Exxaro Resources Limited
Integrated report for the year ended 31 December 2025
We are becoming a diversified natural resources champion through our Sustainable Growth and Impact strategy. With stakeholders in mind, our strategy proactively positions our business for long-term success in a low-carbon economy while leveraging our strong coal foundation to power our diversified ambitions.
Aligned with our purpose of powering better lives in Africa and bceyond, we are acccelerating the execution of our strategy to provide resources (people, coal, metals, energy and capital) critical to ensuring a responsible energy transition towards a low-carbon future.
Climate change
Energy transition
Impactful transition
Stewardship
Refer to operating context and operating outlook for more information.
Business transformation
Growth and diversification
Sustainability and social impact
How we will achieve this: our Sustainable Growth and Impact strategy
The successful execution of our strategy is delivered through five strategic objectives, which are supported by key enablers, as illustrated below.
Our business now
Long-term goal
(2050)
Short-term goal
(one to five years)
A coal and renewable energy company adding energy transition metalcs and expanding its renewable power generation, with:
Medium-term goal
(six to 10 years)
Strategic objectives that support the execution of our strategy
We implement disciplined capital allocation while driving a positive energy transition and creating social impact. We will leverage our innovative organisational intelligence and take our people along as we focus on building a diversified natural resources portfolio.
We enhance focus on our core delivery areas of minerals and energy by expanding our footprint, simplifying our portfolio through targeted divestments of non-core assets and maintaining strong operational and digital excellence.
We empower people to create impact and we contribute towards sustainable livelihoods while ensuring our people have the requisite capabilities, skills, mindset and passion to do their best work, a core anchor in achieving our purpose.
Through focused portfolio decarbonisation and supporting initiatives, we continue to power positive social, economic and environmental impact.
We aim to positively impact our ecosystem during and after our operations in minerals and energy, contribute to community projects and build thriving, sustainable businesses through our social impact programmes. These programmes aim to drive lasting, scalable socio-economic upliftment and prosperity, independent of our presence and involvement.
*Formerly referred to as "Make our minerals and energy businesses thrive".
Strategic enablers that support decisive strategy execution
Data and technology
We use data, analytics and technology to advance innovation and drive efficiencies, productivity and targeted improvements across our business. This supports a low‑carbon future and unlocks long‑term competitiveness and strategic value.
Skills and talent development
We focus on building talent while fostering workforce capability to drive successful delivery against our strategy. To ensure sustainable long‑term resilience, we provide relevant skills development programmes to our people. We also offer bursaries and internships to nurture and create a resilient talent pipeline.
Partnerships
Partnerships with our stakeholders, including suppliers and industry players, are central to our success. Partnerships foster collaboration and provide a positive platform to facilitate growth, innovation and broad‑based impact.
Capital allocation
Our disciplined capital allocation framework guides our investment decisions, anchoring our investment criteria. This is essential for financial robustness, effective risk management and continued prudent strategic investment execution.
We implement our strategy across three tiers of accountability, with integration across tiers to ensure alignment with long‑term carbon neutrality aspirations and enabling successful execution against strategic objectives.
Our Sustainable Growth and Impact strategy is anchored on our solid coal foundation, which supports and enables our transition into energy transition minerals and metals, diversifying our business as we continue to advance a sustainable, low-carbon future. As we execute on our strategy, which firmly positions Exxaro as a diversified natural resources champion, our strategy follows a natural and aligned evolution.
This evolution has led to a gradual shift of our strategy language and overall narrative aligned to our reviewed focus areas. Our efforts largely focused on updating our strategic enablers and “What success looks like” pillars over 2025, as reflected above.
Coal is the foundation of our business, powering our growth and diversification ambitions while supporting South Africa’s primary energy security and global energy demand.
We are adding energy transition metals vital for a lowcarbon future, through our manganese acquisition, and looking for copper opportunities, among others.
We aim to be a leading energy solutions provider by 2030
Our goal includes providing energy assets and value-integrated services to a broader market, supported by the following pillars:
Our capital allocation framework and capital excellence programme enable us to optimise financial resources to build a resilient business while we deliver consistent stakeholder value. The framework informs strategic decision making between competing business investment interests and aligns with our broader objectives, as we approach the low-carbon transition with a clear understanding of the risks and rewards.
We apply the following criteria to ensure disciplined, data-driven capital allocation that supports our goals:
In addition, our capital allocation is guided by enterprise key performance indicators (KPIs), including growth in minerals earnings, decarbonisation, return on capital employed (ROCE), increase in energy generation, and maintaining our ESG licence to operate.
We manage excess cash prudently, reinvesting in high-return opportunities or returning it to shareholders through special dividends or repurchases depending on prevailing market conditions, ensuring we maintain flexibility.
We maintained strong cash generation, with revenue of R41.8 billion and a net cash position of R17.6 billion (excluding energy net debt of R6.9 billion). This solid cash base enables us to support strategic investments and sustain our existing operations.
Maintaining financial resilience is a priority. Our internal target net debt to EBITDA ratio of less than 1.5 times excluding project finance debt supports financial flexibility and stability, positioning us to respond agilely to market changes as we pursue growth.
We allocate growth capital towards our diversification goals, emphasising a focus on renewables and energy transition minerals and metals. This includes advancing our decarbonisation initiatives to position us as a sustainable, diversified business.
Sustaining capital expenditure (capex) increased due to the capitalisation of the double benching mining at Belfast. This disciplined approach is central to our capital allocation model and ensures we can sustain production in core areas.
In line with Exxaro's strategic intent, we will not spend growth capital on coal projects, other than capital on life extensions of existing coal operations. Our expansion capital prioritises growth in energy transition minerals and metals and our energy solutions business, supporting our transition to a low-carbon future.
We paid R4.1 billion (2024: R5.7 billion) in dividends to external shareholders and R1.4 billion (2024: R1.9 billion) to BEE Parties. This reflects our balanced approach of providing immediate returns to shareholders while actively growing our business.