Annual report
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Bhagwan Marine Limited ACN 009 154 349 bhagwanmarine.com Annual Report 2026
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About this Report This Annual Report provides an overview of Bhagwan Marine Limited’s operations and performance for the 2026 financial year (FY26), covering the period from 1 July 2025 to 30 June 2026. Unless otherwise stated: References to ‘Bhagwan’ , ‘the Group’ , ‘the Company’ , ‘we’ , ‘us’ or ‘our’ refer to Bhagwan Marine Limited and its controlled entities. References to a ‘year’ relate to the financial year ended 30 June. All dollar figures are expressed in Australian dollars ($) unless otherwise stated. Further Information We welcome questions or feedback about the Company. 2026 Annual Report Please contact us at investor.relations@bhagwanmarine.com 3 BHAGWAN MARINE ANNUAL REPORT 2026
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Iron Whistler 35m Tugboat 4
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Contents BUSINESS OVERVIEW 6 About Bhagwan Marine 6 Our Diversified Business Model 8 Our Integrated Service Offering 9 In Focus: Riverside Marine Acquisition 10 Nationwide Facilities Providing Local Support 12 Diverse & Multifunctional Vessel Fleet 13 Our Clear Growth Strategy 14 FY26 HIGHLIGHTS 16 Financial Highlights 16 Operational Highlights 18 FY26 Riverside Marine Highlights 20 CHAIRMAN’S ADDRESS 23 BOARD OF DIRECTORS 26 CORPORATE GOVERNANCE & SUSTAINABILITY 28 Sustainability 29 REVIEW OF OPERATIONS 31 Executive Leadership Team 34 OPERATING ENVIRONMENT 37 OUTLOOK & FOCUS AREAS 39 FINANCIAL PERFORMANCE 40 FY26 FINANCIAL REPORT 45 Directors’ Report 46 Remuneration Report 55 Financial Report 71 ADDITIONAL ASX INFORMATION 132 OUR PROUD HISTORY 136 5 BHAGWAN MARINE ANNUAL REPORT 2026
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About Bhagwan Marine Bhagwan Marine is Australia’s largest listed marine solutions company, serving the Offshore Energy & Resources, Ports & Inshore and Defence sectors. The Company operates a large multifunctional fleet supporting marine operations nationally. Bhagwan Marine and its 100% owned Riverside Marine and Rivtow operations (‘Bhagwan Group’), are recognised for their strong safety culture and operational excellence in complex marine environments. Long-standing partnerships with major energy and resource companies, construction firms and government agencies reinforce the Bhagwan Group’s reputation as a trusted partner. Bhagwan Marine is one of Australia’s largest in-house marine crewing providers, employing more than 1,000 skilled professionals, including qualified divers. Bhagwan’s locally based crews are recognised for their strong safety culture, operational excellence and ability to deliver high-quality outcomes in complex environments. Founder-led and supported by an experienced Board, Bhagwan Marine maintains a disciplined approach to governance, financial management and sustainable earnings growth for shareholders. Business Overview CMV Athos 6
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Established in 2000 Founder-led management team with a proven track record of safety, operational excellence and disciplined execution. Leading Australian marine solutions provider supporting Offshore Energy & Resources, Ports & Inshore and Defence sectors. 18 Facilities Nationally Multiple growth drivers spanning organic growth, strategic acquisitions and adjacent blue-sky markets, including decommissioning, defence and offshore power. Incumbency at key operating hubs, with long-standing customer relationships that generate opportunities for spot and recurring projects. Net Tangible Assets of $0.42 per share Expanding EBITDA margins and a focus on increasing free cash flow. Large multifunctional fleet positioned to benefit from constrained vessel supply, supporting utilisation, pricing and long-term asset values. 56% recurring revenue1 A strong financial platform to drive further organic and acquisitive growth. Diversified revenue streams with an increasing percentage of recurring revenue supported by Riverside Marine acquisition. 1 FY26 Bhagwan Group recurring revenue was spot and contracted revenues greater than one year in duration. 7 BHAGWAN MARINE ANNUAL REPORT 2026
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Our Diversified Business Model DELIVERING BESPOKE MARINE SOLUTIONS We’re a leading marine solutions provider operating in diverse markets, including offshore energy & resources, ports & inshore and defence industries nationally. Unrivalled Multifunctional Fleet >70 OWNED VESSELS • Dive Support • Tugs and AHTS • Utility and Landing Craft • Multicats • Barges • Crew Transfer Balanced Sources of Revenue INCREASING RECURRING REVENUE • Spot work: <2 weeks • Short-term: <12 months • Long-term: >12 months • FY26 56% Recurring Revenue (spot and long-term) Integrated Service Lines END-TO-END MARINE SOLUTIONS • Marine Services • Subsea Services • Vessel Charters • Project Delivery Diverse Operating Sectors STRONG CORE AND EMERGING MARKETS • Offshore Energy and Resources • Ports and Inshore • Defence 8
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Our Integrated Service Offering PRIORITIES BY SECTOR AND SEGMENT Energy & Resources Our purpose-built vessels, subsea systems and experienced dive teams deliver integrated offshore and subsea services across exploration, construction, Inspection, Maintenance and Repair (IMR), decommissioning and the emerging offshore wind sector, underpinned by a strong safety record and extensive offshore expertise. • Decommissioning • <500m Large Vessel Market • Subsea Project Management • Subsea Remote Operated Vessel (ROV) Operations • Operations and Production • Offshore Wind • Offshore Diving Ports & Inshore We provide extensive port and inshore marine services – including harbour towage, vessel handling, mooring, crew transfers and support for wharf and jetty construction. Our proven capability is demonstrated through long-term contracts with the ports of Melbourne and Brisbane. • Port Maintenance and Repair • Harbour Towage • Inshore Diving • Marine Services and Civil Support • Navigational Aid Maintenance • Port Services Ship Agency • Adhoc Port Towage • Coastal Towage • Dredging • Ferry Services Defence We hold security clearances to support both the Australian Defence Force and the United States Department of Defense, with strategically located facilities at key marine precincts and defence bases enabling 24/7 operational readiness. • Henderson AUKUS • Marine Logistics Barge Services to HMAS Sterling • High-Integrity Pressure Protection Systems (HIPPS) • Inshore Diving • Blue Water Shipping • Border Protection • Research John Oxley II 83m Dredging Vessel 9 BHAGWAN MARINE ANNUAL REPORT 2026
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In Focus: Riverside Marine Acquisition We completed the acquisition of Riverside Marine on 31 March 2026, significantly increasing our scale and diversification. The acquisition expands our geographic and service footprint, increases recurring contracted revenue, and adds Riverside’s capital-light vessel management model. About Riverside Marine A LEADING AUSTRALIAN MARITIME SERVICES GROUP Founded in Brisbane in 1926 by the Campbell Family, Riverside has built a strong reputation for quality, reliability and operational excellence. The Group specialises in the management and operation of approximately thirty diverse vessels, including nine owned vessels, across its five established brands. Supported by deep industry expertise, Riverside serves a long-standing tier-one customer base in markets with high barriers to entry and significant opportunities for growth. Riverside Marine Structure DIVERSE SERVICE OFFERING ACROSS FIVE ESTABLISHED BUSINESSES RIVERSIDE MANAGED VESSELS RIVERSIDE OWNED VESSELS RIVTOW MARINE Managing essential harbour & towage services for tier 1, long-term customers AIMS 1 VESSEL MANAGEMENT Managing dedicated research vessels under long-term government contracts RIVERSIDE INDUSTRIAL SANDS Largest provider of construction sand in Brisbane with high barriers to entry MAGNETIC ISLAND FERRIES Sole provider of essential commercial ferry services linking Townsville and Magnetic Island RIVERSIDE OCEANIC Supplying quality charter vessels across diverse end markets ~30% MANAGED VESSELS – CONTRIBUTION TO FY26 EBITDA 2 ~70% OWNED VESSELS – CONTRIBUTION TO FY26 EBITDA 2 1 Australian Institute of Marine Science. 2 Please refer to the investor presentation for Riverside Marine acquisition. As released on the ASX on 9 February 2026. 10
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Investment Rationale Step-Change Transaction For Bhagwan Riverside is a proven 99-year-old business, founded in 1926 by the Campbell Family Excellent Strategic & Cultural Fit Highly complementary offerings – further diversification by service, geography and commodity Quality-focused, safety-first culture Reinforces Bhagwan’s position as a preferred marine solutions partner Capital Light Business Model Focused on management and operation of vessels rather than ownership Generates additional high-quality revenue with limited capital expenditure High Recurring Annual Revenue Increases Bhagwan’s recurring revenue Strong market position with high barriers to entry Opportunities for revenue synergies High Free Cash Flow2 High EBITDA margin (~40%) Sustaining capex expenditure (30% to 35% of EBITDA) Highly EPS & Return Accretive In FY262 EPS accretion ~14% Return on equity accretion of >20% EBITDA margin increases from 18% to 24% Australian Institute of Marine Science Research Vessel 11 BHAGWAN MARINE ANNUAL REPORT 2026
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Our established presence at key Australia ports and marine hubs enables us to provide efficient and timely support to clients. During FY26 the acquisition of Riverside Marine further expanded and diversified this national presence. Nationwide Facilities Providing Local Support PORT HEDLAND GERALDTON HENDERSON POINT SAMSON ONSLOW EXMOUTH DAMPIER GOVE Perth Melbourne Darwin BHAGWAN MARINE HEAD OFFICE BHAGWAN MARINE OPERATIONS RIVERSIDE MARINE OPERATIONS 12
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GOVE MAGNETIC ISLAND TOWNSVILLE MACKAY GLADSTONE PORT WELSHPOOL PORT ANTHONY Brisbane Multicats Utility & Landing Craft Barges Dive Support Crew Transfer Tugs & AHTS Diverse & Multifunctional Vessel Fleet We operate Australia’s largest vessel fleet, comprising more than 100 inshore and offshore vessels. Our broad range of purpose-built charter vessels and marine assets enables us to deliver tailored solutions that meet specific client requirements. We continue to invest in our fleet, including hybrid power technologies and autonomous vessels. These investments support fleet modernisation and the adoption of technologies that can enhance safety, efficiency and environmental outcomes. 13 BHAGWAN MARINE ANNUAL REPORT 2026
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Solid Core Business POWER OF INCUMBANCY • Market-leading position underpinned by the power of incumbency • Large, multifunctional fleet with a broad geographic footprint • Longstanding client relationships generating consistent opportunities • Established presence at key marine hubs generating ~$50m revenue p.a. • Long-term contracts generating ~$70m revenue p.a. Organic Growth LEVERAGE EXISTING OPPORTUNTIES • Deepen client relationships and increase service offering • Expand into adjacent markets and project types • Drive greater utilisation of the enlarged fleet and capabilities • Multiple growth opportunities already available today • Our Clear Growth Strategy COMPELLING OPPORTUNITIES FOR SUSTAINABLE GROWTH Rivtow Marine Pusher Tugs 14
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Acquisitive Growth EXPERIENCE AND CAPABILITY • Riverside Marine acquisition demonstrates Bhagwan’s capability to execute strategic M&A • Opportunity to further expand scale, capability and market reach • Disciplined approach focused on strategic and commercial fit Blue Sky EMERGING ADJACENT MARKETS • Significant opportunities across decommissioning, defence and offshore power, providing upside beyond the core investment case • Potential for large, material projects as these markets develop • Early positioning provides a platform to capture future market growth over the medium to longer-term Our Clear Growth Strategy 15 BHAGWAN MARINE ANNUAL REPORT 2026
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FY26 Highlights Financial Highlights RESILIENT MARGINS AND STRONG CASH GENERATION EBITDA MARGIN3 20% Up from 18% in FY251 NET REVENUE $235.9m Down 16.6% on FY25 $283.0m1 1 FY25 includes Bhagwan only. 2 Riverside Marine acquisition completed on 31 March 2026 – Riverside Marine FY26 revenue $60.0m. 3 Pro forma EBITDA margin 4 Group pro forma net cash from operations (Bhagwan FY26 and Riverside Marine 4Q FY26) 5 FY25 pro forma cash from operations NET CASH FROM OPERATIONS4 $40.0m Up 9.6% on FY25 $36.5m5 FULLY FRANKED TOTAL DIVIDEND 0.8cps FY25 inaugural fully franked dividend of 0.5cps 60% DIVIDEND GROWTH BHAGWAN $220.8m 4Q FY26 RIVERSIDE MARINE $15.1m 2 4-YEAR REVENUE CAGR 15% BHAGWAN EBITDA $40.0m 3 RIVERSIDE MARINE EBITDA $6.1m 16
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Bhagwan subsea diver 17 BHAGWAN MARINE ANNUAL REPORT 2026
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Operational Highlights BUILDING ON SOLID BASE FOR LONG-TERM GROWTH Secured a five-year contract with Jadestone Energy for Coral Knight 3 Embedded the COO function and strengthened business development capability 1 See announcement Completion of Riverside Marine Acquisition dated 31 March 2026. 2 See announcement Bhagwan Marine Advanced Decommissioning Strategy with Barrow Island Contract dated 24 March 2026. 3 See announcement Award of 5 Year Coral Knight Contract with Jadestone Energy dated 3 December 2025. Additional decommissioning projects2, initial windfarm survey work and built on existing defence presence. Strategic acquisition of Bhagwan Ocean, enhancing capability to capture high-value marine construction and logistic projects Strengthened financial governance and aligned overheads to enhance resilience, margins and future returns Completed transformational acquisition of Riverside Marine and progressed integration1 18
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Bribie Island “Our priorities remain delivering sustainable earnings growth and creating value for our shareholders. ” ANTHONY WOOLES - NON-EXECUTIVE CHAIRMAN 19 BHAGWAN MARINE ANNUAL REPORT 2026
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FY26 Riverside Marine Highlights SUSTAINED GROWTH AND INTEGRATION ON TRACK WITH INVESTMENT CASE 1 Pro forma adjusted EBITDA • Successful completion on 31 March 2026 • 4Q FY26 revenue up 17% on pcp • 4Q FY26 EBITDA up 30%1 on pcp • Further EBITDA margin expansion • 94% long-term recurring revenue in FY26 • Opportunities for Bhagwan to amplify growth across Riverside Marine 52.0 55.0 60.0 FY24 FY25 FY26 17.9 21.6 24.5 FY24 FY25 FY26 $m $m 40.8%39.3%34.4% 52.0 55.0 60.0 FY24 FY25 FY26 17.9 21.6 24.5 FY24 FY25 FY26 $m $m 40.8%39.3%34.4% REVENUE PRO FORMA EBITDA EBITDA MARGIN % 20
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Rivtow Tug 21 BHAGWAN MARINE ANNUAL REPORT 2026
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Kougari 22
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FY26 has been an important year for Bhagwan Marine. There was some disruption in the operating environment during the year, particularly in the energy sector. Disruption in the Middle East and organisational restructuring within the sector contributed to the deferral of a number of select short-term projects in the second half. Throughout, we stayed very focused. These were timing effects rather than structural, and an uplift in activity during May and June was evident. The reality is that project activity levels in energy markets can evolve quite quickly. Bhagwan, however, remains a stable, market-leading business that operates day in, day out. Our national footprint and duration of our market incumbency, longstanding client relationships, diverse fleet and experience, provide Bhagwan with a strong core of recurring activity and allow us to respond to opportunities across the country. Resilient Earnings and Strong Cash Generation Against that backdrop, Bhagwan delivered net revenue of $235.9 million in FY26, compared with $283.0 million in FY25. While revenue was impacted by the deferral of short-term projects, earnings remained resilient and overall Group profitability increased, with Riverside Marine making a strong fourth quarter contribution following completion of the acquisition on 31 March 2026. The Group delivered an EBITDA margin of 20% for FY26. Cash generation was also strong, with pro forma net cash from operations of $40.0 million, up 9.6% on FY25. Following the inaugural dividend paid in FY25, the Board was pleased to declare fully franked dividends totalling 0.8 cents per share for FY26, up 60% on the prior year. Safety Remains Fundamental Throughout FY26, our safety performance remained very strong. Bhagwan's LTIFR was 0.77 and TRIFR improved to 6.90 from 8.32 (FY25). That is particularly important given the growth of the business and the expansion of our workforce. It reflects the commitment of our people across the organisation and the professionalism with which they approach their work every day. As Bhagwan continues to grow in scale and complexity, maintaining a strong safety culture and operating discipline will remain fundamental to the way we do business. Building on Strong Foundations Throughout FY26, I was very pleased with the continued progression of Bhagwan as a public company. Internally, there has been an enormous amount of work undertaken to build on our strong foundations and develop the capabilities required of a business of this scale. During the year, Bhagwan strengthened its accounting, human resources, governance and reporting systems, together with its business development capabilities - critical glue that equips the business for a solid future as a market-leading listed company. We have also continued to bring strong commercial discipline to the business, ensuring Bhagwan is efficient, capable and, importantly, match fit for the opportunities ahead. Bhagwan is the largest ASX-listed marine company in Australia, with a leading market position, an extensive geographic footprint and a large, multifunctional fleet. That fleet is a significant strength, particularly in a market where vessel supply remains tight. Its scale and diversity enable us to respond to a broad range of client requirements across Australia and position Bhagwan well in a market characterised by constrained vessel supply. There is also what I describe as the power of incumbency. We are there, in the business, every day. We have long-standing relationships, vessels operating across the country and people who understand their markets and their clients’ operations intimately. Demand for our services arrives daily, courtesy of that incumbency. Riverside Marine - a Transformational Acquisition The acquisition of Riverside Marine’s marine fleet and operations was unquestionably one of the highlights of the year. It is important to understand the Riverside Marine acquisition in the broader context of the progression of Bhagwan. We could not have undertaken a transaction of this significance without the progress we have made as a listed company in developing our capabilities, governance and skills, together with the balance sheet horsepower required to execute an acquisition of this scale. Anthony Wooles Chairman’s Address NON-EXECUTIVE CHAIRMAN 23 BHAGWAN MARINE ANNUAL REPORT 2026
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We have remained clear that disciplined M&A would form part of Bhagwan’s growth strategy. The Riverside Marine acquisition demonstrates that we have the capability to deliver on that strategy. Importantly, this was not simply a bolt-on acquisition. We have acquired one of the very best marine businesses in the country, with a long and proud history, high-quality operations and a strong reputation built over many years. We now have access to adjacent marine segments that display great potential for sustained growth. I would particularly like to welcome the Campbell family to Bhagwan as shareholders and the Riverside Marine team to the Group and acknowledge the business they have built together over many years. We have enormous respect for Riverside Marine, its people and its heritage. The integration to date has been progressing very smoothly. There is a strong alignment between the cultures and values of the two organisations. Both businesses have very capable people who are deeply committed to what they do, providing a strong foundation for bringing our businesses together. Focused on Execution and Further Growth Our focus now is firmly on ensuring the Riverside Marine acquisition delivers on its strategic potential. Management will remain highly focused on the integration of Riverside Marine and capturing the operational and commercial benefits available from bringing the two businesses together. There is still plenty of work to be done. The Board will remain closely engaged as the integration progresses, while supporting management in delivering the synergies and opportunities available from the combined business. The Bhagwan Investment Thesis At the foundation is a rock-solid core business. Bhagwan has the power of incumbency, a large multifunctional fleet, a broad geographic footprint and longstanding client relationships that generate opportunities day in, day out. Beyond that, there is organic growth already available to us. There are opportunities to do more with existing clients, grow in adjacent markets and put the capabilities of our enlarged fleet to work across a broader range of projects. We have also now demonstrated our capability for inorganic growth. The Riverside Marine acquisition shows that Bhagwan can identify and execute strategic M&A. We will continue to assess opportunities where they make commercial and strategic sense. Beyond, there is significant blue sky. Decommissioning, defence and offshore power have the potential to become significant emerging industry opportunities for Bhagwan. We need to be disciplined about how we think about the timing of those markets because we do not control the pace of their development. Regulatory processes, client decisions and broader market conditions will ultimately determine when activity accelerates. We have already demonstrated through our involvement in decommissioning how substantial individual projects can become, while defence is presenting increasingly tangible opportunities. Importantly, we do not need those opportunities to underpin the strength of Bhagwan today. They sit above a strong core business, and when those markets develop, we will be well-positioned. Acknowledgements FY26 has been about more than one year’s financial performance. It has been another important step in building on the strong foundations of Bhagwan and developing the capability, discipline and scale of a market-leading public company. That progress is the result of the contribution of many people. I would like to thank Tracey Horton and Andrew Wackett for their counsel, commitment and support throughout the year. I would also like to thank Loui and Kerren for their leadership and significant contribution throughout the year. Their commitment to Bhagwan, its people and success has never wavered. Most importantly, I would like to thank everyone at Bhagwan, including the Riverside Marine team who joined us during the year. Our people operate in demanding environments around Australia every day, and their commitment to safety, our clients and each other is fundamental to the strength of the business. Our priorities remain delivering sustainable earnings growth and creating value for our shareholders. On behalf of the Board, I thank our shareholders for their continued support. Anthony Wooles NON-EXECUTIVE CHAIRMAN CHAIRMAN’S ADDRESS 24
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CMV Athos, TVI Project “Bhagwan has the power of incumbency, a large multifunctional fleet, a broad geographic footprint and longstanding client relationships that generate opportunities day in, day out. ” ANTHONY WOOLES - NON-EXECUTIVE CHAIRMAN 25 BHAGWAN MARINE ANNUAL REPORT 2026
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Bhagwan’s Directors have diverse backgrounds in the marine industry, business management, financial oversight and corporate governance. The Board works closely with the Executive Leadership Team to shape the company’s strategic direction while maintaining effective oversight of governance, performance and risk. Board of Directors Anthony Wooles BCom, MBA (Finance), FAICD, SA FIN NON-EXECUTIVE CHAIRMAN Appointed Non-Executive Chairman on 8 March 2012. KEY EXPERIENCE • Extensive executive and advisory experience across mining, oil and gas, power generation, manufacturing, telecommunications, food and beverages and retail. • Current Chairman of IMDEX Limited and Non-Executive Director of High Peak Royalties Limited. • Fellow of the Australian Institute of Company Directors (AICD). • Holds a Bachelor of Commerce (Economics) and an MBA in Finance from the Wharton School, University of Pennsylvania. STRATEGIC CONTRIBUTION • Broad cross-industry leadership experience and board governance expertise. • Chairs Bhagwan’s Remuneration Committee and is a member of the Audit and Risk Committee. Tracey Horton AO BEc (Hons), MBA, FAICDLife INDEPENDENT NON-EXECUTIVE DIRECTOR Appointed Independent Non-Executive Director on 5 June 2024. KEY EXPERIENCE • Professional director with experience across ASX-listed companies, government and not-for-profit boards. • Current Chair of IDP Education Limited and Non-Executive Director of GPT Group and IMDEX Limited. • Former management consultant with Bain & Company and Poynton and Partners, held senior roles with the Reserve Bank of Australia, and served as Winthrop Professor and Dean of the Business School at the University of Western Australia. • Life Fellow of the Australian Institute of Company Directors (AICD). • Holds a Bachelor of Economics (Hons) from the University of Western Australia and an MBA from Stanford Graduate School of Business. STRATEGIC CONTRIBUTION • Board, governance and risk management expertise, together with experience in consulting, education and public sector leadership. • Chairs Bhagwan’s Audit & Risk Committee and is a member of the Remuneration Committee. 26
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Loui Kannikoski Founder MANAGING DIRECTOR AND CHIEF EXECUTIVE OFFICER Founded Bhagwan Marine in 2000. KEY EXPERIENCE • Began his career in the family cray fishing business and led the enterprise from the mid-1980s. • Expanded the family’s marine operations into the oil and gas sector in 1998 as a marine charter operator before formally establishing Bhagwan Marine. STRATEGIC CONTRIBUTION • Deep knowledge of all aspects of the marine industry, combined with strategic and operational expertise that supports Bhagwan’s performance and growth. Andrew Wackett BCom, FCPA, FFIN, GAICD EXECUTIVE DIRECTOR – FINANCE Joined Bhagwan Marine as Executive Director – Finance on 1 May 2024. KEY EXPERIENCE • Former CFO of Fleetwood Limited, Division Director at Macquarie Securities Group for 20 years, and previously spent six years at Wesfarmers. • Holds a Bachelor of Commerce, is a Fellow of CPA Australia, a Fellow of the Financial Services Institute of Australasia, and a Graduate of the Australian Institute of Company Directors (AICD). STRATEGIC CONTRIBUTION • Extensive experience in investment banking, securities management and finance, with significant commercial experience across large Australian and international listed companies. BOARD OF DIRECTORS 27 BHAGWAN MARINE ANNUAL REPORT 2026
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Protecting Our People Our dedication, together with our outstanding performance record of meeting and often exceeding our clients’ strict HSE requirements, has earned us pre-qualification status on several major resource and construction projects. Comprehensive Safety Management System Our Safety Management System is applied across all of our Marine and Subsea operations and complies with the International Maritime Organisation and International Safety Management Code for marine operations. Additionally, our Diving Safety Management System (DSMS) is accepted for Australian State and Federal operations. We ensure all of our crew and specialised Subsea personnel are suitably qualified, experienced and trained in the full implementation of our Safety Management System(s) with a particular focus on the management of risks necessary to conduct safe operations. Vessel Compliance All our vessels hold the requisite Classification Society Certifications and International Maritime Organisation (IMO) Certificates including; • Regular International Marine Contractors Association (IMCA) audits and vessel inspections for registration in the Offshore Vessel Inspection Database (OVID); • Complying with Australian Maritime Safety Authority (AMSA) regulations ensuring safety, environmental protection and seafarer welfare standards are maintained; • Undergoing necessary quarantine inspections and treatments to ensure we comply with Australia’s biosecurity regulations; and • Safety Cases with the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) and the Department of Energy, Mines, Industry Regulation and Safety in Western Australia (DEMIRS) demonstrating thorough understanding of all major accident hazards, and the ability to manage health and safety risks associated within our operations. Corporate Governance & Sustainability Bhagwan Marine’s corporate governance framework supports the delivery of our strategy by providing structure for setting business objectives, monitoring performance, and managing risks. Our framework is designed to align with the ASX Corporate Governance Council’s Principles and Recommendations. Accreditations We’re proud to meet key international standards that reflect our commitment to quality, the environment and keeping our people safe. Our certifications include: ISO 9001:2015 - Quality Management ISO 14001:2015 - Environmental Management ISO 45001:2018 - Occupational Health & Safety Further details are set out in the 2026 Corporate Governance Statement, including Board and Committee Charters and key governance policies, are available on the Company website: www.bhagwanmarine.com/investors/corporate-governance ISO 9001 ISO 14001 ISO 45001 28
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Sustainability PROTECTING OUR ENVIRONMENT Environmental Management is a core priority embedded in our business. We proactively monitor and manage risks across the entire lifecycle of our operations. Our ongoing commitment to sustainability drives the continuous review of our practices and business strategy, to adopt innovative technologies and procedures that reduce our environmental footprint. Our robust environmental policies and management systems underpin our commitment to environmental sustainability. People & Safety Environment Relationships & Performance Innovation Navigate ESG Enablers “Living our values and building our people’s capabilities while ensuring their safety and making it a priority in our workplace” “Committing to preserving our environment for future generations” “Engaging with our customers and suppliers with integrity and respect” “Investing in innovation that reduces energy and improves safety” “Implementing sustainable practices and solutions” Sustainability Development Goals Fiona F Multicat Further details are set out in the 2026 Corporate Governance Statement, including Board and Committee Charters and key governance policies, are available on the Company website: www.bhagwanmarine.com/investors/corporate-governance 29 BHAGWAN MARINE ANNUAL REPORT 2026
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“I am incredibly proud of what our team has achieved during FY26.It has been a year of significant change, growth and progress. ” LOUI KANNIKOSKI – MANAGING DIRECTOR AND CEO Rivtow Marine Port Hedland
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Loui Kannikoski MANAGING DIRECTOR & CEO Review of Operations Dear Shareholders, Last year, Last year, I described FY25 as a significant milestone for Bhagwan, our first full year as an ASX- listed company. FY26 has been another landmark year, defined by the transformational acquisition of Riverside Marine and the exciting opportunities it creates for our future. Reflecting on the progress we have made since listing, I am incredibly proud of what our people have achieved. Together we have strengthened every part of Bhagwan, continuing to build our leadership capability, governance, systems and financial discipline. This has given us the organisational capacity, skills and balance sheet strength not only to bring Riverside Marine into the Group, but also to support its next phase of growth and success. Importantly, while pursuing this transformational acquisition, we remained focused on delivering for our clients and shareholders. Throughout the year, we continued to deepen our position in existing markets, develop new opportunities, expand margins and drive operational excellence across the business. These achievements reflect the commitment, resilience and professionalism of our teams. The operating environment brought some challenges, with conflict in the Middle East and organisational restructuring within the energy sector, which affected the timing of some short-term projects during the second half. Pleasingly, activity lifted in May and June, reinforcing our confidence in the long-term demand drivers across our sectors. As we look ahead, I am optimistic about the opportunities before us. With Riverside Marine now part of the Group, a strong platform for growth and a talented team across our businesses, we have the opportunity to build on this momentum and continue creating value for our clients, employees and shareholders. Financial Performance Against that backdrop, the core business continued to perform well, delivering net revenue of $235.9 million in FY26. This compared with $283.0 million in FY25, with the difference largely reflecting the timing of short-term projects and the absence of revenue from the Thevenard Island project. Pro forma EBITDA was $46.1 million, compared with $50.9 million in FY25. Importantly, disciplined cost management and operational execution supported an increase in the pro forma EBITDA margin to 20%, from 18% in the prior year. Our continued focus on working capital and capital discipline supported strong cash generation. Pro forma net cash from operations increased by 9.6% to $40.0 million, adjusted free cash flow reached $8.3 million and cash conversion remained robust at 90%. Riverside Marine delivered FY26 revenue of $60.0 million and pro forma EBITDA of $24.5 million on a standalone full-year basis. Its fourth- quarter contribution to the Group was $15.1 million of revenue and $6.1 million of pro forma EBITDA. The Board declared fully franked dividends totalling 0.8 cents per share for FY26, up 60% on FY25. Our disciplined approach to capital management balances sustainable shareholder returns with continued investment in the core business and strategic growth opportunities. Operational Achievements Alongside our ongoing long-term contracts with energy clients and the Port of Melbourne, there were several standout achievements during the year: • We maintained a disciplined focus on margins and costs, supporting an increase in pro forma EBITDA margin to 20% from 18% in FY25. • Embedded our COO function, strengthened business development capability and enhanced financial governance and operational processes. • Secured a five-year contract with Jadestone Energy for the Coral Knight, increasing long-term recurring revenue and validating our investment in larger-vessel capability. • Acquired the Bhagwan Ocean, expanding our capability to pursue higher-value marine construction and logistics projects. • Completed the transformational acquisition of Riverside Marine and progressed integration, increasing recurring revenue, fleet scale and capability. • Across our emerging markets, secured additional decommissioning projects, supported initial offshore wind farm survey work, and built on Bhagwan’s existing defence presence through investment at Henderson and early defence industry engagement. Integrating Riverside Marine The strategic fit was evident from the outset: complementary services, long-term customer relationships, broader commodity exposure, greater geographic reach and a capital-light operating model. Since completing the acquisition on 31 March 2026, our priority has been clear: maintaining continuity of service delivery while bringing the two organisations together in a practical and measured way. 31 BHAGWAN MARINE ANNUAL REPORT 2026
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Early integration work has focused on governance, reporting, functional alignment and commercial coordination, while allowing each operation to remain focused on its customers. Riverside Marine brought a high-quality earnings base, with approximately 94% of its FY26 revenue generated from long-term recurring work. Together with Bhagwan's existing contracts, this lifted recurring revenue to 56% of Group revenue, from approximately 40% before the acquisition. Our focus now is on translating the combined platform into higher revenue and earnings by leveraging our broader capabilities, customer relationships and geographic reach. Safety, People and Culture Of all our results, safety is the one I pay closest attention to. In FY26, our lost-time injury frequency rate was 0.77 and our total recordable injury frequency rate improved to 6.90. As I have said before, when it comes to safety, we are never satisfied. There is always more we can do. With this in mind, our leadership and senior management increased site visits across the business to engage with crews, reinforce the importance of safety and identify practical improvements. As Bhagwan continues to grow, preserving our unique culture and strengthening our position as a great place to work remains a key priority. During the year, we established a dedicated People & Culture function, engaging our teams through workshops and employee consultation to help shape the values and behaviours that define who we are and who we aspire to be. That work is continuing. In FY27, we look forward to communicating the refined values across the Group and embedding them in everyday decisions and behaviours. It is an important part of maturing as a company while preserving the practical, people-focused culture that has always been central to Bhagwan. Strategy and FY27 Focus Areas Our growth strategy remains focused on building on the strength of our core business through organic and acquisitive growth, while leveraging opportunities in emerging blue-sky sectors. More specifically, during FY27 we will focus on: • Further strengthening our core business by deepening relationships at key marine hubs, providing a broader range of services and pursuing adjacent project types. • Increasing utilisation and returns across our enlarged fleet by deploying our vessels and capabilities more effectively across the customer network. • Progressing the integration of Riverside Marine and translating the combined platform into higher revenue and earnings. • Building on our position to benefit from increased investment in energy transition, decommissioning and defence. Outlook We enter FY27 with a stronger core business, increasing recurring revenue and a broader national platform following the Riverside Marine acquisition. Integration is on track, with opportunities to strengthen revenue and earnings as a combined business. Incumbency at key marine hubs, enhanced business development capability and positive long-term industry fundamentals support organic growth, while decommissioning, defence and energy transition initiatives, provide additional upside as those markets develop. We remain focused on execution, operational efficiency, free cash flow and sustainable earnings growth. Thank You I am incredibly proud of what our team has achieved during FY26. It has been a year of significant change, growth and progress, made possible by the commitment, professionalism and care shown by our people across the Group. Thank you for looking after one another while continuing to deliver outstanding outcomes for our clients. I would also like to sincerely thank the Campbell family for the trust they have placed in Bhagwan, and the Riverside Marine team for the open, collaborative and positive way they have embraced this next chapter. Together, we have laid the foundations for an exciting future. My thanks also go to the Board and executive leadership team for their guidance, support and steady leadership throughout the year. As we look ahead, we do so from a position of strength. With broader capabilities and an exceptional team, we have an exciting opportunity ahead of us. By continuing to put safety first and delivering dependable outcomes for our clients, I am confident we can create lasting value for our shareholders, customers and people. Loui Kannikoski MANAGING DIRECTOR AND CEO REVIEW OF OPERATIONS 32
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CMV Athos 33 BHAGWAN MARINE ANNUAL REPORT 2026
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Executive Leadership Team Cheryl Williams CHIEF FINANCIAL OFFICER & JOINT COMPANY SECRETARY Managing Director and CEO, Loui Kannikoski, and Executive Director – Finance, Andrew Wackett, are supported by a talented executive leadership team. Together, they combine deep knowledge of the Bhagwan business and the broader marine industry, drawing on experience and expertise to drive operational performance and growth. Loui Kannikoski MANAGING DIRECTOR & CHIEF EXECUTIVE OFFICER Andrew Wackett EXECUTIVE DIRECTOR – FINANCE Cheryl has served as Bhagwan Marine’s Chief Financial Officer and Joint Company Secretary since February 2019. She is responsible for leading the company’s financial strategy, including financial planning, analysis, reporting and overall financial management. Cheryl brings over 15 years of senior finance experience spanning multinational corporations, privately owned businesses and public practice. She is a Certified Chartered Accountant and holds a Certificate in Governance Practice from the Governance Institute of Australia, as well as a BA (Hons) in Accounting and Human Resource Management from the National College of Ireland. 34
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Mark Annand CHIEF OPERATING OFFICER Mark joined Bhagwan in May 2025 to lead the company’s growth strategy and drive operational excellence. He brings strong capabilities in commercial leadership and transformation, with extensive experience in the energy sector. Mark holds a Higher National Certificate in Mechanical Design Engineering from Robert Gordon University in Scotland. Kerren Kannikoski EXECUTIVE GENERAL MANAGER, CORPORATE SERVICES Kerren is a co-founder of Bhagwan Marine and worked to develop the business since its inception in 2000. Kerren plays a key role in overseeing human resources, vessel crewing, information systems and marketing, contributing to the company’s operational strength and growth. Peter Carmichael EXECUTIVE GENERAL MANAGER OF STRATEGY AND BUSINESS DEVELOPMENT Peter is an AMSA-qualified Marine Master and Engineer who has been with Bhagwan Marine since 2006. Over his 18-year tenure, he has operated and managed a wide range of vessels across the Bhagwan fleet, progressing through senior roles including Marine Superintendent and General Manager of Operations for Western Australia. Peter’s extensive operational experience and deep knowledge of the business have been central to building strong client relationships and supporting the company’s growth. His strategic insight and comprehensive understanding of the maritime industry have led to his appointment as General Manager of Corporate and Strategic Development. Peter holds a Graduate Certificate in Business from the University of Western Australia. Angus Campbell MANAGING DIRECTOR, RIVERSIDE MARINE Angus joined Riverside Marine in 1999 and the Bhagwan team in 2026. He is responsible for the Riverside Marine Group brands. Angus has over 35 years’ experience in the maritime sector with comprehensive expertise in marine industry operations management, business development and strategy. Angus holds a Bachelor of Business (Marketing & International Business) from the University of Southern Queensland. EXECUTIVE LEADERSHIP TEAM 35 BHAGWAN MARINE ANNUAL REPORT 2026
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CORE MARKET CORE MARKET CORE MARKET Rivtow Marine Engineer 36
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Operating Environment Positive Long-Term Industry Outlook SUPPLY DEMAND IMBALANCE EXPECTED TO SUPPORT RATES OFFSHORE SUPPORT VESSEL GLOBAL UTILISATION OFFSHORE SUPPORT VESSEL RATE INDEX OFFSHORE SUPPORT VESSEL NEW BUILDING CONTRACTING ACTIVITY BHAGWAN FLEET VALUES INCREASING DUE TO TIGHT NEW BUILD MARKET Forecasts subject to further revision. Projections highly subject to assumptions on future demand estimates, orderbook non-delivery and vessel removals. Anchor Handling Tug Supply (AHTS) Vessels and Platform Supply Vessels (PSV) Source: Clarkson Research 30% 40% 50% 60% 70% 80% 90% 100% 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 (f) 2027 (f) 2028 (f) PSV > 1,000 DWTAHTS 4,000+ BHP 0 100 200 300 400 500 600 1996 1999 2002 2005 2008 2011 2014 2017 2020 2023 2026 40 60 80 100 120 140 160 180 200 220 200 5 2006 200 7 200 8 200 9 201 0 201 1 201 2 201 3 201 4 201 5 201 6 201 7 201 8 201 9 202 0 202 1 202 2 202 3 202 4 202 5 202 6 5.00 7.00 9.00 11.00 13.00 15.00 17.00 19.00 50 70 90 110 130 150 170 190 210 2024 2025 2026 Bhagwan Owned Fleet value (left axis) Riverside Owned Fleet value (left axis)AHTS/AHT PSV/Supply Jan 2005 = 100 PSVAHTS AHTS Global Average Vessel Resale Price - Medium (6,000 BHP) (right axis) $m No. Units $m 30% 40% 50% 60% 70% 80% 90% 100% 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 (f) 2027 (f) 2028 (f) PSV > 1,000 DWTAHTS 4,000+ BHP 0 100 200 300 400 500 600 1996 1999 2002 2005 2008 2011 2014 2017 2020 2023 2026 40 60 80 100 120 140 160 180 200 220 200 5 2006 200 7 200 8 200 9 201 0 201 1 201 2 201 3 201 4 201 5 201 6 201 7 201 8 201 9 202 0 202 1 202 2 202 3 202 4 202 5 202 6 5.00 7.00 9.00 11.00 13.00 15.00 17.00 19.00 50 70 90 110 130 150 170 190 210 2024 2025 2026 Bhagwan Owned Fleet value (left axis) Riverside Owned Fleet value (left axis)AHTS/AHT PSV/Supply Jan 2005 = 100 PSVAHTS AHTS Global Average Vessel Resale Price - Medium (6,000 BHP) (right axis) $m No. Units $m 30% 40% 50% 60% 70% 80% 90% 100% 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 (f) 2027 (f) 2028 (f) PSV > 1,000 DWTAHTS 4,000+ BHP 0 100 200 300 400 500 600 1996 1999 2002 2005 2008 2011 2014 2017 2020 2023 2026 40 60 80 100 120 140 160 180 200 220 200 5 2006 200 7 200 8 200 9 201 0 201 1 201 2 201 3 201 4 201 5 201 6 201 7 201 8 201 9 202 0 202 1 202 2 202 3 202 4 202 5 202 6 5.00 7.00 9.00 11.00 13.00 15.00 17.00 19.00 50 70 90 110 130 150 170 190 210 2024 2025 2026 Bhagwan Owned Fleet value (left axis) Riverside Owned Fleet value (left axis)AHTS/AHT PSV/Supply Jan 2005 = 100 PSVAHTS AHTS Global Average Vessel Resale Price - Medium (6,000 BHP) (right axis) $m No. Units $m 30% 40% 50% 60% 70% 80% 90% 100% 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 (f) 2027 (f) 2028 (f) PSV > 1,000 DWTAHTS 4,000+ BHP 0 100 200 300 400 500 600 1996 1999 2002 2005 2008 2011 2014 2017 2020 2023 2026 40 60 80 100 120 140 160 180 200 220 200 5 2006 200 7 200 8 200 9 201 0 201 1 201 2 201 3 201 4 201 5 201 6 201 7 201 8 201 9 202 0 202 1 202 2 202 3 202 4 202 5 202 6 5.00 7.00 9.00 11.00 13.00 15.00 17.00 19.00 50 70 90 110 130 150 170 190 210 2024 2025 2026 Bhagwan Owned Fleet value (left axis) Riverside Owned Fleet value (left axis)AHTS/AHT PSV/Supply Jan 2005 = 100 PSVAHTS AHTS Global Average Vessel Resale Price - Medium (6,000 BHP) (right axis) $m No. Units $m 37 BHAGWAN MARINE ANNUAL REPORT 2026
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Wheatstone Platform 38
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Outlook & Focus Areas DELIVERING SUSTAINABLE EARNINGS GROWTH Bhagwan enters FY27 with a strong core business, growing recurring revenue and a broader national platform following the Riverside Marine acquisition. Integration is on track, with opportunities to increase volumes, fleet utilisation and earnings. Incumbency at key marine hubs, enhanced business development capability and positive long-term industry fundamentals support organic growth, while decommissioning and defence provide additional upside as these markets develop. Management will remain focused on execution, operational efficiency, free cash flow and sustainable earnings growth. Solid Core Business With Compelling Opportunities for Organic Growth ENERGY & RESOURCES PORTS & INSHORE DEFENCE • Organic growth via incumbency and key marine hubs • Expanding gross and EBITDA margins • Disciplined cost control and capital management • Invest in enhanced systems and processes, including automation Proven Capability for Acquisitive Growth • Ability to pursue acquisitive growth • Progressing Riverside Marine integration Emerging Blue-Sky Opportunities • Decommissioning, defence and energy transition opportunities • Supply demand imbalance within marine sector • Limited new vessel builds since 2015 • Industry rates must rise substantially to encourage further investment INCREASING FREE CASH FLOW ON EXISTING ASSET BASE 39 BHAGWAN MARINE ANNUAL REPORT 2026
