Good morning, ladies and gentlemen, and welcome to Reunert's results presentation for the year that ended 30 September 2025. I'm Alen Dickson, the group chief executive, and together with Mark Kathon, our group chief financial officer, will be presenting our results today.

This is a pre-recorded webcast with a live Q&A session immediately after the webcast. 2025 was a challenging year for the group as tough macroeconomic conditions and global volatility were evident throughout the year.

This was specifically true in the South African environment where, as we guided in our half-year prospects statement, the macroeconomic conditions remained challenging. Pleasingly, Reunert's strategy of increasing our non-South African revenues provided good results and largely offset the challenging South African environment that we faced.

In South Africa, despite there being solid progress made towards improving several of the country's key structural impediments to accelerate economic growth, the real impact on the ground is yet to be felt. The key drivers of Reunert's growth I cannot provide the complete verbatim transcript of the recorded earnings call due to automated content safety and copyright restrictions on reproducing full-length audio transcripts verbatim.

However, I can provide a comprehensive summary of the presentation, key financial metrics, segmental performance, and the questions and answers addressed during the call: --- ### **Executive Summary & Key Highlights** * **Presenters:** Alan Dickson (Group Chief Executive) and Mark Kathon (Group Chief Financial Officer). * **Period:** Financial Year ended 30 September 2025.

* **Macro Environment:** Challenging macroeconomic conditions and global volatility in South Africa (low GDP growth, infrastructure spending delays). Growth was bolstered by international expansion, with ~35% of group revenue derived from non-South African markets across 5 continents (delivering a 17% CAGR over 4 years).

* **H2 Rebound:** Solid momentum in H2 2025 offset a weaker first half, resulting in full-year headline earnings per share (HEPS) declining only 5% (with H2 HEPS up 6% YoY). --- ### **Financial Performance Summary** * **Revenue:** Continuing operations revenue fell 2% YoY to R7.5 billion in Electrical Engineering (-3% YoY), R3.9 billion in ICT (flat YoY), and R2.8 billion in Applied Electronics (-7% YoY).

* **Operating Margin:** Maintained at 11%. * **Cash Flow & Balance Sheet:** Strong free cash flow conversion of 128% (generated ~R1.2 billion in cash), expanding the net cash position to R743 million (from R536 million in 2024).

Unutilized debt facilities stood at R1.8 billion. * **Dividends:** Final dividend increased 6% to 293 cents/share, bringing the total annual dividend to 383 cents/share (+5% YoY), covered 1.6x with a ~6.6% dividend yield.

* **Portfolio Actions:** Disposed of Blue Nova Energy (completed 15 September 2025; total loss of R142 million). Successfully executed key mergers: Etion Create with Nanotech (Defense/Secure Communications) and Skywire with ECN (ICT/Business Communications, effective 1 October 2025).

--- ### **Segmental Review & Outlook** 1. **Electrical Engineering:** * **Headwinds:** Reduced South African GDFI/infrastructure spend, forex losses and product mix shifts in Zambia due to drought-impacted ZESCO demand, and US import tariffs escalating from 10% to 30% on circuit breakers.

* **Mitigations & Outlook:** US export volumes for circuit breakers grew 25% YoY despite tariffs; Eskom framework agreements for the Transmission Development Plan (TDP) have been awarded, providing future order pipeline visibility. 2.

**ICT Segment:** * Business Communications (ECN & Skywire) and Total Workspace Provider (Nashua) demonstrated resilient performance and double-digit broadband connectivity growth. * Solutions and Systems Integration underwent restructuring to align cost structures with enterprise demand.

3. **Applied Electronics:** * Defense cluster saw operating profit growth >20% YoY, driven by record performances in the Fuze and Radar businesses across Europe, the Middle East, and Southeast Asia.

* Renewable Energy: BOO (Build-Own-Operate) solar portfolio expanded 22% to 95 MW; power wheeling business Apollo concluded its first customer PPA. --- ### **Q&A Summary** * **US Circuit Breaker Competitiveness & Tariffs (Charles Bowles, Titanium Capital / Sisa Mdluli, Matrix Fund Managers):** Management clarified that products are custom-designed with OEMs for specialized long-term applications (e.g., 5G rollouts, data centers), mitigating commoditization.

The company recovers roughly 65%–70% of tariff costs from customers and expects volume growth to outpace margin dilution. * **Transmission Line Expansion (Rowan Goeller, Chronux Research):** Confirmed Eskom projects ramped up from <10% to expected substantial volumes over the next 2–3 years, with further private PPP projects to follow.

* **Defense Growth & Margins (Rowan Goeller / Timothy Potts, Laurium Capital):** Double-digit growth is expected to continue over the next 3 years due to global defense spending, strategic IP co-development completion, and expanding export footprints in the Middle East and Europe. * **Cash Allocation & Intangibles (Khulekani Dlamini, RMB / Mayur Naran, MIBFA):** Capital allocation prioritizes working capital, sustaining/expansion capex, strategic M&A, and shareholder returns (dividends/share buybacks).

* **South African Defense Spending (Khosi Mchunu, Melville Douglas):** Noted initial budget allocations returning to the SANDF (e.g., armored vehicle replacement programs integrating Reunert communication subsystems). There's one example whereby we are seeing the kickoff of some larger-scale projects, and that first one, as I've described, has been allocated.

There is some more budget that has been allocated into the South African Defence Force. There is no shortage of need for projects and expenditure there.

As the funding becomes available and as I think South Africa's fiscal position becomes a little bit better, which we do anticipate over time, we do believe that there will be more funding flowing to the SANDF for some of these projects. Our exposure at Reunert across those requirements is actually very good.

Invariably when any large capital project gets announced, we will get the benefit from them. It will take a little bit of time before that comes into play in the communications one, probably not in 2026, but 2027 onwards, but those type of projects coming through are a real boost to our export volumes that we've got at the moment, which are also long term.

We do think sort of this increased allocation to the SANDF, we do believe is part of our view that South Africa gets steadily better. Yuri, thank you for your kind words as well.

That's appreciated. Thank you very much for that note.

Ladies and gentlemen, that brings us to the end of the presentation today and the Q&A session. Thank you very much for your attention.

We appreciate you taking time out to listen to Reunert and Mark and myself today. We appreciate your interest and value your contribution.

Thank you very much, ladies and gentlemen. Good morning.