CEO's report

Despite a dynamic macro-environment, we focused on stabilising the business, operational delivery and accelerating the prudent delivery of our Sustainable Growth and Impact strategy. This affirmed Exxaro's position as a diversified natural resources champion, underpinned by our strong coal base, a growing energy solutions business, equity-accounted investments in iron ore and base metals, and now a significant global manganese presence through the recent acquisition of select manganese assets in the Kalahari Manganese Field.

This acquisition represents both a decisive delivery of Exxaro's strategy and a meaningful transformation in the sector. The transaction was awarded the Black Economic Empowerment (BEE) Deal of the Year at the 2025 DealMakers Annual Awards for bringing together two big South African BEE mining companies with shared values and setting a precedent for the manganese sector through enhanced empowerment participation, strengthened partnerships and a structure designed to deliver sustainable economic inclusion.

We delivered on our priorities of safety, stability, succession planning, operational delivery and prudent diversification. To strengthen stability and execution, we completed our group management structure with permanent appointments, embedding a future-fit functional model that enhances collaboration, agile decision making and delivery as we accelerate into Exxaro's next phase of growth.

The group recorded zero work-related fatalities. This marks 40 consecutive months without a fatality. Our LTIFR improved by 33% to 0.04 per 200 000 worker-hours worked (2024: 0.06). Both Grootegeluk and Belfast achieved a full year without lost-time injuries (LTIs). These outcomes show that our goal of zero harm is achievable, and we must remain vigilant.

Maintaining resilient performance

Exxaro delivered a strong performance in 2025, despite a persistently challenging macro -economic environment. Group revenue increased, and our portfolio of high quality assets achieved a robust cash generation enhancing a solid balance sheet. Our net cash position increased to R17 641 million compared to R16 309 million at the end of 2024 (excluding energy's net debt). Group earnings before interest, tax, depreciation and amortisation (EBITDA) declined marginally by 2% to R10 225 million (2024: R10 423 million), despite export coal prices declining by 14%.

We met our market guidance across all metrics. Through our effective market-to-resource initiatives, we achieved a price realisation of 96% (2024: 95%) against the 2025 average API4 coal benchmark price of US$90 per tonne (2024: US$105 per tonne). Despite a 14% weaker export coal pricing environment, our strong marketing capabilities, disciplined cost management and the defensive nature of Exxaro's portfolio enabled the group to sustain a resilient EBITDA performance.

The Matla life of mine (LoM) expansion project progressed well and is targeted for completion in the first half of 2026. The project is ahead of schedule, delivering early coal production and contributing to increased mine output in 2025. Upon completion, the mine will supply between 8Mt and 10Mt of coal per annum to Matla power station. Furthermore, the renewal of the mine's mining right and integrated water use licence (IWUL) provides long-term operating certainty and strengthens the value of this investment.

A year of accelerated and responsible diversification has solidified our position as a diversified natural resources champion.

Cash generation remained robust, and our equity-accounted investments in iron ore and base metals continued to enhance the quality of our earnings. As a result, headline earnings per share (HEPS) increased by 8% to R32.47 per share (2024: R30.16 per share). Following the acquisition of select manganese assets from Ntsimbintle Holdings and OMH, the group will no longer maintain the previously targeted cash buffer of R12 billion to R15 billion, and we have reviewed our capital allocation framework. Consequently, the dividend cover ratio was improved from a range of 2.5 times to 3.5 times, adjusted group earnings to a range of 1.5 times to 2.5 times, while the 100% pass-through of the Sishen Iron Ore Company (SIOC) dividend remains unchanged.

In line with the improved dividend cover range, the board declared a final gross dividend of R10 per share, amounting to approximately R3.4 billion. Including the interim dividend of R2.9 billion paid in October 2025, total dividends for 2025 amount to R6.3 billion. This reflects our ongoing commitment to delivering superior and consistent returns to our shareholders, as guided by our disciplined capital allocation framework.

Refer to capital allocation and FD's overview for details on our capital allocation framework.