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134.7 169.0 203.4 256.6 220.8 65.4 26.4 15.1 268.8 283.0 235.9 FY22 FY23 FY24 FY25 FY26 99.1 104.3 127.7 128.9 116.9 103.9 10.4 55.0 26.4 15.1 109.5 159.3 154.1 119.0 H1 FY24 H2 FY24 H1 FY25 H2 FY25 H1 FY26 H2 FY26 4Q FY26 RIVERSIDE MARINE TVI PROJECT 2 CORE BHAGWAN BUSINESS LONG-TERM REVENUE: >$500K >12M SHORT-TERM REVENUE: >$500K <12M SPOT REVENUE: <$500K & <2WKS RIVERSIDE MARINE FY26 REVENUE 45.0 51.1 50.2 36.7 52.8 67.2 121.7 152.7 103.4 65.4 26.4 15.1 FY24 FY25 FY26 50.2 67.2 103.1 56.4 FY26 PRO FORMA ANNUALISED TVI PROJECT 2 (BLUE-SKY) $m$m $m 62% 56% 44%40% Uncertainty in the Middle East and organisational restructuring within energy sector. (ORGANIC) (AQUISITIVE) (ORGANIC) (ORGANIC) 134.7 169.0 203.4 256.6 220.8 65.4 26.4 15.1 268.8 283.0 235.9 FY22 FY23 FY24 FY25 FY26 99.1 104.3 127.7 128.9 116.9 103.9 10.4 55.0 26.4 15.1 109.5 159.3 154.1 119.0 H1 FY24 H2 FY24 H1 FY25 H2 FY25 H1 FY26 H2 FY26 4Q FY26 RIVERSIDE MARINE TVI PROJECT 2 CORE BHAGWAN BUSINESS LONG-TERM REVENUE: >$500K >12M SHORT-TERM REVENUE: >$500K <12M SPOT REVENUE: <$500K & <2WKS RIVERSIDE MARINE FY26 REVENUE 45.0 51.1 50.2 36.7 52.8 67.2 121.7 152.7 103.4 65.4 26.4 15.1 FY24 FY25 FY26 50.2 67.2 103.1 56.4 FY26 PRO FORMA ANNUALISED TVI PROJECT 2 (BLUE-SKY) $m$m $m 62% 56% 44%40% Uncertainty in the Middle East and organisational restructuring within energy sector. (ORGANIC) (AQUISITIVE) (ORGANIC) (ORGANIC) 134.7 169.0 203.4 256.6 220.8 65.4 26.4 15.1 268.8 283.0 235.9 FY22 FY23 FY24 FY25 FY26 99.1 104.3 127.7 128.9 116.9 103.9 10.4 55.0 26.4 15.1 109.5 159.3 154.1 119.0 H1 FY24 H2 FY24 H1 FY25 H2 FY25 H1 FY26 H2 FY26 4Q FY26 RIVERSIDE MARINE TVI PROJECT 2 CORE BHAGWAN BUSINESS LONG-TERM REVENUE: >$500K >12M SHORT-TERM REVENUE: >$500K <12M SPOT REVENUE: <$500K & <2WKS RIVERSIDE MARINE FY26 REVENUE 45.0 51.1 50.2 36.7 52.8 67.2 121.7 152.7 103.4 65.4 26.4 15.1 FY24 FY25 FY26 50.2 67.2 103.1 56.4 FY26 PRO FORMA ANNUALISED TVI PROJECT 2 (BLUE-SKY) $m$m $m 62% 56% 44%40% Uncertainty in the Middle East and organisational restructuring within energy sector. (ORGANIC) (AQUISITIVE) (ORGANIC) (ORGANIC) 134.7 169.0 203.4 256.6 220.8 65.4 26.4 15.1 268.8 283.0 235.9 FY22 FY23 FY24 FY25 FY26 99.1 104.3 127.7 128.9 116.9 103.9 10.4 55.0 26.4 15.1 109.5 159.3 154.1 119.0 H1 FY24 H2 FY24 H1 FY25 H2 FY25 H1 FY26 H2 FY26 4Q FY26 RIVERSIDE MARINE TVI PROJECT 2 CORE BHAGWAN BUSINESS LONG-TERM REVENUE: >$500K >12M SHORT-TERM REVENUE: >$500K <12M SPOT REVENUE: <$500K & <2WKS RIVERSIDE MARINE FY26 REVENUE 45.0 51.1 50.2 36.7 52.8 67.2 121.7 152.7 103.4 65.4 26.4 15.1 FY24 FY25 FY26 50.2 67.2 103.1 56.4 FY26 PRO FORMA ANNUALISED TVI PROJECT 2 (BLUE-SKY) $m$m $m 62% 56% 44%40% Uncertainty in the Middle East and organisational restructuring within energy sector. (ORGANIC) (AQUISITIVE) (ORGANIC) (ORGANIC) 134.7 169.0 203.4 256.6 220.8 65.4 26.4 15.1 268.8 283.0 235.9 FY22 FY23 FY24 FY25 FY26 99.1 104.3 127.7 128.9 116.9 103.9 10.4 55.0 26.4 15.1 109.5 159.3 154.1 119.0 H1 FY24 H2 FY24 H1 FY25 H2 FY25 H1 FY26 H2 FY26 4Q FY26 RIVERSIDE MARINE TVI PROJECT 2 CORE BHAGWAN BUSINESS LONG-TERM REVENUE: >$500K >12M SHORT-TERM REVENUE: >$500K <12M SPOT REVENUE: <$500K & <2WKS RIVERSIDE MARINE FY26 REVENUE 45.0 51.1 50.2 36.7 52.8 67.2 121.7 152.7 103.4 65.4 26.4 15.1 FY24 FY25 FY26 50.2 67.2 103.1 56.4 FY26 PRO FORMA ANNUALISED TVI PROJECT 2 (BLUE-SKY) $m$m $m 62% 56% 44%40% Uncertainty in the Middle East and organisational restructuring within energy sector. (ORGANIC) (AQUISITIVE) (ORGANIC) (ORGANIC) 134.7 169.0 203.4 256.6 220.8 65.4 26.4 15.1 268.8 283.0 235.9 FY22 FY23 FY24 FY25 FY26 99.1 104.3 127.7 128.9 116.9 103.9 10.4 55.0 26.4 15.1 109.5 159.3 154.1 119.0 H1 FY24 H2 FY24 H1 FY25 H2 FY25 H1 FY26 H2 FY26 4Q FY26 RIVERSIDE MARINE TVI PROJECT 2 CORE BHAGWAN BUSINESS LONG-TERM REVENUE: >$500K >12M SHORT-TERM REVENUE: >$500K <12M SPOT REVENUE: <$500K & <2WKS RIVERSIDE MARINE FY26 REVENUE 45.0 51.1 50.2 36.7 52.8 67.2 121.7 152.7 103.4 65.4 26.4 15.1 FY24 FY25 FY26 50.2 67.2 103.1 56.4 FY26 PRO FORMA ANNUALISED TVI PROJECT 2 (BLUE-SKY) $m$m $m 62% 56% 44%40% Uncertainty in the Middle East and organisational restructuring within energy sector. (ORGANIC) (AQUISITIVE) (ORGANIC) (ORGANIC) Revenue ($m) 4-YEAR CAGR 15% Revenue Profile ($m) INCREASING RECURRING REVENUE AS A % OF TOTAL Financial Performance 134.7 169.0 203.4 256.6 220.8 65.4 26.4 15.1 268.8 283.0 235.9 FY22 FY23 FY24 FY25 FY26 99.1 104.3 127.7 128.9 116.9 103.9 10.4 55.0 26.4 15.1 109.5 159.3 154.1 119.0 H1 FY24 H2 FY24 H1 FY25 H2 FY25 H1 FY26 H2 FY26 4Q FY26 RIVERSIDE MARINE TVI PROJECT 2 CORE BHAGWAN BUSINESS LONG-TERM REVENUE: >$500K >12M SHORT-TERM REVENUE: >$500K <12M SPOT REVENUE: <$500K & <2WKS RIVERSIDE MARINE FY26 REVENUE 45.0 51.1 50.2 36.7 52.8 67.2 121.7 152.7 103.4 65.4 26.4 15.1 FY24 FY25 FY26 50.2 67.2 103.1 56.4 FY26 PRO FORMA ANNUALISED TVI PROJECT 2 (BLUE-SKY) $m$m $m 62% 56% 44%40% Uncertainty in the Middle East and organisational restructuring within energy sector. (ORGANIC) (AQUISITIVE) (ORGANIC) (ORGANIC) • Riv erside Marine contributed $15.1m in revenue for FY26 post-acquisition, increasing recurring revenue to 56% of total revenue (+40% vs FY25) and 62% on an annualised basis. • Short -term projects (<12 months) have recovered in May and June. 1 Riverside Marine 4Q 26 contribution aligning with completion on 31 March 2026. 2 Significant Thevenard Island (TVI) decommissioning project. Recurring Revenue % 268.8 283.0 235.9 276.9 4-Year CAGR 15% 40
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Pro Forma EBITDA 1 Adjusted Cash from Operations Free cash flow Interest & finance costs (5.0) (0.5) (0.6) (18.1) (13.6) 8.3 46.1 40.0 Lease repayments Sustaining capex Working capital Tax paid 134.7 169.0 203.4 256.6 220.8 65.4 26.4 15.1 268.8 283.0 235.9 FY22 FY23 FY24 FY25 FY26 99.1 104.3 127.7 128.9 116.9 103.9 10.4 55.0 26.4 15.1 109.5 159.3 154.1 119.0 H1 FY24 H2 FY24 H1 FY25 H2 FY25 H1 FY26 H2 FY26 4Q FY26 RIVERSIDE MARINE TVI PROJECT 2 CORE BHAGWAN BUSINESS LONG-TERM REVENUE: >$500K >12M SHORT-TERM REVENUE: >$500K <12M SPOT REVENUE: <$500K & <2WKS RIVERSIDE MARINE FY26 REVENUE 45.0 51.1 50.2 36.7 52.8 67.2 121.7 152.7 103.4 65.4 26.4 15.1 FY24 FY25 FY26 50.2 67.2 103.1 56.4 FY26 PRO FORMA ANNUALISED TVI PROJECT 2 (BLUE-SKY) $m$m $m 62% 56% 44%40% Uncertainty in the Middle East and organisational restructuring within energy sector. (ORGANIC) (AQUISITIVE) (ORGANIC) (ORGANIC) 90% STRONG CASH CONVERSION Operating Cash flow before interest and tax to EBITDA 1 $8.3m PR O FORMA FREE CASH FLOW Comprising $4.7m of underlying free cash flow and $3.6m of pro forma adjustments Pro Forma Earnings ($m) STRONG EBITDA MARGINS MAINTAINED Pro Forma Free Cash Flow STRONG CASH CONVERSION 20.9 $m (0.3) 14.5 23.4 23.6 22.4 17.6 6.2 3.9 6.1 20.6 20.7 27.3 23.7 H1 FY24 H2 FY24 H1 FY25 H2 FY25 H1 FY26 H2 FY26 21.5 36.4 35.3 47.0 40.06.0 3.9 6.141.3 50.9 46.1 FY22 FY23 FY24 FY25 FY26 20%18%15%22%16% $m (ORGANIC) (ORGANIC) FINANCIAL PERFORMANCE Small variances may exist due to rounding. 1 Pro forma EBITDA • Cor e business EBITDA increased from $21.5m in FY22 to $40.0m in FY26, representing a CAGR of 16.5%. • Riv erside acquisition and gross margin efficiencies have expanded EBITDA margins. • FY26 earning s reflect a successful transition from TVI project contributions to recurring earnings from the Riverside Marine acquisition. $m 41 BHAGWAN MARINE ANNUAL REPORT 2026
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Debt NET DEBT INCREASED TO FUND GROWTH FINANCIAL PERFORMANCE • Net debt increased to fund the Riverside acquisition and fleet expansion, while the balance sheet remains conservatively positioned at 1.2x leverage (annualised) 34% gearing and 11.7x interest cover – leaving ample headroom to fund the next phase of growth. Notes: Small variances may exist due to rounding. 1 Net debt excluding leases. 2 EBITDA annualised for Riverside Group LEVERAGE 1.2x Net debt 1 / EBITDA 2 GEARING 34% Net debt to equity INTEREST COVER 11.7x Pro forma 2 / interest Capital Expenditure Detail FY26 FY25 Change $m Actual Actual Growth 9.1 19.6 (10.5) S ustaining 18.1 11.9 6.2 Dis cretionary - 6.9 (6.9) A sset sales - (0.9) 0.9 Total 27.2 37.5 (10.3) Growth Capex: Investing for Future Earnings Growth • Str ategic fleet additions to support contracted demand and expand capability: • S eawind 1 landing craft • H ybrid-electric Narrah for the Port of Melbourne contract • Bhag wan Ocean multi-cat vessel (~$6m) targeting higher-margin marine construction and logistics projects Sustaining & Discretionary Capex: Protecting Asset Quality • T argeted fleet upgrades to enhance safety, reliability and operational efficiency. • Maint enance investment reflecting inflationary pressures and extended lead times. Capital Expenditure Detail ENHANCING FLEET QUALITY , SIZE & CAPABILITY FY26 CAPEX MIX ($m ) Growth 9.1 Sustaining 18.1 Notes: Small variances may exist due to rounding. Opening net debt FY26 Growth capex Acquisitions (net of cash) Dividends paid Pro forma free cash flow Capital raised Closing net debt FY26 +9.1 +3.0 (8.3) (28.7)+94.1 5.3 74.5 $m 42
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Balance Sheet NET TANGIBLE ASSETS PER SHARE 42CPS • Riv erside strengthened the balance sheet increasing capital employed and expanding the Group's fleet, property and intangible asset base. • Net debt is f unding growth reflecting the acquisition funding, fleet investment and longer-term lease commitments. • W orking capital was effectively managed throughout the acquisition period. The decline in net working capital assets was primarily due to acquisition-related deferred tax liabilities arising from accounting timing differences, while underlying operating working capital remained stable and well controlled. Statutory Balance Sheet FY 26 FY 25 Change $m Actual Actual FY26 vs FY25 Net working capital (6.6) 4.1 (10.7) P roperty, Plant and Equipment1 269.1 193.6 +75.5 Int angibles 69.5 - +69.5 O ther 6.5 5.4 +1.1 Capi tal employed 338.4 203.1 +135.3 Net debt (inc luding leases) 121.8 38.2 +83.6 Shar eholders funds 216.6 164.9 +51.7 Capi tal employed 338.4 203.1 +135.3 NT A per share (excluding leased assets) (%) 0.42 0.47 (0.05) NTA per share (excluding leased assets and liabilities) (cents) 0.54 0.59 (0.05) ROA (last 12 months) 5.8 9.0 (3.2)pts Notes: Small variances may exist due to rounding. 1 Includes Right of Use Assets. FINANCIAL PERFORMANCE 43 BHAGWAN MARINE ANNUAL REPORT 2026
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Riverside Industrial Sands
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FY26 Financial Report DIRECTORS’ REPORT 46 REMUNERA TION REPORT 55 A UDITOR’S INDEPENDENCE DECLARATION 70 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER INCOME 71 C ONSOLIDATED STATEMENT OF FINANCIAL POSITION 72 C ONSOLIDATED STATEMENT OF CHANGES IN EQUITY 73 C ONSOLIDATED STATEMENT OF CASH FLOWS 74 NO TES TO THE CONSOLIDATED FINANCIAL STATEMENTS 75 C ONSOLIDATED ENTITY DISCLOSURE STATEMENT 124 DIRE CTORS’ DECLARATION 125 INDEPENDENT A UDITOR’S REPORT 126 ADDITIONAL SHAREHOLDER INF ORMATION 132 O UR PROUD HISTORY 136 45 BHAGWAN MARINE ANNUAL REPORT 2026
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Directors’ Report Bhagwan Marine Limited Directors’ R eport 30 June 2026 1 Directors’ Report The Directors of Bhagwan Marine Limited (‘Bhagwan Marine’ or ‘the Company’) present their report on the consolidated entity (referred to hereafter as ‘Group’) consisting of Bhagwan Marine Limited and the entities it controlled at the end of, or during, the year ended 30 June 2026. Directors The names and particulars of the Directors of the Company during the financial year and at the date of this report are: Name and role Information on Directors Anthony Wooles BCom, MBA (Finance), FAICD, SA FIN Chairman & Non-Executive Director Anthony was appointed as Chairman of the Board and Non-Executive Director on 8 March 2012. Experience and Expertise A nthony Wooles has extensive experience in executive and advisory roles in diverse industries, including mining, oil and gas, power generation, manufacturing, telecommunications, food and beverages, and retail. He is also a Fellow of the Australian Institute of Company Directors and holds a Bachelor of Commerce (Economics) and an MBA in Finance from the Wharton School of the University of Pennsylvania. Directorships of other listed companies held in the past three years Imdex Ltd (2016 to current) High Peak Royalties Ltd (2012 to current). Board Committee Memberships Remuneration Committee (Chair) – since 5 June 2024 Audit & Risk Committee – since 5 June 2024 Relevant Interests in Securities in Bhagwan Marine 25,000,000 ordinary shares Tracey Horton AO BEc (Hons), MBA, FAICDLife Independent Non-Executive Director Tracey was appointed as an Independent Non-Executive Director on 5 June 2024. Experience and Expertise T racey Horton is a professional Director with experience across a wide range of ASX- listed companies, Government, and Not -For-Profit boards. She has extensive experience in Australia and internationally as a management consultant, with deep knowledge across a broad range of industries, including utilities (gas and electric), resources, healthcare, manufacturing, retail, and technology. Tracey has previously held executive and senior management roles with Bain & Company in North America, and in Australia wit h Poynton and Partners and the Reserve Bank of Australia. She is a Life Fellow of the Australian Institute of Company Directors and holds a Bachelor of Economics (Hons) from the University of Western Australia and an MBA from Stanford Graduate School of Business. Directorships of other listed companies held in the past three years Imdex Ltd (2023 to current) IDP Education Ltd (2022 to current) GPT Group Ltd (2019 to current) 46
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DIRECTORS’ REPORT Bhagwan Marine Limited Directors’ R eport 30 June 2026 1 Directors’ Report The Directors of Bhagwan Marine Limited (‘Bhagwan Marine’ or ‘the Company’) present their report on the consolidated entity (referred to hereafter as ‘Group’) consisting of Bhagwan Marine Limited and the entities it controlled at the end of, or during, the year ended 30 June 2026. Directors The names and particulars of the Directors of the Company during the financial year and at the date of this report are: Name and role Information on Directors Anthony Wooles BCom, MBA (Finance), FAICD, SA FIN Chairman & Non-Executive Director Anthony was appointed as Chairman of the Board and Non-Executive Director on 8 March 2012. Experience and Expertise A nthony Wooles has extensive experience in executive and advisory roles in diverse industries, including mining, oil and gas, power generation, manufacturing, telecommunications, food and beverages, and retail. He is also a Fellow of the Australian Institute of Company Directors and holds a Bachelor of Commerce (Economics) and an MBA in Finance from the Wharton School of the University of Pennsylvania. Directorships of other listed companies held in the past three years Imdex Ltd (2016 to current) High Peak Royalties Ltd (2012 to current). Board Committee Memberships Remuneration Committee (Chair) – since 5 June 2024 Audit & Risk Committee – since 5 June 2024 Relevant Interests in Securities in Bhagwan Marine 25,000,000 ordinary shares Tracey Horton AO BEc (Hons), MBA, FAICDLife Independent Non-Executive Director Tracey was appointed as an Independent Non-Executive Director on 5 June 2024. Experience and Expertise T racey Horton is a professional Director with experience across a wide range of ASX- listed companies, Government, and Not -For-Profit boards. She has extensive experience in Australia and internationally as a management consultant, with deep knowledge across a broad range of industries, including utilities (gas and electric), resources, healthcare, manufacturing, retail, and technology. Tracey has previously held executive and senior management roles with Bain & Company in North America, and in Australia wit h Poynton and Partners and the Reserve Bank of Australia. She is a Life Fellow of the Australian Institute of Company Directors and holds a Bachelor of Economics (Hons) from the University of Western Australia and an MBA from Stanford Graduate School of Business. Directorships of other listed companies held in the past three years Imdex Ltd (2023 to current) IDP Education Ltd (2022 to current) GPT Group Ltd (2019 to current) Bhagwan Marine Limited Directors’ R eport 30 June 2026 2 Name and role Information on Directors Tracey Horton AO Continued Board Committee Memberships A udit & Risk Committee (Chair) – since 5 June 2024 Remuneration Committee – since 5 June 2024 Relevant Interests in Securities in Bhagwan Marine 54,391 ordinary shares 74,627 share rights Loui Kannikoski Founder Managing Director & CEO Loui was appointed as Managing Director & CEO in 1985. Experience and Expertise Lou i Kannikoski is the Founder and Managing Director & CEO of Bhagwan Marine. His career began in the family’s cray fishing business, which he led from the mid- 1980s. In 1998, he expanded the enterprise by entering the oil and gas sector as a marine charter operator. This strategic move laid the foundation for the establishment of Bhagwan Marine in 2000, marking a significant milestone in the company's growth and diversification. Loui's strategy and growth expertise, combined with his operational experience, have provided a strong understanding of the success factors driving Bhagwan Marine’s performance and business. Directorships of other listed companies held in the past three years None Board Committee Memberships None Relevant Interests in Securities in Bhagwan Marine 120,424,125 ordinary shares 1,349,436 performance rights Andrew Wackett BCom, FCPA, FFIN, GAICD Executive Director - Finance Andrew was appointed as Executive Director – Finance on 1 May 2024. Experience and Expertise Andrew Wackett has extensive experience in investment banking, securities management, and finance and has significant commercial experience with large Australian and international listed entities. Andrew was previously the CFO of Fleetwood Ltd and a Division Director of Macquarie Securities Group for 20 years. Before joining Macquarie, Andrew worked at Wesfarmers for over six years. He holds a Bachelor of Commerce, is a Fellow of CPA Australia, a Fellow of the Financial Services Institute of Australasia and a Graduate of the Australian Institute of Company Directors. Directorships of other listed companies held in the past three years None Board Committee Memberships None Relevant Interests in Securities in Bhagwan Marine 295,976 ordinary shares 689,438 performance rights 74,627 share rights 47 BHAGWAN MARINE ANNUAL REPORT 2026
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DIRECTORS’ REPORT Bhagwan Marine Limited Directors’ R eport 30 June 2026 3 Attendance of Directors at meetings The number of Board meetings including meetings of Board committees, held during the year and the number of meetings attended by each Director is set out below: Board Audit and Risk Committee Remuneration Committee Director Eligible Attended Eligible Attended Eligible Attended Anthony Wooles 17 17 4 4 2 2 Tracey Horton 17 17 4 4 2 2 Loui Kannikoski 17 17 - - - - Andrew Wackett 17 17 - - - - Company Secretary Cheryl Williams and Darryl Edwards are the Joint Company Secretaries. Cheryl Williams is the Chief Financial Officer of Bhagwan Marine and assumed the role of Company Secretary in September 2019. Cheryl has over 15 years’ experience within strategic financial leadership roles across diverse corporate environments including global enterprises, private sector firms, and advisory practice. Cheryl is a Certified Chartered Accountant (ACCA) who holds a Certificate in Governance Practice from the Governance Institute of Australia and a BA (Hons) degree in Accounting and Human Resource Management from the National College of Ireland. Darryl Edwards was appointed as Joint Company Secretary on 5 June 2024. Darryl is a finance, legal, and governance professional with extensive experience in corporate governance, advisory services, mergers and acquisitions, and risk and compliance. He has held roles in board advisory, finance, in-house legal, and company secretary across several large ASX- listed companies. He holds a bachelor’s degree in accounting and finance and studied law at Murdoch University. He is a Fellow of the Governance Institute of Australia and a Member of the Australian Institute of Company Directors and was the former state president of the Governance Institute of Australia. Principal activities During the year the principal activities of the Group consisted of operating a diverse range of vessels providing marine solutions across the offshore energy & resources, subsea, ports & inshore, and defence sectors. The Group completed the acquisition of Riverside Marine, further strengthening and expanding its po rts & in shore operations. There were no other significant changes in the nature of the activities of the Group during the year. Objectives The Company ’s strategic objective is to deliver sustainable earnings growth by leveraging our core service strengths within the marine services sector. The Company is focused on service offerings to meet the evolving needs of its clients across multiple sectors, within offshore energy and resources, subsea, ports & inshore, and defence sectors. The Company is committed to creating long-term shareholder value through disciplined execution, operational excellence, and strategic diversification. Operating and financial review The Group reported revenue from contracts with customers of $235.9 million for the year ending 30 June 2026 (2025: $283.0 million). The reported loss is $0.2 million for the year (2025: profit of $12.5 million). The information required under the Corporations Act on the Company's financial performance and operational review for the year ended 30 June 2026 can be found on pages 31 to 33. 48
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DIRECTORS’ REPORT Bhagwan Marine Limited Directors’ Re port 30 June 2026 3 Attendance of Directors at meetings The number of Board meetings including meetings of Board committees, held during the yearand the number of meetings attended by each Director is set out below: Board Audit and Risk Committee Remuneration Committee Director Eligible Attended Eligible Attended Eligible Attended Anthony Wooles 17 17 4 4 2 2 Tracey Horton 17 17 4 4 2 2 Loui Kannikoski 17 17 - - - - Andrew Wackett 17 17 - - - - Company Secretary Cheryl Williams and Darryl Edwards are the Joint Company Secretaries. Cheryl Williamsis theChief Financial Officer of Bhagwan Marine and assumed the role of Company Secretary in September 2019. Cheryl has over 15 years’ experience within strategic financial leadership roles across diverse corporate environments including global enterprises, private sector firms, and advisory practice. Cheryl is a Certified Chartered Accountant (ACCA) who holds a Certificate in Governance Practice from the Governance Institute of Australia and a BA (Hons) degree in Accounting and Human Resource Management from the National College of Ireland. Darryl Edwards was appointed as Joint Company Secretary on 5 June 2024. Darryl is a finance, legal, and governance professional with extensive experience in corporate governance, advisory services, mergers and acquisitions, and risk and compliance. He has held roles in board advisory, finance, in-house legal, and company secretary across several large ASX- listed companies. He holds a bachelor’s degree in accounting and finance and studied law at Murdoch University. He is a Fellow of the Governance Institute of Australia and a Member of the Australian Institute of Company Directors and was the former state president of the Governance Institute of Australia. Principal activities During the year the principal activities of the Group consisted of operating a diverse range of vessels providing marine solutions across the offshore energy & resources, subsea, ports & inshore, and defence sectors. The Group completed the acquisition of Riverside Marine, further strengthening and expanding its po rts & in shore operations. There were no other significant changes in the nature of the activities of the Group during the year. Objectives The Company ’s strategic objective is to deliver sustainable earnings growth by leveraging our core service strengths within the marine services sector. The Company is focused on service offerings to meet the evolving needs of its clients across multiple sectors, within offshore energy and resources, subsea, ports & inshore, and defence sectors. The Company is committed to creating long-term shareholder value through disciplined execution, operational excellence, and strategic diversification. Operating and financial review The Group reported revenue from contracts with customers of $235.9 million for the year ending 30 June 2026 (2025: $283.0 million). The reported loss is $0.2 million for the year (2025: profit of $12.5 million). The information required under the Corporations Act on the Company's financial performance and operational review for the year ended 30 June 2026 can be found on pages 31 to 33. Bhagwan Marine Limited Directors’ Report 30 June 2026 Operating and financial review (continued) Shareholder returns 2026 2025 2024 2023 2022 Statutory Earnings Before Interest, Tax, Depreciation & Amortisation (EBITDA1) ($’000) 42,500 50,200 39,700 36,400 21,500 Net Pro Forma Adjustments ($’000) 3,600 700 1,600 - - Pro Forma Earnings Before Interest, Tax, Depreciation & Amortisation (Pro Forma EBITDA2) ($’000) 46,100 50,900 41,300 36,400 21,500 (Loss)/profit attributable to owners of the company ($’000) (200) 12,486 5,547 15,4413 2,405 Basic (loss)/earnings per share (cents per share) (0.06) 4.67 3.71 11.56 1.60 Fully franked dividends per share (cents per share) 0.80 0.50 - - - Share price at 30 June4 (cents per share) 27.0 49.0 - - - 1 Earnings before interest, taxes, depreciation and amortisation (“EBITDA”) is an unaudited non-IFRS measure and is a common measure used to assess profitability before the impact of different financing methods, income taxes, depreciation of property, plant and equipment, amortisation of intangible assets and fair value movements. 2 Pro Forma adjustments to EBITDA have been calculated to more clearly represent the Company’s underlying earnings (noting that these adjustments have not been reviewed in accordance with Australian Auditing Standards). These adjustments are; • Transaction costs include $2.0 million of non-contingent costs related to the Company’s acquisition of Riverside Marine Holdings Pty Ltd and $1.6 million of post-acquisition integration costs. Transaction costs for FY25 include $0.7 million of non-contingent transaction costs related to the Company’s IPO. 3 Refer to note 29 for details of the restatement. 4 The Company listed on the ASX on 30 July 2024 with an IPO Price of 63 cents per share. Risks – Specific Business Risks The following are the material risks relevant to the Company’s operations. A. Reliance on resources and oil and gas exploration, development, production and decommissioning activity Bhagwan Marine’s performance and future growth is largely dependent on the level of activity that relates to the resources and oil and gas industry. The level of activity in the resources and oil and gas industry may impact the demand for Bhagwan Marine’s services in offshore energy & resources, subsea, ports & inshore, and defence. B. Reliance on key clients During the financial year ended 30 June 2026, a portion of the Group’s total revenue was derived from a small number of long-term key clients. These clients engaged the Group for the provision of various marine services, including, but not limited to, subsea operations, offshore energy & resources support, and ports & inshore services. The Group’s reliance on a limited number of clients for a significant portion of its revenue represents a concentration risk, which is actively monitored and managed by the Group. C. Failure to renew existing contracts or win new contracts Bhagwan Marine’s ability to renew existing contracts with existing clients and win new contracts is fundamental to maintaining its business profitability and to drive growth with existing clients in terms of expanding the range of services provided and to attract new cl ients. Bhagwan Marine has contracts at various stages and of varying lengths, including contracts that are due to expire in the next 12 months. D. Ability to retain and engage skilled personnel Casual employees make up the majority of Bhagwan Marine’s workforce. Many of these casual employees are highly skilled individuals who are critical to the provision of Bhagwan Marine’s services and the operation of Bhagwan Marine’s vessels. These casual employees generally do not have an obligation to be engaged to provide services when called upon and can generally terminate their employment at short notice. There is a risk that Bhagwan Marine may fail to engage the adequate number of casual employees with the requisite skills to provide the services that it is required to provide or fail to deliver such services in a timely manner or to the standards required. 49 BHAGWAN MARINE ANNUAL REPORT 2026
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DIRECTORS’ REPORT Bhagwan Marine Limited Directors’ Report 30 June 2026 5 Risks – Specific Business Risks (continued) E. Industrial relations and employee risks A substantial portion of Bhagwan Marine’s employees are members of various labour unions under several collective bargaining agreements. While the Company strives to maintain constructive relationships with these unions, Bhagwan Marine notes the following potential risks related to employing members of labour unions: labour disputes and strikes, increased operational costs, regulatory compliance, and periodic contract negotiations. F. Large and highly skilled workforce Bhagwan Marine employs a large and highly skilled workforce. Bhagwan Marine’s service quality is dependent on its ability to attract, develop, motivate and retain appropriately skilled and qualified personnel and on Bhagwan Marine’s ability to provide sufficient training and oversight to its employees to achieve consistent service standards. G. Delay in projects and new contracts’ commencement There is a possibility of delays in the commencement of any new projects or new contracts past the expected commencement date, for example, due to project pre- requisites for commencement not being met, delays in the supply of certain materials, adverse weather events and the failure by Bhagwan Marine to mobilise resources needed to provide the services under the contract in a timely manner. H. Quality of work and delivery of services An important part of Bhagwan Marine’s business is its ability to add value to its clients by delivering high -quality services in a consistent and timely manner. Whilst Bhagwan Marine has a strong record of delivering its services and has systems and processes in place to ensure the continuation of its service standards, there is no guarantee that all of Bhagwan Marine’s services will always meet its client’s expectations as to the quality and timing of the work performed. I. Competition and supply of vessels The marine service industry is competitive and is comprised of many global and regional owners and operators of vessels and marine providers. Bhagwan Marine expects to continue to have a broad range of competitors across all of its operations and in the various locations where Bhagwan Marine operates, which could impact Bhagwan Marine’s ability to retain existing clients, attract new clients, obtain attractive margins on new contracts and other similar or favourable terms when seeking new, or renewing existing, engagements. Demand for Bhagwan Marine’s vessels is affected, at a whole of industry level, by the number of vessels available in the market, Bhagwan Marine’s ability to secure vessels on acceptable commercial terms and maintain those vessels under contracts with counterparties and the competitive landscape in which it operates. Increased competition adversely impacts utilisation levels of Bhagwan Marine’s vessels, day rates that Bhagwan Marine may charge on engagements and other contract terms. An increase in size or capabilities of Bhagwan Marine’s competitors and/or the increased supply or production of new vessels in the industry in which Bhagwan Marine operates, may also increase competition and limit the demand for Bhagwan Marine’s vessels. J. Potential for litigation, claims and disputes Bhagwan Marine may be exposed to various litigation, claims and disputes in the ordinary course of its business as an operator of vessels. These may include property damage claims, contractual disputes, personal injury claims and employment disputes. For example, contractual disputes with clients may arise if Bhagwan Marine is not able to provide the adequate resources to provide the services required by the client under a service contract, such as the appropriate vessel (size or type) or appropriately skilled personnel. The risk of disputes with clients could impact Bhagwan Marine’s relationship with the client, its reputation in the industry and its ability to attract new clients and maintain existing cli ents. K. Third party injury or commercial operations interruption Bhagwan Marine provides services to prominent mining and oil and gas companies and government agencies and operates within settings where it interacts with the public and third- party commercial businesses. While delivering its services, Bhagwan Marine’s employees or contractors, through the use of Bhagwan Marine’s owned or leased vessels, could potentially inflict harm upon individuals, as well as cause damage or disruption to the business operations of third parties. In some instances, Bhagwan Marine is responsible for a client’s assets and may be exposed to risk of loss or damage to such assets irrespective as to the cause of that loss or damage. Bhagwan Marine may be liable for such injury, damage or interruption not covered by insurance protection, which may have a material adverse impact on Bhagwan Marine’s financial performance and financial position. Bhagwan Marine Limited Directors’ Report 30 June 2026 6 Risks – Specific Business Risks (continued) L. Reputation Bhagwan Marine’s ability to maintain its reputation is critical to its ongoing financial performance. Bhagwan Marine’s reputation could be impacted if it does not maintain high standards for service quality or if it fails to comply with regulations or accepted practices. Furthermore, the actions of external entities (i.e. clients, contractors, subcontractors, technical service providers or material suppliers), have the potential to negatively impact Bhagwan Marine’s reputation. Any consequential negative publicity may reduce the demand for Bhagwan Marine’s services. M. Securing funding on acceptable terms Bhagwan Marine is party to a number of separate facility agreements with lenders for the purposes of financing acquisitions, providing guarantees and financing other corporate expenses. Any deterioration in Bhagwan Marine’s financial health, a decline in its creditworthiness, or instability in local and global banking and capital markets might lead to higher borrowing costs for Bhagwan Marine or may impede its ability to secure additional debt or replace existing debt as it matures. An inability for Bhagwan Marine to secure debt funding on favourable terms, or to continue to comply with its financial covenants, could constrain the future growth of its business and could adversely impact Bhagwan Marine’s operating and financial performance. N. Environment and cultural protection Many of Bhagwan Marine’s operations and proposed activities are subject to laws and regulations concerning the environment and cultural heritage protection. Bhagwan Marine ’s services may have an impact on the environment when servicing its clients. Should any of these services adversely impact or interfere with the environment, this may adversely affect Bhagwan Marine’s financial performance. It is Bhagwan Marine’s intention to fully comply with its environmental obligations, including compliance with all environmental and cultural heritage protection laws and regulations. O. Project management and cost management Execution and delivery of projects involves judgment regarding the planning, development and operation of complex operating facilities and equipment. As a result, Bhagwan Marine’s operations, cash flows and liquidity could be affected if the resources or time needed to complete a project are miscalculated, if it fails to meet contractual obligations, or if it encounters delays or unspecified conditions. Cost overruns, unfavourable contract outcomes, serious or continued operational failure, disruption at key projects, disruptions to communication systems or a safety incident have the potential to have an adverse impact on Bhagwan Marine’s ability to adequately resource future engagements and its financial performance. Bhagwan Marine is also exposed to input costs through its operations, such as the cost of fuel and energy sources, equipment and personnel. To the extent that these costs cannot be passed on to clients in a timely manner, or at all, Bhagwan Marine’s financial performance could be adversely affected. P. Maintenance and capital expenditure risk Given the nature of the Company’s operations, its fleet of vessels will age and depreciate over time. As its fleet of vessels age, the cost of maintaining such assets, if not replaced within a certain period of time, will increase. Determining the optimal age of its fleet of vessels is subjective and requires estimates by management with asset management expertise. Q. Inability to maintain adequate insurance Although the Company maintains insurance, no assurance can be given that adequate insurance will continue to be available to the Company in the future on commercially acceptable terms. R. Cyber security Bhagwan Marine may be adversely affected by malicious third- party applications that interfere with, or exploit, security flaws of Bhagwan Marine’s computer or operating systems. Breaches of security, such as cyber-attacks by hackers, could also render Bhagwan Marine’s information technology infrastructure and software platforms unavailable. If the Company’s efforts to combat these malicious applications are unsuccessful, Bhagwan Marine’s reputation and brand name may be impacted, which may result in an adverse effect on its operations and financial position. 50
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DIRECTORS’ REPORT Bhagwan Marine Limited Directors’ Report 30 June 2026 5 Risks – Specific Business Risks (continued) E. Industrial relations and employee risks A substantial portion of Bhagwan Marine’s employees are members of various labour unions under several collective bargaining agreements. While the Company strives to maintain constructive relationships with these unions, Bhagwan Marine notes the following potential risks related to employing members of labour unions: labour disputes and strikes, increased operational costs, regulatory compliance, and periodic contract negotiations. F. Large and highly skilled workforce Bhagwan Marine employs a large and highly skilled workforce. Bhagwan Marine’s service quality is dependent on its ability to attract, develop, motivate and retain appropriately skilled and qualified personnel and on Bhagwan Marine’s ability to provide sufficient training and oversight to its employees to achieve consistent service standards. G. Delay in projects and new contracts’ commencement There is a possibility of delays in the commencement of any new projects or new contracts past the expected commencement date, for example, due to project pre- requisites for commencement not being met, delays in the supply of certain materials, adverse weather events and the failure by Bhagwan Marine to mobilise resources needed to provide the services under the contract in a timely manner. H. Quality of work and delivery of services An important part of Bhagwan Marine’s business is its ability to add value to its clients by delivering high -quality services in a consistent and timely manner. Whilst Bhagwan Marine has a strong record of delivering its services and has systems and processes in place to ensure the continuation of its service standards, there is no guarantee that all of Bhagwan Marine’s services will always meet its client’s expectations as to the quality and timing of the work performed. I. Competition and supply of vessels The marine service industry is competitive and is comprised of many global and regional owners and operators of vessels and marine providers. Bhagwan Marine expects to continue to have a broad range of competitors across all of its operations and in the various locations where Bhagwan Marine operates, which could impact Bhagwan Marine’s ability to retain existing clients, attract new clients, obtain attractive margins on new contracts and other similar or favourable terms when seeking new, or renewing existing, engagements. Demand for Bhagwan Marine’s vessels is affected, at a whole of industry level, by the number of vessels available in the market, Bhagwan Marine’s ability to secure vessels on acceptable commercial terms and maintain those vessels under contracts with counterparties and the competitive landscape in which it operates. Increased competition adversely impacts utilisation levels of Bhagwan Marine’s vessels, day rates that Bhagwan Marine may charge on engagements and other contract terms. An increase in size or capabilities of Bhagwan Marine’s competitors and/or the increased supply or production of new vessels in the industry in which Bhagwan Marine operates, may also increase competition and limit the demand for Bhagwan Marine’s vessels. J. Potential for litigation, claims and disputes Bhagwan Marine may be exposed to various litigation, claims and disputes in the ordinary course of its business as an operator of vessels. These may include property damage claims, contractual disputes, personal injury claims and employment disputes. For example, contractual disputes with clients may arise if Bhagwan Marine is not able to provide the adequate resources to provide the services required by the client under a service contract, such as the appropriate vessel (size or type) or appropriately skilled personnel. The risk of disputes with clients could impact Bhagwan Marine’s relationship with the client, its reputation in the industry and its ability to attract new clients and maintain existing cli ents. K. Third party injury or commercial operations interruption Bhagwan Marine provides services to prominent mining and oil and gas companies and government agencies and operates within settings where it interacts with the public and third- party commercial businesses. While delivering its services, Bhagwan Marine’s employees or contractors, through the use of Bhagwan Marine’s owned or leased vessels, could potentially inflict harm upon individuals, as well as cause damage or disruption to the business operations of third parties. In some instances, Bhagwan Marine is responsible for a client’s assets and may be exposed to risk of loss or damage to such assets irrespective as to the cause of that loss or damage. Bhagwan Marine may be liable for such injury, damage or interruption not covered by insurance protection, which may have a material adverse impact on Bhagwan Marine’s financial performance and financial position. Bhagwan Marine Limited Directors’ Report 30 June 2026 6 Risks – Specific Business Risks (continued) L. Reputation Bhagwan Marine’s ability to maintain its reputation is critical to its ongoing financial performance. Bhagwan Marine’s reputation could be impacted if it does not maintain high standards for service quality or if it fails to comply with regulations or accepted practices. Furthermore, the actions of external entities (i.e. clients, contractors, subcontractors, technical service providers or material suppliers), have the potential to negatively impact Bhagwan Marine’s reputation. Any consequential negative publicity may reduce the demand for Bhagwan Marine’s services. M. Securing funding on acceptable terms Bhagwan Marine is party to a number of separate facility agreements with lenders for the purposes of financing acquisitions, providing guarantees and financing other corporate expenses. Any deterioration in Bhagwan Marine’s financial health, a decline in its creditworthiness, or instability in local and global banking and capital markets might lead to higher borrowing costs for Bhagwan Marine or may impede its ability to secure additional debt or replace existing debt as it matures. An inability for Bhagwan Marine to secure debt funding on favourable terms, or to continue to comply with its financial covenants, could constrain the future growth of its business and could adversely impact Bhagwan Marine’s operating and financial performance. N. Environment and cultural protection Many of Bhagwan Marine’s operations and proposed activities are subject to laws and regulations concerning the environment and cultural heritage protection. Bhagwan Marine ’s services may have an impact on the environment when servicing its clients. Should any of these services adversely impact or interfere with the environment, this may adversely affect Bhagwan Marine’s financial performance. It is Bhagwan Marine’s intention to fully comply with its environmental obligations, including compliance with all environmental and cultural heritage protection laws and regulations. O. Project management and cost management Execution and delivery of projects involves judgment regarding the planning, development and operation of complex operating facilities and equipment. As a result, Bhagwan Marine’s operations, cash flows and liquidity could be affected if the resources or time needed to complete a project are miscalculated, if it fails to meet contractual obligations, or if it encounters delays or unspecified conditions. Cost overruns, unfavourable contract outcomes, serious or continued operational failure, disruption at key projects, disruptions to communication systems or a safety incident have the potential to have an adverse impact on Bhagwan Marine’s ability to adequately resource future engagements and its financial performance. Bhagwan Marine is also exposed to input costs through its operations, such as the cost of fuel and energy sources, equipment and personnel. To the extent that these costs cannot be passed on to clients in a timely manner, or at all, Bhagwan Marine’s financial performance could be adversely affected. P. Maintenance and capital expenditure risk Given the nature of the Company’s operations, its fleet of vessels will age and depreciate over time. As its fleet of vessels age, the cost of maintaining such assets, if not replaced within a certain period of time, will increase. Determining the optimal age of its fleet of vessels is subjective and requires estimates by management with asset management expertise. Q. Inability to maintain adequate insurance Although the Company maintains insurance, no assurance can be given that adequate insurance will continue to be available to the Company in the future on commercially acceptable terms. R. Cyber security Bhagwan Marine may be adversely affected by malicious third- party applications that interfere with, or exploit, security flaws of Bhagwan Marine’s computer or operating systems. Breaches of security, such as cyber-attacks by hackers, could also render Bhagwan Marine’s information technology infrastructure and software platforms unavailable. If the Company’s efforts to combat these malicious applications are unsuccessful, Bhagwan Marine’s reputation and brand name may be impacted, which may result in an adverse effect on its operations and financial position. 51 BHAGWAN MARINE ANNUAL REPORT 2026
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DIRECTORS’ REPORT Bhagwan Marine Limited Directors’ Report 30 June 2026 7 Risks – Specific Business Risks (continued) S. Contingent liabilities Although Bhagwan Marine has limited contractual security arrangements in place in the form of issued bank guarantees and bonds as at 30 June 2026, there is a risk that such a performance security may be called upon, requiring Bhagwan Marine to make whole the provider of the security which may in turn adversely impact the Company’s financial performance. There is also a risk that such performance securities may become difficult or more expensive to secure in the future. Significant changes in the state of affairs On 31 March 2026, the Company acquired 100% of Riverside Marine Holdings Pty Ltd (Riverside Marine). The acquisition was completed on a debt free cash free basis with a normal level of working capital, for an enterprise value of up to $130.0 million. Other than those matters noted above, there were no other significant changes in the Group during the financial year. Matters subsequent to the end of the financial year The Board has declared a final dividend of 0.3 cents per share for the year ended 30 June 2026. The dividend is fully franked, has a record date of 10 September 2026, and will be paid to shareholders on 6 October 2026. No other matter or circumstance has arisen since 30 June 2026 that has significantly affected the group’s operations, results or state of affairs, or may do so in future years. Securities on issue At the date of this report the number of securities on issue is: Number of Securities on Issue Ordinary shares 397,151,458 Performance and share rights 6,456,360 The voting rights attached to each class of equity securities are set out below: (a) Ordinary Fully Paid Shares: every member present at a meeting of the Company in person or by proxy shall have one vote. (b) Performance Rights and Share Rights: no voting rights. One performance right is convertible into one ordinary share for nil consideration. Likely developments and expected results of operations Information on likely developments in the operations of the Group and the expected results of operations have not been included in this report because the Directors believe it would be likely to result in unreasonable prejudice to the Group. Indemnification of Officers and Auditor During the financial year, the Company paid an insurance premium in respect of the Directors and Officers Insurance Policy that insures Directors and Officers against liabilities to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium. In addition, the Company has entered into Deeds of Indemnity, Insurance, and Access in favour of the current Directors, Company Secretaries, and the Chief Operating Officer (COO). 52
