These pillars reflect the behaviors we believe will enable us to move
faster, work more effectively across functions and deliver greater value for our customers.
We also held our first Culture Week, bringing employees together across our locations in the United
States, Mexico and Korea. The week included culture training, employee engagement activities and
community volunteer efforts across our sites. In addition, we implemented a Rewards and Recognition
Program aligned with our culture pillars to recognize team members whose actions reflect the values
and behaviors we are building across Strattec.
As part of our efforts to strengthen the organization, we added commercial capabilities to begin
developing relationships with new customers and to deepen engagement with existing customers. We
also added a Head of Innovation to sharpen our focus on product management and to ensure our
innovation priorities are closely aligned with customer needs and market opportunities. Across
Procurement, Quality, Supply Chain, Information Technology and Program Management, we added and
developed talent to help drive operational improvement and support the next phase of our
transformation.
Building Customer-Led Growth
While we continued to improve operational stability, we also began to sharpen our focus on longer-term
revenue growth. We are working to evolve from a primarily reactive organization responding to RFQs
toward a more customer-led business that engages earlier in vehicle development cycles.
For many vehicle programs, meaningful early engagement occurs years before production begins. This
makes it essential that we strengthen customer relationships early, understand evolving requirements
and align our product and technology roadmaps with future needs.
Our commercial, innovation and engineering teams are working more closely together to engage both
existing and prospective customers around a clear product framework: Permission, Motion and Hold.
Permission includes secure vehicle-entry technologies; Motion encompasses powered access systems;
and Hold includes latching products designed for safety, strength and durability. This framework better
aligns our commercial, innovation and engineering teams around customers    evolving access needs and
future program opportunities. By combining our history in mechanical and electronic access solutions
with a more deliberate focus on product management, innovation and customer engagement, we are
positioning Strattec to compete for future platforms and create opportunities for sustainable growth.
Our joint venture also remains an important part of our business and strategy. We continue to work with

9/16/2026 Letter Continued (Full PDF)

 

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