Pursuing our Sustainable Growth and Impact strategy

Our Sustainable Growth and Impact strategy anchors our position as a diversified natural resources champion. The strength of our coal business is underpinned by the high-quality infrastructure investments made over many years and a substantial resource base of over 9 billion tonnes, supporting long LoM profiles. The International Energy Agency (IEA) forecasts that global energy demand will still include coal well beyond 2050. Exxaro is therefore exploring organic growth opportunities through life extension within and around our operations to meet this demand. Our manganese acquisition strengthens our diversified asset base, and our energy solutions business is expanding in wind and solar, deepening the defensive nature of our portfolio. This, together with disciplined cost management and site-specific climate adaptation plans, reinforces operational resilience. Our strategic execution is unfolding at a measured pace.

For more on our objectives and related outcomes, see our Sustainable Growth and Impact strategy.

At the same time, our decarbonisation commitments and social impact investment programmes highlight our dedication to creating impact beyond compliance. We structure our environmental stewardship from active operations through to postmining land use. In 2025, we rehabilitated 2 639ha of land, an increase from 2 325ha in 2024.

In 2025, our social investment of R1.70 billion supported 389 local SMMEs through a procurement spend of R1.3 billion. Exxaro's education and early learning support approach evolved from onceoff infrastructure interventions to a whole-school development approach that includes school resourcing, extracurricular support and health programmes.

We accelerated the growth of our energy solutions business, achieving financial close on the Karreebosch windfarm, which is now under construction and progressing well, with green electrons expected in the first half of 2027. The project will supply wheeled green energy to our coal customer, Northam Platinum Limited, under a 20-year power purchase agreement, reducing our scope 3 emissions. It will also add stability to the national grid while advancing South Africa's decarbonisation goals. We estimate that Karreebosch will create over 1 000 jobs during construction and 17 permanent operational roles, bolstering the local economy. The project will also support social initiatives in surrounding areas, including education, skills development and healthcare programmes. Other exciting growth developments, including the acquisition of majority interests in the Gouda windfarm and Sishen solar plant, are expected to significantly expand our energy solutions business.

Refer to our reporting theme and our assets for details on Cennergi's strategic developments.

As we expand our energy operations, we are simultaneously divesting non-core assets to streamline our portfolio and sharpen management focus. The group concluded the disposal of our entire shareholding in FerroAlloys Proprietary Limited to EverSeed Energy Proprietary Limited, a 100% black-owned investor and operator, with meaningful management and employee participation. This supports empowered local ownership while enabling the redeployment of capital into opportunities as presented by a diversified natural resources company, underpinning our strategic objectives to make our coal, metals and energy businesses thrive and to be a catalyst for economic growth and environmental stewardship.

Leeuwpan's turnaround strategy is progressing well. The section 189 process was concluded without any forced retrenchments, reinforcing the strength of collaboration between Exxaro and all our stakeholders. Following the section 189 consultation process, we concluded a strategic partnership with Transnet Freight Rail, strengthening logistics and rail capacity planning for Leeuwpan. This is expected to improve performance and unlock value for the operation.

Investing in our people

I am grateful for the dedication and resilience of Exxaro's people, as they supported the stabilising of the company. As an executive leadership team, we listened to our employees across all operations and visited our sites, including closed collieries and renewable energy farms. These engagements, together with visits to our regulators, investors and national labour organisations at their head offices, reinforced the fact that our Sustainable Growth and Impact strategy is robust and intact, supported by ongoing investment in our people.

I am pleased with the establishment of a strong management team that is fit for purpose. This includes four new appointments: Caroline Shirindza as executive head: coal, Neo Monareng as executive head: sustainability, Fortune Ntlhoro as executive head: commercial and Mervin Govender as executive head: technical services. Our leadership bench is complete and broadly representative of the country's demographics, combining experience and fresh perspectives.