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DIRECTORS’ REPORT Bhagwan Marine Limited Directors’ Report 30 June 2026 7 Risks – Specific Business Risks (continued) S. Contingent liabilities Although Bhagwan Marine has limited contractual security arrangements in place in the form of issued bank guarantees and bonds as at 30 June 2026, there is a risk that such a performance security may be called upon, requiring Bhagwan Marine to make whole the provider of the security which may in turn adversely impact the Company’s financial performance. There is also a risk that such performance securities may become difficult or more expensive to secure in the future. Significant changes in the state of affairs On 31 March 2026, the Company acquired 100% of Riverside Marine Holdings Pty Ltd (Riverside Marine). The acquisition was completed on a debt free cash free basis with a normal level of working capital, for an enterprise value of up to $130.0 million. Other than those matters noted above, there were no other significant changes in the Group during the financial year. Matters subsequent to the end of the financial year The Board has declared a final dividend of 0.3 cents per share for the year ended 30 June 2026. The dividend is fully franked, has a record date of 10 September 2026, and will be paid to shareholders on 6 October 2026. No other matter or circumstance has arisen since 30 June 2026 that has significantly affected the group’s operations, results or state of affairs, or may do so in future years. Securities on issue At the date of this report the number of securities on issue is: Number of Securities on Issue Ordinary shares 397,151,458 Performance and share rights 6,456,360 The voting rights attached to each class of equity securities are set out below: (a) Ordinary Fully Paid Shares: every member present at a meeting of the Company in person or by proxy shall have one vote. (b) Performance Rights and Share Rights: no voting rights. One performance right is convertible into one ordinary share for nil consideration. Likely developments and expected results of operations Information on likely developments in the operations of the Group and the expected results of operations have not been included in this report because the Directors believe it would be likely to result in unreasonable prejudice to the Group. Indemnification of Officers and Auditor During the financial year, the Company paid an insurance premium in respect of the Directors and Officers Insurance Policy that insures Directors and Officers against liabilities to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium. In addition, the Company has entered into Deeds of Indemnity, Insurance, and Access in favour of the current Directors, Company Secretaries, and the Chief Operating Officer (COO). Bhagwan Marine Limited Directors’ Report 30 June 2026 8 Climate reporting and environmental regulations The Group operates in compliance with the International Convention for the Prevention of Pollution from Ships (MARPOL) under Commonwealth legislation through the Australian Maritime Safety Authority (AMSA) Marine Order Regulations. In addition, the company complies with all applicable National Law Marine Orders under the Marine S afety (Domestic Commercial Vessel) National Law Act 2012, as administered by AMSA. This includes adherence to Marine Orders relating to vessel certification, crew competency, operational safety, and environmental protection. Our operations are guided by a robust Safety Management System (SMS) aligned with AMSA’s regulatory framework. The Company reports its carbon emissions, energy production, and consumption each year in line with the National Greenhouse Gas and Energy Reporting Act 2007 (Cth) (NGERS). Future mandatory climate & sustainability reporting In accordance with the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024, the Company will be required to submit its first mandatory Sustainability Report containing Climate-related disclosures for the financial year ending 30 June 2027. To facilitate the Company’s compliance with its future sustaina bility reporting obligations, management has prepared a readiness plan. Refer to Corporate Governance & Sustainability on page 28 and 29. Proceedings on behalf of the Company No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or part of those proceedings. Auditor's independence declaration The lead auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this Directors' report on page 70. Non-audit services During the year KPMG, the external auditor, has performed ot her services in addition to the audit of the financial statements. The Directors are satisfied that non-audit services provided during the year by the auditor did not compromise the external auditor’s independence requirements of the Corporations Act 2001 for the following reasons: • all non-audit services were subject to the corporate governance procedures adopted by the Board and have been reviewed by the Audit & Risk Committee to ensure they do not impact the integrity and objectivity of the auditor; and • the non-audit services provided do not undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a management or decision- making capacity for the Company, acting as an advocate for the Company or jointly sharing risks and rewards. Details of the amounts paid /payable to the external auditor of the Company, and its network firms for non- audit services relating to taxation services provided during the current year are $54,530 (2025: $52,250). Rounding of amounts The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Director's Reports) Instrument 2026/183, issued by the Australian Securities and Investments Commission, relating to ' rounding off'. Amounts in this report have been rounded off in accordance with the Corporations Instrument to the nearest thousand dollars, or in certain cases, the nearest dollar. 53 BHAGWAN MARINE ANNUAL REPORT 2026
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Bhagwan Marine Limited Directors’ Report 30 June 2026 9 Dividends Declared and paid due the year Dividends that were paid or declared by the Company to members since the end of the previous financial year were: Cents per Total amount Date of payment share $’000 Final ordinary dividend for the year ending 30 June 2025 0.5 1,376 07 October 2025 Interim ordinary dividend for the year ending 30 June 2026 0.5 1,576 09 April 2026 Total amount 2,952 Declared after end of year After the balance sheet date the following dividends were proposed by the Directors. The dividends have not been provided and there are no income tax consequences. Cents per Total amount Date of payment share $’000 Final ordinary dividend for the year ending 30 June 2026 0.3 1,191 06 October 2026 Total amount 1,191 The financial effect of these dividends has not been brought to account in the consolidated financial statements for the year ended 30 June 2026 and will be recognised in subsequent financial reports. Total amount Note $’000 Dividends have been dealt with in the financial report as: Dividends 19 2,952 Noted as a subsequent event 19, 28 1,191 DIRECTORS’ REPORT 54
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Remuneration Report Bhagwan Marine Limited Directors’ Report 30 June 2026 9 Dividends Declared and paid due the year Dividends that were paid or declared by the Company to members since the end of the previous financial year were: Cents per Total amount Date of payment share $’000 Final ordinary dividend for the year ending 30 June 2025 0.5 1,376 07 October 2025 Interim ordinary dividend for the year ending 30 June 2026 0.5 1,576 09 April 2026 Total amount 2,952 Declared after end of year After the balance sheet date the following dividends were proposed by the Directors. The dividends have not been provided and there are no income tax consequences. Cents per Total amount Date of payment share $’000 Final ordinary dividend for the year ending 30 June 2026 0.3 1,191 06 October 2026 Total amount 1,191 The financial effect of these dividends has not been brought to account in the consolidated financial statements for the year ended 30 June 2026 and will be recognised in subsequent financial reports. Total amount Note $’000 Dividends have been dealt with in the financial report as: Dividends 19 2,952 Noted as a subsequent event 19, 28 1,191 Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 10 Remuneration Report (Audited) This Remuneration Report ( Report) forms part of the Directors’ Report for the year ended 30 June 2026 and has been prepared and audited as required by section 300A of the Corporations Act 2001. This Report is presented under the following sections: A. Introduction and KMP B. Remuneration Governance C. Summary of 2026 Performance and Remuneration Outcomes D. Executive Remuneration Arrangements E. Executive Remuneration Outcomes for FY26 F. Non-Executive Director Remuneration G. Remuneration Expenses for KMP H. Additional Disclosures A. Introduction and KMP Introduction This Report outlines the remuneration arrangements for Key Management Personnel ( KMP) during the financial year ending 30 June 2026 (FY26). The Company’s Executive Remuneration Framework reflects the Remuneration Policy established by the Board and its Remuneration Committee following the Company’s ASX -Listing in July 2024. There have been no changes to the Company’s Remuneration Policy for KMPs during FY26. The Board and its Remuneration Committee are committed to achieving remuneration practices that foster a culture that values integrity, ethical behaviour, accountability, transparency, and respect for all stakeholders. Key Management Personnel KMP is defined as those persons having authority and responsibility for planning, directing, and controlling the major activities of the Company, directly or indirectly, including: • Non-Executive Directors (NEDs); and • Executive Directors and senior executives (collectively the ‘Executives’) The table below details the KMP of the Company for FY26. Each was a KMP for the entire period unless, otherwise stated. Non-Executive Directors Role Anthony Wooles Chair and Non-Executive Director Tracey Horton AO Independent Non-Executive Director Executives Role Loui Kannikoski Managing Director & CEO Andrew Wackett Executive Director – Finance Mark Annand Chief Operating Officer (COO) Details on the experience and skills of each KMP are set out on pages 26, 27 and 35. 55 BHAGWAN MARINE ANNUAL REPORT 2026
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 11 B. Remuneration Governance Remuneration Committee The Remuneration Committee continued to be comprised solely of Non-Executive Directors. The purpose of the Remuneration Committee is to advise the Board on remuneration policies and practices. This includes assisting and making recommendations to the Board in relation to the overall remuneration strategy of the Company, including its specific application of remuneration to Executives and Non-Executive Directors. In fulfilling its purpose, the Remuneration Committee aims to: • align the remuneration and people related policies with the Company’s purpose, vision and values. • determine the eligibility, award, performance measures and vesting of Executive and employee incentive plans. • ensure financial outcomes and risks properly inform the relevant STI and LTI outcomes. The Remuneration Committee receives external remuneration consultant input as required. Remuneration Consultants The Remuneration Committee engaged the services of independent external consultant to provide insights on KMP remuneration benchmarking and market data. No remuneration recommendations as defined in section 9B of the Corporations Act 2001 were obtained during FY26. During the year, the Committee engaged The Reward Practice Pty Ltd to provide remuneration services, including the provision of incentive market insights and benchmarking support, at a total fee of $2,500 (2025: $26,048) and Aon Advisory Australia Pty Ltd to provide remuneration services in respect to external benchmarking with a total fee of $17,431 (2025: $nil) for these services. The Reward Practice and Aon Advisory did not provide other services. The Group is satisfied that the remuneration consultants’ teams are independent. Approach to Executive Remuneration Framework Following the Company’s ASX listing on 26 July 2024, the Board established an Executive Remuneration Framework to support the Company’s long-term strategy and annual operating plan. The framework comprises fixed remuneration and at-risk variable remuneration. As the Company completes its second year as an ASX -listed company, the Board remains focused on ensuring the remuneration framework supports the attraction, retention and development of talent. During the year, the Board continued to review Executive remun eration to ensure it remained aligned with shareholder interests, supported delivery of the Company’s strategic objectives and was competitive with relevant ASX-listed peers. The Executive Remuneration Framework is intended to provide a compelling employee value proposition for Executives and other senior roles by recognising performance and supporting long- term value creation. As the Company matures, the Board will continue to apply disciplined remuneration governance and ensure remuneration practices remain fit for purpose and aligned with shareholder and market expectations. The Board expects the Executive Remuneration Framework to remain unchanged in the coming year, reflecting its confidence that it continues to effectively support the Company's strategy and objectives. The key elements of the Executive Remuneration Framework are outlined in Section D below. Shareholders’ Approval of Remuneration Report at 2025 AGM At the Company’s 2025 Annual General Meeting, 99.96% of eligible shareholders, who voted, approved the 2025 Remuneration Report. This demonstrates ongoing shareholder support and confidence in the Company’s remuneration approach for KMP. Securities Trading Policy Directors and employees (including Executive KMP) are prohibited from trading in financial products issued or created over the Company’s securities created by third parties, and from trading in associated products and entering into transactions that operate to limit the economic risk of holdings of unvested Bhagwan Marine securities or vested shares which are subject to a holding lock. The Security Trading Policy is available on the Company’s website. 56
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 11 B. Remuneration Governance Remuneration Committee The Remuneration Committee continued to be comprised solely of Non-Executive Directors. The purpose of the Remuneration Committee is to advise the Board on remuneration policies and practices. This includes assisting and making recommendations to the Board in relation to the overall remuneration strategy of the Company, including its specific application of remuneration to Executives and Non-Executive Directors. In fulfilling its purpose, the Remuneration Committee aims to: • align the remuneration and people related policies with the Company’s purpose, vision and values. • determine the eligibility, award, performance measures and vesting of Executive and employee incentive plans. • ensure financial outcomes and risks properly inform the relevant STI and LTI outcomes. The Remuneration Committee receives external remuneration consultant input as required. Remuneration Consultants The Remuneration Committee engaged the services of independent external consultant to provide insights on KMP remuneration benchmarking and market data. No remuneration recommendations as defined in section 9B of the Corporations Act 2001 were obtained during FY26. During the year, the Committee engaged The Reward Practice Pty Ltd to provide remuneration services, including the provision of incentive market insights and benchmarking support, at a total fee of $2,500 (2025: $26,048) and Aon Advisory Australia Pty Ltd to provide remuneration services in respect to external benchmarking with a total fee of $17,431 (2025: $nil) for these services. The Reward Practice and Aon Advisory did not provide other services. The Group is satisfied that the remuneration consultants’ teams are independent. Approach to Executive Remuneration Framework Following the Company’s ASX listing on 26 July 2024, the Board established an Executive Remuneration Framework to support the Company’s long-term strategy and annual operating plan. The framework comprises fixed remuneration and at-risk variable remuneration. As the Company completes its second year as an ASX -listed company, the Board remains focused on ensuring the remuneration framework supports the attraction, retention and development of talent. During the year, the Board continued to review Executive remun eration to ensure it remained aligned with shareholder interests, supported delivery of the Company’s strategic objectives and was competitive with relevant ASX-listed peers. The Executive Remuneration Framework is intended to provide a compelling employee value proposition for Executives and other senior roles by recognising performance and supporting long- term value creation. As the Company matures, the Board will continue to apply disciplined remuneration governance and ensure remuneration practices remain fit for purpose and aligned with shareholder and market expectations. The Board expects the Executive Remuneration Framework to remain unchanged in the coming year, reflecting its confidence that it continues to effectively support the Company's strategy and objectives. The key elements of the Executive Remuneration Framework are outlined in Section D below. Shareholders’ Approval of Remuneration Report at 2025 AGM At the Company’s 2025 Annual General Meeting, 99.96% of eligible shareholders, who voted, approved the 2025 Remuneration Report. This demonstrates ongoing shareholder support and confidence in the Company’s remuneration approach for KMP. Securities Trading Policy Directors and employees (including Executive KMP) are prohibited from trading in financial products issued or created over the Company’s securities created by third parties, and from trading in associated products and entering into transactions that operate to limit the economic risk of holdings of unvested Bhagwan Marine securities or vested shares which are subject to a holding lock. The Security Trading Policy is available on the Company’s website. Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 12 C. Summary of 2026 Performance and Remuneration Outcomes In determining the 2026 remuneration outcomes, the Board has carefully considered C ompany performance and progression of strategic objectives, individual achievements, the operating environment and the context in which targets were set, and alignment with stakeholder expectations. The following summarises the remuneration outcomes for FY26 for KMP. FY26 Highlights for KMP Remuneration Executive KMP Executives’ Total Fixed Remuneration (TFR) outcomes An executive remuneration review was conducted in June 2025, with each Executives remuneration benchmarked against similarly sized organisations using independent data provided by an external remuneration consultant, with market median adopted as the benchmark adopted as the benchmark. As a result from 1 July 2025, the MD/CEO’s, Executive Director – Finance and COO received increases to their TFR. The MD/CEO’s base salary increased by 3.3% and increase to statutory superannuation, the Executive Director – Finance base salary increased by 1.25% and the COO’s salary increased in line with changes in statutory superannuation. See Section D - Executive Remuneration Arrangements for more details. Executives’ Short-Term Incentive (STI) outcomes The STI Plan for FY26 was structured to align Executive remuneration outcomes with the achievement of Board -approved financial and safety objectives set at the beginning of the financial year. For FY26, the minimum EBITDA hurdle was not achieved. Accordingly, no STI awards are payable to Executives for FY26 performance. Refer to Section E – Executive Remuneration Outcomes for FY26 for further details. Executives’ Long-Term Incentive (LTI) outcomes No performance rights on issue have a performance period ending on or before 30 June 2026. Accordingly, no performance rights vested during the financial year. During the year, Executives were granted performance rights subject to achievement of performance conditions over a three- year period from 1 July 2025 to 30 June 2028. The performance rights are not subject to any retesting. Shareholders approved the issue of these performance rights to Executives. See Section D - Executive Remuneration Arrangements for further details on the performance hurdles and terms of the LTIs. Non-Executive Directors Non-Executive Directors (NEDs) Fixed Remuneration for FY26 There was no change to the fees payable to Non-Executive Directors. Non-Executive Directors did not participate in any incentive plans. Non- Executive Directors' Fees are periodically benchmarked by external remuneration consultants. See Section F - Non-Executive Director Remuneration. 2027 Remuneration Approach As we conclude our second year as an ASX -listed company, we remain focused on strengthening our remuneration framework to support the attraction, retention and development of high- calibre talent. The Board continues to review remuneration arrangements to ensure they remain aligned with shareholder interests, support the delivery of the Company's strategic objectives and are competitive with relevant ASX-listed peers. Our remuneration framework is designed to provide a compelling employee value proposition for both Executives and employees, recognising performance and fostering long- term value creation. As the Company continues to mature, we will maintain a disciplined approach to remuneration governance while ensuring our practices remain fit for purpose and aligned with market expectations. For FY27, the Board expects the Executive Remuneration Framework to remain substantially unchanged, reflecting its confidence that the framework continues to effectively support the Company's strategy and remuneration objectives. 57 BHAGWAN MARINE ANNUAL REPORT 2026
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 13 D. Executive Remuneration Arrangements Executive Remuneration Framework and Strategy The Company’s Executive Remuneration Framework is designed to attract, motivate, and retain high- performing individuals, and align the interests of Executives and shareholders. The following diagram illustrates how the Executive Remuneration Framework aligns with the strategic direction and links Executives’ remuneration outcomes to performance. Business Objective Providing leading marine solutions to deliver the best possible level of service, ensuring our clients’ success and contributing to a sustainable future. How our Executive Remuneration links to our Strategic Objective Align the interests of Executives with our shareholders • The Executive Remuneration Framework includes “at-risk” components, including both short -term and long-term, delivered through cash and equity; and • Executive performance is evaluated against financial and non-financial metrics that drive growth, profitability, and overall shareholder value. Align, motivate, and retain high-performing individuals • Executive’s remuneration is benchmarked to remain competitive with companies of similar size and complexity; and • Long-term incentive components are designed to promote Executive retention and sustained performance over the long-term. Remuneration Component Vehicle Purpose Link to Performance Total Fixed Remuneration (TFR) Cash comprising of base salary and superannuation. To offer a competitive fixed salary based on the role, location, and individual experience. Executives' experience, responsibilities and performance. Relevant to market comparisons. Short-Term Incentives (STI) Cash-based incentive scheme based on the Company’s performance for the current financial year. Rewards Executives for their contributions to achieving financial and safety outcomes that are a priority for the Company for the financial year. Measures are set considering the Company’s annual objectives and short-term strategy. EBITDA is a key financial metric, alongside safety performance for the current financial year. Long-Term Incentives (LTI) Awards are made in the form of performance rights that vest subject to the achievement of three-year performance hurdles. Rewards Executives for their contribution to the creation of shareholder value over the longer term. Vesting of incentives is dependent on Relative Total Shareholder Return (rTSR) performance relative to a peer group of companies, and the achievement EBITDA compound growth, over a three- year performance period. A safety gateway applies. There is no re-testing. Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 14 D. Executive Remuneration Arrangements (continued) Approach to setting remuneration and details of incentive plans In FY26, the Executives’ remuneration comprised fixed remuneration and at-risk short and long-term incentives. Executive remuneration packages are weighted towards at-risk remuneration to drive performance for shareholders. Executive Remuneration and Mix How is overall remuneration and mix determined? Executive remuneration is reviewed annually, taking into account market data, company and individual performance, as well as the broader economic context. The Company seeks to provide Executives with remuneration that is appropriately structured in terms of fixed remuneration, short -term incentives, and long- term incentives. This structure reflects the Executive’s role, responsibilities, and performance. Fixed Remuneration – Base Salary and other benefits How is base salary and other benefits reviewed and approved? Executives’ total fixed remuneration, including base salary, superannuation and benefits, is reviewed using external benchmarked data reflecting the size and complexity of the Company. Any changes in remuneration for Executives must be approved by the Board’s Remuneration Committee. The Company’s policy is to position Executives base salary around the 50 percentile of its targeted market comparators. Variable Remuneration – Short-Term Incentives What is the STI Plan? The STI Plan is a cash-based incentive used to align executive remuneration with the achievement of annual financial and operational objectives, promote safe and sustainable performance, support the retention and motivation of Executives, and create value for shareholders by rewarding performance that exceeds Board-approved targets set at the beginning of the financial year. Participation in the STI Plan is available to Executives and other senior managers. How much can Executives earn under the STI Plan? The MD/CEO, the Executive Director – Finance and the COO have a maximum STI opportunity of 50% of their TFR, and other senior managers have a maximum STI opportunity of 30% of their TFR. STIs are paid in cash and are inclusive of relevant statutory superannuation. STI payments are made following the release of the Company’s audited financial statements for the relevant financial period. What performance measures will inform the STI Plan? The Remuneration Committee sets annual performance targets related to the Company’s annual operating plan. The FY26 performance measures for Executive KMP included Pro Forma EBITDA (100% weighting) and a safety performance gate, set at the beginning of the year. EBITDA is used as a STI performance measure because it focuses on operational performance, is well understood throughout the business, and aligns with shareholder value creation. The Board may, in its sole discretion, exclude unbudgeted, non-recurring or non-operational events or transactions not expected to occur regularly or unrelated to underlying operating activities, including one- off or individually significant items such as gains or losses from business or asset acquisitions and significant litigation settlements. The safety gate measures lost time injury frequency rate (LTIFR) to ensure sustainable performance in health and safety. Executives are eligible for an STI payment only if the overarching EBITDA threshold of 2% above Board-approved budget EBITDA (stretch EBIT DA) and the safety gateway requirements are achieved. Once the EBITDA threshold is met, STI outcomes are determined under a profit -sharing formula, with awards increasing for EBITDA performance above threshold up to the participant’s maximum STI opportunity. To achieve 100% of the maximum STI Opportunity, the stretch EBITDA for FY26 would have to be met. Final STI outcomes are determined by the Remuneration Committee after assessing stretch EBITDA and safety performance at year end, with regard to Company performance and broader market factors. What happens if a participant leaves before the vesting date? If an Executive KMP ceases employment, prior to the STI payment date, for any other reason or circumstances (including death, total and permanent disability, retirement or redundancy), the STI opportunity will be forfeited. How is Board discretion considered? The Board’s discretion on STI awards will take into account all relevant factors at the time, which may include the Company's and the participant's performance, the operating environment, and the context in which targets were set, as well as alignment with stakeholder expectations. Consideration of these factors may lead to the exercise of discretion to increase or decrease STI outcomes. 58
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 14 D. Executive Remuneration Arrangements (continued) Approach to setting remuneration and details of incentive plans In FY26, the Executives’ remuneration comprised fixed remuneration and at-risk short and long-term incentives. Executive remuneration packages are weighted towards at-risk remuneration to drive performance for shareholders. Executive Remuneration and Mix How is overall remuneration and mix determined? Executive remuneration is reviewed annually, taking into account market data, company and individual performance, as well as the broader economic context. The Company seeks to provide Executives with remuneration that is appropriately structured in terms of fixed remuneration, short -term incentives, and long- term incentives. This structure reflects the Executive’s role, responsibilities, and performance. Fixed Remuneration – Base Salary and other benefits How is base salary and other benefits reviewed and approved? Executives’ total fixed remuneration, including base salary, superannuation and benefits, is reviewed using external benchmarked data reflecting the size and complexity of the Company. Any changes in remuneration for Executives must be approved by the Board’s Remuneration Committee. The Company’s policy is to position Executives base salary around the 50 percentile of its targeted market comparators. Variable Remuneration – Short-Term Incentives What is the STI Plan? The STI Plan is a cash-based incentive used to align executive remuneration with the achievement of annual financial and operational objectives, promote safe and sustainable performance, support the retention and motivation of Executives, and create value for shareholders by rewarding performance that exceeds Board-approved targets set at the beginning of the financial year. Participation in the STI Plan is available to Executives and other senior managers. How much can Executives earn under the STI Plan? The MD/CEO, the Executive Director – Finance and the COO have a maximum STI opportunity of 50% of their TFR, and other senior managers have a maximum STI opportunity of 30% of their TFR. STIs are paid in cash and are inclusive of relevant statutory superannuation. STI payments are made following the release of the Company’s audited financial statements for the relevant financial period. What performance measures will inform the STI Plan? The Remuneration Committee sets annual performance targets related to the Company’s annual operating plan. The FY26 performance measures for Executive KMP included Pro Forma EBITDA (100% weighting) and a safety performance gate, set at the beginning of the year. EBITDA is used as a STI performance measure because it focuses on operational performance, is well understood throughout the business, and aligns with shareholder value creation. The Board may, in its sole discretion, exclude unbudgeted, non-recurring or non-operational events or transactions not expected to occur regularly or unrelated to underlying operating activities, including one- off or individually significant items such as gains or losses from business or asset acquisitions and significant litigation settlements. The safety gate measures lost time injury frequency rate (LTIFR) to ensure sustainable performance in health and safety. Executives are eligible for an STI payment only if the overarching EBITDA threshold of 2% above Board-approved budget EBITDA (stretch EBIT DA) and the safety gateway requirements are achieved. Once the EBITDA threshold is met, STI outcomes are determined under a profit -sharing formula, with awards increasing for EBITDA performance above threshold up to the participant’s maximum STI opportunity. To achieve 100% of the maximum STI Opportunity, the stretch EBITDA for FY26 would have to be met. Final STI outcomes are determined by the Remuneration Committee after assessing stretch EBITDA and safety performance at year end, with regard to Company performance and broader market factors. What happens if a participant leaves before the vesting date? If an Executive KMP ceases employment, prior to the STI payment date, for any other reason or circumstances (including death, total and permanent disability, retirement or redundancy), the STI opportunity will be forfeited. How is Board discretion considered? The Board’s discretion on STI awards will take into account all relevant factors at the time, which may include the Company's and the participant's performance, the operating environment, and the context in which targets were set, as well as alignment with stakeholder expectations. Consideration of these factors may lead to the exercise of discretion to increase or decrease STI outcomes. 59 BHAGWAN MARINE ANNUAL REPORT 2026
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 15 Variable Remuneration – Long Term Incentives What is the LTI Plan? The Incentive Awards Plan ( LTI Plan) is designed to provide incentives to attract and retain talent, and to align the interests of Executives with those of the Company. Under the terms of the LTI Plan, the Board may, from time to time, provide the opportunity for Eligible Participants to subscribe for such number of equity securities in the Company and on the conditions specified in the LTI Plan. A full copy of the LTI Plan is available on the Company’s website at www.bhagwanmarine.com Shareholder approvals for LTI Plan and grants? The LTI Plan was approved by shareholders on 12 November 2024, for the purposes of ASX Listing Rule 7.2, Exception 13 and for all other purposes. The maximum number of equity securities to be granted under the LTI Plan must not exceed 13,760,012 (being 5% of the Company’s Share capital at the date of shareholders’ approval). The issue of FY26 LTIs to Executive Directors, Mr Kannikoski and Mr Wackett, was approved under ASX Listing Rule 10.14 by shareholders at the Company’s AGM on 29 October 2025. How much can Executives earn under the LTI Plan? The MD/CEO, the Executive Director – Finance, and the COO have a maximum LTI opportunity of 50% of their TFR, and other senior managers have a maximum LTI opportunity of 30% of their TFR. Executives are not entitled to receive dividends or dividend-equivalent payments on p erformance rights that remain unvested or unexercised. What performance measures will inform the LTI Plan? Performance Rights granted are subject to the achievement of two performance criteria comprising EBITDA compound annual growth rate ( EBITDA CAGR ) and Relative Total Shareholder Return (rTSR), measured over a three-year performance period. Performance Measure rTSR EBITDA CAGR Weighting 50% 50% Purpose To recognise the performance of the Company’s shares and shareholder value creation. To recognise long-term growth in profitability and shareholder value creation. The vesting of Performance Rights is also subject to the Company's safety performance, including no fatalities and a lost time injury frequency rate ( LTIFR) of less than 2.0 ( Safety Gate) and Board discretion. The calculation of each performance measure is outlined below: rTSR Hurdle: The Board believes that rTSR is widely accepted by the market as a key measure of long-term performance. rTSR is a measure of the performance of the Company’s shares over a three-year performance period compared with the TSR of a comparator group of companies. TSR measures the percentage change in a Company’s share price over a three-year performance period, plus the value of dividends received during that period, assuming all dividends are reinvested to acquire new shares. The comparator group is a peer group comprised of ASX -listed as determined by the Board at the beginning of the performance period. Details on how rTSR is calculated and the comparator group are set out in Annexure B in the Company’s 2025 Notice of Annual General Meeting. Details of the vesting schedule for rTSR Performance Rights are set out below: rTSR over the three-year performance period Level of vesting Less than 50th percentile 0% At 50th percentile 50% Between the 50th and 75th percentile 50% plus a pro-rata straight-line percentage increase between 50% and 75% At or above the 75th percentile 100% Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 16 Variable Remuneration – Long Term Incentives (continued) What performance measures will inform the LTI Plan? (continued) EBITDA CAGR Hurdle: The Board considers EBITDA CAGR growth over a three- year performance period an appropriate measure for the grant of long-term incentives, as it is well understood within the business and a key measure of performance and shareholder value. The Board will continue to evaluate this measure in future years. EBITDA is a measure of the Company’s profitability before interest, tax, depreciation and amortisation. EBITDA also indicates how much cash the Company makes and is a widely used metric for measuring performance. Details of the vesting schedule for EBITDA CAGR Performance Rights are set out below: EBITDA CAGR performance Level of vesting Less than 5% EBITDA CAGR 0% At 5% EBITDA CAGR 25% Between 5% and 15% EBITDA CAGR 25% plus a pro-rata straight-line percentage increase between 5% and 15% At or above 15% EBITDA CAGR 100% How is the number of performance rights granted determined? The number of performance rights granted to each participant is determined by the Board. During FY26, the number of Performance Rights issued was calculated based on each Executive’s maximum long- term incentive opportunity, divided by $0.493, being the 5-day Volume -Weighted Average Price (VWAP) of Bhagwan Marine Shares at 30 June 2025. When is performance criteria measured? LTI outcomes are determined by the Remuneration Committee following an assessment of performance measures at the end of the three-year performance period and with regard to the Company’s performance and broader market factors. Performance rights will lapse if the performance measures are not met at the end of the performance period. There is no opportunity for re-testing. What happens on cessation of employment? If a participant ceases employment, whether due to special circumstances (including death, terminal illness or permanent disablement) or due to the participant’s resignation or termination, unless the Board determines otherwise and subject to applicable laws , unvested performance rights will automatically lapse. If a participant ceases employment after performance rights have vested but not exercised, the participant may continue to hold such vested performance rights depending on the circumstances of the cessation of employment. Do any clawback or malus provisions apply? The Board has clawback powers which it may exercise if: • there has been a material misstatement in Bhagwan Marine’s financial statements; • a participant has acted fraudulently or with malfeasance; or • some other event has occurred, which, as a result, means that the performance conditions in respect of any vested Performance Rights were not, or should not have been determined to have been, satisfied. What happens if there is a change in control? Subject to applicable ASX Listing Rules, in the event of a change of control or Business Sale: • any performance conditions in respect of unvested Performance Rights will be deemed to be automatically waived unless and to the extent the Board otherwise resolves; and the Board may require that all vested Performance Rights be exercised as part of a Change of Control/Business Sale, failing which they lapse. Is hedging permitted on unvested LTIs? In accordance with the Company’s Securities Trading Policy, a participant is prohibited from entering into arrangements to protect the value of unvested performance rights. This includes entering into contracts to hedge the exposure to performance rights or shares granted. Are participants entitled to voting rights and dividends? No dividends are paid on performance rights until they vest. Performance rights do not carry voting entitlements. How is Board discretion considered? In determining whether to exercise discretion, the Board will have regard to all relevant factors at the time, which may include the performance of the Company and the participant over the performance period and the proportion of the performance period that has elapsed. 60
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 15 Variable Remuneration – Long Term Incentives What is the LTI Plan? The Incentive Awards Plan ( LTI Plan) is designed to provide incentives to attract and retain talent, and to align the interests of Executives with those of the Company. Under the terms of the LTI Plan, the Board may, from time to time, provide the opportunity for Eligible Participants to subscribe for such number of equity securities in the Company and on the conditions specified in the LTI Plan. A full copy of the LTI Plan is available on the Company’s website at www.bhagwanmarine.com Shareholder approvals for LTI Plan and grants? The LTI Plan was approved by shareholders on 12 November 2024, for the purposes of ASX Listing Rule 7.2, Exception 13 and for all other purposes. The maximum number of equity securities to be granted under the LTI Plan must not exceed 13,760,012 (being 5% of the Company’s Share capital at the date of shareholders’ approval). The issue of FY26 LTIs to Executive Directors, Mr Kannikoski and Mr Wackett, was approved under ASX Listing Rule 10.14 by shareholders at the Company’s AGM on 29 October 2025. How much can Executives earn under the LTI Plan? The MD/CEO, the Executive Director – Finance, and the COO have a maximum LTI opportunity of 50% of their TFR, and other senior managers have a maximum LTI opportunity of 30% of their TFR. Executives are not entitled to receive dividends or dividend-equivalent payments on p erformance rights that remain unvested or unexercised. What performance measures will inform the LTI Plan? Performance Rights granted are subject to the achievement of two performance criteria comprising EBITDA compound annual growth rate ( EBITDA CAGR ) and Relative Total Shareholder Return (rTSR), measured over a three-year performance period. Performance Measure rTSR EBITDA CAGR Weighting 50% 50% Purpose To recognise the performance of the Company’s shares and shareholder value creation. To recognise long-term growth in profitability and shareholder value creation. The vesting of Performance Rights is also subject to the Company's safety performance, including no fatalities and a lost time injury frequency rate ( LTIFR) of less than 2.0 ( Safety Gate) and Board discretion. The calculation of each performance measure is outlined below: rTSR Hurdle: The Board believes that rTSR is widely accepted by the market as a key measure of long-term performance. rTSR is a measure of the performance of the Company’s shares over a three-year performance period compared with the TSR of a comparator group of companies. TSR measures the percentage change in a Company’s share price over a three-year performance period, plus the value of dividends received during that period, assuming all dividends are reinvested to acquire new shares. The comparator group is a peer group comprised of ASX -listed as determined by the Board at the beginning of the performance period. Details on how rTSR is calculated and the comparator group are set out in Annexure B in the Company’s 2025 Notice of Annual General Meeting. Details of the vesting schedule for rTSR Performance Rights are set out below: rTSR over the three-year performance period Level of vesting Less than 50th percentile 0% At 50th percentile 50% Between the 50th and 75th percentile 50% plus a pro-rata straight-line percentage increase between 50% and 75% At or above the 75th percentile 100% Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 16 Variable Remuneration – Long Term Incentives (continued) What performance measures will inform the LTI Plan? (continued) EBITDA CAGR Hurdle: The Board considers EBITDA CAGR growth over a three- year performance period an appropriate measure for the grant of long-term incentives, as it is well understood within the business and a key measure of performance and shareholder value. The Board will continue to evaluate this measure in future years. EBITDA is a measure of the Company’s profitability before interest, tax, depreciation and amortisation. EBITDA also indicates how much cash the Company makes and is a widely used metric for measuring performance. Details of the vesting schedule for EBITDA CAGR Performance Rights are set out below: EBITDA CAGR performance Level of vesting Less than 5% EBITDA CAGR 0% At 5% EBITDA CAGR 25% Between 5% and 15% EBITDA CAGR 25% plus a pro-rata straight-line percentage increase between 5% and 15% At or above 15% EBITDA CAGR 100% How is the number of performance rights granted determined? The number of performance rights granted to each participant is determined by the Board. During FY26, the number of Performance Rights issued was calculated based on each Executive’s maximum long- term incentive opportunity, divided by $0.493, being the 5-day Volume -Weighted Average Price (VWAP) of Bhagwan Marine Shares at 30 June 2025. When is performance criteria measured? LTI outcomes are determined by the Remuneration Committee following an assessment of performance measures at the end of the three-year performance period and with regard to the Company’s performance and broader market factors. Performance rights will lapse if the performance measures are not met at the end of the performance period. There is no opportunity for re-testing. What happens on cessation of employment? If a participant ceases employment, whether due to special circumstances (including death, terminal illness or permanent disablement) or due to the participant’s resignation or termination, unless the Board determines otherwise and subject to applicable laws , unvested performance rights will automatically lapse. If a participant ceases employment after performance rights have vested but not exercised, the participant may continue to hold such vested performance rights depending on the circumstances of the cessation of employment. Do any clawback or malus provisions apply? The Board has clawback powers which it may exercise if: • there has been a material misstatement in Bhagwan Marine’s financial statements; • a participant has acted fraudulently or with malfeasance; or • some other event has occurred, which, as a result, means that the performance conditions in respect of any vested Performance Rights were not, or should not have been determined to have been, satisfied. What happens if there is a change in control? Subject to applicable ASX Listing Rules, in the event of a change of control or Business Sale: • any performance conditions in respect of unvested Performance Rights will be deemed to be automatically waived unless and to the extent the Board otherwise resolves; and the Board may require that all vested Performance Rights be exercised as part of a Change of Control/Business Sale, failing which they lapse. Is hedging permitted on unvested LTIs? In accordance with the Company’s Securities Trading Policy, a participant is prohibited from entering into arrangements to protect the value of unvested performance rights. This includes entering into contracts to hedge the exposure to performance rights or shares granted. Are participants entitled to voting rights and dividends? No dividends are paid on performance rights until they vest. Performance rights do not carry voting entitlements. How is Board discretion considered? In determining whether to exercise discretion, the Board will have regard to all relevant factors at the time, which may include the performance of the Company and the participant over the performance period and the proportion of the performance period that has elapsed. 61 BHAGWAN MARINE ANNUAL REPORT 2026
