Country-by-country information

Exxaro Resources, as the ultimate parent of a Multinational Enterprise and reporting entity, is responsible for the preparation and submission of the country-by-country report for the Exxaro group in South Africa. The master file has been prepared in accordance with commentary in chapter V of the 2017 Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations issued by the Organisation for Economic Co-operation and Development, and in line with the requirements of the public notice published by SARS for the submission of the country-by-country report, master file and local file by persons specified therein.

Exxaro is a diversified resources group with business interests in South Africa, Switzerland, China, Australia and Israel. Refer to about Exxaro for a description of Exxaro's key business areas locally.

Refer to the annual financial statements for a full list of Exxaro's entities per jurisdiction.

Offshore business areas

Switzerland

Coal extracted from the South African mines is sold into the overseas markets through the Swiss marketing company, EITAG, which is Exxaro's central offshore sales company. EITAG buys coal from Exxaro Coal and Exxaro Coal Mpumalanga and on-sells the coal products to the ultimate customer. The goods are delivered to Richards Bay Coal Terminal Proprietary Limited (RBCT) and other ports and, from there, directly to the foreign customer. EITAG is responsible for the coal blending process as well as the RBCT port cost.

EITAG attracts new customers and develops new markets for Exxaro coal products. Based on the contract concluded with customers, EITAG manages the scheduling of coal volumes, quality types and shipping dates.

EITAG's business strategy is to use the following regional advantages:

• Proximity of clients
• Intelligence gathering
• Product and market knowledge
• Access to ports to facilitate efficient logistics
• Cultural fit with customers

Having a central offshore sales company ensures the application of consistent policies and the growth of the Exxaro brand and offshore customer base. EITAG has five employees (one expat employee, one local employee and three contractors).

Australia

Exxaro Australia Holdings Proprietary Limited (EAH) is the holding company of the Australian group of companies (the EAH Australian tax group) and does not have any employees. Exxaro Australia Proprietary Limited, a subsidiary of EAH, holds a 50% interest in a joint venture with Anglo Coal (Grosvenor) Proprietary Limited (Anglo Coal) in the Moranbah project, which is currently an undeveloped coal resource in exploration stage. Anglo Coal manages the project.

The Moranbah project is located in the Queensland district of Australia.

China

Exxaro holds a minority investment in the Chifeng Hongye Zinc Smelting Co Limited smelting operations, incorporated in China.

United Kingdom (UK)

Exxaro owns a 25.85% interest in Insect Technology Group Holdings UK Limited, which is currently in the process of deregistration.

Israel

Exxaro owns a 28.01% interest in LightApp Technologies Limited.

Significant intercompany transactions

Important service arrangements within the Exxaro group are shown in the table below. During 2022, there were no loans between Exxaro and any of its foreign group companies outside South Africa. Exxaro does not maintain unilateral advance pricing agreements in support of its intercompany transactions, or tax rulings relating to the allocation of income across countries.

Service	Supply entity	Supply country	Receiving entity	Receiving country	Transfer pricing policy
Sale of coal	Exxaro Coal and Exxaro Coal Mpumalanga	South Africa	EITAG	Switzerland	Yes
Provision of warehousing, logistics and blending support	Exxaro Coal	South Africa	EITAG	Switzerland	Yes
Provision of various business and management support services, including but not limited to: Financial and accounting services Human resources Legal and insurance services IT, purchasing, business developments, operations and quality assurance Communication and regional management services	Exxaro Resources	South Africa	Various	South Africa	Not applicable

Country-by-country reporting for the year ended 31 December 2022

	Revenue from  third-party  sales	Revenue from   intra-group   transactions with   other   jurisdiction1	Net   profit/(loss)   before tax2	Equity-   accounted   investment   income3	Corporate  tax paid/  (received) in cash	Normal  corporate  tax expense  accrued
South Africa
Coal	23 581	20 524	14 273	1 892	3 802	3 456
Ferrous	224		19		2	0
Base metals			578	578
Iron ore			4 077	4 077
Renewable energy	1 159		263		10	10
Other	15		22 216		272	244
Intercompany sales		(20 524)
Elimination			(19 528)
Total	24 979	–	21 898	6 547	4 086	3 710
Switzerland (coal)
Coal – EITAG	21 390		453		24	54
Australia (coal)			(77)
Israel (energy)			18	(70)
Grand total	46 369	–	22 292	6 477	4 110	3 764

	Dividend   withholding   tax accrued5	Dividend  withholding  tax paid	Statutory tax  rate	Effective tax  rate	Total   number of   employees4	Tangible  assets
South Africa
Coal			28%		6 148	31 531
Ferrous			28%		78	32
Base metals
Iron ore			28%
Renewable energy			28%		24	5 348
Other	1	1			493	412
Intercompany sales
Elimination			28%
Total	1	1	28%	19.23%	6 743	37 323
Switzerland (coal)
Coal – EITAG	10	10	12%	12%	2	–
Australia (coal)						123
Israel (energy)
Grand total	11	11		19.23%	6 745	37 446

1	Excludes fees received for administration services delivered by the Exxaro Coal head office.
2	Equity-accounted investment income is included in net profit/(loss) before tax
3	Equity-accounted investment income is reflected in the country of incorporation. Income is after-tax income.
4	The number of employees consists of permanent employees. It does not include full-time equivalents and contractors.
5	Deferred tax has been excluded from the total corporate tax expense therefore normal corporate tax expenses accrued represents only current tax expenses accrued.