Alongside leadership stability, we are advancing our culture transformation journey, reinforcing the behaviours and leadership practices required to enable collaboration, accountability and high performance across the group, delivered through the One Exxaro Way. We executed an ethics and culture reset, and the positive results were reflected in our follow-up culture pulse survey outcomes post-year end. Building a strong, ethical, values-driven and high-performance culture remains central to sustaining operational excellence and delivering long‑term value, while creating an environment where our people can do the best work of their lives together, safely.

Our commitment to diversity, equity, inclusion and belonging continues to shape our employee composition, with historically disadvantaged backgrounds representing 91% of our workforce. Women account for 35% of employees and 47% of management roles. These outcomes reflect our deliberate, ongoing efforts to build a more inclusive and representative organisation.

The strength of our people practices was again recognised externally, with Exxaro being certified by the Top Employer Institute for the fifth time, with an improved overall score of 89.49% (2024: 83.39%).

Looking ahead

I am pleased with the progress we made in 2025. We strengthened our strategic foundations, advanced key portfolio initiatives and further enhanced our leadership capability to support the next phase of delivery.

Exxaro is now an established diversified natural resources champion, underpinned by a strong coal base, a growing energy solutions business and, through the Tshipi Borwa Mine, a globally significant manganese producer. Together, these businesses form a defensive portfolio with built-in optionality. Both our coal and energy businesses play an important role in supplying South Africa's energy needs, one through reliable baseload supply and the other through renewable energy generation, creating a stable earnings base that anchors the defensive nature of our portfolio. Further upside optionality is provided through our coal and manganese export capability, enabling meaningful participation in seaborne markets supported by a substantial, high-quality, long-life mineral resource base.

The evolving geopolitical environment, including tensions in the Middle East, has introduced uncertainty into global energy markets through oil price volatility, rising freight costs and higher insurance premiums. The conflict is contributing to disruptions in global energy supply dynamics, increasing risks to energy security. Higher oil prices place pressure on global inflation and economic growth, while also influencing trade balances in energy-importing economies such as South Africa. These dynamics are reinforcing a greater focus on reliability and security of energy supply across many markets.

Our coal exports are largely sold on a free on board (FOB) basis and do not transit the Strait of Hormuz, limiting direct exposure to shipping disruptions in the region. However, higher freight and insurance costs may impact certain commodities differently. Manganese, which is typically traded on a cost, insurance and freight (CIF) basis, may experience some margin pressure in a higher freight environment. In addition, higher oil prices contribute to inflationary pressure on fuel costs, which form part of our mining cost base, adding pressure to already rising marginal costs of production in South Africa.

Our business continuity management plans have been activated, ensuring a coordinated approach across stakeholders in our supply chain to maintain operational continuity.

The rebuild of war-ravaged infrastructure and restoration of oil and liquefied natural gas (LNG) supply chains are likely to take time, suggesting that disruptions across energy and logistics may persist in the medium to long term. In this environment, coal market fundamentals remain supported by demand in key economies, as well as the role coal continues to play in supporting reliable and affordable power supply where alternative fuels, including LNG, are constrained by availability, security and pricing.

Climate change remains one of the defining challenges of our time. In line with our objective of being catalysts for environmental stewardship, we recognise our responsibility in minimising and mitigating environmental impact. We remain committed to our goal of reaching carbon neutrality by 2050.

Our initiatives support improved energy efficiency, cost reduction and operational resilience. The commissioning of Lephalale solar plant (LSP) marks an important milestone as Exxaro's first self‑generation renewable energy project. The project is expected to reduce scope 2 emissions by 17% and lower the mine's electricity costs by over R100 million a year.

I would like to acknowledge the commitment and hard work of our employees. Our results are a direct reflection of the dedication, professionalism and resilience of our people. It is through their efforts that Exxaro continues to deliver for all our stakeholders and position the business for long-term success.

We place strong emphasis on employee wellbeing and are dedicated to fostering a culture of integrity that enables all our people to thrive. Our priorities for 2026 are clear: sustain safe and reliable delivery, support improved logistics performance and execute the integration of our newly acquired assets. At the same time, we will continue advancing key milestones in our energy solutions business, including financial close and commissioning activities already underway.

Ben Magara
CEO

29 April 2026