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 17 D. Executive Remuneration Arrangements (continued) Key terms of employment contracts These employment contracts may be terminated by either party giving the required notice and subject to termination payments as detailed in the table below: Name: Loui Kannikoski Title: Managing Director & Chief Executive Officer Agreement commenced: 13 May 2024 Term of agreement: Permanent contract Details: FY26 Base salary of $506,091 per annum and 12% superannuation of $60,731. Not entitled to any other benefits as part of fixed arrangements. Eligible to participate in incentive arrangements offered by the Company. During the year, the Remuneration Committee approved participation in the STI Plan, and the shareholders approved participation in the LTI Plan. Expenses – employment-related expenses to be reimbursed. Termination – 4 weeks’ notice in writing. Name: Andrew Wackett Title: Executive Director – Finance Agreement commenced: 13 May 2024 Term of agreement: Permanent contract Details: FY26 Base salary of $354,375 per annum and superannuation of $30,000. Eligible to participate in incentive arrangements offered by the Company. During the year, the Remuneration Committee approved participation in the STI Plan, and the shareholders approved participation in the LTI Plan. Expenses – employment-related expenses to be reimbursed. Termination – 4 weeks’ notice in writing. Name: Mark Annand Title: Chief Operating Officer Agreement commenced: 26 May 2025 Term of agreement: Permanent contract Details: FY26 Base salary of $400,000 per annum and 12% superannuation of $48,000. Eligible to participate in incentive arrangements offered by the Company. During the year, the Remuneration Committee approved participation in the STI Plan and LTI Plan, from 1 July 2025. Expenses – employment-related expenses to be reimbursed. Termination – 6 months’ notice in writing. As at the date of this report, the MD/CEO, the Executive Director - Finance, and the COO are employed by the Company under an Executive Service Agreement. The MD/CEO and the Executive Director Finance do not receive Director Fees. Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 18 E. Executive Remuneration Outcomes for FY26 Summary of the Company’s performance A summary of the Company’s performance as measured by a range of financial and other indicators, including disclosure required by the Corporations Act 2001, is outlined in the table below: Performance Measure Unit FY2026 FY2025 FY2024 FY2023 FY2022 Pro Forma Earnings Before Interest, Tax, Depreciation & Amortisation (Pro Forma EBITDA1) $’000 46,100 50,900 41,300 36,400 21,500 (Loss)/profit attributable to owners of the Company $’000 (200) 12,486 5,547 15,4413 2,405 Dividends paid cents per share 1.00 - - - - Pro Forma EBITDA (decline)/growth % (9.43) 23.23 13.64 69.25 18.29 Share price at 30 June2 cents per share 27.0 49.0 - - - 1 Earnings before interest, taxes, depreciation and amortisation ( “EBITDA”) is an unaudited non -IFRS measure and is a common measure used to assess profitability before the impact of different financing methods, income taxes, depreciation or property, plant and equipment, amortisation of intangible assets and fair value m ovements. 2 The Company listed on the ASX on 30 July 2024 with an IPO Price of 63 cents per share. 3 Refer to note 29 for details of the restatement. Pro Forma EBITDA represents the Board's preferred measure of underlying financial performance. To ensure comparability between reporting periods, EBITDA has been adjusted to exclude significant non- recurring transaction costs, including costs associated wi th the acquisition of Riverside Marine Holdings Pty Ltd in FY26 ($2.0 million), and post-acquisition integration costs in FY26 ($ 1.6 million) as well as the Company's IPO in FY25 ($0.7 million). These adjustments provide a clearer view of the Company's operating performance and the outcomes underpinning executive remuneration. Short-Term Incentives Company performance and its link to short-term incentives The Company achieved a LTIFR of 0.77 in FY26, exceeding the safety gateway requirement set at the beginning of the financial year and reflecting its continued commitment to maintaining a strong safety culture across the business. However, under the FY26 STI Plan, both the safety gateway and financial threshold must be met before any STI award can be made. The financial threshold required FY26 EBITDA to exceed the Board- approved FY26 EBITDA threshold by at least 2% above FY26 budget EBITDA, which was not achieved. Accordingly, and with the design of the STI Plan and its alignment with shareholder outcomes, no STI award was payable to participating executives for FY26. The following table provides STI outcomes by Executives for FY26: Name Position STI Achieved STI Awarded Maximum Potential Award % $ $ Loui Kannikoski Managing Director & CEO - - 283,411 Andrew Wackett Executive Director – Finance - - 192,188 Mark Annand Chief Operating Officer - - 224,000 Total - 699,599 Long-Term Incentives Company performance and its link to long-term incentives No LTIs vested in during the year. Shareholders approved, on 29 October 202 5, for the purpose of ASX Listing Rule 10.14 and for all other purposes, the issue of Performance Rights under the LTI Plan, as long- term incentives, to the Managing Director & CEO and the Executive Director – Finance. The grants of Performance Rights under the Company’s LTI Plan forms part of each Executive’s remuneration package and long-term incentive opportunity for the financial year ending 30 June 2026. Further details are set out in Section H below. 62
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 18 E. Executive Remuneration Outcomes for FY26 Summary of the Company’s performance A summary of the Company’s performance as measured by a range of financial and other indicators, including disclosure required by the Corporations Act 2001, is outlined in the table below: Performance Measure Unit FY2026 FY2025 FY2024 FY2023 FY2022 Pro Forma Earnings Before Interest, Tax, Depreciation & Amortisation (Pro Forma EBITDA1) $’000 46,100 50,900 41,300 36,400 21,500 (Loss)/profit attributable to owners of the Company $’000 (200) 12,486 5,547 15,4413 2,405 Dividends paid cents per share 1.00 - - - - Pro Forma EBITDA (decline)/growth % (9.43) 23.23 13.64 69.25 18.29 Share price at 30 June2 cents per share 27.0 49.0 - - - 1 Earnings before interest, taxes, depreciation and amortisation ( “EBITDA”) is an unaudited non -IFRS measure and is a common measure used to assess profitability before the impact of different financing methods, income taxes, depreciation or property, plant and equipment, amortisation of intangible assets and fair value m ovements. 2 The Company listed on the ASX on 30 July 2024 with an IPO Price of 63 cents per share. 3 Refer to note 29 for details of the restatement. Pro Forma EBITDA represents the Board's preferred measure of underlying financial performance. To ensure comparability between reporting periods, EBITDA has been adjusted to exclude significant non- recurring transaction costs, including costs associated wi th the acquisition of Riverside Marine Holdings Pty Ltd in FY26 ($2.0 million), and post-acquisition integration costs in FY26 ($ 1.6 million) as well as the Company's IPO in FY25 ($0.7 million). These adjustments provide a clearer view of the Company's operating performance and the outcomes underpinning executive remuneration. Short-Term Incentives Company performance and its link to short-term incentives The Company achieved a LTIFR of 0.77 in FY26, exceeding the safety gateway requirement set at the beginning of the financial year and reflecting its continued commitment to maintaining a strong safety culture across the business. However, under the FY26 STI Plan, both the safety gateway and financial threshold must be met before any STI award can be made. The financial threshold required FY26 EBITDA to exceed the Board- approved FY26 EBITDA threshold by at least 2% above FY26 budget EBITDA, which was not achieved. Accordingly, and with the design of the STI Plan and its alignment with shareholder outcomes, no STI award was payable to participating executives for FY26. The following table provides STI outcomes by Executives for FY26: Name Position STI Achieved STI Awarded Maximum Potential Award % $ $ Loui Kannikoski Managing Director & CEO - - 283,411 Andrew Wackett Executive Director – Finance - - 192,188 Mark Annand Chief Operating Officer - - 224,000 Total - 699,599 Long-Term Incentives Company performance and its link to long-term incentives No LTIs vested in during the year. Shareholders approved, on 29 October 202 5, for the purpose of ASX Listing Rule 10.14 and for all other purposes, the issue of Performance Rights under the LTI Plan, as long- term incentives, to the Managing Director & CEO and the Executive Director – Finance. The grants of Performance Rights under the Company’s LTI Plan forms part of each Executive’s remuneration package and long-term incentive opportunity for the financial year ending 30 June 2026. Further details are set out in Section H below. 63 BHAGWAN MARINE ANNUAL REPORT 2026
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 19 E. Executive Remuneration Outcomes for FY26 (continued) Long-Term Incentives (continued) Each Performance Right issued to Executives will give them the right to receive one share in the Company, subject to the achievement of the performance conditions at the end of a three- year performance period beginning on 1 July 2025 and ending on 30 June 2028. The share-based payments expense in respect of the issue of Performance Rights (unvested) is calculated in accordance with Australian Accounting Standards and represents the fair value of equity -related awards that have been granted to Executives. F. Non-Executive Director Remuneration Non-Executive Directors Remuneration The Board seeks to set aggregate Non- Executive Directors remuneration at a level that enables the Company to attract and retain Non-Executive Directors of the highest calibre, while incurring a cost that is acceptable to shareholders. Non-Executive Director remuneration consists of base Director fee and additional fees for the Chair and Members of any Board Committees. No element of Non- Executive Director remuneration is ‘at -risk’ (i.e. performance- related pay) to preserve their independence and impartiality. Non-Executive Director fees were benchmarked by the Board's external remuneration consultant against those of comparable ASX-listed companies with similar market capitalisations to the Company. The Company’s constitution and the ASX Listing Rule 10.17 specify that the maximum fee pool available for Non- Executive Directors shall be determined from time to time by shareholders in a general meeting. The latest determination was made at the General Meeting of Shareholders on 10 June 2024, when shareholders approved an aggregate annual fee pool of $800,000 per annum. Non-Executive Director Fees The remuneration of a Non-Executive Director comprises of fixed Board Fee and Committee Fees, inclusive of statutory superannuation. The statutory value for superannuation increased in 2026. Non-Executive Directors are not entitled to retirement benefits other than statutory superannuation or other statutory required benefits. There were no changes to Non-Executive Directors’ remuneration during the year. Current annual remuneration payable to Non-Executive Directors is set out below: Share Rights Granted to Ms Horton in July 2024 Included in Ms Horton’s remuneration is a Share based payments expense, calculated in accordance with Australian Accounting Standards, in respect of the issue of Share Rights (unvested) and issued in July 2024 to her for services prior to her appointment as an Independent Non- Executive Director on 5 June 2024 and for services associated with work , leading up to the Company’s Initial Public Offer ( IPO), in June 2024. The Performance Rights were granted with Shareholder approval and vested on 30 July 2026. Position Annual Directors' Fees (inclusive of superannuation) Chairman of the Board $260,000 Non-Executive Directors (each) $130,000 Committee Chair (per committee) $20,000 Committee Member (per committee) $10,000 64
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 19 E. Executive Remuneration Outcomes for FY26 (continued) Long-Term Incentives (continued) Each Performance Right issued to Executives will give them the right to receive one share in the Company, subject to the achievement of the performance conditions at the end of a three- year performance period beginning on 1 July 2025 and ending on 30 June 2028. The share-based payments expense in respect of the issue of Performance Rights (unvested) is calculated in accordance with Australian Accounting Standards and represents the fair value of equity -related awards that have been granted to Executives. F. Non-Executive Director Remuneration Non-Executive Directors Remuneration The Board seeks to set aggregate Non- Executive Directors remuneration at a level that enables the Company to attract and retain Non-Executive Directors of the highest calibre, while incurring a cost that is acceptable to shareholders. Non-Executive Director remuneration consists of base Director fee and additional fees for the Chair and Members of any Board Committees. No element of Non- Executive Director remuneration is ‘at -risk’ (i.e. performance- related pay) to preserve their independence and impartiality. Non-Executive Director fees were benchmarked by the Board's external remuneration consultant against those of comparable ASX-listed companies with similar market capitalisations to the Company. The Company’s constitution and the ASX Listing Rule 10.17 specify that the maximum fee pool available for Non- Executive Directors shall be determined from time to time by shareholders in a general meeting. The latest determination was made at the General Meeting of Shareholders on 10 June 2024, when shareholders approved an aggregate annual fee pool of $800,000 per annum. Non-Executive Director Fees The remuneration of a Non-Executive Director comprises of fixed Board Fee and Committee Fees, inclusive of statutory superannuation. The statutory value for superannuation increased in 2026. Non-Executive Directors are not entitled to retirement benefits other than statutory superannuation or other statutory required benefits. There were no changes to Non-Executive Directors’ remuneration during the year. Current annual remuneration payable to Non-Executive Directors is set out below: Share Rights Granted to Ms Horton in July 2024 Included in Ms Horton’s remuneration is a Share based payments expense, calculated in accordance with Australian Accounting Standards, in respect of the issue of Share Rights (unvested) and issued in July 2024 to her for services prior to her appointment as an Independent Non- Executive Director on 5 June 2024 and for services associated with work , leading up to the Company’s Initial Public Offer ( IPO), in June 2024. The Performance Rights were granted with Shareholder approval and vested on 30 July 2026. Position Annual Directors' Fees (inclusive of superannuation) Chairman of the Board $260,000 Non-Executive Directors (each) $130,000 Committee Chair (per committee) $20,000 Committee Member (per committee) $10,000 Bhagwan Marine Limited Remuneration Report (Audited) 30 June 2026 20 G. Remuneration Expenses for KMP Details of the nature and amount of each major element of the remuneration of each KMP of the Group for the year ended 30 Jun e 2026 are as follows: Short-term benefits Post-employment benefits Long-term benefits Performance related Year Salary and fees Cash bonus7 Non- monetary Annual leave Superannuation Long service leave Share-based payments8 Total $ $ $ $ $ $ $ $ % Non-Executive Directors Anthony Wooles1 2026 290,000 - - - - - - 290,000 - 2025 290,000 - - - - - - 290,000 - Tracey Horton2 2026 160,000 - - - - - 23,475 183,475 - 2025 152,066 - - - 7,934 - 21,610 181,610 - Total Non-Executive Director Remuneration 2026 450,000 - - - - - 23,475 473,475 - 2025 442,066 - - - 7,934 - 21,610 471,610 - Executive Directors Loui Kannikoski3 2026 506,091 - 6,931 (70,212)4 60,731 (51,223)4 43,082 495,400 9% 2025 492,085 245,745 6,935 35,603 56,637 11,971 40,633 889,609 32% Andrew Wackett5 2026 354,375 - - 13,590 30,000 3,693 52,787 454,445 12% 2025 350,000 171,000 - 21,465 30,000 3,540 49,698 625,703 35% Total Executive Director Remuneration 2026 860,466 - 6,931 (56,622) 90,731 (47,530) 95,869 949,845 10% 2025 842,085 416,745 6,935 57,068 86,637 15,511 90,331 1,515,312 35% Other Executive KMP Mark Annand6 2026 400,000 - - 24,173 48,000 3,510 21,728 497,411 4% 2025 38,462 - - 2,360 4,462 - - 45,284 - Total Other Executive KMPs Remuneration 2026 400,000 - - 24,173 48,000 3,510 21,728 497,411 4% 2025 38,462 - - 2,360 4,462 - - 45,284 - Total KMP Remuneration 2026 1,710,466 - 6,931 (32,449) 138,731 (44,020) 141,072 1,920,731 7% 2025 1,322,613 416,745 6,935 59,428 99,033 15,511 111,941 2,032,206 26% 1. Anthony Wooles is Chairman of the Board and Non-Executive Director. Mr Wooles is Chair of the Remuneration Committee and a Member of the Audit & Risk Committee. Mr Wooles Director Fees, plus GST, are paid to Trudo Consulting Pty Ltd. 2. Tracey Horton was appointed as Independent Non -Executive Director on 5 June 2024. Ms Horton is Chair of the Audit & Risk Committee and a Member of the Remuneration Committe e. Share-based payments represent the one -off grant of 74,627 Share Rights for her contribution, prior to her appointment to the Board, to the Company’s successful IPO. These Share Rights vested on 30 July 2026. 3. Loui Kannikoski’s salary and fees were increased following a benchmarking review of Executive remuneration and changes in statutory superannuation. 4. Loui Kannikoski elected to cash out a portion of accrued annual leave and long service leave in accordance with the Company’s leave policies. 5. Andrew Wackett’s salary and fees were increased following a benchmarking review of Executive remuneration. 6. Mark Annand’s salary and fees were increased by changes in statutory superannuation. 7. Cash bonus represents STIs that were awarded to each Executive KMP in relation to FY25 performance and were paid in September 2025. 8. Share-based payments are calculated in accordance with Australian Accounting Standards and are amortised at the fair value of equit y-related awards that have been granted to KMPs. 65BHAGWAN MARINE ANNUAL REPORT 2026
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (audited) 30 June 2026 21 H. Additional Disclosures (a) Share-based Compensation Ordinary Shares: During the 2026 financial year, no ordinary shares were issued to KMP as part of their remuneration (2025: nil). Options: During the 2026 financial year, no options were issued to KMP as part of their remuneration (2025: nil). Performance Rights and Share Rights: During the year, shareholders approved on 30 October 2025 the issue of 964,704 (2025: 733,018), Performance Rights to the MD/CEO and the Executive Director – Finance, under the Company’s Incentive Award Plan. During the year, the Board approved on 23 September 2025 the issue of 454,362 (2025: nil), Performance Rights to the COO, under the Company’s Incentive Award Plan. Assumptions made in the valuation of the Share Rights issued in the current period are outlined below: Performance Rights MD/CEO & Executive Director – Finance Tranche 1 Tranche 2 Grant date 30 October 2025 30 October 2025 Exercise price $nil $nil Vesting date 30 June 2028 30 June 2028 Performance hurdle rTSR performance measure over the performance period - 01 July 2025 to 30 June 2028. EBITDA CAGR of 5% to 15% over the performance period - 01 July 2025 to 30 June 2028. Underlying share price $0.57 $0.57 Risk-free rate 4.30% 4.30% Volatility 50% 50% Valuation $0.37 $0.57 Probability of success N/A 0% Expected employee retention rate 100% 100% Number granted to KMP 482,352 482,352 Performance Rights COO Tranche 1 Tranche 2 Grant date 23 September 2025 23 September 2025 Exercise price $nil $nil Vesting date 30 June 2028 30 June 2028 Performance hurdle rTSR performance measure over the performance period - 01 July 2025 to 30 June 2028. EBITDA CAGR of 5% to 15% over the performance period - 01 July 2025 to 30 June 2028. Underlying share price $0.54 $0.54 Risk-free rate 4.27% 4.27% Volatility 50% 50% Valuation $0.35 $0.54 Probability of success N/A 0% Expected employee retention rate 82% 82% Number granted to KMP 227,181 227,181 66
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (audited) 30 June 2026 21 H. Additional Disclosures (a) Share-based Compensation Ordinary Shares: During the 2026 financial year, no ordinary shares were issued to KMP as part of their remuneration (2025: nil). Options: During the 2026 financial year, no options were issued to KMP as part of their remuneration (2025: nil). Performance Rights and Share Rights: During the year, shareholders approved on 30 October 2025 the issue of 964,704 (2025: 733,018), Performance Rights to the MD/CEO and the Executive Director – Finance, under the Company’s Incentive Award Plan. During the year, the Board approved on 23 September 2025 the issue of 454,362 (2025: nil), Performance Rights to the COO, under the Company’s Incentive Award Plan. Assumptions made in the valuation of the Share Rights issued in the current period are outlined below: Performance Rights MD/CEO & Executive Director – Finance Tranche 1 Tranche 2 Grant date 30 October 2025 30 October 2025 Exercise price $nil $nil Vesting date 30 June 2028 30 June 2028 Performance hurdle rTSR performance measure over the performance period - 01 July 2025 to 30 June 2028. EBITDA CAGR of 5% to 15% over the performance period - 01 July 2025 to 30 June 2028. Underlying share price $0.57 $0.57 Risk-free rate 4.30% 4.30% Volatility 50% 50% Valuation $0.37 $0.57 Probability of success N/A 0% Expected employee retention rate 100% 100% Number granted to KMP 482,352 482,352 Performance Rights COO Tranche 1 Tranche 2 Grant date 23 September 2025 23 September 2025 Exercise price $nil $nil Vesting date 30 June 2028 30 June 2028 Performance hurdle rTSR performance measure over the performance period - 01 July 2025 to 30 June 2028. EBITDA CAGR of 5% to 15% over the performance period - 01 July 2025 to 30 June 2028. Underlying share price $0.54 $0.54 Risk-free rate 4.27% 4.27% Volatility 50% 50% Valuation $0.35 $0.54 Probability of success N/A 0% Expected employee retention rate 82% 82% Number granted to KMP 227,181 227,181 Bhagwan Marine Limited Remuneration Report (audited) 30 June 2026 22 H. Additional Disclosures (continued) (b) Equity instruments held by KMP - direct and indirect holdings Ordinary Shareholding: The number of ordinary shares in the Company held by each KMP, directly and indirectly, during the year ended 30 June 2026 is outlined below: Balance at 1 July 2025 Shares allocated as remuneration Other changes during the period Balance at 30 June 2026 Anthony Wooles 23,392,021 - 1,607,979 25,000,000 Tracey Horton 30,000 - 24,391 54,391 Loui Kannikoski 112,294,051 - 8,130,074 120,424,125 Andrew Wackett 160,000 - 135,976 295,976 Mark Annand 32,228 - 24,391 56,619 Total 135,908,300 - 9,922,811 145,831,111 The above shareholdings represent their relevant interest in ordinary shares and their beneficial interest held through nomin ee accounts. Performance Rights and Share Rights held: The following table sets out the Performance Rights and Share Rights held by KMP , directly and indirectly, that were granted, vested and forfeited during the year. Balance at 1 July 2025 Granted Exercised / Lapsed Balance at 30 June 2026 Vested during the year Vested and Exercisable Unvested Anthony Wooles - - - - - - - Tracey Horton1 74,627 - - 74,627 - - 74,627 Loui Kannikoski2 571,504 777,932 - 1,349,436 - - 1,349,436 Andrew Wackett 374,231 389,834 - 764,065 - - 764,065 Mark Annand - 454,362 - 454,362 - - 454,362 Total 1,020,362 1,622,128 - 2,642,490 - - 2,642,490 The above represent their relevant interest in performance rights and their beneficial interest held through nominee accounts . 1 Ms Horton holds Shares Rights issued to her for services prior to her appointment as an Independent Non- Executive Director on 5 June 2024 and for services associated with work, leading up to the Company’s Initial Public Offer (IPO), in June 2024. The Share Rights were granted with Shareholder approval. The Share Rights vested on 30 July 2026. 2 203,062 performance rights granted during the period (2025: 138,090) were issued to the Kannikoski Super Fund, which Loui Kannikoski is a beneficiary of, but relates to Kerren Kannikoski’s remuneration. This was approved by shareholders on 29 October 2025 (2025: 12 November 2024), as required by ASX Listing Rule 10.14. ASX Listing Rule 10.14 On 29 October 2025, Shareholders’ approval was obtained under ASX Listing Rule 10.14 for the grant of 574,870 Performance Rights granted to Loui Kannikoski and 389,834 Performance Rights to Andrew Wackett. The Performance Rights form part of their remuneration arrangements. Details on the Performance Rights granted are set out in the Company’s 2025 Notice of Annual General Meeting and in Section D above. On 12 November 2024, Shareholders’ approval was obtained under ASX Listing Rule 10.14 for the grant of 433,414 Performance Rights granted to Loui Kannikoski and 299,604 Performance Rights to Andrew Wackett. The Performance Rights form part of their remuner ation arrangements. Details on the Performance Rights granted are set out in the Company’s 2024 Notice of Annual General Meeting and in Section D above. As at 30 June 2026, all of these Performance Right remained unvested and subject to applicable vesting conditions. On 8 July 2024, the Company granted 74,627 Share Rights to Andrew Wackett and 74,627 Share Rights to Tracey Horton, under the terms of the Company’s Prospectus and in consideration of the Company’s successful IPO. As at 30 June 2026, these Share Rights remained unvested. Subsequent to year end, on 30 July 2026, all Share Rights vested in accordance with the applicable terms and conditions. 67 BHAGWAN MARINE ANNUAL REPORT 2026
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (audited) 30 June 2026 23 H. Additional Disclosures (continued) (b) Equity instruments held by KMP - direct and indirect holdings (continued) Options held: No Options in the Company were held by any KMP during the year ended 30 June 2026. (c) Other Transactions with KMP and their Related Parties Total Related Party Transactions The aggregate value of each transaction and outstanding balances related to KMP and entities over which they have control or significant influence were as follows: Transaction values for the year ended 30 June Balance outstanding as at 30 June 2026 2025 2026 2025 $ $ $ $ Amounts recognised as revenue Services provided to BM Fleet Pty Ltd 468,501 159,892 247,777 155,474 468,501 159,892 247,777 155,474 Amounts recognised as expense Lease of Vessels – BM Fleet Pty Ltd 632,534 853,263 27,225 736,464 Lease of Vessels – KFAMS Pty Ltd 760,010 755,569 366,911 386,364 Lease of Property – The Kannikoski Property Trust 190,805 275,831 - - 1,583,349 1,884,663 394,136 1,122,828 Related Party Vessels and Property As disclosed in the Company’s Prospectus sections 6.7.1 and 6.7.2, there are several related party leases for certain vessels and premises. For the purposes of Chapter 2E of the Corporations Act, the Directors (excluding Anthony Wooles and Loui Kannikoski) consider each lease arrangement below to be on arm's length terms. On renewal of lease arrangements, the Board, excluding the conflicted Directors, considers the commercial terms of any lease renewal and undertakes an assessment of the arms-length nature of the transaction to ensure it remains in the best interest of the Company. Directors with interests in the transactions below have abstained from voting on matters approved by the Board related to vessel and property leases. BM Fleet Pty Ltd – vessels leased During the reporting period, the Company leased vessels from BM Fleet Pty Ltd. The vessel lease arrangements are based on normal industry commercial terms and conditions. KFAMS Pty Ltd – vessels leased During the reporting period, the Company leased vessels from KFAMS Pty Ltd, an entity controlled by Tom Kannikoski. Tom Kannikoski is a related party of the Company by virtue of being the son of Director Loui Kannikoski. The vessel lease arrangements are based on normal industry commercial terms and conditions. 68
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REMUNERATION REPORT Bhagwan Marine Limited Remuneration Report (audited) 30 June 2026 23 H. Additional Disclosures (continued) (b) Equity instruments held by KMP - direct and indirect holdings (continued) Options held: No Options in the Company were held by any KMP during the year ended 30 June 2026. (c) Other Transactions with KMP and their Related Parties Total Related Party Transactions The aggregate value of each transaction and outstanding balances related to KMP and entities over which they have control or significant influence were as follows: Transaction values for the year ended 30 June Balance outstanding as at 30 June 2026 2025 2026 2025 $ $ $ $ Amounts recognised as revenue Services provided to BM Fleet Pty Ltd 468,501 159,892 247,777 155,474 468,501 159,892 247,777 155,474 Amounts recognised as expense Lease of Vessels – BM Fleet Pty Ltd 632,534 853,263 27,225 736,464 Lease of Vessels – KFAMS Pty Ltd 760,010 755,569 366,911 386,364 Lease of Property – The Kannikoski Property Trust 190,805 275,831 - - 1,583,349 1,884,663 394,136 1,122,828 Related Party Vessels and Property As disclosed in the Company’s Prospectus sections 6.7.1 and 6.7.2, there are several related party leases for certain vessels and premises. For the purposes of Chapter 2E of the Corporations Act, the Directors (excluding Anthony Wooles and Loui Kannikoski) consider each lease arrangement below to be on arm's length terms. On renewal of lease arrangements, the Board, excluding the conflicted Directors, considers the commercial terms of any lease renewal and undertakes an assessment of the arms-length nature of the transaction to ensure it remains in the best interest of the Company. Directors with interests in the transactions below have abstained from voting on matters approved by the Board related to vessel and property leases. BM Fleet Pty Ltd – vessels leased During the reporting period, the Company leased vessels from BM Fleet Pty Ltd. The vessel lease arrangements are based on normal industry commercial terms and conditions. KFAMS Pty Ltd – vessels leased During the reporting period, the Company leased vessels from KFAMS Pty Ltd, an entity controlled by Tom Kannikoski. Tom Kannikoski is a related party of the Company by virtue of being the son of Director Loui Kannikoski. The vessel lease arrangements are based on normal industry commercial terms and conditions. Bhagwan Marine Limited Remuneration Report (audited) 30 June 2026 24 H. Additional Disclosures (continued) (c) Other Transactions with KMP and their Related Parties (continued) Kannikoski Property Trust – Dampier property lease During the reporting period, the Company leased premises in Dampier, W estern Australia from the Kannikoski Property Trust. The Kannikoski Property Trust is a trust associated with Director, Loui Kannikoski and his wife Kerren Kannikoski. Since the initial expiry of the term on 30 June 2015, the lease has continued to operate on extension options, with the current extension ending 30 June 2027. The lease agreement is based on normal commercial terms and conditions. For the purposes of Chapter 2E of the Corporations Act, the Directors (excluding Loui Kannikoski) consider the lease arrangement with the Kannikoski Property Trust to be on arm's length terms. This concludes the remuneration report, which has been audited by KPMG. This Directors’ Report is made in accordance with a resolution of the Directors of the Company, pursuant to section 298(2) of the Corporations Act 2001. On behalf of the Board of Bhagwan Marine Limited Anthony Wooles Chairman and Non-Executive Director 27 August 2026 Perth, WA 69 BHAGWAN MARINE ANNUAL REPORT 2026
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KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation. Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001 To the Directors of Bhagwan Marine Limited I declare that, to the best of my knowledge and belief, in relation to the audit of the financial report of Bhagwan Marine Limited for the financial year ended 30 June 2026 there have been: i. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and ii. no contraventions of any applicable code of professional conduct in relation to the audit. KPM_INI_01 KPMG Hayden Rutters Partner Perth 27 August 2026 PAR_SIG_01 PAR_NAM_01 PAR_POS_01 PAR_DAT_01 PAR_CIT_01 Bhagwan Marine Limited Consolidated statement of profit or loss and other comprehensive income For the year ended 30 June 2026 27 Consolidated Note 2026 2025 $’000 $’000 Continuing operations Revenue from contracts with customers 4 235,914 283,038 Raw materials and consumables (12,544) (18,281) Vessel expenses (51,546) (69,247) Employee benefits expense (108,160) (128,493) Depreciation and amortisation expense (36,682) (28,074) Impairment of assets (1,658) (219) Other direct costs (4,401) (6,745) Professional fees (8,747) (5,378) Other income 288 923 Other expenses (6,361) (4,487) Operating profit 6,103 23,037 Finance income 896 533 Finance costs 5 (5,469) (4,242) Profit before tax 1,530 19,328 Income tax expense 6 (1,730) (6,842) (Loss)/Profit for the period attributable to the owners of Bhagwan Marine Limited (200) 12,486 Other comprehensive income Items that will not be reclassified to profit or loss Revaluation of vessels, net of tax 19 5,762 - Other comprehensive income for the year, net of tax 5,762 - Total comprehensive income for the year attributable to the owners of Bhagwan Marine Limited 5,562 12,486 Earnings per share Basic (loss)/earnings per share (cents) 7 (0.06) 4.67 Diluted (loss)/earnings per share (cents) 7 (0.06) 4.65 The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes to the consolidated financial statements Bhagwan Marine Limited Consolidated statement of profit or loss and other comprehensive income For the year ended 30 June 2026 27 Consolidated Note 2026 2025 $’000 $’000 Continuing operations Revenue from contracts with customers 4 235,914 283,038 Raw materials and consumables (12,544) (18,281) Vessel expenses (51,546) (69,247) Employee benefits expense (108,160) (128,493) Depreciation and amortisation expense (36,682) (28,074) Impairment of assets (1,658) (219) Other direct costs (4,401) (6,745) Professional fees (8,747) (5,378) Other income 288 923 Other expenses (6,361) (4,487) Operating profit 6,103 23,037 Finance income 896 533 Finance costs 5 (5,469) (4,242) Profit before tax 1,530 19,328 Income tax expense 6 (1,730) (6,842) (Loss)/Profit for the period attributable to the owners of Bhagwan Marine Limited (200) 12,486 Other comprehensive income Items that will not be reclassified to profit or loss Revaluation of vessels, net of tax 19 5,762 - Other comprehensive income for the year, net of tax 5,762 - Total comprehensive income for the year attributable to the owners of Bhagwan Marine Limited 5,562 12,486 Earnings per share Basic (loss)/earnings per share (cents) 7 (0.06) 4.67 Diluted (loss)/earnings per share (cents) 7 (0.06) 4.65 The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes to the consolidated financial statements 70
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Consolidated Statement of Profit or Loss and Other Comprehensive Income FOR THE YEAR ENDED 30 JUNE 2026 Financial Report Bhagwan Marine Limited Consolidated statement of profit or loss and other comprehensive income For the year ended 30 June 2026 27 Consolidated Note 2026 2025 $’000 $’000 Continuing operations Revenue from contracts with customers 4 235,914 283,038 Raw materials and consumables (12,544) (18,281) Vessel expenses (51,546) (69,247) Employee benefits expense (108,160) (128,493) Depreciation and amortisation expense (36,682) (28,074) Impairment of assets (1,658) (219) Other direct costs (4,401) (6,745) Professional fees (8,747) (5,378) Other income 288 923 Other expenses (6,361) (4,487) Operating profit 6,103 23,037 Finance income 896 533 Finance costs 5 (5,469) (4,242) Profit before tax 1,530 19,328 Income tax expense 6 (1,730) (6,842) (Loss)/Profit for the period attributable to the owners of Bhagwan Marine Limited (200) 12,486 Other comprehensive income Items that will not be reclassified to profit or loss Revaluation of vessels, net of tax 19 5,762 - Other comprehensive income for the year, net of tax 5,762 - Total comprehensive income for the year attributable to the owners of Bhagwan Marine Limited 5,562 12,486 Earnings per share Basic (loss)/earnings per share (cents) 7 (0.06) 4.67 Diluted (loss)/earnings per share (cents) 7 (0.06) 4.65 The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes to the consolidated financial statements Bhagwan Marine Limited Consolidated statement of profit or loss and other comprehensive income For the year ended 30 June 2026 27 Consolidated Note 2026 2025 $’000 $’000 Continuing operations Revenue from contracts with customers 4 235,914 283,038 Raw materials and consumables (12,544) (18,281) Vessel expenses (51,546) (69,247) Employee benefits expense (108,160) (128,493) Depreciation and amortisation expense (36,682) (28,074) Impairment of assets (1,658) (219) Other direct costs (4,401) (6,745) Professional fees (8,747) (5,378) Other income 288 923 Other expenses (6,361) (4,487) Operating profit 6,103 23,037 Finance income 896 533 Finance costs 5 (5,469) (4,242) Profit before tax 1,530 19,328 Income tax expense 6 (1,730) (6,842) (Loss)/Profit for the period attributable to the owners of Bhagwan Marine Limited (200) 12,486 Other comprehensive income Items that will not be reclassified to profit or loss Revaluation of vessels, net of tax 19 5,762 - Other comprehensive income for the year, net of tax 5,762 - Total comprehensive income for the year attributable to the owners of Bhagwan Marine Limited 5,562 12,486 Earnings per share Basic (loss)/earnings per share (cents) 7 (0.06) 4.67 Diluted (loss)/earnings per share (cents) 7 (0.06) 4.65 The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes to the consolidated financial statements 71 BHAGWAN MARINE ANNUAL REPORT 2026
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Consolidated Statement of Financial Position FOR THE YEAR ENDED 30 JUNE 2026 Bhagwan Marine Limited Consolidated statement of financial position For the year ended 30 June 2026 28 Consolidated Restated1 Note 2026 2025 $’000 $’000 Assets Current assets Cash and cash equivalents 8 23,847 16,192 Trade and other receivables 9 66,494 52,584 Inventories 10 7,596 2,287 Other current assets 11 5,065 3,939 Total current assets 103,002 75,002 Non-current assets Other investments 1,430 1,454 Property, plant and equipment 12 221,156 158,300 Right-of-use assets 13 47,909 35,305 Intangible assets and goodwill 14 69,500 - Non-current financial assets 15 11,978 11,730 Total non-current assets 351,973 206,789 Total assets 454,975 281,791 Liabilities Current liabilities Trade and other payables 16 52,841 35,178 Loans and borrowings 17 23,541 21,996 Lease liabilities 13 12,963 14,771 Employee benefits 18 6,932 6,094 Total current liabilities 96,277 78,039 Non-current liabilities Loans and borrowings 17 86,786 11,195 Lease liabilities 13 34,322 18,142 Deferred tax liabilities 6 19,794 8,659 Employee benefits 18 1,150 849 Total non-current liabilities 142,052 38,845 Total liabilities 238,329 116,884 Net assets 216,646 164,907 Equity Issued capital 19 190,739 142,062 Reserves 19 63,602 57,388 Profit reserve 19 9,534 12,486 Accumulated losses (47,229) (47,029) Total equity 216,646 164,907 1 Refer to note 29 for details of the restatement. The above consolidated statement of financial position should be read in conjunction with the accompanying notes to the consolidated financial statements Bhagwan Marine Limited Consolidated statement of changes in equity For the year ended 30 June 2026 29 Consolidated Issued capital Reserves Profit reserve Accumulated losses Total equity $’000 $’000 $’000 $’000 $’000 Balance at 1 July 2024 as previously reported 65,262 56,942 - (44,128) 78,076 Impact of restatement - - - (2,901) (2,901) Balance at 1 July 2024 (restated)1 65,262 56,942 - (47,029) 75,175 Profit for the period - - - 12,486 12,486 Other comprehensive income: Revaluation of vessels, net of tax - - - - - Total comprehensive income for the period - - - 12,486 12,486 Transactions with owners in their capacity as owners: Share capital issued, net of transaction costs 76,800 - - - 76,800 Transfer to profit reserve - - 12,486 (12,486) - Equity settled share-based payments - 446 - - 446 Total transactions with owners in their capacity as owners 76,800 446 12,486 (12,486) 77,246 Balance at 30 June 2025 (restated)1 142,062 57,388 12,486 (47,029) 164,907 Consolidated Issued capital Reserves Profit reserve Accumulated losses Total equity $’000 $’000 $’000 $’000 $’000 Balance at 1 July 2025 (restated)1 142,062 57,388 12,486 (47,029) 164,907 Loss for the period - - - (200) (200) Other comprehensive income: Revaluation of vessels, net of tax - 5,762 - - 5,762 Total comprehensive income for the period - 5,762 - (200) 5,562 Transactions with owners in their capacity as owners: Share capital issued, net of transaction costs 48,677 - - - 48,677 Transfer to profit reserve - - - - - Dividends paid (2,952) - (2,952) Equity settled share-based payments - 452 - - 452 Total transactions with owners in their capacity as owners 48,677 452 (2,952) - 46,177 Balance at 30 June 2026 190,739 63,602 9,534 (47,229) 216,646 1 Refer to note 29 for details of the restatement. The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes to the consolidated financial statements 72
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Bhagwan Marine Limited Consolidated statement of financial position For the year ended 30 June 2026 28 Consolidated Restated1 Note 2026 2025 $’000 $’000 Assets Current assets Cash and cash equivalents 8 23,847 16,192 Trade and other receivables 9 66,494 52,584 Inventories 10 7,596 2,287 Other current assets 11 5,065 3,939 Total current assets 103,002 75,002 Non-current assets Other investments 1,430 1,454 Property, plant and equipment 12 221,156 158,300 Right-of-use assets 13 47,909 35,305 Intangible assets and goodwill 14 69,500 - Non-current financial assets 15 11,978 11,730 Total non-current assets 351,973 206,789 Total assets 454,975 281,791 Liabilities Current liabilities Trade and other payables 16 52,841 35,178 Loans and borrowings 17 23,541 21,996 Lease liabilities 13 12,963 14,771 Employee benefits 18 6,932 6,094 Total current liabilities 96,277 78,039 Non-current liabilities Loans and borrowings 17 86,786 11,195 Lease liabilities 13 34,322 18,142 Deferred tax liabilities 6 19,794 8,659 Employee benefits 18 1,150 849 Total non-current liabilities 142,052 38,845 Total liabilities 238,329 116,884 Net assets 216,646 164,907 Equity Issued capital 19 190,739 142,062 Reserves 19 63,602 57,388 Profit reserve 19 9,534 12,486 Accumulated losses (47,229) (47,029) Total equity 216,646 164,907 1 Refer to note 29 for details of the restatement. The above consolidated statement of financial position should be read in conjunction with the accompanying notes to the consolidated financial statements Consolidated Statement of Changes in Equity FOR THE YEAR ENDED 30 JUNE 2026 Bhagwan Marine Limited Consolidated statement of changes in equity For the year ended 30 June 2026 29 Consolidated Issued capital Reserves Profit reserve Accumulated losses Total equity $’000 $’000 $’000 $’000 $’000 Balance at 1 July 2024 as previously reported 65,262 56,942 - (44,128) 78,076 Impact of restatement - - - (2,901) (2,901) Balance at 1 July 2024 (restated)1 65,262 56,942 - (47,029) 75,175 Profit for the period - - - 12,486 12,486 Other comprehensive income: Revaluation of vessels, net of tax - - - - - Total comprehensive income for the period - - - 12,486 12,486 Transactions with owners in their capacity as owners: Share capital issued, net of transaction costs 76,800 - - - 76,800 Transfer to profit reserve - - 12,486 (12,486) - Equity settled share-based payments - 446 - - 446 Total transactions with owners in their capacity as owners 76,800 446 12,486 (12,486) 77,246 Balance at 30 June 2025 (restated)1 142,062 57,388 12,486 (47,029) 164,907 Consolidated Issued capital Reserves Profit reserve Accumulated losses Total equity $’000 $’000 $’000 $’000 $’000 Balance at 1 July 2025 (restated)1 142,062 57,388 12,486 (47,029) 164,907 Loss for the period - - - (200) (200) Other comprehensive income: Revaluation of vessels, net of tax - 5,762 - - 5,762 Total comprehensive income for the period - 5,762 - (200) 5,562 Transactions with owners in their capacity as owners: Share capital issued, net of transaction costs 48,677 - - - 48,677 Transfer to profit reserve - - - - - Dividends paid (2,952) - (2,952) Equity settled share-based payments - 452 - - 452 Total transactions with owners in their capacity as owners 48,677 452 (2,952) - 46,177 Balance at 30 June 2026 190,739 63,602 9,534 (47,229) 216,646 1 Refer to note 29 for details of the restatement. The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes to the consolidated financial statements 73 BHAGWAN MARINE ANNUAL REPORT 2026
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Consolidated Statement of Cash Flows FOR THE YEAR ENDED 30 JUNE 2026 Bhagwan Marine Limited Consolidated statement of cash flows For the year ended 30 June 2026 30 Consolidated Note 2026 2025 $’000 $’000 Cash flows from operating activities Receipts from customers 263,648 351,247 Payments to suppliers and employees (221,747) (313,041) Interest and other finance costs paid (4,993) (2,385) Income tax paid (531) - Net cash from operating activities 8 36,377 35,821 Cash flows from investing activities Acquisition of controlled entity (net of cash received) 21 (90,813) - Payments for property, plant and equipment (27,236) (38,363) Proceeds from disposal of property, plant and equipment 35 900 Net cash used in investing activities (118,014) (37,463) Cash flows from financing activities Proceeds from cash advance facility 17 70,000 - Proceeds from market rate loan 17 10,165 - Proceeds from asset finance facility 17 4,474 15,125 Proceeds from working capital facility 17 - 20,000 Repayment of market rate loan 17 (5,165) - Repayment of asset finance facility 17 (2,338) - Repayment of borrowings - (60,907) Repayment to overdraft facility - (18,769) Dividends paid to shareholders of the parent (2,952) - Payment of lease liabilities (13,570) (15,766) Proceeds from issue of ordinary shares 28,678 76,800 Net cash from financing activities 89,292 16,483 Net increase in cash and cash equivalents 7,655 14,841 Cash and cash equivalents at the beginning of the financial year 16,192 1,351 Cash and cash equivalents at the end of the financial year 8 23,847 16,192 The above consolidated statement of cash flows should be read in conjunction with the accompanying notes to the consolidated financial statements Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 31 Note 1. Basis of preparation The consolidated financial statements comprise Bhagwan Marine Limited ( the “Company”) and its subsidiaries (the “Group”). Bhagwan Marine Limited is a company limited by shares, incorporated and domiciled in Australia. The address of its registered office and principal place of business is Level 11, 15-17 William Street, Perth, Western Australia, 6000. The Group is a for -profit entity and a description of the nature of the group’ s operations and its principal activities are included in the Directors' report, which is not part of the financial statements. These consolidated financial statements were authorised for issue by the Company’s B oard of D irectors on 27 August 2026. (a) Statement of compliance These consolidated financial statements are general purpose financial statements which have been prepared in accordance with the Corporations Act 2001, Australian Accounting Standards and Interpretations, and comply with other requirements of the law. Compliance with Australian Accounting Standards ensures that the Group financial statements and notes comply with International Financial Reporting Standards ( IFRS) as issued by the International Accounting Standards Board (IASB). The accounting policies have been consistently applied to all years presented unless otherwise stated. Details of the Group’s other accounting policies are included in note 30. (b) Going concern The financial statements have been prepared on a going concern basis, which assumes the continuation of normal business operations and the ability to realise assets and discharge liabilities in the ordinary course of business. On 31 March 2026, the Company acquired 100% of Riverside Marine Holdings Pty Ltd (Riverside Marine). The acquisition was completed on a debt free cash free basis with a normal level of working capital, for an enterprise value of up to $130.0 million. Initial cash consideration of $100.0 million was paid at date of acquisition. The initial cash consideration was funded in two parts, being $30.0 million funded from equity raising and $70.0 million funded by a three-year facility from Commonwealth Bank of Australia. In assessing the appropriateness of the going concern assumption, the Directors have considered: • The Group’s cash flow forecasts for a period of at least 12 months from the date of signing these financial statements; • Forecast compliance with all financial covenants under the Group’s debt facilities; • The expected operating performance and cash generation of both the existing operations and the acquired business; • Available undrawn debt facilities of $29.7 million; and • Analysis performed on ke y assumptions, including revenue growth, operating margins and working capital movements. Accordingly, the Directors believe that, at the date of approving the financial statements, there are reasonable grounds to believe that the Group will have sufficient funds to meet its obligations as and when they fall due and are of the opinion that the use of the going concern basis remains appropriate. (c) Basis of measurement The consolidated financial statements have been prepared under the historical cost convention, except for vessel assets which are measured at fair value. Identifiable assets and liabilities acquired through business combinations, including customer relationships and customer contracts, are initially recognised at fair value at the acquisition date. 74
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Bhagwan Marine Limited Consolidated statement of cash flows For the year ended 30 June 2026 30 Consolidated Note 2026 2025 $’000 $’000 Cash flows from operating activities Receipts from customers 263,648 351,247 Payments to suppliers and employees (221,747) (313,041) Interest and other finance costs paid (4,993) (2,385) Income tax paid (531) - Net cash from operating activities 8 36,377 35,821 Cash flows from investing activities Acquisition of controlled entity (net of cash received) 21 (90,813) - Payments for property, plant and equipment (27,236) (38,363) Proceeds from disposal of property, plant and equipment 35 900 Net cash used in investing activities (118,014) (37,463) Cash flows from financing activities Proceeds from cash advance facility 17 70,000 - Proceeds from market rate loan 17 10,165 - Proceeds from asset finance facility 17 4,474 15,125 Proceeds from working capital facility 17 - 20,000 Repayment of market rate loan 17 (5,165) - Repayment of asset finance facility 17 (2,338) - Repayment of borrowings - (60,907) Repayment to overdraft facility - (18,769) Dividends paid to shareholders of the parent (2,952) - Payment of lease liabilities (13,570) (15,766) Proceeds from issue of ordinary shares 28,678 76,800 Net cash from financing activities 89,292 16,483 Net increase in cash and cash equivalents 7,655 14,841 Cash and cash equivalents at the beginning of the financial year 16,192 1,351 Cash and cash equivalents at the end of the financial year 8 23,847 16,192 The above consolidated statement of cash flows should be read in conjunction with the accompanying notes to the consolidated financial statements Notes to the Consolidated Financial Statements FOR THE YEAR ENDED 30 JUNE 2026 Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 31 Note 1. Basis of preparation The consolidated financial statements comprise Bhagwan Marine Limited ( the “Company”) and its subsidiaries (the “Group”). Bhagwan Marine Limited is a company limited by shares, incorporated and domiciled in Australia. The address of its registered office and principal place of business is Level 11, 15-17 William Street, Perth, Western Australia, 6000. The Group is a for -profit entity and a description of the nature of the group’ s operations and its principal activities are included in the Directors' report, which is not part of the financial statements. These consolidated financial statements were authorised for issue by the Company’s B oard of D irectors on 27 August 2026. (a) Statement of compliance These consolidated financial statements are general purpose financial statements which have been prepared in accordance with the Corporations Act 2001, Australian Accounting Standards and Interpretations, and comply with other requirements of the law. Compliance with Australian Accounting Standards ensures that the Group financial statements and notes comply with International Financial Reporting Standards ( IFRS) as issued by the International Accounting Standards Board (IASB). The accounting policies have been consistently applied to all years presented unless otherwise stated. Details of the Group’s other accounting policies are included in note 30. (b) Going concern The financial statements have been prepared on a going concern basis, which assumes the continuation of normal business operations and the ability to realise assets and discharge liabilities in the ordinary course of business. On 31 March 2026, the Company acquired 100% of Riverside Marine Holdings Pty Ltd (Riverside Marine). The acquisition was completed on a debt free cash free basis with a normal level of working capital, for an enterprise value of up to $130.0 million. Initial cash consideration of $100.0 million was paid at date of acquisition. The initial cash consideration was funded in two parts, being $30.0 million funded from equity raising and $70.0 million funded by a three-year facility from Commonwealth Bank of Australia. In assessing the appropriateness of the going concern assumption, the Directors have considered: • The Group’s cash flow forecasts for a period of at least 12 months from the date of signing these financial statements; • Forecast compliance with all financial covenants under the Group’s debt facilities; • The expected operating performance and cash generation of both the existing operations and the acquired business; • Available undrawn debt facilities of $29.7 million; and • Analysis performed on ke y assumptions, including revenue growth, operating margins and working capital movements. Accordingly, the Directors believe that, at the date of approving the financial statements, there are reasonable grounds to believe that the Group will have sufficient funds to meet its obligations as and when they fall due and are of the opinion that the use of the going concern basis remains appropriate. (c) Basis of measurement The consolidated financial statements have been prepared under the historical cost convention, except for vessel assets which are measured at fair value. Identifiable assets and liabilities acquired through business combinations, including customer relationships and customer contracts, are initially recognised at fair value at the acquisition date. 75 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 32 Note 1. Basis of preparation (continued) (d) Significant judgements and estimates The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 2. (e) Functional and presentation currency These consolidated financial statements are presented in Australian dollars, which is the Company’s functional currency. The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Director's Reports) Instrument 2026/183, and in accordance with that instrument, amounts in the consolidated financial statements and Directors’ report have been rounded off to the nearest thousand dollars, unless otherwise stated. (f) Parent entity information In accordance with the Corporations Act 2001, these financial statements present the results of the Group only. Supplementary information about the parent entity is disclosed in note 26. Note 2. Critical accounting judgements, estimates and assumptions In preparing these financial statements , management has made judgements, estimates and assumptions that affect the application of the Group’s accounting policies and the reported amounts of assets, liabilities, income and expenses. These estimates and assumptions are based on historical experience and other relevant factors that are considered reasonable under the circumstances. Actual results may differ from these estimates. (a) Judgements Information about judgements made in applying accounting policies that have the most significant effects on the amounts recognised in the financial statements is included in the following notes: • Note 13 - Determining the lease term of contracts with renewal and termination options – Group as lessee and determining the incremental borrowing rates on leases (b) Assumptions and estimation uncertainties Information about assumptions and estimation uncertainties at the reporting date that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next financial year is included in the following notes: • Note 12 and Note 27(a) – Fair value of vessels • Note 20 – Share-based payment arrangements • Note 14 – Goodwill • Note 14 – Customer contracts acquired in a business combination • Note 21 – Business combination Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 33 Note 3. Segment information (a) Basis for segmentation In the prior year the Group managed its operations as a single business operation as there were no parts of the business that qualify as operating segments under AASB 8 Operating Segments. Following the acquisition of Riverside Marine on 31 March 2026, segmentation of the Group’s operations ha s been reviewed, and it has been determined that the Group operates two segments, being Bhagwan Operations and Riverside Operations. This has been determined based on how the Board assesses, as chief operating decision maker, the financial performance of operations to make strategic decisions. The following summary describes the operations of each reportable segment. Reportable segments Operations Bhagwan Operations Bhagwan provides integrated marine logistics , solutions and vessel services to the ports & inshore, offshore energy & resources and subsea sectors across Australia. Its operations include the provision of marine assets, transportation services, project solutions, off shore support, towage and associated marine solutions to support customer operations in coastal and offshore environments. Riverside Operations Riverside operates a diversified portfolio of business, including Rivtow Marine, Riverside Industrial Sands, Magnetic Island Ferries and Riverside Oceanic. Riverside’s core activities encompass ports & inshore services, including harbour and terminal towage, vessel management, passenger and vehicle ferry services, marine tourism, sand transport and processing and marine consultancy. The Group operates in only one geographical segment, being Australia. (b) Information about reportable segments Information in relation to each reportable segment is set out below. Segment EBITDA (Segment earnings before interest, tax, depreciation and amortisation) is a non-IFRS measure used to assess the performance as management believe that this information is the most relevant in evaluating the results of the Group’s operations relative to other entities that operate in the same industries. Segment results 2026 Reportable Segments Bhagwan Operations Riverside Operations Total $’000 $’000 $’000 External revenues 220,848 15,066 235,914 Cost of sales (143,489) (5,942) (149,431) Gross profit 77,359 9,124 86,483 Admin costs (35,705) (3,010) (38,715) Significant non-recurring transaction costs (3,613) - (3,613) Impairment of assets (1,658) - (1,658) Segment EBITDA 36,383 6,114 42,497 Adjustments for: Finance income 896 Other income 288 Depreciation expense (35,506) Acquired intangible assets amortisation expense (1,176) Finance costs (5,469) Income tax expense (1,730) (Loss)/Profit for the year (200) 76
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 33 Note 3. Segment information (a) Basis for segmentation In the prior year the Group managed its operations as a single business operation as there were no parts of the business that qualify as operating segments under AASB 8 Operating Segments. Following the acquisition of Riverside Marine on 31 March 2026, segmentation of the Group’s operations ha s been reviewed, and it has been determined that the Group operates two segments, being Bhagwan Operations and Riverside Operations. This has been determined based on how the Board assesses, as chief operating decision maker, the financial performance of operations to make strategic decisions. The following summary describes the operations of each reportable segment. Reportable segments Operations Bhagwan Operations Bhagwan provides integrated marine logistics , solutions and vessel services to the ports & inshore, offshore energy & resources and subsea sectors across Australia. Its operations include the provision of marine assets, transportation services, project solutions, off shore support, towage and associated marine solutions to support customer operations in coastal and offshore environments. Riverside Operations Riverside operates a diversified portfolio of business, including Rivtow Marine, Riverside Industrial Sands, Magnetic Island Ferries and Riverside Oceanic. Riverside’s core activities encompass ports & inshore services, including harbour and terminal towage, vessel management, passenger and vehicle ferry services, marine tourism, sand transport and processing and marine consultancy. The Group operates in only one geographical segment, being Australia. (b) Information about reportable segments Information in relation to each reportable segment is set out below. Segment EBITDA (Segment earnings before interest, tax, depreciation and amortisation) is a non-IFRS measure used to assess the performance as management believe that this information is the most relevant in evaluating the results of the Group’s operations relative to other entities that operate in the same industries. Segment results 2026 Reportable Segments Bhagwan Operations Riverside Operations Total $’000 $’000 $’000 External revenues 220,848 15,066 235,914 Cost of sales (143,489) (5,942) (149,431) Gross profit 77,359 9,124 86,483 Admin costs (35,705) (3,010) (38,715) Significant non-recurring transaction costs (3,613) - (3,613) Impairment of assets (1,658) - (1,658) Segment EBITDA 36,383 6,114 42,497 Adjustments for: Finance income 896 Other income 288 Depreciation expense (35,506) Acquired intangible assets amortisation expense (1,176) Finance costs (5,469) Income tax expense (1,730) (Loss)/Profit for the year (200) 77 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 34 Note 3. Segment information (continued) (b) Information about reportable segments (continued) Segment results (continued) 2025 Reportable Segments Bhagwan Operations Riverside Operations Total $’000 $’000 $’000 External revenues 292,240 - 292,240 Passthrough revenue1 (9,202) - (9,202) Net revenue 283,038 - 283,038 Cost of sales (198,664) - (198,664) Gross profit 84,374 - 84,374 Admin costs (33,967) - (33,967) Impairment of assets (219) - (219) Segment EBITDA 50,188 - 50,188 Adjustments for: Finance income 533 Other income 923 Depreciation and amortisation expense (28,074) Finance costs (4,242) Income tax expense (6,842) Profit for the year 12,486 Footnote: 1. Non AASB15 Revenue from Contracts with Customers Segment assets and liabilities Assets Liabilities 2026 2025 2026 2025 $’000 $’000 $’000 $’000 Bhagwan Operations 350,559 281,791 189,827 116,884 Riverside Operations 104,416 - 48,502 - Consolidated Group 454,975 281,791 238,329 116,884 (c) Major customers The Group’s major customers vary year on year, being dependant on the projects and services occurring. For the year end ed 30 June 2026, there w as one major customer, contributing 10.3% of Group revenue being $24.2 million for the Bhagwan Operations segment. For the year ended 30 June 2025, there were two major customers, one contributing 20.9% of Group revenue being $61.2 million for the Bhagwan Operations segment and the other contributing 10.7% of Group revenue being $ 31.4 million for the Bhagwan Operations segment. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 35 Note 4. Revenue (a) Revenue streams Consolidated 2026 2025 $’000 $’000 Sales revenue Rendering of services 228,075 283,038 Sale of goods 7,839 - 235,914 283,038 (b) Disaggregation of revenue from contracts with customers In the following tables, revenue from contracts with customers is disaggregated by primary geographical market, industry sector and timing of revenue recognition. Consolidated 2026 2025 $’000 $’000 Primary geographical markets: Australia 235,914 283,038 External revenue as reported 235,914 283,038 Primary industry sector: Port & inshore services 115,156 84,091 Offshore energy & resources services 71,072 112,873 Subsea services 43,593 56,353 Defence & other services 6,093 3,273 TVI project - 26,448 External revenue as reported 235,914 283,038 Timing of revenue recognition: Products and services transferred over time 228,075 283,038 Products transferred at a point in time 7,839 - External revenue as reported 235,914 283,038 Revenue from contracts with customers is recognised over time when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those goods or services. Revenue relating to sale of goods is recognised as revenue at the point in time that the Group transfers control of the goods to the customer. 78
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 34 Note 3. Segment information (continued) (b) Information about reportable segments (continued) Segment results (continued) 2025 Reportable Segments Bhagwan Operations Riverside Operations Total $’000 $’000 $’000 External revenues 292,240 - 292,240 Passthrough revenue1 (9,202) - (9,202) Net revenue 283,038 - 283,038 Cost of sales (198,664) - (198,664) Gross profit 84,374 - 84,374 Admin costs (33,967) - (33,967) Impairment of assets (219) - (219) Segment EBITDA 50,188 - 50,188 Adjustments for: Finance income 533 Other income 923 Depreciation and amortisation expense (28,074) Finance costs (4,242) Income tax expense (6,842) Profit for the year 12,486 Footnote: 1. Non AASB15 Revenue from Contracts with Customers Segment assets and liabilities Assets Liabilities 2026 2025 2026 2025 $’000 $’000 $’000 $’000 Bhagwan Operations 350,559 281,791 189,827 116,884 Riverside Operations 104,416 - 48,502 - Consolidated Group 454,975 281,791 238,329 116,884 (c) Major customers The Group’s major customers vary year on year, being dependant on the projects and services occurring. For the year end ed 30 June 2026, there w as one major customer, contributing 10.3% of Group revenue being $24.2 million for the Bhagwan Operations segment. For the year ended 30 June 2025, there were two major customers, one contributing 20.9% of Group revenue being $61.2 million for the Bhagwan Operations segment and the other contributing 10.7% of Group revenue being $ 31.4 million for the Bhagwan Operations segment. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 35 Note 4. Revenue (a) Revenue streams Consolidated 2026 2025 $’000 $’000 Sales revenue Rendering of services 228,075 283,038 Sale of goods 7,839 - 235,914 283,038 (b) Disaggregation of revenue from contracts with customers In the following tables, revenue from contracts with customers is disaggregated by primary geographical market, industry sector and timing of revenue recognition. Consolidated 2026 2025 $’000 $’000 Primary geographical markets: Australia 235,914 283,038 External revenue as reported 235,914 283,038 Primary industry sector: Port & inshore services 115,156 84,091 Offshore energy & resources services 71,072 112,873 Subsea services 43,593 56,353 Defence & other services 6,093 3,273 TVI project - 26,448 External revenue as reported 235,914 283,038 Timing of revenue recognition: Products and services transferred over time 228,075 283,038 Products transferred at a point in time 7,839 - External revenue as reported 235,914 283,038 Revenue from contracts with customers is recognised over time when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those goods or services. Revenue relating to sale of goods is recognised as revenue at the point in time that the Group transfers control of the goods to the customer. 79 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 36 Note 4. Revenue (continued) (b) Disaggregation of revenue from contracts with customers (continued) Revenue from services Revenue is derived from the utilisation of specialised vessels, equipment , personnel and materials to provide a diverse range of marine services within ports & inshore, offshore energy & resources and subsea locations to its customers. The services provided in each contract are all integrated and represent single performance obligations. These services are contracted on a set rate per day. Revenue is recognised over the period of time based on the number of days the customer utilises the services provided. Income received in advance is deferred until the service is rendered. The Group assesses each revenue contract it enters to determine whether it acts as a principal or an agent. This assessment is based on whether the Group controls the specified goods or services before they are transferred to the customer. In most cases, t he Group acts as a principal, as it typically controls the goods or services prior to transfer. Accordingly, revenue is recognised at the gross amount of consideration received or receivable. However, in limited arrangements, the Group facilitates the provision of services by third-party contractors or suppliers on behalf of customers. In these instances, the Group does not control the services before they are transferred to the customer and therefore acts as an agent. Revenue is recognised at the net amount that is retained for these arrangements . The determination of whether the Group is acting as a principal or an agent is based on the nature of the specific contractual arrangements. Revenue from sale of goods Revenue is derived from the sale of goods and is recognised when control of the goods transfers to the customer, generally upon delivery to the customer’s nominated location. Revenue is measured at the agreed transaction price, net of discounts and rebates. The performance obligation is satisfied at a point in time upon transfer of control of the goods to the customer. Note 5. Finance costs Consolidated 2026 2025 $’000 $’000 Interest and finance charges paid/payable 3,818 2,635 Interest on lease of right of use assets 1,651 1,063 Net foreign exchange loss - 544 Total finance costs 5,469 4,242 80
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 37 Note 6. Income tax expense Consolidated 2026 2025 $’000 $’000 Amounts recognised in profit or loss: Current tax expense Current year - - Changes in estimates related to prior years - - - - Deferred tax expense: Utilisation of prior period tax loss (4,221) (5,637) Origination and reversal of temporary differences 2,491 (1,205) Tax expense on continuing operations (1,730) (6,842) Reconciliation of effective tax rate: Profit before tax from continuing operations 1,530 19,328 Tax at the statutory tax rate of 30% (459) (5,799) Non-deductible expenses: Share based payments (135) (134) Acquisition transaction costs (568) - Other (28) - (731) (134) (Under) / over provided in prior years (540) (909) Income tax expense (1,730) (6,842) Balance 30 June Net Balances Charged Charged Net Deferred Deferred 2026 balance on to Income to balance tax tax 1 July Acquisition Statement Equity 30 June assets liabilities Movements in tax Restated1 balances $’000 $’000 $’000 $’000 $’000 $’000 $’000 Tax losses carried forward 5,934 - (4,221) - 1,713 1,713 - Impairment of receivables 170 - 544 - 714 714 - Accrued income - (230) 54 - (176) - (176) Accrued expenses 2,442 54 1,562 - 4,058 4,058 - Property, plant and equipment (16,537) (774) (461) (2,470) (20,242) - (20,242) Prepaid expenses (108) (13) 12 - (109) - (109) Intangible assets 738 (7,771) (4) - (7,037) - (7,037) AASB 16 - Right of use assets (10,590) (1,102) (2,494) - (14,186) - (14,186) AASB 16 – Lease liabilities 9,874 1,247 3,023 - 14,144 14,144 - Other items (625) 1,654 297 - 1,327 1,327 - Foreign exchange 43 - (43) - - - - Tax assets/ (liabilities) before offset (8,659) (6,935) (1,730) (2,470) (19,794) 21,956 (41,750) Tax liabilities offset (41,750) Net deferred tax liabilities (19,794) 81 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 38 Note 6. Income tax expense (continued) Balance 30 June 2025 Net Charged Charged Net Deferred Deferred balance to Income to balance tax tax 1 July Statement Equity 30 June assets liabilities Restated1 Restated1 Restated1 Movements in tax balances $’000 $’000 $’000 $’000 $’000 $’000 Tax losses carried forward 11,571 (5,637) - 5,934 5,934 - Impairment of receivables 104 66 - 170 170 - Accrued expenses 2,620 (178) - 2,442 2,442 - Property, plant and equipment (16,357) (180) - (16,537) - (16,537) Prepaid expenses - (108) - (108) - (108) Intangible assets 885 (147) - 738 738 - AASB 16 - Right of use assets (4,926) (5,664) - (10,590) - (10,590) AASB 16 – Lease liabilities 4,884 4,989 - 9,874 9,874 - Other items (599) (26) - (625) - (625) Foreign exchange - 43 - 43 43 - Tax assets/(liabilities) before offset (1,818) (6,842) - (8,659) 19,201 (27,860) Tax liabilities offset (27,860) Net deferred tax liabilities (8,659) Footnote: 1 Refer to note 29 for details of the restatement. The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary differences, unused tax losses and the adjustment recognised for prior periods, where applicable. Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for: • When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits and does not give rise to equal taxable and deductible temporary differences; or • When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the timing of the reversal can be controlled, and it is probable that the temporary difference will not reverse in the foreseeable future; and • Taxable temporary differences arising on the initial recognition of goodwill. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to recover the asset. Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on either the same taxable entity or different taxable entities which intend to settle simultaneously. Bhagwan Marine Limited (the 'head entity') and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under the tax consolidation regime. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 39 Note 7. Earnings per share Consolidated 2026 2025 Basic (loss)/earnings per ordinary share (cents) (0.06) 4.67 Diluted (loss)/earnings per ordinary share (cents) (0.06) 4.65 The calculation of basic and diluted earnings per share is based on the following: (Loss)/Profit for the period attributable to ordinary shareholders – basic and diluted ($’000) (200) 12,486 Weighted average number of ordinary shares – basic (‘000) 310,303 267,525 Weighted average number of ordinary shares – diluted (‘000) 311,117 268,323 Basic (loss)/earnings per share Basic (loss)/earnings per share is calculated by dividing profit attributable to equity holders of the Company, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year. Diluted (loss)/earnings per share Diluted (loss)/earnings per share is calculated by dividing profit attributable to equity holders of the Company, excluding any costs of servicing equity other than ordinary shares, and weighted-average number of ordinary shares outstanding after adjustment for the effects of all dilutive potential ordinary shares. 82
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 38 Note 6. Income tax expense (continued) Balance 30 June 2025 Net Charged Charged Net Deferred Deferred balance to Income to balance tax tax 1 July Statement Equity 30 June assets liabilities Restated1 Restated1 Restated1 Movements in tax balances $’000 $’000 $’000 $’000 $’000 $’000 Tax losses carried forward 11,571 (5,637) - 5,934 5,934 - Impairment of receivables 104 66 - 170 170 - Accrued expenses 2,620 (178) - 2,442 2,442 - Property, plant and equipment (16,357) (180) - (16,537) - (16,537) Prepaid expenses - (108) - (108) - (108) Intangible assets 885 (147) - 738 738 - AASB 16 - Right of use assets (4,926) (5,664) - (10,590) - (10,590) AASB 16 – Lease liabilities 4,884 4,989 - 9,874 9,874 - Other items (599) (26) - (625) - (625) Foreign exchange - 43 - 43 43 - Tax assets/(liabilities) before offset (1,818) (6,842) - (8,659) 19,201 (27,860) Tax liabilities offset (27,860) Net deferred tax liabilities (8,659) Footnote: 1 Refer to note 29 for details of the restatement. The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary differences, unused tax losses and the adjustment recognised for prior periods, where applicable. Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for: • When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits and does not give rise to equal taxable and deductible temporary differences; or • When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the timing of the reversal can be controlled, and it is probable that the temporary difference will not reverse in the foreseeable future; and • Taxable temporary differences arising on the initial recognition of goodwill. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to recover the asset. Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on either the same taxable entity or different taxable entities which intend to settle simultaneously. Bhagwan Marine Limited (the 'head entity') and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under the tax consolidation regime. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 39 Note 7. Earnings per share Consolidated 2026 2025 Basic (loss)/earnings per ordinary share (cents) (0.06) 4.67 Diluted (loss)/earnings per ordinary share (cents) (0.06) 4.65 The calculation of basic and diluted earnings per share is based on the following: (Loss)/Profit for the period attributable to ordinary shareholders – basic and diluted ($’000) (200) 12,486 Weighted average number of ordinary shares – basic (‘000) 310,303 267,525 Weighted average number of ordinary shares – diluted (‘000) 311,117 268,323 Basic (loss)/earnings per share Basic (loss)/earnings per share is calculated by dividing profit attributable to equity holders of the Company, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year. Diluted (loss)/earnings per share Diluted (loss)/earnings per share is calculated by dividing profit attributable to equity holders of the Company, excluding any costs of servicing equity other than ordinary shares, and weighted-average number of ordinary shares outstanding after adjustment for the effects of all dilutive potential ordinary shares. 83 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 40 Note 8. Cash and cash equivalents Consolidated 2026 2025 $’000 $’000 Cash at bank and on hand 23,847 16,192 Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash, and which are subject to an insignificant risk of changes in value. For the consolidated statement of cash flows presentation purposes, cash and cash equivalents also includes bank overdrafts, which are shown within loans and borrowings in current liabilities on the consolidated statement of financial position unless the overdraft account is used for financing. (a) Reconciliation of (loss)/profit after income tax to net cash from operating activities: Consolidated 2026 2025 $’000 $’000 (200) 12,486 36,682 28,074 1,933 219 - 544 35 (908) (275) - (478) (387) 1,730 6,842 5,036 30,373 (248) (716) (959) (87) (307) (459) 25 - (6,835) (41,537) 238 1,377 (Loss)/profit after income tax benefit from continuing operations Adjustments for: Depreciation and amortisation Impairment current assets Net foreign exchange differences Net loss/(gain) on disposal of property, plant and equipment Revaluation of vessels Interest income on related party loan Income tax expense Change in operating assets and liabilities: Decrease in trade and other receivables Increase in non-current financial assets Increase in inventories Increase in prepayments Decrease in other investments Decrease in trade and other payables Increase in employee benefits Net cash from operating activities from continuing operations 36,377 35,821 Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 41 Note 9. Trade and other receivables Consolidated 2026 2025 $’000 $’000 Trade receivables 45,809 47,539 Related party receivables (note 22) 248 155 Less: Allowance for expected credit losses (2,379) (564) 43,678 47,130 Accrued revenue 7,047 3,462 Contract costs to be recharged 13,714 - Other receivables 2,055 1,992 66,494 52,584 Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any provision for expected credit loss. Trade receivables are generally due for settlement within 30 days. Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectable are written off by reducing the carrying amount directly. A provision for expected credit loss of trade receivables is raised when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation and default or delinquency in payments (more than 60 days overdue) are considered indicators that the trade receivable may be impaired. The amount of the impairment allowance is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Cash flows relating to short -term receivables are not discounted if the effect of discounting is immaterial. Other receivables are recognised at amortised cost, less any provision for expected credit loss. Note 10. Inventories Consolidated 2026 2025 $’000 $’000 Raw materials and consumables 7,434 2,287 Finished goods 162 - 7,596 2,287 Raw materials and consumables are measured at the lower of cost and net realisable value. Costs are assigned on the basis of weighted average costs. Inventories consumed in operations and recognised as an expense during the year were $13.2 million (2025: $10.9 million). The Group did not recognise any write-downs of inventory during the year (2025: $nil). 84
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 40 Note 8. Cash and cash equivalents Consolidated 2026 2025 $’000 $’000 Cash at bank and on hand 23,847 16,192 Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash, and which are subject to an insignificant risk of changes in value. For the consolidated statement of cash flows presentation purposes, cash and cash equivalents also includes bank overdrafts, which are shown within loans and borrowings in current liabilities on the consolidated statement of financial position unless the overdraft account is used for financing. (a) Reconciliation of (loss)/profit after income tax to net cash from operating activities: Consolidated 2026 2025 $’000 $’000 (200) 12,486 36,682 28,074 1,933 219 - 544 35 (908) (275) - (478) (387) 1,730 6,842 5,036 30,373 (248) (716) (959) (87) (307) (459) 25 - (6,835) (41,537) 238 1,377 (Loss)/profit after income tax benefit from continuing operations Adjustments for: Depreciation and amortisation Impairment current assets Net foreign exchange differences Net loss/(gain) on disposal of property, plant and equipment Revaluation of vessels Interest income on related party loan Income tax expense Change in operating assets and liabilities: Decrease in trade and other receivables Increase in non-current financial assets Increase in inventories Increase in prepayments Decrease in other investments Decrease in trade and other payables Increase in employee benefits Net cash from operating activities from continuing operations 36,377 35,821 Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 41 Note 9. Trade and other receivables Consolidated 2026 2025 $’000 $’000 Trade receivables 45,809 47,539 Related party receivables (note 22) 248 155 Less: Allowance for expected credit losses (2,379) (564) 43,678 47,130 Accrued revenue 7,047 3,462 Contract costs to be recharged 13,714 - Other receivables 2,055 1,992 66,494 52,584 Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any provision for expected credit loss. Trade receivables are generally due for settlement within 30 days. Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectable are written off by reducing the carrying amount directly. A provision for expected credit loss of trade receivables is raised when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation and default or delinquency in payments (more than 60 days overdue) are considered indicators that the trade receivable may be impaired. The amount of the impairment allowance is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Cash flows relating to short -term receivables are not discounted if the effect of discounting is immaterial. Other receivables are recognised at amortised cost, less any provision for expected credit loss. Note 10. Inventories Consolidated 2026 2025 $’000 $’000 Raw materials and consumables 7,434 2,287 Finished goods 162 - 7,596 2,287 Raw materials and consumables are measured at the lower of cost and net realisable value. Costs are assigned on the basis of weighted average costs. Inventories consumed in operations and recognised as an expense during the year were $13.2 million (2025: $10.9 million). The Group did not recognise any write-downs of inventory during the year (2025: $nil). 85 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 42 Note 11. Other current assets Consolidated 2026 2025 $’000 $’000 Prepayments 4,291 3,444 Contract assets 618 339 Security deposits 156 156 5,065 3,939 Note 12. Property, plant and equipment Consolidated 2026 2025 $’000 $’000 Leasehold land and buildings improvements – at cost 6,876 5,614 Less: Accumulated depreciation (2,748) (2,563) 4,128 3,051 Plant and equipment – at cost 25,621 22,246 Less: Accumulated depreciation (18,844) (17,331) 6,777 4,915 Leasehold vessel improvements – at cost 20,911 17,583 Less: Accumulated depreciation (11,868) (9,021) 9,043 8,562 Vessels – at revaluation 267,974 195,790 Less: Accumulated depreciation (70,545) (54,516) 197,429 141,274 Capital work in progress 3,779 498 221,156 158,300 Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 43 Note 12. Property, plant and equipment (continued) Consolidated Leasehold land and buildings Plant and equipment Vessels Leasehold vessels and vessel equipment Capital work in progress Total $’000 $’000 $’000 $’000 $’000 $’000 Balance at 1 July 2024 3,231 4,207 117,873 3,950 4,930 134,191 Additions 8 2,013 30,746 5,399 498 38,664 Disposals - (1) - - - (1) Revaluation of vessels - - - - - - Transfers from capital WIP - - 3,791 1,139 (4,930) - Other transfers - - - - - - Depreciation expense (188) (1,304) (11,136) (1,926) - (14,554) Balance at 30 June 2025 3,051 4,915 141,274 8,562 498 158,300 Additions 151 708 12,863 4,980 2,906 21,608 Acquired through business acquisition (note 21) 1,110 2,668 43,500 - 442 47,720 Disposals - (1) - - - (1) Revaluation of vessels - - 8,507 - - 8,507 Transfers from capital WIP - - 48 19 (67) - Other transfers - - 1,671 (1,671) - - Transfer from ROU asset - - 5,595 - - 5,595 Depreciation expense (184) (1,513) (16,029) (2,847) - (20,573) Balance at 30 June 2026 4,128 6,777 197,429 9,043 3,779 221,156 Impairment of non-current assets The Group performs a review of non- current asset values each year whenever circumstances indicate that the carrying amount of assets are impaired. The Group did not recognise an impairment as at 30 June 2026 (2025: impairment of $nil). There were no other indicators of impairment identified as at 30 June 2026. Estimation of useful lives of assets The Group determines the estimated useful lives and related depreciation and amortisation charges for its property, plant and equipment. The useful lives could change significantly as a result of technical innovations or some other event. The depreciation and amortisation charge will increase where the useful lives are less than previously estimated lives, or technically obsolete or non-strategic assets that have been abandoned or sold will be written off or written down. Revaluation of vessels Vessels are measured at fair value less accumulated depreciation and impairment losses recognised after the date of revaluation. Valuations are performed with sufficient frequency to ensure the carrying amount of a revalued vessel does not differ materially from its fair value. The fair value measurements of the Group’s vessels at 30 June 2026 were performed by Marko Boats Australia Pty Ltd, independent valuers not related to the Group. Marko Boats Australia Pty Ltd are certified valuers with an AMIS and AVAA designation, and they have appropriate qualifications and recent experience in the fair value measurement of vessels in the relevant sectors. The valuations conform to International Valuation Standards and w ere based on industry accepted approaches to value being the Cost Approach (current replacement cost). Independent valuations were obtained for vessels with a total fair value of $153.0 million at 30 June 2026. Vessels acquired through the Riverside Marine acquisition were independently valued as at March 2026, with a total fair value of $43.5 million. The carrying amount of vessels, had they been carried under the cost model, would be $119.3 million (2025: $83.5 million). 86
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 43 Note 12. Property, plant and equipment (continued) Consolidated Leasehold land and buildings Plant and equipment Vessels Leasehold vessels and vessel equipment Capital work in progress Total $’000 $’000 $’000 $’000 $’000 $’000 Balance at 1 July 2024 3,231 4,207 117,873 3,950 4,930 134,191 Additions 8 2,013 30,746 5,399 498 38,664 Disposals - (1) - - - (1) Revaluation of vessels - - - - - - Transfers from capital WIP - - 3,791 1,139 (4,930) - Other transfers - - - - - - Depreciation expense (188) (1,304) (11,136) (1,926) - (14,554) Balance at 30 June 2025 3,051 4,915 141,274 8,562 498 158,300 Additions 151 708 12,863 4,980 2,906 21,608 Acquired through business acquisition (note 21) 1,110 2,668 43,500 - 442 47,720 Disposals - (1) - - - (1) Revaluation of vessels - - 8,507 - - 8,507 Transfers from capital WIP - - 48 19 (67) - Other transfers - - 1,671 (1,671) - - Transfer from ROU asset - - 5,595 - - 5,595 Depreciation expense (184) (1,513) (16,029) (2,847) - (20,573) Balance at 30 June 2026 4,128 6,777 197,429 9,043 3,779 221,156 Impairment of non-current assets The Group performs a review of non- current asset values each year whenever circumstances indicate that the carrying amount of assets are impaired. The Group did not recognise an impairment as at 30 June 2026 (2025: impairment of $nil). There were no other indicators of impairment identified as at 30 June 2026. Estimation of useful lives of assets The Group determines the estimated useful lives and related depreciation and amortisation charges for its property, plant and equipment. The useful lives could change significantly as a result of technical innovations or some other event. The depreciation and amortisation charge will increase where the useful lives are less than previously estimated lives, or technically obsolete or non-strategic assets that have been abandoned or sold will be written off or written down. Revaluation of vessels Vessels are measured at fair value less accumulated depreciation and impairment losses recognised after the date of revaluation. Valuations are performed with sufficient frequency to ensure the carrying amount of a revalued vessel does not differ materially from its fair value. The fair value measurements of the Group’s vessels at 30 June 2026 were performed by Marko Boats Australia Pty Ltd, independent valuers not related to the Group. Marko Boats Australia Pty Ltd are certified valuers with an AMIS and AVAA designation, and they have appropriate qualifications and recent experience in the fair value measurement of vessels in the relevant sectors. The valuations conform to International Valuation Standards and w ere based on industry accepted approaches to value being the Cost Approach (current replacement cost). Independent valuations were obtained for vessels with a total fair value of $153.0 million at 30 June 2026. Vessels acquired through the Riverside Marine acquisition were independently valued as at March 2026, with a total fair value of $43.5 million. The carrying amount of vessels, had they been carried under the cost model, would be $119.3 million (2025: $83.5 million). 87 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 44 Note 12. Property, plant and equipment (continued) Property, plant and equipment, except vessels, is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Vessels – survey and refits In a vessel’s lifetime, it will undergo general maintenance due to operations, be inspected to satisfy the requirements of licensing, and go through restoration to extend the useful life of the vessel. • A vessel survey is an Australian Maritime Safety Authority (AMSA) requirement, a certificate of survey is evidence that a vessel is surveyed and meets specified standards for design, construction, stability and safety equipment that apply to the vessel. When each major survey is performed the costs are recognised in the carrying amount of the vessel. Any previous vessel survey cost remaining within the carrying amount of the vessel is derecognised when the new vessel survey is recognised in the carrying amount. • A vessel refit is general vessel upgrades and improvements in addition to the requirement of the vessel survey. When a vessel has a scheduled refit, the work performed extends the useful life of the vessel therefore all costs in relation to the refit are recognised in the carrying amount of the vessel as a component. Vessels – leasehold vessels Capital costs in relation to vessels that are leased rather than owned are capitalised and depreciated over the life of the lease. Vessels – depreciation Depreciation is calculated on a straight-line or diminishing value basis to write off the net cost of each item of property, plant and equipment over their expected useful lives. The depreciation rates used are as follows: Buildings 2.5% Leasehold land (over period of lease) 4%–10% Leasehold vessels (over period of lease) 20%–100% Plant and equipment 20%–66% Vessels 4% Vessel survey and refits 20%–100% Increases in the carrying amounts arising on the revaluation of vessels are recognised, net of tax, in other comprehensive income and accumulated in reserves in shareholders’ equity. To the extent that the increase reverses a decrease previously recognised in profit or loss, the increase is first recognised in profit or loss. Decreases that reverse previous increases of the same asset are first recognised in other comprehensive income to the extent of the remaining surplus attributable to the asset; all other decreases are charged to profit or loss. The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date. An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the Group. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss. 88
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 44 Note 12. Property, plant and equipment (continued) Property, plant and equipment, except vessels, is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Vessels – survey and refits In a vessel’s lifetime, it will undergo general maintenance due to operations, be inspected to satisfy the requirements of licensing, and go through restoration to extend the useful life of the vessel. • A vessel survey is an Australian Maritime Safety Authority (AMSA) requirement, a certificate of survey is evidence that a vessel is surveyed and meets specified standards for design, construction, stability and safety equipment that apply to the vessel. When each major survey is performed the costs are recognised in the carrying amount of the vessel. Any previous vessel survey cost remaining within the carrying amount of the vessel is derecognised when the new vessel survey is recognised in the carrying amount. • A vessel refit is general vessel upgrades and improvements in addition to the requirement of the vessel survey. When a vessel has a scheduled refit, the work performed extends the useful life of the vessel therefore all costs in relation to the refit are recognised in the carrying amount of the vessel as a component. Vessels – leasehold vessels Capital costs in relation to vessels that are leased rather than owned are capitalised and depreciated over the life of the lease. Vessels – depreciation Depreciation is calculated on a straight-line or diminishing value basis to write off the net cost of each item of property, plant and equipment over their expected useful lives. The depreciation rates used are as follows: Buildings 2.5% Leasehold land (over period of lease) 4%–10% Leasehold vessels (over period of lease) 20%–100% Plant and equipment 20%–66% Vessels 4% Vessel survey and refits 20%–100% Increases in the carrying amounts arising on the revaluation of vessels are recognised, net of tax, in other comprehensive income and accumulated in reserves in shareholders’ equity. To the extent that the increase reverses a decrease previously recognised in profit or loss, the increase is first recognised in profit or loss. Decreases that reverse previous increases of the same asset are first recognised in other comprehensive income to the extent of the remaining surplus attributable to the asset; all other decreases are charged to profit or loss. The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date. An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the Group. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 45 Note 13. Leases This note provides information for leases where the group is a lessee. The Group leases several assets including: • Current head office premises in Perth which expires on 15 January 2033. • Operating premises in Henderson, Darwin, Gove, Dampier, Brisbane and Melbourne. • Vessel bareboat charters with varying lease terms. (a) Amounts recognised in the consolidated statement of financial position Consolidated Note Properties Vessels Motor vehicles and equipment Total $’000 $’000 $’000 $’000 Balance at 1 July 2024 4,970 11,119 335 16,424 Depreciation charge for the year (3,030) (10,008) (478) (13,516) Additions to right-of-use assets 5,558 23,632 3,207 32,397 Balance at 30 June 2025 7,498 24,743 3,064 35,305 Depreciation charge for the year (3,736) (10,380) (817) (14,933) Acquired through business acquisition 21 4,295 - - 4,295 Additions to right-of-use assets 20,537 10,880 448 31,865 Disposals of right-of-use assets - (2,356) (672) (3,028) Transfer to property, plant & equipment asset - (5,595) - (5,595) Balance at 30 June 2026 28,594 17,292 2,023 47,909 Consolidated Note 2026 2025 $’000 $’000 Lease liabilities Balance at 1 July 32,913 16,281 Acquired through business acquisition 21 4,295 - Additions 31,865 32,397 Disposals (3,028) - Transfer to property, plant & equipment asset 12 (5,595) - Accretion of interest 1,651 1,063 Payments (14,816) (16,828) Balance at 30 June 47,285 32,913 Current 12,963 14,771 Non-Current 34,322 18,142 (b) Amounts recognised in the consolidated statement of profit or loss Consolidated 2026 2025 $’000 $’000 Interest expense (included in finance cost) 1,651 1,063 Expense relating to short-term leases 865 15,942 2,516 17,005 The total cash outflow for leases in 2026 was $14.4 million (2025: $31.7 million). The short-term committed lease payments at 30 June 2026 were $nil (2025: $nil). 89 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 46 Note 13. Leases (continued) (c) Future lease payments The total of future lease payments is disclosed for each of the following periods: Consolidated 2026 2025 $’000 $’000 Less than one year 15,961 31,805 One to two years 10,541 8,085 Two to three years 8,227 6,645 Three to four years 4,885 4,886 Four to five years 3,035 1,548 More than five years 20,082 468 62,731 53,437 The Group as a lessee The Group makes use of leasing arrangements principally for the provision of office space and related facilities and vessels. The rental contracts for properties are typically negotiated for terms of between 2 and 20 years and some of these have extension terms. Lease terms for vessels are between 1 and 5 years and some of these have extension terms. The group assesses whether a contract is or contains a lease at inception of the contract. A lease conveys the right to direct the use and obtain substantially all of the economic benefits of an identified asset for a period of time in exchange for consideration. The Group determines the lease term as the non- cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. The Group has several lease contracts that include extension options. The Group applies judgement in evaluating whether it is reasonably certain whether or not to exercise the option to renew the lease. That is, it considers all relevant factors that create an economic incentive for it to exercise the renewal. After commencement date, the Group reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise or not exercise the option to renew. Measurement and recognition of leases as a lessee At lease commencement date, the Group recognises a right-of-use asset and a lease liability in its consolidated statement of financial position. The right-of-use asset is measured at cost, which is made up of the initial measurement of the lease liability, any initial direct costs incurred by the Group, an estimate of any costs to dismantle and remove the asset at the end of the lease, and any lease payments made in advance of the lease commencement date (net of any incentives received). The Group depreciates the right-of-use asset on a straight-line basis from the lease commencement date to the earlier of the end of the useful life of the right -of-use asset or the end of the lease term. The Group also assesses the right -of-use asset for impairment when such indicators exist. At the commencement date, the Group measures the lease liability at the present value of the lease payments unpaid at that date, discounted using the Group’s incremental borrowing rate because as the lease contracts are negotiated with third parties it is not possible to determine the interest rate that is implied in the lease. The incremental borrowing rate is the estimated rate that the Group would have to pay to borrow the same amount over a similar term, and with a similar security to obtain an asset of equivalent value. Lease payments included in the measurement of the lease liability are made up of fixed payments, variable payments based on an index or rate, amounts expected to be payable under a residual guarantee and payments arising from options reasonably certain to be exercised. 90
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 47 Note 13. Leases (continued) (c) Future lease payments (continued) Subsequent to initial measurement, the liability will be reduced by lease payments that are allocated between repayments of principal and finance costs. The finance cost is the amount that produces a constant periodic rate of interest on the remaining balance of the lease liability. The lease liability is reassessed when there is a change in the lease payments. Change in lease payments arising from a change in the lease term or a change in the assessment of an option to purchase a leased asset. The revised lease payments are discounted using the Group’s incremental borrowing rate at the date of reassessment when the rate implicit in the lease cannot be readily determined. The amount of the remeasurement of the lease liability is reflected as an adjustment to the carrying amount of the right -of-use asset. The exception being when the carrying amount of the right - of-use asset has been reduced to zero then any excess is recognised in profit or loss. Payments under leases can also change when there is either a change in the amounts expected to be paid under residual value guarantees or when future payments change through an index or a rate used to determine those payments, including changes in market rental rates following a market rent review. The lease liability is remeasured only when the adjustment to the lease term is discounted using an unchanged discount rate. Except for where the change in lease payments results from a change in floating interest rates, in which case the discount rate is amended to reflect the change in interest rates. The Group has elected to account for short-term leases using the practical expedients. $0.9 million was recognised in the profit or loss for the reporting period ( 2025: $15.9 million) to reflect lease payments that arise from short -term leases. Instead of recognising a right -of-use asset and lease liability, the payments in relation to these are recognised as an expense in profit or loss on a straight-line basis over the lease term. Note 14. Intangible assets and goodwill Goodwill Customer contracts Customer relationships Total $’000 $’000 $’000 $’000 Year ended 30 June 2026 Carrying amount at 1 July 2025 - - - - Acquisitions Business combinations (note 21) 44,237 25,200 1,239 70,676 Amortisation - (1,122) (54) (1,176) Carrying amount at 30 June 2026 44,237 24,078 1,185 69,500 At 30 June 2026 Cost 44,237 25,200 1,239 70,676 Accumulated amortisation and impairment - (1,122) (54) (1,176) Net carrying amount 44,237 24,078 1,185 69,500 Year ended 30 June 2025 Carrying amount at 1 July 2024 - - - - Acquisitions Purchases - - - - Amortisation - - - - Carrying amount at 30 June 2025 - - - - At 30 June 2025 Cost - - - - Accumulated amortisation and impairment - - - - Net carrying amount - - - - 91 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 48 Note 14. Intangible assets and goodwill (continued) Goodwill is initially measured at cost and is subsequently measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is from the acquisition date. Goodwill is not amortised but will be assessed for impairment at least annually and more frequently if events or changes in circumstances indicate that it might be required. The customer contracts were acquired as part of a business combination and represent the difference in contract pricing and market prices, adjusted for time value of money. Customer relationships were acquired as part of a business combination and represent the value attributed to the acquired customer base and the expected future economic benefits arising from ongoing customer contracts and recurring business opportunities. The customer contracts and relationships are recognised at fair value at the acquisition date and are subsequently amortised over their deemed useful lives. There was no impairment expense at 30 June 2026 (2025: $nil). Estimation of useful lives of intangible assets The Group determines the estimated useful lives and related depreciation and amortisation charges for its finite life intangible assets. Note 15. Non-current financial assets Consolidated Note 2026 2025 $’000 $’000 Debt instruments at amortised cost Receivables from related parties 22 11,978 11,730 Note 16. Trade and other payables Consolidated Note 2026 2025 $’000 $’000 Trade payables 27,456 19,117 Payable to related parties 22 394 1,123 Accrued expenses 24,991 14,938 52,841 35,178 These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year and which are unpaid. Due to their short -term nature, they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 49 Note 17. Loans and borrowings Consolidated 2026 2025 $’000 $’000 Current Liabilities Commonwealth Bank of Australia (‘CBA’) Working Capital Facility 20,000 20,000 Commonwealth Bank of Australia (‘CBA’) Asset Finance Facility 3,541 1,996 23,541 21,996 Non-current Liabilities Commonwealth Bank of Australia (‘CBA’) Cash Advance Facility 70,000 - Commonwealth Bank of Australia (‘CBA’) Asset Finance Facility 11,786 11,195 Commonwealth Bank of Australia (‘CBA’) Market Rate Loan Facility 5,000 - 86,786 11,195 Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method. The terms and conditions of outstanding loans are as follows: 2026 2025 Currency Nominal interest rate Year of Maturity Limit Carrying Amount Limit Carrying Amount $’000 $’000 $’000 $’000 Secured loans Working capital facility – CBA AUD BBSY + 0.80% 20271 30,000 20,000 30,000 20,000 Total bank overdraft facility 30,000 20,000 30,000 20,000 Secured loans Asset finance facility – CBA AUD 6.01% 20302 25,000 11,194 30,000 13,191 Asset finance facility – CBA AUD 6.25% 20293 5,000 4,133 - - 30,000 15,327 30,000 13,191 Cash advance facility – CBA AUD 2.40% 20294 70,000 70,000 - - Market rate loan facility – CBA AUD BBSY + 1.50% 20275 10,000 5,000 10,000 - Contingent liability facility – CBA6 AUD 1.75% 20271 10,000 - 10,000 - Corporate card facility – CBA7 AUD 17.99% 20271 1,500 - 1,500 - Total interest-bearing liabilities 151,500 110,327 81,500 33,191 Footnote: 1. 30 June 2027. 2. 06 February 2030. 3. 27 March 2029. 4. 25 March 2029. 5. 20 December 2027. 6. The contingent liability facility can be drawn down if required for bank guarantees and letters of credit to third party cust omers. Refer to note 24 for further details. 7. The corporate card facility includes three facilities in relation to the corporate credit card and procurement cards. The fac ility limit totalling $1.5 million can be re- allocated between these facilities upon request. Security provided for CBA facilities include: • 1st ranking General Security Interest over all present and after-acquired property of each of the Obligors; • Unlimited interlocking corporate Guarantee & Indemnity from each of the Obligors; • 1st ranking security over all trade receivables by way of assignment in equity supported by a registration on the PPSR; • Purchase Money Security Interest registration over each asset financed under Asset Finance Facility; • Master Asset Finance Agreement; • Negative pledge from the Obligors; • Facility Agreement and documentation incorporating usual representatives and warranties, undertakings and events of default; and • Derivatives Master Agreement. 92
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 49 Note 17. Loans and borrowings Consolidated 2026 2025 $’000 $’000 Current Liabilities Commonwealth Bank of Australia (‘CBA’) Working Capital Facility 20,000 20,000 Commonwealth Bank of Australia (‘CBA’) Asset Finance Facility 3,541 1,996 23,541 21,996 Non-current Liabilities Commonwealth Bank of Australia (‘CBA’) Cash Advance Facility 70,000 - Commonwealth Bank of Australia (‘CBA’) Asset Finance Facility 11,786 11,195 Commonwealth Bank of Australia (‘CBA’) Market Rate Loan Facility 5,000 - 86,786 11,195 Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method. The terms and conditions of outstanding loans are as follows: 2026 2025 Currency Nominal interest rate Year of Maturity Limit Carrying Amount Limit Carrying Amount $’000 $’000 $’000 $’000 Secured loans Working capital facility – CBA AUD BBSY + 0.80% 20271 30,000 20,000 30,000 20,000 Total bank overdraft facility 30,000 20,000 30,000 20,000 Secured loans Asset finance facility – CBA AUD 6.01% 20302 25,000 11,194 30,000 13,191 Asset finance facility – CBA AUD 6.25% 20293 5,000 4,133 - - 30,000 15,327 30,000 13,191 Cash advance facility – CBA AUD 2.40% 20294 70,000 70,000 - - Market rate loan facility – CBA AUD BBSY + 1.50% 20275 10,000 5,000 10,000 - Contingent liability facility – CBA6 AUD 1.75% 20271 10,000 - 10,000 - Corporate card facility – CBA7 AUD 17.99% 20271 1,500 - 1,500 - Total interest-bearing liabilities 151,500 110,327 81,500 33,191 Footnote: 1. 30 June 2027. 2. 06 February 2030. 3. 27 March 2029. 4. 25 March 2029. 5. 20 December 2027. 6. The contingent liability facility can be drawn down if required for bank guarantees and letters of credit to third party cust omers. Refer to note 24 for further details. 7. The corporate card facility includes three facilities in relation to the corporate credit card and procurement cards. The fac ility limit totalling $1.5 million can be re- allocated between these facilities upon request. Security provided for CBA facilities include: • 1st ranking General Security Interest over all present and after-acquired property of each of the Obligors; • Unlimited interlocking corporate Guarantee & Indemnity from each of the Obligors; • 1st ranking security over all trade receivables by way of assignment in equity supported by a registration on the PPSR; • Purchase Money Security Interest registration over each asset financed under Asset Finance Facility; • Master Asset Finance Agreement; • Negative pledge from the Obligors; • Facility Agreement and documentation incorporating usual representatives and warranties, undertakings and events of default; and • Derivatives Master Agreement. 93 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 50 Note 17. Loans and borrowings (continued) CBA facility covenants: The Group’s financing arrangements include undertakings to ensure ongoing compliance with key financial covenants, specifically the Debt Service Cover Ratio ( DSCR) and Gross Leverage Ratio. The Minimum Equity Ratio has been included in Bhagwan Marine’s reporting requirements since Q1 FY26. Following the renegotiation of the facility to facilitate the acquisition of Riverside Marine (see note 21), the Group’s covenants were reviewed and remained unchanged. Covenant obligations are reviewed quarterly by both management and the Group’s financial counterparties. As at the reporting date, the Group remained in full compliance with all banking covenant requirements . If the Group fails to meet the required covenants, the lender may declare that all the loans, together with the accrued interest, be immediately due and payable by the Group. The borrowings are classified as non- current based on management expectation that the Group will continue to meet these covenants and have existing right to defer settlement for at least 12 months after the reporting date. The Group expects to comply with the quarterly covenants for the 12 months following the reporting date. Note 18. Employee benefits Consolidated 2026 2025 $’000 $’000 Non-current Liabilities Liability for long-service leave 1,150 849 1,150 849 Current Liabilities Liability for long-service leave 2,181 2,170 Liability for annual leave 2,841 2,244 Liability for marine leave 1,910 1,680 6,932 6,094 Short-term employee benefits Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within 12- months of the reporting date are measured at the amounts expected to be paid when the liabilities are settled. Long-term employee benefits The liability for long term employee benefits is measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows. Defined contribution superannuation expense Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred. Expense recognised for the defined contribution plan during the year was $11.0 million (2025: $12.0 million). Amounts not expected to be settled within the next 12 months The current provision for long service leave includes all unconditional entitlements where employees have completed the required period of service and those where employees are entitled to pro- rata payments in certain circumstances. The entire amount is presented as current since the Group does not have an unconditional right to defer settlement. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 51 Note 19. Capital and reserves (a) Share capital 2026 2025 2026 2025 Shares Shares $’000 $’000 Ordinary shares fully paid 397,151,458 275,200,238 190,739 142,062 Movements in ordinary share capital Date Shares Issue Price $’000 Balance as at 30 June 2024 148,216,111 - 65,262 Issue of ordinary shares1 23 July 2024 126,984,127 0.63 80,000 Less IPO costs - - (3,200) Balance as at 30 June 2025 275,200,238 142,062 Issue of ordinary shares2 17 February 2026 40,000,000 0.41 16,400 Issue of ordinary shares – Acquisition of Riverside3 31 March 2026 48,780,488 0.41 20,000 Issue of ordinary shares4 31 March 2026 33,170,732 0.41 13,600 Less share issue costs - - (1,323) Balance as at 30 June 2026 397,151,458 190,739 Footnote: 1. On 23rd July 2024, the Company raised $80.0 million (before costs) by issuing 126,984,127 ordinary shares through the Company’s Initial Public Offering. 2. On 17th February 2026, the Company raised $16.4 million (before costs) by issuing 40,000,000 ordinary shares through Tranche 1 of the Placement as part of the acquisition of Riverside Marine. These ordinary shares were issued under the Company’s existing placement capacity. 3. On 31st March 2026, 48,780,488 ordinary shares were issued as part of the consideration for the Riverside Marine acquisition. Refer to note 21 for further det ail. 4. On 31st March 2026, following Shareholder Approval on 24th March 2026, the Company raised $13.6 million (before costs) by issuing 33,170,732 ordinary shares through Tranche 2 of the Placement as part of the acquisition of Riverside Marine. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Ordinary shares Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the company does not have a limited amount of authorised capital. On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. (b) Reserves Revaluation reserve This reserve is used to recognise the fair value adjustment on revaluation of vessels. Share-based payment reserve This reserve is used to record the value of share-based payments provided to employees, including KMP, as part of their remunerations. Refer to note 20 for further details of these plans. Profit reserve The profits reserve represents current year profits (net) transferred to a separate reserve to preserve their profit character. Such profits are available to enable payment of franked dividends in the future should the directors declare by resolution. Accumulated losses Accumulated losses represents current year and historical losses separated from profits to preserve their loss character . 94
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 50 Note 17. Loans and borrowings (continued) CBA facility covenants: The Group’s financing arrangements include undertakings to ensure ongoing compliance with key financial covenants, specifically the Debt Service Cover Ratio ( DSCR) and Gross Leverage Ratio. The Minimum Equity Ratio has been included in Bhagwan Marine’s reporting requirements since Q1 FY26. Following the renegotiation of the facility to facilitate the acquisition of Riverside Marine (see note 21), the Group’s covenants were reviewed and remained unchanged. Covenant obligations are reviewed quarterly by both management and the Group’s financial counterparties. As at the reporting date, the Group remained in full compliance with all banking covenant requirements . If the Group fails to meet the required covenants, the lender may declare that all the loans, together with the accrued interest, be immediately due and payable by the Group. The borrowings are classified as non- current based on management expectation that the Group will continue to meet these covenants and have existing right to defer settlement for at least 12 months after the reporting date. The Group expects to comply with the quarterly covenants for the 12 months following the reporting date. Note 18. Employee benefits Consolidated 2026 2025 $’000 $’000 Non-current Liabilities Liability for long-service leave 1,150 849 1,150 849 Current Liabilities Liability for long-service leave 2,181 2,170 Liability for annual leave 2,841 2,244 Liability for marine leave 1,910 1,680 6,932 6,094 Short-term employee benefits Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within 12- months of the reporting date are measured at the amounts expected to be paid when the liabilities are settled. Long-term employee benefits The liability for long term employee benefits is measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows. Defined contribution superannuation expense Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred. Expense recognised for the defined contribution plan during the year was $11.0 million (2025: $12.0 million). Amounts not expected to be settled within the next 12 months The current provision for long service leave includes all unconditional entitlements where employees have completed the required period of service and those where employees are entitled to pro- rata payments in certain circumstances. The entire amount is presented as current since the Group does not have an unconditional right to defer settlement. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 51 Note 19. Capital and reserves (a) Share capital 2026 2025 2026 2025 Shares Shares $’000 $’000 Ordinary shares fully paid 397,151,458 275,200,238 190,739 142,062 Movements in ordinary share capital Date Shares Issue Price $’000 Balance as at 30 June 2024 148,216,111 - 65,262 Issue of ordinary shares1 23 July 2024 126,984,127 0.63 80,000 Less IPO costs - - (3,200) Balance as at 30 June 2025 275,200,238 142,062 Issue of ordinary shares2 17 February 2026 40,000,000 0.41 16,400 Issue of ordinary shares – Acquisition of Riverside3 31 March 2026 48,780,488 0.41 20,000 Issue of ordinary shares4 31 March 2026 33,170,732 0.41 13,600 Less share issue costs - - (1,323) Balance as at 30 June 2026 397,151,458 190,739 Footnote: 1. On 23rd July 2024, the Company raised $80.0 million (before costs) by issuing 126,984,127 ordinary shares through the Company’s Initial Public Offering. 2. On 17th February 2026, the Company raised $16.4 million (before costs) by issuing 40,000,000 ordinary shares through Tranche 1 of the Placement as part of the acquisition of Riverside Marine. These ordinary shares were issued under the Company’s existing placement capacity. 3. On 31st March 2026, 48,780,488 ordinary shares were issued as part of the consideration for the Riverside Marine acquisition. Refer to note 21 for further det ail. 4. On 31st March 2026, following Shareholder Approval on 24th March 2026, the Company raised $13.6 million (before costs) by issuing 33,170,732 ordinary shares through Tranche 2 of the Placement as part of the acquisition of Riverside Marine. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Ordinary shares Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the company does not have a limited amount of authorised capital. On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. (b) Reserves Revaluation reserve This reserve is used to recognise the fair value adjustment on revaluation of vessels. Share-based payment reserve This reserve is used to record the value of share-based payments provided to employees, including KMP, as part of their remunerations. Refer to note 20 for further details of these plans. Profit reserve The profits reserve represents current year profits (net) transferred to a separate reserve to preserve their profit character. Such profits are available to enable payment of franked dividends in the future should the directors declare by resolution. Accumulated losses Accumulated losses represents current year and historical losses separated from profits to preserve their loss character . 95 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 52 Note 19. Capital and reserves (continued) (b) Reserves (continued) Movements in reserves Movements in each class of reserve during the current and previous financial year are set out below: Revaluation Reserve Profit Reserve Share-Based Payment Reserve Total $’000 $’000 $’000 $’000 Balance at 1 July 2024 56,942 - - 56,942 Movement for the year - 12,486 446 12,932 Balance at 30 June 2025 56,942 12,486 446 69,874 Movement for the year 5,762 (2,952) 452 3,262 Balance at 30 June 2026 62,704 9,534 898 73,136 (c) Dividends Dividends Dividends paid during the current financial year totalled $3.0 million (2025: nil), which were paid out of the profit reserve . Subsequent to year end the Board of Directors has declared a final dividend of 0.3 cents per share (2025: 0.5 cents). The dividend is fully franked, has a record date of 10 September 2026, and will be paid to shareholders on 6 October 2026. The total value of the dividend distribution to be paid is $1. 2 million (2025: $1.4 million), this has not been recognised as a liability at year end. Franking Credits Consolidated 2026 2025 $’000 $’000 Franking credits available for subsequent financial years based on a tax rate of 30% 40,306 23,522 The above amounts represent the balance of the franking account as at the end of the financial year, adjusted for: • franking credits that will arise from the payment of the amount of the provision for income tax at the reporting date. • franking debits that will arise from the payment of dividends recognised as a liability at the reporting date. • franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date. Franking credits are related to the Australian operations of the Group. The increase in available franking credits during the year primarily reflects franking credits acquired as part of the Riverside acquisition, which have been recognised within the Group’s franking account balance. (d) Capital risk management The Group’s objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 53 Note 20. Share-based payment arrangements The Company has adopted an incentive awards plan which provides the framework under which individual grants of equity or equity-based incentive awards may be made to executives, employees and individual service providers of the Company and any Associated Body Corporate of the Company. The incentive awards plan has been designed to allow the Board to grant awards to attract and retain talent, and to align the interest of its executives and employees with those of the Company. During the current year performance rights have been issued to certain executives and employees under the 2024 Incentive Awards Plan. (a) Equity settled awards outstanding A summary of the performance rights granted under the incentive awards plan are set out below: 2026 2025 Number of share rights Weighted average fair value at grant date Number of share rights Weighted average fair value at grant date Outstanding balance at the beginning of the year 3,064,245 0.51 - - Rights issued during the year 3,874,760 0.45 3,064,245 0.51 Rights vested during the year - - - - Rights lapsed and cancelled during the year (482,645) 0.46 - - 6,456,360 0.48 3,064,245 0.51 The share-based payment expense relating to performance rights included in the profi t or loss for the year totalled $ 0.5 million (2025: $0.4 million). On 7 October 2025 , 2,523,698 performance rights were issued to Executives (Other Executives) and on 4 November 2025, 1,351,062 performance rights were issued to Executives, following Shareholder approval, (Shareholder Approved) as part of the Company’s long- term remuneration incentive. The performance rights (FY26 LTI), for both issues, will convert to ordinary shares upon the following conditions being achieved: • Tranche 1 (50%): Subject to a Relative Total Shareholder Return ( rTSR) over the three-year performance period, measured against the Total Shareholder Return performance of those in the Comparator Group ( rTSR Hurdle); and • Tranche 2 (50%): Subject to a performance condition based on the Company’s EBITDA compound annual growth rate (EBITDA CAGR) of 5% to 15% per annum over the three-year performance period. The fair value of the performance rights – long-term incentives for Tranche 1 are determined using a hybrid employee share option pricing model which incorporates a Monte Carlo simulation. The fair value of Tranche 2 is determined using a Black Scholes option pricing model. The assumptions used in assessing the indicative fair value of the performance rights are set out below: FY26 LTI – Shareholder Approved FY26 LTI – Other Executives Tranche 1 Tranche 2 Tranche 1 Tranche 2 Grant date 30 October 2025 30 October 2025 23 September 2025 23 September 2025 Exercise price $nil $nil $nil $nil Vesting date 30 June 2028 30 June 2028 30 June 2028 30 June 2028 Underlying share price $0.57 $0.57 $0.54 $0.54 Risk free rate 4.30% 4.30% 4.27% 4.27% Volatility 50% 50% 50% 50% Valuation per performance right $0.37 $0.57 $0.35 $0.54 Probability of success N/A 0% N/A 0% Provision for employee exit 100% 100% 82% 82% Number of performance rights granted 675,531 675,531 1,261,849 1,261,849 96
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 52 Note 19. Capital and reserves (continued) (b) Reserves (continued) Movements in reserves Movements in each class of reserve during the current and previous financial year are set out below: Revaluation Reserve Profit Reserve Share-Based Payment Reserve Total $’000 $’000 $’000 $’000 Balance at 1 July 2024 56,942 - - 56,942 Movement for the year - 12,486 446 12,932 Balance at 30 June 2025 56,942 12,486 446 69,874 Movement for the year 5,762 (2,952) 452 3,262 Balance at 30 June 2026 62,704 9,534 898 73,136 (c) Dividends Dividends Dividends paid during the current financial year totalled $3.0 million (2025: nil), which were paid out of the profit reserve . Subsequent to year end the Board of Directors has declared a final dividend of 0.3 cents per share (2025: 0.5 cents). The dividend is fully franked, has a record date of 10 September 2026, and will be paid to shareholders on 6 October 2026. The total value of the dividend distribution to be paid is $1. 2 million (2025: $1.4 million), this has not been recognised as a liability at year end. Franking Credits Consolidated 2026 2025 $’000 $’000 Franking credits available for subsequent financial years based on a tax rate of 30% 40,306 23,522 The above amounts represent the balance of the franking account as at the end of the financial year, adjusted for: • franking credits that will arise from the payment of the amount of the provision for income tax at the reporting date. • franking debits that will arise from the payment of dividends recognised as a liability at the reporting date. • franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date. Franking credits are related to the Australian operations of the Group. The increase in available franking credits during the year primarily reflects franking credits acquired as part of the Riverside acquisition, which have been recognised within the Group’s franking account balance. (d) Capital risk management The Group’s objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 53 Note 20. Share-based payment arrangements The Company has adopted an incentive awards plan which provides the framework under which individual grants of equity or equity-based incentive awards may be made to executives, employees and individual service providers of the Company and any Associated Body Corporate of the Company. The incentive awards plan has been designed to allow the Board to grant awards to attract and retain talent, and to align the interest of its executives and employees with those of the Company. During the current year performance rights have been issued to certain executives and employees under the 2024 Incentive Awards Plan. (a) Equity settled awards outstanding A summary of the performance rights granted under the incentive awards plan are set out below: 2026 2025 Number of share rights Weighted average fair value at grant date Number of share rights Weighted average fair value at grant date Outstanding balance at the beginning of the year 3,064,245 0.51 - - Rights issued during the year 3,874,760 0.45 3,064,245 0.51 Rights vested during the year - - - - Rights lapsed and cancelled during the year (482,645) 0.46 - - 6,456,360 0.48 3,064,245 0.51 The share-based payment expense relating to performance rights included in the profi t or loss for the year totalled $ 0.5 million (2025: $0.4 million). On 7 October 2025 , 2,523,698 performance rights were issued to Executives (Other Executives) and on 4 November 2025, 1,351,062 performance rights were issued to Executives, following Shareholder approval, (Shareholder Approved) as part of the Company’s long- term remuneration incentive. The performance rights (FY26 LTI), for both issues, will convert to ordinary shares upon the following conditions being achieved: • Tranche 1 (50%): Subject to a Relative Total Shareholder Return ( rTSR) over the three-year performance period, measured against the Total Shareholder Return performance of those in the Comparator Group ( rTSR Hurdle); and • Tranche 2 (50%): Subject to a performance condition based on the Company’s EBITDA compound annual growth rate (EBITDA CAGR) of 5% to 15% per annum over the three-year performance period. The fair value of the performance rights – long-term incentives for Tranche 1 are determined using a hybrid employee share option pricing model which incorporates a Monte Carlo simulation. The fair value of Tranche 2 is determined using a Black Scholes option pricing model. The assumptions used in assessing the indicative fair value of the performance rights are set out below: FY26 LTI – Shareholder Approved FY26 LTI – Other Executives Tranche 1 Tranche 2 Tranche 1 Tranche 2 Grant date 30 October 2025 30 October 2025 23 September 2025 23 September 2025 Exercise price $nil $nil $nil $nil Vesting date 30 June 2028 30 June 2028 30 June 2028 30 June 2028 Underlying share price $0.57 $0.57 $0.54 $0.54 Risk free rate 4.30% 4.30% 4.27% 4.27% Volatility 50% 50% 50% 50% Valuation per performance right $0.37 $0.57 $0.35 $0.54 Probability of success N/A 0% N/A 0% Provision for employee exit 100% 100% 82% 82% Number of performance rights granted 675,531 675,531 1,261,849 1,261,849 97 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 54 Note 20. Share-based payment arrangements (continued) (b) Vesting conditions of share rights and performance rights granted Relative TSR: The comparator group is a peer group comprised of ASX -listed, or otherwise recognised security exchange, companies as determined by the Board. The TSR for Bhagwan Marine and comparator companies is measured ov er three financial years (e.g. 1 July 2025 to 30 June 2028 for the FY26 LTI grant). Relative TSR measures the percentage change in a company’s s hare price, plus the value of dividends received during the period, assuming all those dividends are reinvested into new shares. The proportion of Performance Rights that may vest based on rTSR performance is determined based on ranking approach. The TSR for Bhagwan Marine and each company in the comparator group is measured and the companies are ranked by their TSR performance with vesting based on the following schedule: Relative TSR performance Level of vesting Less than 50th percentile 0% At 50th percentile 50% Between the 50th and 75th percentile 50% plus a pro-rata straight-line percentage increase between 50% and 75% At or above the 75th percentile 100% EBITDA CAGR: The EBITDA CAGR will be measured over the three-year performance period and will not be retested. The vesting schedule for the 50% of the performance rights subject to EBITDA CAGR testing is set out below: EBITDA CAGR performance Level of vesting Less than 5% EBITDA CAGR 0% At 5% EBITDA CAGR 25% Between 5% and 15% EBITDA CAGR 25% plus a pro-rata straight-line percentage increase between 5% and 15% At or above 15% EBITDA CAGR 100% (c) Recognition and measurement The performance measures are tested at the end of the three- year performance period to determine the number of Performance Rights that vest. There is no opportunity for re-testing. Rights will lapse if the performance measures are not met at the end of the performance period. Where a participant ceases employment, whether due to special circumstances (including death, terminal illness or permanent disablement) or due to the participant’s resignation or termination, unless the Board determines otherwise and subject to applicable laws, unvested Performance Rights will automatically lapse. If a participant ceases employment after Performance Rights have vested but not exercised, the participant may continue to hold such vested Performance Rights depending on the circumstances of the cessation of employment. In these circumstances, vesting will be determined at the discretion of the Board. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 55 Note 21. Acquisition of Riverside Marine On 31 March 2026, the Group acquired 100% of the issued capital of Riverside Marine Holdings Pty Ltd (Riverside Marine). Riverside Marine specialises in the management and operation of approximately thirty diverse vessels, including nine owned vessels, across five established brands. The acquisition represents a step- change in scale and scope for Bhagwan Marine, strengthening the Group’s position as a preferred marine solutions partner. For the three months ended 30 June 2026, Riverside Marine contributed revenue of $15.1 million, and profit before tax of $2.8 million to the Group’s results. If the acquisition had occurred on 1 July 2025, management estimates that consolidated revenue would have been $60.0 million, and consolidated profit before tax for the year would have been $14.3 million. In determining these amounts, management has assumed that the fair value adjustments, determined provisionally, that arose on the date of acquisition would have been the same if the acquisition had occurred on 1 July 2025. There were no business combinations in the year ended 30 June 2025. (a) Consideration transferred The following table summarises the acquisition date fair value of each major class of consideration transferred. 2026 $’000 Cash (see (a)(i)) 100,000 Equity instruments (48.8m ordinary shares) (see (a)(ii)) 20,000 Working capital and net debt adjustments 2,607 Contingent consideration (see (a)(iii)) - Total consideration transferred 122,607 (i) Cash The Company paid initial cash consideration of $100.0 million at date of acquisition. The initial cash consideration was funded in two parts, being $30.0 million funded from equity raising and $70.0 million funded by a three-year facility from Commonwealth Bank of Australia (refer to note 17). Equity raising: The Company secured binding commitments to raise $30.0 million (before costs) at an issue price of $0.41 per share, as set out below. • 40.0 million placement shares (Tranche 1) were issued under the Company’s existing placement capacity pursuant to Listing Rule 7.1 on 17 February 2026; and • 23.9 million placement shares ( Tranche 2) were issued following shareholder approval at a general meeting held on 24 March 2026. • 9.3 million placement shares (Director Shares) were issued following shareholder approval at the general meeting held on 24 March 2026 to Directors and other related parties of Bhagwan Marine. (ii) Equity instruments issued The fair value of the 48.8 million ordinary shares issued was based on the listed share price of the Company at 31 March 2026 of $0.41 per share. The ordinary shares will be subject to voluntary escrow (50% escrowed for one year and 50% escrowed for two years) under voluntary escrow agreements. (iii) Contingent consideration The Group has agreed to pay the selling shareholders linear earn out consideration of up to $10.0 million if the acquiree’s adjusted earn-out EBITDA assessed from 1 July 2025 to 30 June 2026 reaches $25.2 million and capped at $27.2 million. The Group has not included any contingent consideration in the consideration transferred balance, which represents its fair value at the date of acquisition. 98
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 54 Note 20. Share-based payment arrangements (continued) (b) Vesting conditions of share rights and performance rights granted Relative TSR: The comparator group is a peer group comprised of ASX -listed, or otherwise recognised security exchange, companies as determined by the Board. The TSR for Bhagwan Marine and comparator companies is measured ov er three financial years (e.g. 1 July 2025 to 30 June 2028 for the FY26 LTI grant). Relative TSR measures the percentage change in a company’s s hare price, plus the value of dividends received during the period, assuming all those dividends are reinvested into new shares. The proportion of Performance Rights that may vest based on rTSR performance is determined based on ranking approach. The TSR for Bhagwan Marine and each company in the comparator group is measured and the companies are ranked by their TSR performance with vesting based on the following schedule: Relative TSR performance Level of vesting Less than 50th percentile 0% At 50th percentile 50% Between the 50th and 75th percentile 50% plus a pro-rata straight-line percentage increase between 50% and 75% At or above the 75th percentile 100% EBITDA CAGR: The EBITDA CAGR will be measured over the three-year performance period and will not be retested. The vesting schedule for the 50% of the performance rights subject to EBITDA CAGR testing is set out below: EBITDA CAGR performance Level of vesting Less than 5% EBITDA CAGR 0% At 5% EBITDA CAGR 25% Between 5% and 15% EBITDA CAGR 25% plus a pro-rata straight-line percentage increase between 5% and 15% At or above 15% EBITDA CAGR 100% (c) Recognition and measurement The performance measures are tested at the end of the three- year performance period to determine the number of Performance Rights that vest. There is no opportunity for re-testing. Rights will lapse if the performance measures are not met at the end of the performance period. Where a participant ceases employment, whether due to special circumstances (including death, terminal illness or permanent disablement) or due to the participant’s resignation or termination, unless the Board determines otherwise and subject to applicable laws, unvested Performance Rights will automatically lapse. If a participant ceases employment after Performance Rights have vested but not exercised, the participant may continue to hold such vested Performance Rights depending on the circumstances of the cessation of employment. In these circumstances, vesting will be determined at the discretion of the Board. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 55 Note 21. Acquisition of Riverside Marine On 31 March 2026, the Group acquired 100% of the issued capital of Riverside Marine Holdings Pty Ltd (Riverside Marine). Riverside Marine specialises in the management and operation of approximately thirty diverse vessels, including nine owned vessels, across five established brands. The acquisition represents a step- change in scale and scope for Bhagwan Marine, strengthening the Group’s position as a preferred marine solutions partner. For the three months ended 30 June 2026, Riverside Marine contributed revenue of $15.1 million, and profit before tax of $2.8 million to the Group’s results. If the acquisition had occurred on 1 July 2025, management estimates that consolidated revenue would have been $60.0 million, and consolidated profit before tax for the year would have been $14.3 million. In determining these amounts, management has assumed that the fair value adjustments, determined provisionally, that arose on the date of acquisition would have been the same if the acquisition had occurred on 1 July 2025. There were no business combinations in the year ended 30 June 2025. (a) Consideration transferred The following table summarises the acquisition date fair value of each major class of consideration transferred. 2026 $’000 Cash (see (a)(i)) 100,000 Equity instruments (48.8m ordinary shares) (see (a)(ii)) 20,000 Working capital and net debt adjustments 2,607 Contingent consideration (see (a)(iii)) - Total consideration transferred 122,607 (i) Cash The Company paid initial cash consideration of $100.0 million at date of acquisition. The initial cash consideration was funded in two parts, being $30.0 million funded from equity raising and $70.0 million funded by a three-year facility from Commonwealth Bank of Australia (refer to note 17). Equity raising: The Company secured binding commitments to raise $30.0 million (before costs) at an issue price of $0.41 per share, as set out below. • 40.0 million placement shares (Tranche 1) were issued under the Company’s existing placement capacity pursuant to Listing Rule 7.1 on 17 February 2026; and • 23.9 million placement shares ( Tranche 2) were issued following shareholder approval at a general meeting held on 24 March 2026. • 9.3 million placement shares (Director Shares) were issued following shareholder approval at the general meeting held on 24 March 2026 to Directors and other related parties of Bhagwan Marine. (ii) Equity instruments issued The fair value of the 48.8 million ordinary shares issued was based on the listed share price of the Company at 31 March 2026 of $0.41 per share. The ordinary shares will be subject to voluntary escrow (50% escrowed for one year and 50% escrowed for two years) under voluntary escrow agreements. (iii) Contingent consideration The Group has agreed to pay the selling shareholders linear earn out consideration of up to $10.0 million if the acquiree’s adjusted earn-out EBITDA assessed from 1 July 2025 to 30 June 2026 reaches $25.2 million and capped at $27.2 million. The Group has not included any contingent consideration in the consideration transferred balance, which represents its fair value at the date of acquisition. 99 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 56 Note 21. Acquisition of Riverside Marine (continued) (b) Acquisition-related costs The Group incurred acquisition-related costs of $2.0 million including legal fees and due diligence costs. These costs have been included in ‘professional fees’. (c) Identifiable assets acquired and liabilities assumed The provisionally accounted for assets and liabilities recognised as a result of the acquisition are as follows: 2026 $’000 Property, plant and equipment 47,720 Intangible assets – customer contracts and relationships 26,439 Inventories 4,350 Trade and other receivables 19,765 Right of use asset 4,295 Cash and cash equivalents 10,104 Trade and other payables (23,073) Lease liabilities (4,295) Deferred tax liabilities (6,935) Total identifiable net assets acquired 78,370 (i) Measurement of fair values The valuation techniques used for measuring the fair values of material assets acquired were as follows. Assets acquired Valuation technique Property, plant and equipment - Vessels Cost approach method – The fair value assessment of vessels was determined using the depreciated replacement cost method. This approach estimates the current replacement cost of a vessel with equivalent service potential and deducts for the loss in value caused by physical deterioration, functional obsolescence, and economic obsolescence, existing at the acquisition date. Property, plant and equipment - Other Market comparison – The fair value assessment for property, plant and equipment other than vessels was determined by reference to observable market transactions for similar assets, where available. Adjustments were made for differences in age, condition, capacity, location and remaining useful life to reflect the characteristics of the acquired assets at the acquisition date. Intangible assets – customer contracts and relationships Multi-period excess earnings method – The excess earnings method is appropriate where the associated cashflows from customer contracts and relationships can be reasonably estimated. The premise of this method is that the value of an intangible asset is equal to the present value of the earnings it generates, net of a reasonable return on other assets contributing to those earnings. Inventories Cost and net realisable value approach method – The fair value of inventories was assessed based on the estimated selling price in the ordinary course of business less the estimated costs of completion and costs necessary to make the sale (net realisable value), where this was lower than cost. The assessment considered the condition and age of inventory, expected future demand, inventory turnover rates and any obsolescence risks existing and the acquisition date. If new information obtained within one year of the date of acquisition about facts and circumstances that existed at the date of acquisition identifies adjustments to the above amounts, or any additional provisions that existed at the date of acquisition, then the accounting for the acquisition will be revised. 100
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 56 Note 21. Acquisition of Riverside Marine (continued) (b) Acquisition-related costs The Group incurred acquisition-related costs of $2.0 million including legal fees and due diligence costs. These costs have been included in ‘professional fees’. (c) Identifiable assets acquired and liabilities assumed The provisionally accounted for assets and liabilities recognised as a result of the acquisition are as follows: 2026 $’000 Property, plant and equipment 47,720 Intangible assets – customer contracts and relationships 26,439 Inventories 4,350 Trade and other receivables 19,765 Right of use asset 4,295 Cash and cash equivalents 10,104 Trade and other payables (23,073) Lease liabilities (4,295) Deferred tax liabilities (6,935) Total identifiable net assets acquired 78,370 (i) Measurement of fair values The valuation techniques used for measuring the fair values of material assets acquired were as follows. Assets acquired Valuation technique Property, plant and equipment - Vessels Cost approach method – The fair value assessment of vessels was determined using the depreciated replacement cost method. This approach estimates the current replacement cost of a vessel with equivalent service potential and deducts for the loss in value caused by physical deterioration, functional obsolescence, and economic obsolescence, existing at the acquisition date. Property, plant and equipment - Other Market comparison – The fair value assessment for property, plant and equipment other than vessels was determined by reference to observable market transactions for similar assets, where available. Adjustments were made for differences in age, condition, capacity, location and remaining useful life to reflect the characteristics of the acquired assets at the acquisition date. Intangible assets – customer contracts and relationships Multi-period excess earnings method – The excess earnings method is appropriate where the associated cashflows from customer contracts and relationships can be reasonably estimated. The premise of this method is that the value of an intangible asset is equal to the present value of the earnings it generates, net of a reasonable return on other assets contributing to those earnings. Inventories Cost and net realisable value approach method – The fair value of inventories was assessed based on the estimated selling price in the ordinary course of business less the estimated costs of completion and costs necessary to make the sale (net realisable value), where this was lower than cost. The assessment considered the condition and age of inventory, expected future demand, inventory turnover rates and any obsolescence risks existing and the acquisition date. If new information obtained within one year of the date of acquisition about facts and circumstances that existed at the date of acquisition identifies adjustments to the above amounts, or any additional provisions that existed at the date of acquisition, then the accounting for the acquisition will be revised. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 57 Note 21. Acquisition of Riverside Marine (continued) (d) Goodwill Goodwill arising from the acquisition has been recognised as follows. 2026 $’000 Consideration transferred 122,607 Fair value of identifiable net assets (78,370) Goodwill 44,237 The goodwill is attributable mainly to the skills and technical talent of Riverside Marine’s work force and the synergies expected to be achieved from integrating Riverside Marine into the Group’s existing business. None of the goodwill recognised is expected to be deductible for tax purposes. Note 22. Related party disclosures (a) Parent entity The Parent entity of the Group is Bhagwan Marine Limited. (b) Transactions with key management personnel Key management personnel compensation comprised the following: Consolidated 2026 2025 $ $ Short-term employee benefits 1,678,017 1,798,786 Long-term employee benefits (44,020) 15,511 Post-employment benefits 138,731 99,033 Non-monetary car parking employment benefits 6,931 6,935 Share-based payments 141,072 111,941 1,920,731 2,032,206 Detailed remuneration disclosures are provided in the remuneration report on pages 55 to 69. (c) Related party transactions Related party transactions disclosed in this note are determined in accordance with AASB 124 Related Party Disclosures. While there is overlap with the related party provisions of the Corporations Act 2001 (Cth) , AASB 124 applies a broader definition that includes key management personnel, persons with control, joint control or significant influence over the Company, their close family members, subsidiaries, associates, joint ventures and certain other related entities. 101 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 58 Note 22. Related party disclosures (continued) (c) Related party transactions (continued) The following people are considered r elated parties for the purposes of disclosure in this note and are subject to transactions with the Company: Name Position / Role Associates Commentary Board Members Loui Kannikoski Founder, Managing Director & CEO BM Fleet Pty Ltd1 Bhagwan Properties Pty Ltd2 Guru Pty Ltd3 Receives remuneration in his Executive role. Transactions between the Company and with related parties. Holds a material relevant interest of 30.32% in the capital of the Company. Anthony Wooles Chair and Non- Executive Director BM Fleet Pty Ltd1 AEW Holdings Pty Ltd4 Trudo Consulting Pty Ltd5 Receives Directors Fees in his Board role. Transactions between the Company and with related parties. Holds a material relevant interest of 6.29% in the capital of the Company. Andrew Wackett Executive Director – Finance N/A Receives remuneration in his Executive role. Tracey Horton AO Independent Non- Executive Director N/A Receives Director Fees in her Board role. Persons related to Board Members Kerren Kannikoski General Manager Corporate Services Bhagwan Properties Pty Ltd2 Guru Pty Ltd3 Spouse of Loui Kannikoski. Receives remuneration in her role as an employee. Transactions between the Company and with related parties. Holds a material relevant interest in the capital of the Company with Loui Kannikoski. Tom Kannikoski General Manager Operations – WA KFAMS Pty Ltd6 Son of Loui Kannikoski and Kerren Kannikoski. Receives remuneration in his role as an employee. Transactions between the Company and with related parties. Chloe Kannikoski Culture and Engagement Advisor N/A Daughter of Loui Kannikoski and Kerren Kannikoski. Receives remuneration in her role as an employee. Footnote: 1. BM Fleet Pty Ltd is an entity associated with Loui Kannikoski and Anthony Wooles . Refer to note (c) below. 2. Bhagwan Properties Pty Ltd is the trustee of the Kannikoski Property Trust, an entity associated with Loui Kannikoski and Ker ren Kannikoski. 3. Guru Pty Ltd, is an entity associated with Loui Kannikoski and Kerren Kannikoski. 4. AEW Holdings Pty Ltd is an entity associated with Anthony Wooles and holds shares in the Company . 5. Trudo Consulting Pty Ltd atf TRUDO Consulting Trust, an entity associated with Anthony Wooles , received Directors Fees for the services of Anthony Wooles as Chairman and Director of the Company. 6. KFAMS Pty Ltd is an entity associated with Tom Kannikoski. Total Related Party Transactions As a Founder-led Company, which was converted into a public company in May 2024, there are several related party transactions, which are deemed necessary for the continuing operation of the Company. During the year, the Company was a party to an ongoing arrangement with entities associated with Founder and Managing Director & CEO Loui Kannikoski and his immediate family members, as well as with Anthony Wooles. For the purposes of Chapter 2E of the Corporations Act, the Directors (excluding those Directors receiving the financial benefit) consider that the terms and conditions of the r elated party transaction described in this note were no more favourable than those available, or which might reasonably be expected to be available, in similar transactions with non- KMP related companies on an arm’s length basis and within market practice for transactions of the nature of the industry in which the Company operates. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 59 Note 22. Related party disclosures (continued) (c) Related party transactions (continued) Total Related Party Transactions (continued) The Company did not obtain shareholder approval for any of the r elated party arrangements referred to in notes (c) (i) to (iv) on the basis that each of the transactions was entered into at a time when the Company was a proprietary company and such related party arrangements did not attract the operation of Chapter 2E of the Corporations Act. Total transactions with related parties (excluding remuneration) are set out in the table below and described in more detail in notes (i) to (iv) below. The aggregate value of each of the above transactions and outstanding balances related to related parties and entities over which they have control or significant influence was as follows: Transaction values for the year ended 30 June Balance outstanding as at 30 June 2026 2025 2026 2025 Note $ $ $ $ Amounts recognised as revenue Services provided to BM Fleet Pty Ltd (i) 468,501 159,892 247,777 155,474 468,501 159,892 247,777 155,474 Amounts recognised as expense Vessel Leases – BM Fleet Pty Ltd (ii) 632,534 853,263 27,225 736,464 Vessel Leases – KFAMS Pty Ltd (ii) 760,010 755,569 366,911 386,364 Property Lease – The Kannikoski Property Trust (iii) 190,805 275,831 - - 1,583,349 1,884,663 394,136 1,122,828 Loans Loan receivable and related interest – BM Fleet Pty Ltd (iv) 478,464 425,458 11,977,558 11,730,176 Loan payable and related interest – Kannikoski Shareholder Loan (iv) - (322,283) - - 478,464 103,175 11,977,558 11,730,176 (i) Services During the year, Bhagwan Marine provided services to BM Fleet Pty Ltd (BM Fleet) totalling $468,501 (2025: $159,892). The services were rendered under arm’s length terms, consistent with standard commercial practices and market rates . These services are predominately in connection with the construction, finishings and commissioning of the Bhagwan Micah vessel (formerly known as Bhagwan Phoenix). Bhagwan Marine’s direct costs were recovered from BM Fleet at cost price plus 10% by invoice to BM Fleet . Bhagwan Marine has a 5- year lease over the Bhagwan Micah vessel commencing upon delivery and it was therefore in Bhagwan Marine's interests for the vessel build to be completed. (ii) Vessel leases As disclosed in sections 6.7.1 and 6.7.2 of the Company’s Prospectus, the related party vessel leases arose from historical operational and financing requirements. At the time, the Company’s financier was not prepared to fund the acquisition of vessels needed to meet customer demand, requiring the Company to obtain alternative funding arrangements through BM Fleet Pty Ltd and KFAMS Pty Ltd. BM Fleet Pty Ltd was established under these arrangements to acquire and make vessels available to the Company. Its Directors, Anthony Wooles and Loui Kannikoski, provided personal guarantees and security over BM Fleet-owned vessels to support BM Fleet’s financing. The structure was established in good faith, for proper purposes and in the Company’s best interests, with the personal financial risk assumed by those Directors considered necessary to support the Company’s ongoing operations. 102
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 58 Note 22. Related party disclosures (continued) (c) Related party transactions (continued) The following people are considered r elated parties for the purposes of disclosure in this note and are subject to transactions with the Company: Name Position / Role Associates Commentary Board Members Loui Kannikoski Founder, Managing Director & CEO BM Fleet Pty Ltd1 Bhagwan Properties Pty Ltd2 Guru Pty Ltd3 Receives remuneration in his Executive role. Transactions between the Company and with related parties. Holds a material relevant interest of 30.32% in the capital of the Company. Anthony Wooles Chair and Non- Executive Director BM Fleet Pty Ltd1 AEW Holdings Pty Ltd4 Trudo Consulting Pty Ltd5 Receives Directors Fees in his Board role. Transactions between the Company and with related parties. Holds a material relevant interest of 6.29% in the capital of the Company. Andrew Wackett Executive Director – Finance N/A Receives remuneration in his Executive role. Tracey Horton AO Independent Non- Executive Director N/A Receives Director Fees in her Board role. Persons related to Board Members Kerren Kannikoski General Manager Corporate Services Bhagwan Properties Pty Ltd2 Guru Pty Ltd3 Spouse of Loui Kannikoski. Receives remuneration in her role as an employee. Transactions between the Company and with related parties. Holds a material relevant interest in the capital of the Company with Loui Kannikoski. Tom Kannikoski General Manager Operations – WA KFAMS Pty Ltd6 Son of Loui Kannikoski and Kerren Kannikoski. Receives remuneration in his role as an employee. Transactions between the Company and with related parties. Chloe Kannikoski Culture and Engagement Advisor N/A Daughter of Loui Kannikoski and Kerren Kannikoski. Receives remuneration in her role as an employee. Footnote: 1. BM Fleet Pty Ltd is an entity associated with Loui Kannikoski and Anthony Wooles . Refer to note (c) below. 2. Bhagwan Properties Pty Ltd is the trustee of the Kannikoski Property Trust, an entity associated with Loui Kannikoski and Ker ren Kannikoski. 3. Guru Pty Ltd, is an entity associated with Loui Kannikoski and Kerren Kannikoski. 4. AEW Holdings Pty Ltd is an entity associated with Anthony Wooles and holds shares in the Company . 5. Trudo Consulting Pty Ltd atf TRUDO Consulting Trust, an entity associated with Anthony Wooles , received Directors Fees for the services of Anthony Wooles as Chairman and Director of the Company. 6. KFAMS Pty Ltd is an entity associated with Tom Kannikoski. Total Related Party Transactions As a Founder-led Company, which was converted into a public company in May 2024, there are several related party transactions, which are deemed necessary for the continuing operation of the Company. During the year, the Company was a party to an ongoing arrangement with entities associated with Founder and Managing Director & CEO Loui Kannikoski and his immediate family members, as well as with Anthony Wooles. For the purposes of Chapter 2E of the Corporations Act, the Directors (excluding those Directors receiving the financial benefit) consider that the terms and conditions of the r elated party transaction described in this note were no more favourable than those available, or which might reasonably be expected to be available, in similar transactions with non- KMP related companies on an arm’s length basis and within market practice for transactions of the nature of the industry in which the Company operates. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 59 Note 22. Related party disclosures (continued) (c) Related party transactions (continued) Total Related Party Transactions (continued) The Company did not obtain shareholder approval for any of the r elated party arrangements referred to in notes (c) (i) to (iv) on the basis that each of the transactions was entered into at a time when the Company was a proprietary company and such related party arrangements did not attract the operation of Chapter 2E of the Corporations Act. Total transactions with related parties (excluding remuneration) are set out in the table below and described in more detail in notes (i) to (iv) below. The aggregate value of each of the above transactions and outstanding balances related to related parties and entities over which they have control or significant influence was as follows: Transaction values for the year ended 30 June Balance outstanding as at 30 June 2026 2025 2026 2025 Note $ $ $ $ Amounts recognised as revenue Services provided to BM Fleet Pty Ltd (i) 468,501 159,892 247,777 155,474 468,501 159,892 247,777 155,474 Amounts recognised as expense Vessel Leases – BM Fleet Pty Ltd (ii) 632,534 853,263 27,225 736,464 Vessel Leases – KFAMS Pty Ltd (ii) 760,010 755,569 366,911 386,364 Property Lease – The Kannikoski Property Trust (iii) 190,805 275,831 - - 1,583,349 1,884,663 394,136 1,122,828 Loans Loan receivable and related interest – BM Fleet Pty Ltd (iv) 478,464 425,458 11,977,558 11,730,176 Loan payable and related interest – Kannikoski Shareholder Loan (iv) - (322,283) - - 478,464 103,175 11,977,558 11,730,176 (i) Services During the year, Bhagwan Marine provided services to BM Fleet Pty Ltd (BM Fleet) totalling $468,501 (2025: $159,892). The services were rendered under arm’s length terms, consistent with standard commercial practices and market rates . These services are predominately in connection with the construction, finishings and commissioning of the Bhagwan Micah vessel (formerly known as Bhagwan Phoenix). Bhagwan Marine’s direct costs were recovered from BM Fleet at cost price plus 10% by invoice to BM Fleet . Bhagwan Marine has a 5- year lease over the Bhagwan Micah vessel commencing upon delivery and it was therefore in Bhagwan Marine's interests for the vessel build to be completed. (ii) Vessel leases As disclosed in sections 6.7.1 and 6.7.2 of the Company’s Prospectus, the related party vessel leases arose from historical operational and financing requirements. At the time, the Company’s financier was not prepared to fund the acquisition of vessels needed to meet customer demand, requiring the Company to obtain alternative funding arrangements through BM Fleet Pty Ltd and KFAMS Pty Ltd. BM Fleet Pty Ltd was established under these arrangements to acquire and make vessels available to the Company. Its Directors, Anthony Wooles and Loui Kannikoski, provided personal guarantees and security over BM Fleet-owned vessels to support BM Fleet’s financing. The structure was established in good faith, for proper purposes and in the Company’s best interests, with the personal financial risk assumed by those Directors considered necessary to support the Company’s ongoing operations. 103 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 60 Note 22. Related party disclosures (continued) (c) Related party transactions (continued) (ii) Vessel leases (continued) These arrangements were entered into before the Company became a public company and have continued where necessary to support its operations. The Directors, excluding conflicted Directors, consider that the ongoing arrangements are made in good faith, for proper commercial purposes, and on terms no more favourable than those available, or reasonably expected to be available, under comparable arm’s length arrangements. Total amounts paid during the year were $1.4 million, including GST (2025: $1.9 million). The total commitments to related parties, included in vessel lease liabilities is $0.4 million (2025: $3.9 million). During the year and for the prior year, the Company leased vessels from related parties as set out in the table below: Vessel Related Party / Entity Term Lease Expiry Matilda Mae Tom Kannikoski / KFAMS Pty Ltd Leased since Nov 2021 21 November 2026 AMS 6 Tom Kannikoski / KFAMS Pty Ltd Leased since Nov 2022 15 May 2027 BM 2101 Tom Kannikoski / KFAMS Pty Ltd Leased since Nov 2021 31 October 2026 Rhumb 4113 Tom Kannikoski / KFAMS Pty Ltd Leased since Dec 2023 11 December 2026 Bhagwan Micah (formerly Phoenix) Anthony Wooles and Loui Kannikoski / BM Fleet Pty Ltd 5-year term from delivery of vessel Henderson Barge Anthony Wooles and Loui Kannikoski / BM Fleet Pty Ltd Leased since May 2023 and off-hired in Nov 2025 30 November 2025 (iii) Property leases The Company has leased Lot 375 Nielsen Place, Dampier, Western Australia ( Premises) since 2010 from the Bhagwan Properties Pty Ltd ATF the Kannikoski Property Trust. The Premises continues to have strategic value to the Company’s operations in WA due to its location and the design, including office and five crew accommodation units. In June 2026, the Board (excluding conflicted Directors) approved to renew the lease for a one-year term, expiring 30 June 2027, with an increase to the monthly rental charge in line with CPI. Total amounts paid during the year were $0.3 million, including outgoings and GST (2025: $0.3 million). Total amounts recognised as an expense were $0.2 million (2025: $0.3 million). The total commitments to related parties, included in property lease liabilities is $0.3 million (2025: $nil). (iv) Loans with related parties Loan Receivable from BM Fleet Pty Ltd As set out in the Company’s Prospectus (section 9.6.4.4), the Company (as lender) entered into a loan arrangement with BM Fleet (as borrower) on or around February 2022 . The purpose of the loan was to acquire and/or construct certain vessels. The loan amount outstanding at 30 June 2026 due from BM Fleet Pty Ltd is $6.1 million (2025: $5.8 million). Interest accrued of $0.5 million (2025: $0.4 million) is charged at 8% per annum as from 1 July 2023. In addition to the above, a loan of $5.9 million (2025: $5.9 million) due from BM Fleet Pty Ltd, resulted from the transfer of 50% ownership in a joint venture from Bhagwan Marine to BM Fleet Pty Ltd in 2023. There is no interest paid or payable on this amount. Arm’s length interest would have been charged at 8% per annum, totalling $0.5 million ($0.5 million). These amounts outstanding loans are unsecured and not expected to be settled within the next 12 months. No write downs and no expense has been recognised in the current or prior period for bad or doubtful debts in respect of amounts owed by related parties. Repayment of these loans by BM Fleet Pty Ltd is required from any available operating cash (after BM Fleet Pty Ltd has first repaid any amounts owing under the NAB facility), or on sale of an asset where release of the NAB security has occurred. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 61 Note 22. Related party disclosures (continued) (d) Securities granted as remuneration On 29 October 2025, Shareholders approved, under ASX Listing Rules 10.14 and 10.11, the grant of performance rights to Loui Kannikoski, Tom Kannikoski, Kerren Kannikoski, and Andrew Wackett. The performance rights for part of their long-term incentive for FY26 are contingent upon performance hurdles that vest over a three-year period ending 30 June 2028. Details are set in the Remuneration Report on pages 55 to 69 and in the Company’s Notice of 2025 Annual General Meeting. On 12 November 2024, Shareholders approved, under ASX Listing Rules 10.14 and 10.11, the grant of performance rights to Loui Kannikoski, Tom Kannikoski, Kerren Kannikoski, and Andrew Wackett. The performance rights for part of their long-term incentive for FY25 are contingent upon performance hurdles that vest over a three- year period ending 30 June 2027. Details are set in the Remuneration Report on pages 55 to 69 and in the Company’s Notice of 2024 Annual General Meeting. On 8 July 2024, pursuant to the Company’s Prospectus and prior to the Company listing on the ASX, the Company granted 74,627 share rights to Directors, Andrew Wackett and Tracey Horton, respectively. These share rights were granted for these services in overseeing the Company’s I nitial Public Offer and associated processes. Details are set in the Remuneration Report on pages 55 to 69. (e) Remuneration relating to close family members During the year, the Company paid employee remuneration related to three (2025: five) Close Family Members of Directors. These costs include salary and other remuneration payments, which forms part of their conditions of employment. Their remuneration is applied consistently based on the relevant band for the roles and requisite skills and experience, and externally benchmarked and reviewed periodically. Consolidated 2026 2025 $ $ Remuneration expense relating to Close Family Members of Directors 877,912 770,252 The increase in remuneration expense during the year, despite the lower number of Close Family Members of Directors, was primarily attributable to 2025 short term incentive (STI) payments made during the period. Close Family Members include spouses or domestic partners, children and dependents of the Director or their spouse/domestic partner, and any other family members who may be expected to influence, or be influenced by, the Directors in their dealings with the Company. 104
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 60 Note 22. Related party disclosures (continued) (c) Related party transactions (continued) (ii) Vessel leases (continued) These arrangements were entered into before the Company became a public company and have continued where necessary to support its operations. The Directors, excluding conflicted Directors, consider that the ongoing arrangements are made in good faith, for proper commercial purposes, and on terms no more favourable than those available, or reasonably expected to be available, under comparable arm’s length arrangements. Total amounts paid during the year were $1.4 million, including GST (2025: $1.9 million). The total commitments to related parties, included in vessel lease liabilities is $0.4 million (2025: $3.9 million). During the year and for the prior year, the Company leased vessels from related parties as set out in the table below: Vessel Related Party / Entity Term Lease Expiry Matilda Mae Tom Kannikoski / KFAMS Pty Ltd Leased since Nov 2021 21 November 2026 AMS 6 Tom Kannikoski / KFAMS Pty Ltd Leased since Nov 2022 15 May 2027 BM 2101 Tom Kannikoski / KFAMS Pty Ltd Leased since Nov 2021 31 October 2026 Rhumb 4113 Tom Kannikoski / KFAMS Pty Ltd Leased since Dec 2023 11 December 2026 Bhagwan Micah (formerly Phoenix) Anthony Wooles and Loui Kannikoski / BM Fleet Pty Ltd 5-year term from delivery of vessel Henderson Barge Anthony Wooles and Loui Kannikoski / BM Fleet Pty Ltd Leased since May 2023 and off-hired in Nov 2025 30 November 2025 (iii) Property leases The Company has leased Lot 375 Nielsen Place, Dampier, Western Australia ( Premises) since 2010 from the Bhagwan Properties Pty Ltd ATF the Kannikoski Property Trust. The Premises continues to have strategic value to the Company’s operations in WA due to its location and the design, including office and five crew accommodation units. In June 2026, the Board (excluding conflicted Directors) approved to renew the lease for a one-year term, expiring 30 June 2027, with an increase to the monthly rental charge in line with CPI. Total amounts paid during the year were $0.3 million, including outgoings and GST (2025: $0.3 million). Total amounts recognised as an expense were $0.2 million (2025: $0.3 million). The total commitments to related parties, included in property lease liabilities is $0.3 million (2025: $nil). (iv) Loans with related parties Loan Receivable from BM Fleet Pty Ltd As set out in the Company’s Prospectus (section 9.6.4.4), the Company (as lender) entered into a loan arrangement with BM Fleet (as borrower) on or around February 2022 . The purpose of the loan was to acquire and/or construct certain vessels. The loan amount outstanding at 30 June 2026 due from BM Fleet Pty Ltd is $6.1 million (2025: $5.8 million). Interest accrued of $0.5 million (2025: $0.4 million) is charged at 8% per annum as from 1 July 2023. In addition to the above, a loan of $5.9 million (2025: $5.9 million) due from BM Fleet Pty Ltd, resulted from the transfer of 50% ownership in a joint venture from Bhagwan Marine to BM Fleet Pty Ltd in 2023. There is no interest paid or payable on this amount. Arm’s length interest would have been charged at 8% per annum, totalling $0.5 million ($0.5 million). These amounts outstanding loans are unsecured and not expected to be settled within the next 12 months. No write downs and no expense has been recognised in the current or prior period for bad or doubtful debts in respect of amounts owed by related parties. Repayment of these loans by BM Fleet Pty Ltd is required from any available operating cash (after BM Fleet Pty Ltd has first repaid any amounts owing under the NAB facility), or on sale of an asset where release of the NAB security has occurred. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 61 Note 22. Related party disclosures (continued) (d) Securities granted as remuneration On 29 October 2025, Shareholders approved, under ASX Listing Rules 10.14 and 10.11, the grant of performance rights to Loui Kannikoski, Tom Kannikoski, Kerren Kannikoski, and Andrew Wackett. The performance rights for part of their long-term incentive for FY26 are contingent upon performance hurdles that vest over a three-year period ending 30 June 2028. Details are set in the Remuneration Report on pages 55 to 69 and in the Company’s Notice of 2025 Annual General Meeting. On 12 November 2024, Shareholders approved, under ASX Listing Rules 10.14 and 10.11, the grant of performance rights to Loui Kannikoski, Tom Kannikoski, Kerren Kannikoski, and Andrew Wackett. The performance rights for part of their long-term incentive for FY25 are contingent upon performance hurdles that vest over a three- year period ending 30 June 2027. Details are set in the Remuneration Report on pages 55 to 69 and in the Company’s Notice of 2024 Annual General Meeting. On 8 July 2024, pursuant to the Company’s Prospectus and prior to the Company listing on the ASX, the Company granted 74,627 share rights to Directors, Andrew Wackett and Tracey Horton, respectively. These share rights were granted for these services in overseeing the Company’s I nitial Public Offer and associated processes. Details are set in the Remuneration Report on pages 55 to 69. (e) Remuneration relating to close family members During the year, the Company paid employee remuneration related to three (2025: five) Close Family Members of Directors. These costs include salary and other remuneration payments, which forms part of their conditions of employment. Their remuneration is applied consistently based on the relevant band for the roles and requisite skills and experience, and externally benchmarked and reviewed periodically. Consolidated 2026 2025 $ $ Remuneration expense relating to Close Family Members of Directors 877,912 770,252 The increase in remuneration expense during the year, despite the lower number of Close Family Members of Directors, was primarily attributable to 2025 short term incentive (STI) payments made during the period. Close Family Members include spouses or domestic partners, children and dependents of the Director or their spouse/domestic partner, and any other family members who may be expected to influence, or be influenced by, the Directors in their dealings with the Company. 105 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 62 Note 22. Related party disclosures (continued) (f) Interests in subsidiaries The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 30(a): Principal place of business / country of incorporation ACN Ownership % Name 2026 2025 DSL Marine Holdings Pty Ltd Australia 155 467 271 100% 100% C-side Marine Engineering Pty Ltd Australia 150 638 190 100% 100% Barge Partners Group Australia Pty Ltd Australia 158 034 229 100% 100% Work Boats Northern Australia 2 Pty Ltd Australia 158 034 256 100% 100% Ugly Boats Northern Australia Pty Ltd Australia 153 173 310 100% 100% Bhagwan Marine Security Pty Ltd Australia 087 894 577 100% 100% RCWB Northern Australia Pty Ltd Australia 158 034 265 100% 100% North Australian Barge Services Pty Ltd Australia 130 684 203 100% 100% Barge Partnership Pty Ltd Australia 158 034 247 100% 100% Bhagwan Marine (NT) Pty Ltd Australia 609 927 102 100% 100% Delta Subsea Australasia Pty Ltd Australia 158 078 043 100% 100% Bhagwan Employee Incentive Custodian Pty Ltd Australia 164 188 925 100% 100% Fourtrees Pty Ltd1 Australia 087 320 974 100% - Riverside Marine Holdings Pty Ltd1 Australia 009 797 791 100% - Riverside Industrial Sands Pty Ltd1 Australia 009 942 849 100% - Riverside Marine Townsville Pty Ltd1 Australia 010 961 690 100% - Riverside Oceanic Pty Ltd1 Australia 010 596 933 100% - Rivtow Marine Pty Ltd1 Australia 601 268 115 100% - Rivtow Marine Queensland Pty Ltd1 Australia 612 478 181 100% - Footnote: 1. As announced on 31 March 2026, the Company completed its acquisition of 100% of Riverside Marine Holdings Pty Ltd and associa ted entities and Fourtrees Pty Ltd. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 63 Note 23. Remuneration of auditors The Board has considered the non-audit services provided during the year, by the auditor, is satisfied that the provision of those non -audit services during the year by the auditor is compatible with, and did not compromise, the auditor independence requirements of the Corporations Act 2001 for the following reasons: • all non-audit services were subject to the corporate governance procedures adopted by the Group and have been reviewed by the board to ensure they do not impact the integrity and objectivity of the auditor; and • the non-audit services provided do not undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a management or decision-making capacity for the Group, acting as an advocate for the Group or jointly sharing risks and rewards. The following fees were paid or payable to the Group’s auditors, KPMG, and services provided by other firms: Consolidated 2026 2025 $ $ Audit services Audit of the financial statements – KPMG 435,000 289,000 435,000 289,000 Other services Tax compliance and advisory – KPMG 54,530 52,250 54,530 52,250 Total fees 489,530 341,250 Note 24. Contingent liabilities The Group has given bank guarantees and letters of credit to third party customers, in the normal course of business, as at 30 June 2026 totalling $5.6 million (2025: $2.7 million). The outflow of settlement is considered remote and additional information is not considered practicable to disclose. Note 25. Deed of cross guarantee Bhagwan Marine Limited together with certain wholly owned subsidiaries set out below have entered into a Deed of Cross Guarantee (Deed) dated 11 June 2026. The effect of the Deed is that Bhagwan Marine Limited has guaranteed to pay any outstanding liabilities upon the winding up of any wholly owned subsidiary that is party to the Deed. Subsidiaries that are party to the Deed have also given a similar guarantee in the event that Bhagwan Marine Limited or another party to the Deed is wound up. Pursuant to ASIC Corporations (Wholly owned Companies) Instrument 2016/785 the wholly owned subsidiaries listed below are relieved from the Corporations Act 2001 requirements for preparation, audit and lodgement of financial reports and Directors’ reports. 106
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 62 Note 22. Related party disclosures (continued) (f) Interests in subsidiaries The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 30(a): Principal place of business / country of incorporation ACN Ownership % Name 2026 2025 DSL Marine Holdings Pty Ltd Australia 155 467 271 100% 100% C-side Marine Engineering Pty Ltd Australia 150 638 190 100% 100% Barge Partners Group Australia Pty Ltd Australia 158 034 229 100% 100% Work Boats Northern Australia 2 Pty Ltd Australia 158 034 256 100% 100% Ugly Boats Northern Australia Pty Ltd Australia 153 173 310 100% 100% Bhagwan Marine Security Pty Ltd Australia 087 894 577 100% 100% RCWB Northern Australia Pty Ltd Australia 158 034 265 100% 100% North Australian Barge Services Pty Ltd Australia 130 684 203 100% 100% Barge Partnership Pty Ltd Australia 158 034 247 100% 100% Bhagwan Marine (NT) Pty Ltd Australia 609 927 102 100% 100% Delta Subsea Australasia Pty Ltd Australia 158 078 043 100% 100% Bhagwan Employee Incentive Custodian Pty Ltd Australia 164 188 925 100% 100% Fourtrees Pty Ltd1 Australia 087 320 974 100% - Riverside Marine Holdings Pty Ltd1 Australia 009 797 791 100% - Riverside Industrial Sands Pty Ltd1 Australia 009 942 849 100% - Riverside Marine Townsville Pty Ltd1 Australia 010 961 690 100% - Riverside Oceanic Pty Ltd1 Australia 010 596 933 100% - Rivtow Marine Pty Ltd1 Australia 601 268 115 100% - Rivtow Marine Queensland Pty Ltd1 Australia 612 478 181 100% - Footnote: 1. As announced on 31 March 2026, the Company completed its acquisition of 100% of Riverside Marine Holdings Pty Ltd and associa ted entities and Fourtrees Pty Ltd. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 63 Note 23. Remuneration of auditors The Board has considered the non-audit services provided during the year, by the auditor, is satisfied that the provision of those non -audit services during the year by the auditor is compatible with, and did not compromise, the auditor independence requirements of the Corporations Act 2001 for the following reasons: • all non-audit services were subject to the corporate governance procedures adopted by the Group and have been reviewed by the board to ensure they do not impact the integrity and objectivity of the auditor; and • the non-audit services provided do not undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a management or decision-making capacity for the Group, acting as an advocate for the Group or jointly sharing risks and rewards. The following fees were paid or payable to the Group’s auditors, KPMG, and services provided by other firms: Consolidated 2026 2025 $ $ Audit services Audit of the financial statements – KPMG 435,000 289,000 435,000 289,000 Other services Tax compliance and advisory – KPMG 54,530 52,250 54,530 52,250 Total fees 489,530 341,250 Note 24. Contingent liabilities The Group has given bank guarantees and letters of credit to third party customers, in the normal course of business, as at 30 June 2026 totalling $5.6 million (2025: $2.7 million). The outflow of settlement is considered remote and additional information is not considered practicable to disclose. Note 25. Deed of cross guarantee Bhagwan Marine Limited together with certain wholly owned subsidiaries set out below have entered into a Deed of Cross Guarantee (Deed) dated 11 June 2026. The effect of the Deed is that Bhagwan Marine Limited has guaranteed to pay any outstanding liabilities upon the winding up of any wholly owned subsidiary that is party to the Deed. Subsidiaries that are party to the Deed have also given a similar guarantee in the event that Bhagwan Marine Limited or another party to the Deed is wound up. Pursuant to ASIC Corporations (Wholly owned Companies) Instrument 2016/785 the wholly owned subsidiaries listed below are relieved from the Corporations Act 2001 requirements for preparation, audit and lodgement of financial reports and Directors’ reports. 107 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 64 Note 25. Deed of cross guarantee (continued) The subsidiaries subject to the Deed are: • Riverside Marine Holdings Pty Ltd • Fourtrees Pty Ltd • Riverside Industrial Sands Pty Ltd • Riverside Marine Townsville Pty Ltd • Riverside Oceanic Pty Ltd • Rivtow Marine Pty Ltd • Rivtow Marine Queensland Pty Ltd A consolidated statement of comprehensive income and consolidated statemen t of financial position, comprising the Company and the controlled entities which are a party to the Deed, after eliminating all transactions between parties to the Deed of Cross Guarantee, for the year ended 30 June 2026 is set out as follows: (a) Statement of profit or loss and other comprehensive income and retained earnings 2026 $’000 Revenue from contracts with customers 235,914 Raw materials and consumables (12,544) Vessel expenses (51,546) Employee benefits expense (108,160) Depreciation and amortisation expense (35,395) Impairment of assets (1,877) Other direct costs (4,401) Professional fees (8,747) Other income 288 Other expenses (6,363) Operating profit 7,169 Finance income 896 Finance costs (5,469) Profit before tax 2,596 Income tax expense (1,730) Profit for the period 866 Other comprehensive income Items that will not be reclassified to profit or loss Revaluation of vessels, net of tax 4,454 Other comprehensive income for the year, net of tax 4,454 Total comprehensive income for the year 5,320 Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 65 Note 25. Deed of cross guarantee (continued) (b) Statement of financial position 2026 $’000 Assets Current assets Cash and cash equivalents 23,847 Trade and other receivables 66,495 Inventories 7,596 Other current assets 5,065 Total current assets 103,003 Non-current assets Other investments 28,217 Deferred tax assets - Property, plant and equipment 191,151 Right-of-use assets 47,909 Intangible assets and goodwill 69,500 Non-current financial assets 8,947 Total non-current assets 345,724 Total assets 448,727 Liabilities Current liabilities Trade and other payables 52,060 Loans and borrowings 23,541 Lease liabilities 12,963 Employee benefits 6,932 Total current liabilities 95,496 Non-current liabilities Loans and borrowings 86,786 Lease liabilities 34,322 Deferred tax liabilities 19,233 Employee benefits 1,152 Total non-current liabilities 141,493 Total liabilities 236,989 Net assets 211,738 Equity Issued capital 190,739 Reserves 42,251 Profit reserve 11,702 Accumulated losses (32,954) Total equity 211,738 108
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 65 Note 25. Deed of cross guarantee (continued) (b) Statement of financial position 2026 $’000 Assets Current assets Cash and cash equivalents 23,847 Trade and other receivables 66,495 Inventories 7,596 Other current assets 5,065 Total current assets 103,003 Non-current assets Other investments 28,217 Deferred tax assets - Property, plant and equipment 191,151 Right-of-use assets 47,909 Intangible assets and goodwill 69,500 Non-current financial assets 8,947 Total non-current assets 345,724 Total assets 448,727 Liabilities Current liabilities Trade and other payables 52,060 Loans and borrowings 23,541 Lease liabilities 12,963 Employee benefits 6,932 Total current liabilities 95,496 Non-current liabilities Loans and borrowings 86,786 Lease liabilities 34,322 Deferred tax liabilities 19,233 Employee benefits 1,152 Total non-current liabilities 141,493 Total liabilities 236,989 Net assets 211,738 Equity Issued capital 190,739 Reserves 42,251 Profit reserve 11,702 Accumulated losses (32,954) Total equity 211,738 109 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 66 Note 26. Parent entity information Set out below is the supplementary information about the parent entity. Statement of profit or loss and other comprehensive income Parent 2026 2025 $’000 $’000 (Loss)/Profit after income tax (1,093) 13,794 Revaluation of vessels 4,454 - Total comprehensive income 3,361 13,794 Statement of financial position Parent Restated1 2026 2025 $’000 $’000 Total current assets 61,013 75,002 Total assets 397,423 276,351 Total current liabilities 66,236 77,258 Total liabilities 187,642 116,104 Equity Issued capital 190,739 142,062 Reserves 42,251 37,346 Accumulated losses (34,047) (32,955) Profit reserve 10,838 13,794 Total equity 209,781 160,247 1 Refer to note 29 for more details on the restatement. Comparative figures The comparative figures for the previous period have been reclassified where necessary, in order to conform to the current year’s presentation. Such reclassification does not affect the previously reported net profits or net assets for the Group. Guarantees entered into by the parent entity in relation to the debts of its subsidiaries The parent entity had given guarantees in relation to the debts of its subsidiaries as at 30 June 2026 of $0.6 million (2025: $nil). Contingent liabilities The parent entity has given bank guarantees as at 30 June 2026 of $5.6 million (2025: $2.7 million). Capital commitments - Property, plant and equipment The Group has capital commitments of $2.1 million for property, plant and equipment at as 30 June 2026 (2025: $0.6 million). The Parent entity has capital commitments of $ 1.9 million for property, plant and equipment at as 30 June 2026 (2025: $0.6 million). Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 67 Note 26. Parent entity information (continued) Material accounting policies The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 30(a), except for the following: • Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity. • Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be an indicator of an impairment of the investment. Note 27. Financial instruments – Fair values and risk management (a) Accounting classifications and fair values (i) Fair value hierarchy When measuring the fair value of a vessel, the Group uses market data as far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the input used in the valuation techniques as follows: • Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities. • Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices). • Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). The fair value measurements of vessel assets have been categorised as Level 3 fair values based on the valuation techniques used by the vessel valuer. In acknowledging Cost Approach, the valuer makes significant unobservable inputs per vessel, being the estimated replacement cost of each vessel. (ii) Level 3 fair values The following table shows a breakdown of the total gains recognised in respect of Level 3 fair values (vessel assets). 2026 2025 $’000 $’000 Gain included in ‘Other Income’ Change in fair value (pre-tax) 275 - Gain included in Other Comprehensive Income Change in fair value (pre-tax) 8,232 - Total change in fair value (pre-tax) – refer note 12 8,507 - The Company’s core fleet of vessels has an estimated replacement cost ranging from $0.1 million to $31.5 million per vessel (2025: $0.1 million to $16.8 million). The Company’s purpose-built dive support vessel has an estimated replacement cost of $50.5 million (2025: $50.5 million). 110
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 66 Note 26. Parent entity information Set out below is the supplementary information about the parent entity. Statement of profit or loss and other comprehensive income Parent 2026 2025 $’000 $’000 (Loss)/Profit after income tax (1,093) 13,794 Revaluation of vessels 4,454 - Total comprehensive income 3,361 13,794 Statement of financial position Parent Restated1 2026 2025 $’000 $’000 Total current assets 61,013 75,002 Total assets 397,423 276,351 Total current liabilities 66,236 77,258 Total liabilities 187,642 116,104 Equity Issued capital 190,739 142,062 Reserves 42,251 37,346 Accumulated losses (34,047) (32,955) Profit reserve 10,838 13,794 Total equity 209,781 160,247 1 Refer to note 29 for more details on the restatement. Comparative figures The comparative figures for the previous period have been reclassified where necessary, in order to conform to the current year’s presentation. Such reclassification does not affect the previously reported net profits or net assets for the Group. Guarantees entered into by the parent entity in relation to the debts of its subsidiaries The parent entity had given guarantees in relation to the debts of its subsidiaries as at 30 June 2026 of $0.6 million (2025: $nil). Contingent liabilities The parent entity has given bank guarantees as at 30 June 2026 of $5.6 million (2025: $2.7 million). Capital commitments - Property, plant and equipment The Group has capital commitments of $2.1 million for property, plant and equipment at as 30 June 2026 (2025: $0.6 million). The Parent entity has capital commitments of $ 1.9 million for property, plant and equipment at as 30 June 2026 (2025: $0.6 million). Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 67 Note 26. Parent entity information (continued) Material accounting policies The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 30(a), except for the following: • Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity. • Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be an indicator of an impairment of the investment. Note 27. Financial instruments – Fair values and risk management (a) Accounting classifications and fair values (i) Fair value hierarchy When measuring the fair value of a vessel, the Group uses market data as far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the input used in the valuation techniques as follows: • Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities. • Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices). • Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). The fair value measurements of vessel assets have been categorised as Level 3 fair values based on the valuation techniques used by the vessel valuer. In acknowledging Cost Approach, the valuer makes significant unobservable inputs per vessel, being the estimated replacement cost of each vessel. (ii) Level 3 fair values The following table shows a breakdown of the total gains recognised in respect of Level 3 fair values (vessel assets). 2026 2025 $’000 $’000 Gain included in ‘Other Income’ Change in fair value (pre-tax) 275 - Gain included in Other Comprehensive Income Change in fair value (pre-tax) 8,232 - Total change in fair value (pre-tax) – refer note 12 8,507 - The Company’s core fleet of vessels has an estimated replacement cost ranging from $0.1 million to $31.5 million per vessel (2025: $0.1 million to $16.8 million). The Company’s purpose-built dive support vessel has an estimated replacement cost of $50.5 million (2025: $50.5 million). 111 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 68 Note 27. Financial instruments – Fair values and risk management (continued) (a) Accounting classifications and fair values (continued) (iii) Valuation techniques and significant unobservable inputs Type: Vessel assets Valuation technique: Depreciated replacement cost is based on the principle of substitution; a prudent buyer will not pay more for a vessel than the cost of acquiring a substitute vessel of equivalent utility. The appraiser starts with the current replacement cost new of the vessel being appraised and then deducts for the loss in value caused by physical deterioration, functional obsolescence, and economic obsolescence. Significant unobservable inputs: Estimated replacement cost. Inter-relationship between key unobservable inputs and fair value measurement: The estimated fair value would increase/(decrease) if the estimated replacement cost of the vessels was higher/(lower). Other than the ‘other investment’, the Group does not have financial assets measured at fair value. Cash and cash equivalents (refer to n ote 8) and Trade and other receivables (refer to n ote 9) are financial assets at amortised cost which approximates fair value. Financial liabilities not measured at fair value include bank overdrafts and secured bank loans (refer to note 17). (b) Financial risk management The Group has exposure to the following risks arising from financial instruments: • Credit risk (see (b)(ii)); • Liquidity risk (see (b)(iii)); and • Market risk (see (b)(iv)) (i) Risk management framework The Company’s B oard of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework and is responsible for developing and monitoring the Group’s risk management policies. The Group’s risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s activities. The Group, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations. The Group’s Board of Directors oversees how management monitors compliance with the Group’s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the Group. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 69 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (ii) Credit risk Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Group’s receivables from customers and investments in debt securities. The carrying amounts of financial assets and contract assets represent the maximum credit exposure. Impairment losses on financial assets and contract assets recognised in profit or loss were as follows : 2026 2025 $’000 $’000 Impairment loss on trade receivables and contract assets arising from contracts with customers 1,933 219 1,933 219 Expected credit loss (ECL) assessment for individual customers The ECL of receivables assessment requires a degree of estimation and judgement. The level of provision is assessed by considering the recent sales experience, the ageing of receivables, historical collection rates and specific knowledge of the individual debtor's financial position. The Group uses an allowance matrix to measure the ECLs of trade receivables from individual customers. Loss rates are calculated using a ‘roll rate’ method based on the probability of a receivable progressing through successive stages of delinquency to write- off. Roll rates are calculated separately for exposures in different segments based on the following common credit risk characteristics – geographic region, age of customer relationship and type of product purchased. The Group writes off a trade receivable when there is information indicating that the debtor is in significant financial difficulty and there is no realistic prospect of recovery. Subsequent recoveries of amounts previously written off are credited against the allowance account. The following table provides information about the exposure to credit risk and ECLs for trade receivables and contract assets from individual customers as at 30 June 2026: Weighted- Gross 30 June 2026 average carrying Loss Credit- loss rate amount allowance impaired $’000 $’000 Current (not past due) 0.31% 15,856 (49) No 1-30 days past due 0.17% 17,185 (29) No 31-60 days past due 0.07% 6,979 (5) No 61-90 days past due 41.16% 450 (185) No More than 90 days past due 37.78% 5,587 (2,111) Yes 46,057 (2,379) 112
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 69 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (ii) Credit risk Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Group’s receivables from customers and investments in debt securities. The carrying amounts of financial assets and contract assets represent the maximum credit exposure. Impairment losses on financial assets and contract assets recognised in profit or loss were as follows : 2026 2025 $’000 $’000 Impairment loss on trade receivables and contract assets arising from contracts with customers 1,933 219 1,933 219 Expected credit loss (ECL) assessment for individual customers The ECL of receivables assessment requires a degree of estimation and judgement. The level of provision is assessed by considering the recent sales experience, the ageing of receivables, historical collection rates and specific knowledge of the individual debtor's financial position. The Group uses an allowance matrix to measure the ECLs of trade receivables from individual customers. Loss rates are calculated using a ‘roll rate’ method based on the probability of a receivable progressing through successive stages of delinquency to write- off. Roll rates are calculated separately for exposures in different segments based on the following common credit risk characteristics – geographic region, age of customer relationship and type of product purchased. The Group writes off a trade receivable when there is information indicating that the debtor is in significant financial difficulty and there is no realistic prospect of recovery. Subsequent recoveries of amounts previously written off are credited against the allowance account. The following table provides information about the exposure to credit risk and ECLs for trade receivables and contract assets from individual customers as at 30 June 2026: Weighted- Gross 30 June 2026 average carrying Loss Credit- loss rate amount allowance impaired $’000 $’000 Current (not past due) 0.31% 15,856 (49) No 1-30 days past due 0.17% 17,185 (29) No 31-60 days past due 0.07% 6,979 (5) No 61-90 days past due 41.16% 450 (185) No More than 90 days past due 37.78% 5,587 (2,111) Yes 46,057 (2,379) 113 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 70 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (ii) Credit risk (continued) The following table provides information about the exposure to credit risk and ECLs for trade receivables and contract assets from individual customers as at 30 June 2025: Weighted- Gross 30 June 2025 average carrying Loss Credit- loss rate amount allowance impaired $’000 $’000 Current (not past due) 0.38% 15,794 (61) No 1-30 days past due 0.14% 14,862 (22) No 31-60 days past due 0.05% 11,664 (6) No 61-90 days past due 0.97% 1,540 (15) No More than 90 days past due 12.02% 3,834 (460) Yes 47,694 (564) Movements in the allowance for impairment in respect of trade receivables and contract assets The movement in the allowance for impairment in respect of trade receivables and contract assets during the year was as follows: 2026 2025 $’000 $’000 Balance at 1 July 564 345 Amounts written off (118) - Net remeasurement of loss allowance 1,933 219 Balance at 30 June 2,379 564 Insignificant trade receivables written off during 2026, are still subject to enforcement activity. Trade receivables and contract assets The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including the default risk associated with the industry and country in which customers operate. Details of concentration of revenue are included in note 4. The Board of D irectors has established a credit policy under which each new customer is analysed individually for creditworthiness before the Group’s standard payment and delivery terms and conditions are offered. The Group’s review includes external ratings, if they are available, financial statements, credit agency information, industry information and in some cases bank references. Sale limits are established for each customer and reviewed quarterly. Any sales exceeding those limits require approval from the Board of Directors. The Group limits its exposure to credit risk from trade receivables by establishing a maximum payment period of one and two months for individual and corporate customers, respectively. More than 69% of the Group’s customers have been transacting with the Group for over five years, and none of these customers’ balances have been written off or are credit-impaired at the reporting date. In monitoring customer credit risk, customers are grouped according to their credit characteristics, including whether they are an individual or a legal entity, whether they are a wholesale, retail or end- user customer, their geographic location, industry, trading history with the Group and existence of previous financial difficulties. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 71 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (ii) Credit risk (continued) The Group manages credit risk exposure of trade receivables by monitoring each individual customer, utilising data that is determined to be predictive of the risk of loss (including but not limited to external ratings, audited financial statements, management accounts and cash flow projections and available press information about customers) and applying experienced credit judgement. The credit risk is defined using qualitative and quantitative factors that are indicative of the risk of default. Collectability of trade receivables is reviewed on an ongoing basis and managed through regular meetings with the customers, ongoing contractual arrangements and regular receipts for the balances outstanding. Debts which are known to be uncollectable are written off by reducing the carrying amount directly. A provision for impairment of trade receivables is raised when there is objective evidence that the Group will not be able to collect all amounts due, according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation and default or delinquency in payments (more than 60 days overdue) are considered indicators that the trade receivable may be impaired. The amount of the impairment allowance is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The Group does not require collateral in respect of trade and other receivables. The exposure to credit risk for trade receivables, other receivables and accrued revenue by geographic region was as follows: 2026 2025 $’000 $’000 Australia Trade receivables 46,057 47,694 Less: Allowance for expected credit losses (2,379) (564) 43,678 47,130 Accrued revenue 7,047 3,462 Contract costs to be recharged 13,714 - Other receivables 2,055 1,992 Total Australia exposure 66,494 52,584 The exposure to credit risk for trade receivables and accrued revenue by type of counterparty was as follows; 2026 2025 $’000 $’000 End-user customers Trade receivables 46,057 47,694 Less: Allowance for expected credit losses (2,379) (564) 43,678 47,130 Accrued revenue 7,047 3,462 Contract costs to be recharged 13,714 - Total End-user customers 64,439 50,592 Other receivables 2,055 1,992 66,494 52,584 At 30 June 2026, the carrying amount of the receivable from the Group’s most significant customer (an Australian end- user) for the year ended 30 June 2026 was $1.8 million. At 30 June 2025, the carrying amount of the receivable from the Group’s most significant customer (an Australian end-user) for the year ended 30 June 2025 was $3.8 million. 114
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 70 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (ii) Credit risk (continued) The following table provides information about the exposure to credit risk and ECLs for trade receivables and contract assets from individual customers as at 30 June 2025: Weighted- Gross 30 June 2025 average carrying Loss Credit- loss rate amount allowance impaired $’000 $’000 Current (not past due) 0.38% 15,794 (61) No 1-30 days past due 0.14% 14,862 (22) No 31-60 days past due 0.05% 11,664 (6) No 61-90 days past due 0.97% 1,540 (15) No More than 90 days past due 12.02% 3,834 (460) Yes 47,694 (564) Movements in the allowance for impairment in respect of trade receivables and contract assets The movement in the allowance for impairment in respect of trade receivables and contract assets during the year was as follows: 2026 2025 $’000 $’000 Balance at 1 July 564 345 Amounts written off (118) - Net remeasurement of loss allowance 1,933 219 Balance at 30 June 2,379 564 Insignificant trade receivables written off during 2026, are still subject to enforcement activity. Trade receivables and contract assets The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including the default risk associated with the industry and country in which customers operate. Details of concentration of revenue are included in note 4. The Board of D irectors has established a credit policy under which each new customer is analysed individually for creditworthiness before the Group’s standard payment and delivery terms and conditions are offered. The Group’s review includes external ratings, if they are available, financial statements, credit agency information, industry information and in some cases bank references. Sale limits are established for each customer and reviewed quarterly. Any sales exceeding those limits require approval from the Board of Directors. The Group limits its exposure to credit risk from trade receivables by establishing a maximum payment period of one and two months for individual and corporate customers, respectively. More than 69% of the Group’s customers have been transacting with the Group for over five years, and none of these customers’ balances have been written off or are credit-impaired at the reporting date. In monitoring customer credit risk, customers are grouped according to their credit characteristics, including whether they are an individual or a legal entity, whether they are a wholesale, retail or end- user customer, their geographic location, industry, trading history with the Group and existence of previous financial difficulties. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 71 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (ii) Credit risk (continued) The Group manages credit risk exposure of trade receivables by monitoring each individual customer, utilising data that is determined to be predictive of the risk of loss (including but not limited to external ratings, audited financial statements, management accounts and cash flow projections and available press information about customers) and applying experienced credit judgement. The credit risk is defined using qualitative and quantitative factors that are indicative of the risk of default. Collectability of trade receivables is reviewed on an ongoing basis and managed through regular meetings with the customers, ongoing contractual arrangements and regular receipts for the balances outstanding. Debts which are known to be uncollectable are written off by reducing the carrying amount directly. A provision for impairment of trade receivables is raised when there is objective evidence that the Group will not be able to collect all amounts due, according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation and default or delinquency in payments (more than 60 days overdue) are considered indicators that the trade receivable may be impaired. The amount of the impairment allowance is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The Group does not require collateral in respect of trade and other receivables. The exposure to credit risk for trade receivables, other receivables and accrued revenue by geographic region was as follows: 2026 2025 $’000 $’000 Australia Trade receivables 46,057 47,694 Less: Allowance for expected credit losses (2,379) (564) 43,678 47,130 Accrued revenue 7,047 3,462 Contract costs to be recharged 13,714 - Other receivables 2,055 1,992 Total Australia exposure 66,494 52,584 The exposure to credit risk for trade receivables and accrued revenue by type of counterparty was as follows; 2026 2025 $’000 $’000 End-user customers Trade receivables 46,057 47,694 Less: Allowance for expected credit losses (2,379) (564) 43,678 47,130 Accrued revenue 7,047 3,462 Contract costs to be recharged 13,714 - Total End-user customers 64,439 50,592 Other receivables 2,055 1,992 66,494 52,584 At 30 June 2026, the carrying amount of the receivable from the Group’s most significant customer (an Australian end- user) for the year ended 30 June 2026 was $1.8 million. At 30 June 2025, the carrying amount of the receivable from the Group’s most significant customer (an Australian end-user) for the year ended 30 June 2025 was $3.8 million. 115 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 72 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (iii) Liquidity risk Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group’s objective when managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. The Group aims to maintain the level of its cash and cash equivalents at an amount in excess of expected cash outflows on financial liabilities (other than trade payables) over the next 60 days. The Group also monitors the level of expected cash inflows on trade and other receivables together with expected cash outflows on trade and other payables. In addition, the Group maintains the following lines of credit; • $30.0 million working capital facility can be drawn down to meet short-term financing needs. At 30 June 2026, $20.0 million was drawn down. Interest is payable at the nominal rate of BBSY + 0.80%. • $70.0 million cash advance facility can be drawn down to meet long-term financing needs. At 30 June 2026, $70.0 million was drawn down. Interest is payable at the nominal rate of 2.40%. • $10.0 million market rate loan facility can be drawn down to meet short -term financing needs. At 30 June 2026, $5.0 million was drawn down. Interest is payable at the nominal rate of BBSY + 1.50%. Exposure to liquidity risk The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted and include contractual interest payments and exclude the impact of netting agreements. The carrying amount of variable interest rate instruments is in agreement with n ote 17 terms and repayment schedule, bank overdraft facility and commercial advance facilities carrying amounts. 30 June 2026 Carrying amount Total 2 months or less 2-12 months 1-2 years 2-5 years More than 5 years $’000 $’000 $’000 $’000 $’000 $’000 $’000 Variable interest rate instruments 25,000 (26,482) (209) (21,047) (5,226) - - Fixed interest rate instruments 85,327 (91,640) (1,007) (10,536) (17,044) (63,053) - Lease liabilities 47,285 (61,864) (2,831) (12,262) (10,541) (16,148) (20,082) Trade payables and accruals 52,813 (52,813) (52,813) - - - - Payable to related party 394 (394) (394) - - - - 210,819 (233,193) (57,254) (43,845) (32,811) (79,201) (20,082) 30 June 2025 Carrying amount Total 2 months or less 2-12 months 1-2 years 2-5 years More than 5 years $’000 $’000 $’000 $’000 $’000 $’000 $’000 Variable interest rate instruments 20,000 (20,893) (149) (20,744) - - - Fixed interest rate instruments 13,191 (15,436) (454) (2,270) (2,724) (9,988) - Lease liabilities 32,913 (37,619) (2,271) (13,580) (8,221) (13,079) (468) Trade payables and accruals 34,443 (34,443) (34,443) - - - - Payable to related party 736 (736) (736) - - - - 101,283 (109,127) (38,053) (36,594) (10,945) (23,067) (468) Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 73 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (iii) Liquidity risk (continued) The Group has a secured Facility Agreement that contains financial covenants, specifically the Debt Service Cover Ratio (DSCR), Gross Leverage Ratio and Minimum Equity Ratio. A future breach of a covenant may require the Group to repay the facility earlier than indicated in the above table. Under the agreement, the covenants are monitored on a regular basis by the Board of Directors to ensure compliance with the agreement. For the year ended 30 June 2026, all such financial covenants have been complied with in accordance with the Facility Agreement. The interest payments on variable interest rate loans in the table above reflect market forward interest rates at the reporting date and these amounts may change as market interest rates change. It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts. (iv) Market risk Market risk is the risk that changes in market prices, will affect the Group’s income or the value of its holdings of financial instruments. The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. Where required, the Group can enter into a range of derivative financial instruments to manage exposure to these risks. At a Group level, these market risks are managed through sensitivity analysis , within the guidelines set by the Board of Directors. There is no change in the manner in which these risks are managed and measured in the current year. Foreign currency risk management Foreign currency risk is the risk that exchange rate fluctuations arise , primarily to the Group’s operating activities, when revenue or expense is denominated in a foreign currency. Exchange rate exposures are managed within the approved policy parameters utilising forward foreign exchange contracts when it is considered appropriate. The summary quantitative data about the Group’s exposure to currency risk as reported to the management of the Group is as follows: 2026 2025 USD $’000 USD $’000 Trade receivables 254 203 Cash at bank and on hand 105 445 Trade payables (63) (356) Net statement of financial position exposure 296 292 116
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 72 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (iii) Liquidity risk Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group’s objective when managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. The Group aims to maintain the level of its cash and cash equivalents at an amount in excess of expected cash outflows on financial liabilities (other than trade payables) over the next 60 days. The Group also monitors the level of expected cash inflows on trade and other receivables together with expected cash outflows on trade and other payables. In addition, the Group maintains the following lines of credit; • $30.0 million working capital facility can be drawn down to meet short-term financing needs. At 30 June 2026, $20.0 million was drawn down. Interest is payable at the nominal rate of BBSY + 0.80%. • $70.0 million cash advance facility can be drawn down to meet long-term financing needs. At 30 June 2026, $70.0 million was drawn down. Interest is payable at the nominal rate of 2.40%. • $10.0 million market rate loan facility can be drawn down to meet short -term financing needs. At 30 June 2026, $5.0 million was drawn down. Interest is payable at the nominal rate of BBSY + 1.50%. Exposure to liquidity risk The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted and include contractual interest payments and exclude the impact of netting agreements. The carrying amount of variable interest rate instruments is in agreement with n ote 17 terms and repayment schedule, bank overdraft facility and commercial advance facilities carrying amounts. 30 June 2026 Carrying amount Total 2 months or less 2-12 months 1-2 years 2-5 years More than 5 years $’000 $’000 $’000 $’000 $’000 $’000 $’000 Variable interest rate instruments 25,000 (26,482) (209) (21,047) (5,226) - - Fixed interest rate instruments 85,327 (91,640) (1,007) (10,536) (17,044) (63,053) - Lease liabilities 47,285 (61,864) (2,831) (12,262) (10,541) (16,148) (20,082) Trade payables and accruals 52,813 (52,813) (52,813) - - - - Payable to related party 394 (394) (394) - - - - 210,819 (233,193) (57,254) (43,845) (32,811) (79,201) (20,082) 30 June 2025 Carrying amount Total 2 months or less 2-12 months 1-2 years 2-5 years More than 5 years $’000 $’000 $’000 $’000 $’000 $’000 $’000 Variable interest rate instruments 20,000 (20,893) (149) (20,744) - - - Fixed interest rate instruments 13,191 (15,436) (454) (2,270) (2,724) (9,988) - Lease liabilities 32,913 (37,619) (2,271) (13,580) (8,221) (13,079) (468) Trade payables and accruals 34,443 (34,443) (34,443) - - - - Payable to related party 736 (736) (736) - - - - 101,283 (109,127) (38,053) (36,594) (10,945) (23,067) (468) Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 73 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (iii) Liquidity risk (continued) The Group has a secured Facility Agreement that contains financial covenants, specifically the Debt Service Cover Ratio (DSCR), Gross Leverage Ratio and Minimum Equity Ratio. A future breach of a covenant may require the Group to repay the facility earlier than indicated in the above table. Under the agreement, the covenants are monitored on a regular basis by the Board of Directors to ensure compliance with the agreement. For the year ended 30 June 2026, all such financial covenants have been complied with in accordance with the Facility Agreement. The interest payments on variable interest rate loans in the table above reflect market forward interest rates at the reporting date and these amounts may change as market interest rates change. It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts. (iv) Market risk Market risk is the risk that changes in market prices, will affect the Group’s income or the value of its holdings of financial instruments. The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. Where required, the Group can enter into a range of derivative financial instruments to manage exposure to these risks. At a Group level, these market risks are managed through sensitivity analysis , within the guidelines set by the Board of Directors. There is no change in the manner in which these risks are managed and measured in the current year. Foreign currency risk management Foreign currency risk is the risk that exchange rate fluctuations arise , primarily to the Group’s operating activities, when revenue or expense is denominated in a foreign currency. Exchange rate exposures are managed within the approved policy parameters utilising forward foreign exchange contracts when it is considered appropriate. The summary quantitative data about the Group’s exposure to currency risk as reported to the management of the Group is as follows: 2026 2025 USD $’000 USD $’000 Trade receivables 254 203 Cash at bank and on hand 105 445 Trade payables (63) (356) Net statement of financial position exposure 296 292 117 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 74 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (iv) Market risk (continued) Foreign currency sensitivity analysis The Group is mainly exposed to US dollar exchange rate fluctuations. The following table details the Group’s sensitivity to a 10% strengthening/(weakening) in the Australian dollar against the US dollar. The 10% sensitivity represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 10% change in foreign currency rates. A positive value below indicates an increase in profit or equity, with a negative value being the opposite impact. This analysis assumes that all other variables, in particular interest rates, remain constant. Profit or loss Equity, net of tax Strengthening Weakening Strengthening Weakening $’000 $’000 $’000 $’000 30 June 2026 USD (10% movement) (39) 39 - - 30 June 2025 USD (10% movement) (44) 44 - - Interest rate risk management Interest rate risk is the risk that interest rate fluctuations arise, the Group is exposed to interest rate risk because it borrows funds primarily at floating interest rates. The risk is managed by the Group’s Board of Directors, through the use of interest rate swap contracts when considered appropriate. Hedging activities are evaluated regularly to align with interest rate views ensuring the most cost -effective hedging strategies are applied, if required. At this point in the interest r ate cycle the Group is unhedged. The Group’s exposures to interest rates on financial liabilities are detailed in the liquidity risk management section of thi s note. Interest rate sensitivity analysis The sensitivity analysis below has been determined based on the exposure to interest rates at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end o f the reporting period was outstanding for the whole year. A 100- basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates. At the reporting date, if interest rates had been 100-basis points higher/lower and all other variables remain constant, the impact on the net profit of the Group would be a decrease/increase in net profit of $1.1 million (2025: decrease/increase by $0.4 million). Note 28. Events after the reporting period The Board has declared a final dividend of 0.3 cents per share for the year ended 30 June 2026. The final dividend is fully franked, has a record date of 10 September 2026, and will be paid to shareholders on 6 October 2026. No other matter or circumstance has arisen since 30 June 2026 that has significantly affected the group’s operations, results or state of affairs, or may do so in future years. 118
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 74 Note 27. Financial instruments – Fair values and risk management (continued) (b) Financial risk management (continued) (iv) Market risk (continued) Foreign currency sensitivity analysis The Group is mainly exposed to US dollar exchange rate fluctuations. The following table details the Group’s sensitivity to a 10% strengthening/(weakening) in the Australian dollar against the US dollar. The 10% sensitivity represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 10% change in foreign currency rates. A positive value below indicates an increase in profit or equity, with a negative value being the opposite impact. This analysis assumes that all other variables, in particular interest rates, remain constant. Profit or loss Equity, net of tax Strengthening Weakening Strengthening Weakening $’000 $’000 $’000 $’000 30 June 2026 USD (10% movement) (39) 39 - - 30 June 2025 USD (10% movement) (44) 44 - - Interest rate risk management Interest rate risk is the risk that interest rate fluctuations arise, the Group is exposed to interest rate risk because it borrows funds primarily at floating interest rates. The risk is managed by the Group’s Board of Directors, through the use of interest rate swap contracts when considered appropriate. Hedging activities are evaluated regularly to align with interest rate views ensuring the most cost -effective hedging strategies are applied, if required. At this point in the interest r ate cycle the Group is unhedged. The Group’s exposures to interest rates on financial liabilities are detailed in the liquidity risk management section of thi s note. Interest rate sensitivity analysis The sensitivity analysis below has been determined based on the exposure to interest rates at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end o f the reporting period was outstanding for the whole year. A 100- basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates. At the reporting date, if interest rates had been 100-basis points higher/lower and all other variables remain constant, the impact on the net profit of the Group would be a decrease/increase in net profit of $1.1 million (2025: decrease/increase by $0.4 million). Note 28. Events after the reporting period The Board has declared a final dividend of 0.3 cents per share for the year ended 30 June 2026. The final dividend is fully franked, has a record date of 10 September 2026, and will be paid to shareholders on 6 October 2026. No other matter or circumstance has arisen since 30 June 2026 that has significantly affected the group’s operations, results or state of affairs, or may do so in future years. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 75 Note 29. Prior period restatements Restatement of 2022 deferred tax: During the year, the Group identified an error in the measurement of deferred tax liabilities recognised in prior reporting periods. The error arose from historical tax calculations associated with the FY2022 financial year and affected the recognition of certain temporary differences. The Group determined that deferred tax liabilities had been overstated, with a corresponding understatement of retained earnings. In accordance with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors, the error has been corrected retrospectively, and comparative periods have been restated. The correction relates solely to the accounting treatment of deferred tax balances and has no impact on the Group's underlying operating performance, cash flows or compliance with debt covenants . The impact of the correction on the affected financial statement line items is summarised below : Consolidated Statement of Financial Position: As previously reported Adjustment As restated $’000 $’000 $’000 For the year ended 30 June 2025 Deferred tax liability 5,758 2,901 8,659 Total non-current liabilities 35,944 2,901 38,845 Total liabilities 113,983 2,901 116,884 Net assets 167,808 (2,901) 164,907 Accumulated losses (44,128) (2,901) (47,029) Total equity 167,808 (2,901) 164,907 For the year ended 30 June 2024 Deferred tax assets 1,083 (1,083) - Total non-current assets 164,166 (1,083) 163,083 Total assets 254,154 (1,083) 253,071 Deferred tax liability - 1,818 1,818 Total non-current liabilities 40,115 1,818 41,933 Total liabilities 176,078 1,818 177,896 Net assets 78,076 (2,901) 75,175 Accumulated losses (44,128) (2,901) (47,029) Total equity 78,076 (2,901) 75,175 There was no impact to the Group’s consolidated statement of profit or loss and other comprehensive income or statement of cash flows. 119 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 76 Note 30. Other material accounting policies The Group has consistently applied the following accounting policies to all periods presented in these consolidated financial statements, except if mentioned otherwise. Set out below are the Group’s material accounting policies, the details of which are available on the pages that follow. (a) Principles of consolidation (b) Foreign currency transactions (c) Current and non-current classification (d) Intangible assets and goodwill (e) Investments and other financial assets (f) Finance costs (g) Provisions (h) Goods and Services Tax (‘GST’) and other similar taxes (i) Changes in comparative amounts (a) Principles of consolidation The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Bhagwan Marine Limited ('company' or 'parent entity') as at 30 June 2026 and the results of all subsidiaries for the year then ended. Bhagwan Marine Limited and its subsidiaries together are referred to in these financial statements as the 'Group'. (i) Business combinations The Group accounts for business combinations under the acquisition method when the acquired set of activities and assets meets the definition of a business and control is transferred to the Group (refer to note 21). In determining whether a particular set of activities and assets is a business, the Group assesses whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce outputs. The Group has an option to apply a ‘concentration test’ that permits a simplified assessment of whether an acquired set of activities and assets is not a business. The optional concentration test is met if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognised in profit or loss immediately. Transaction costs are expensed as incurred, except if related to the issue of debt or equity securities (refer to note 21). The consideration transferred does not include amounts related to the settlement of pre- existing relationships. Such amounts are generally recognised in the profit or loss. Any contingent consideration is measured at fair value at the date of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not remeasured and settlement is accounted for within equity. Otherwise, other contingent consideration is remeasured at fair value at each reporting date and subsequent changes in the fair value of the contingent consideration are recognised in profit or loss. If share-based payment awards (replacement awards) are required to be exchanged for awards held by the acquiree’s employees (acquiree’s awards), then all or a portion of the amount the acquirer’s replacement awards is included in measuring the consideratio n transferred in the business combination. This determination is based on the market -based measure of the replacement awards compared with the market -based measure of the acquiree’s awards and the extent to which the replacement awards relate to the pre-combination service. (ii) Subsidiaries Subsidiaries are all those entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 77 Note 30. Other material accounting policies (continued) (a) Principles of consolidation (continued) (ii) Subsidiaries (continued) Intercompany transactions, balances and unrealised gains on transactions between entities in the Group are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest, without the loss of control, is accounted for as an equity transaction, where the difference between the consideration transferred and the book value of the share of the non- controlling interest acquired is recognised directly in equity attributable to the parent. Where the Group loses control over a subsidiary, it derecognises the assets including goodwill, liabilities, and non- controlling interest in the subsidiary together with any cumulative translation differences recognised in equity. The Group recognises the fair value of the consideration received, and the fair value of any investment retained together with any gain or loss recognised in profit or loss. (b) Foreign currency transactions Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. (c) Current and non-current classification Assets and liabilities are presented in the statement of financial position based on current and non-current classification. An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Group's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are classified as non-current. A liability is classified as current when: it is either expected to be settled in the Group's normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current. Deferred tax assets and liabilities are always classified as non-current. (d) Intangible assets and goodwill (i) Recognition and measurement Goodwill Goodwill arising on the acquisition of subsidiaries is measured at cost less accumulated impairment losses. Other intangible assets Other intangible assets, including customer relationships, that are acquired by the Group and have finite useful lives are measured at cost less accumulated amortisation and any accumulated impairment losses. (ii) Subsequent expenditure Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in profit or loss as incurred. 120
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 76 Note 30. Other material accounting policies The Group has consistently applied the following accounting policies to all periods presented in these consolidated financial statements, except if mentioned otherwise. Set out below are the Group’s material accounting policies, the details of which are available on the pages that follow. (a) Principles of consolidation (b) Foreign currency transactions (c) Current and non-current classification (d) Intangible assets and goodwill (e) Investments and other financial assets (f) Finance costs (g) Provisions (h) Goods and Services Tax (‘GST’) and other similar taxes (i) Changes in comparative amounts (a) Principles of consolidation The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Bhagwan Marine Limited ('company' or 'parent entity') as at 30 June 2026 and the results of all subsidiaries for the year then ended. Bhagwan Marine Limited and its subsidiaries together are referred to in these financial statements as the 'Group'. (i) Business combinations The Group accounts for business combinations under the acquisition method when the acquired set of activities and assets meets the definition of a business and control is transferred to the Group (refer to note 21). In determining whether a particular set of activities and assets is a business, the Group assesses whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce outputs. The Group has an option to apply a ‘concentration test’ that permits a simplified assessment of whether an acquired set of activities and assets is not a business. The optional concentration test is met if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognised in profit or loss immediately. Transaction costs are expensed as incurred, except if related to the issue of debt or equity securities (refer to note 21). The consideration transferred does not include amounts related to the settlement of pre- existing relationships. Such amounts are generally recognised in the profit or loss. Any contingent consideration is measured at fair value at the date of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not remeasured and settlement is accounted for within equity. Otherwise, other contingent consideration is remeasured at fair value at each reporting date and subsequent changes in the fair value of the contingent consideration are recognised in profit or loss. If share-based payment awards (replacement awards) are required to be exchanged for awards held by the acquiree’s employees (acquiree’s awards), then all or a portion of the amount the acquirer’s replacement awards is included in measuring the consideratio n transferred in the business combination. This determination is based on the market -based measure of the replacement awards compared with the market -based measure of the acquiree’s awards and the extent to which the replacement awards relate to the pre-combination service. (ii) Subsidiaries Subsidiaries are all those entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 77 Note 30. Other material accounting policies (continued) (a) Principles of consolidation (continued) (ii) Subsidiaries (continued) Intercompany transactions, balances and unrealised gains on transactions between entities in the Group are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest, without the loss of control, is accounted for as an equity transaction, where the difference between the consideration transferred and the book value of the share of the non- controlling interest acquired is recognised directly in equity attributable to the parent. Where the Group loses control over a subsidiary, it derecognises the assets including goodwill, liabilities, and non- controlling interest in the subsidiary together with any cumulative translation differences recognised in equity. The Group recognises the fair value of the consideration received, and the fair value of any investment retained together with any gain or loss recognised in profit or loss. (b) Foreign currency transactions Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. (c) Current and non-current classification Assets and liabilities are presented in the statement of financial position based on current and non-current classification. An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Group's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are classified as non-current. A liability is classified as current when: it is either expected to be settled in the Group's normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current. Deferred tax assets and liabilities are always classified as non-current. (d) Intangible assets and goodwill (i) Recognition and measurement Goodwill Goodwill arising on the acquisition of subsidiaries is measured at cost less accumulated impairment losses. Other intangible assets Other intangible assets, including customer relationships, that are acquired by the Group and have finite useful lives are measured at cost less accumulated amortisation and any accumulated impairment losses. (ii) Subsequent expenditure Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in profit or loss as incurred. 121 BHAGWAN MARINE ANNUAL REPORT 2026
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 78 Note 30. Other material accounting policies (continued) (d) Intangible assets and goodwill (continued) (iii) Amortisation Amortisation is calculated to write off the cost of intangible assets less their estimated residual values under the straight - line method over their estimated useful lives and is generally recognised in profit or loss. Goodwill is not amortised. The estimated useful lives for current and comparative periods are as follows: Customer contracts 3.1 – 5.8 years Customer relationships 5.8 years Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate. (e) Investments and other financial assets Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial measurement, except for financial assets at fair value through profit or loss. They are subsequently measured at either amortised cost or fair value depending on their classification. Classification is determined based on the purpose of the acquisition and subsequent reclassification to other categories is restricted. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership. Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are carried at amortised cost using the effective interest rate method. Gains and losses are recognised in profit or loss when the asset is derecognised or impaired. Impairment of financial assets The Group applies the AASB 9 Financial Instruments simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all financial assets. The expected loss rates are based on historical evidence of collection. The historical loss rates are adjusted to reflect curre nt and future information such as estimated future cash flows or by using fair value where this is available through observable market prices and review of macroeconomic factors which may affect the counterparty’s ability to settle the receivables. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the original impairment was recognised, the impairment reversal is recognised in the income statement on a basis consis tent with the original charge. (f) Finance costs Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in the period in which they are incurred. (g) Provisions Provisions are recognised when the Group has a present (legal or constructive) obligation as a result of a past event, it is probable the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. If the time value of money is material, provisions are discounted using a current pre -tax rate specific to the liability. The increase in the provision resulting from the passage of time is recognised as a finance cost. Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 79 Note 30. Other material accounting policies (continued) (h) Goods and Services Tax ('GST') and other similar taxes Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of the expense. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of financial position. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the tax authority, are presented as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority. (i) Changes in comparative amounts Certain amounts in these financial statements have been restated as a result of a correction of a prior period error (see note 29). Note 31. New and amended accounting standards and interpretations (a) New and amended standards and interpretations adopted by the Group In the year ended 30 June 2026, the Group has reviewed all of the new and revised Standards and Interpretations issued by the AASB that are relevant to its operation and effective for the current annual reporting period. As a result of this review, the Group has determined that there is no material impact of the new and revised Standards and Interpretations and, therefore, no material change is necessary to the Group accounting policies. (b) New and amended standards and interpretations not yet effective A number of new standards are effective for annual periods beginning after 1 January 2026 and earlier application is permitted; however, the Group has not early adopted the new or amended standards in preparing these consolidated financial statements. (i) AASB 18 Presentation and Disclosure in Financial Statements AASB 18 replaces AASB 101 as the standard describing the primary financial statements and sets out requirements for the presentation and disclosure of information in AASB -compliant financial statements. Amongst other changes, it introduces the concept of the “mana gement-defined performance measure” to financial statements and requires the classification of transactions presented with the statement of profit or loss within one of five categories – operating, investing, financing, income taxes, and discontinued operations . It also provides enhanced requirements for the aggregation and disaggregation of information. (ii) Other standards The following new and amended standards are not expected to have a significant impact on the Group’s consolidated financial statements. • Classification and Measurement of Financial Instruments – amendments to AASB 9 Financial Instruments and AASB 7 Financial Instruments: Disclosures. 122
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 79 Note 30. Other material accounting policies (continued) (h) Goods and Services Tax ('GST') and other similar taxes Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of the expense. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of financial position. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the tax authority, are presented as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority. (i) Changes in comparative amounts Certain amounts in these financial statements have been restated as a result of a correction of a prior period error (see note 29). Note 31. New and amended accounting standards and interpretations (a) New and amended standards and interpretations adopted by the Group In the year ended 30 June 2026, the Group has reviewed all of the new and revised Standards and Interpretations issued by the AASB that are relevant to its operation and effective for the current annual reporting period. As a result of this review, the Group has determined that there is no material impact of the new and revised Standards and Interpretations and, therefore, no material change is necessary to the Group accounting policies. (b) New and amended standards and interpretations not yet effective A number of new standards are effective for annual periods beginning after 1 January 2026 and earlier application is permitted; however, the Group has not early adopted the new or amended standards in preparing these consolidated financial statements. (i) AASB 18 Presentation and Disclosure in Financial Statements AASB 18 replaces AASB 101 as the standard describing the primary financial statements and sets out requirements for the presentation and disclosure of information in AASB -compliant financial statements. Amongst other changes, it introduces the concept of the “mana gement-defined performance measure” to financial statements and requires the classification of transactions presented with the statement of profit or loss within one of five categories – operating, investing, financing, income taxes, and discontinued operations . It also provides enhanced requirements for the aggregation and disaggregation of information. (ii) Other standards The following new and amended standards are not expected to have a significant impact on the Group’s consolidated financial statements. • Classification and Measurement of Financial Instruments – amendments to AASB 9 Financial Instruments and AASB 7 Financial Instruments: Disclosures. 123 BHAGWAN MARINE ANNUAL REPORT 2026
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Bhagwan Marine Limited Notes to the consolidated financial statements For the year ended 30 June 2026 80 CONSOLIDATED ENTITY DISCLOSURE STATEMENT FOR THE YEAR ENDED 30 JUNE 2026 Set out below is a list of entities that are consolidated in this set of consolidated financial statements at the end of the financial year: % of share capital held directly or Body indirectly by Australian corporate, Place the Company or foreign Jurisdiction partnership incorporated in the body tax for foreign Entity name or trust /formed corporate resident tax resident Bhagwan Marine Limited Body Corporate Australia Australian N/A DSL Marine Holdings Pty Ltd Body Corporate Australia 100% Australian N/A C-side Marine Engineering Pty Ltd Body Corporate Australia 100% Australian N/A Barge Partners Group Australia Pty Ltd Body Corporate Australia 100% Australian N/A Work Boats Northern Australia 2 Pty Ltd Body Corporate Australia 100% Australian N/A Ugly Boats Northern Australia Pty Ltd Body Corporate Australia 100% Australian N/A Bhagwan Marine Security Pty Ltd Body Corporate Australia 100% Australian N/A RCWB Northern Australia Pty Ltd Body Corporate Australia 100% Australian N/A North Australian Barge Services Pty Ltd Body Corporate Australia 100% Australian N/A Barge Partnership Pty Ltd Body Corporate Australia 100% Australian N/A Bhagwan Marine (NT) Pty Ltd Body Corporate Australia 100% Australian N/A Delta Subsea Australasia Pty Ltd Body Corporate Australia 100% Australian N/A Bhagwan Employee Incentive Custodian Pty Ltd Body Corporate Australia 100% Australian N/A Fourtrees Pty Ltd Body Corporate Australia 100% Australian N/A Riverside Marine Holdings Pty Ltd Body Corporate Australia 100% Australian N/A Riverside Industrial Sands Pty Ltd Body Corporate Australia 100% Australian N/A Riverside Marine Townsville Pty Ltd Body Corporate Australia 100% Australian N/A Riverside Oceanic Pty Ltd Body Corporate Australia 100% Australian N/A Rivtow Marine Pty Ltd Body Corporate Australia 100% Australian N/A Rivtow Marine Queensland Pty Ltd Body Corporate Australia 100% Australian N/A Basis of preparation: This consolidated entity disclosure statement has been prepared in accordance with the Corporations Act 2001 and includes information for each entity that was part of the consolidated entity as at the end of the financial year in accordance with AASB 10 Consolidated Financial Statements. Key assumptions and judgements: Determination of Tax Residency Section 295 (3A) of the Corporations Act 2001 requires that the tax residency of each entity which is included in the Consolidated Entity Disclosure Statement be disclosed. In the context of an entity which was an Australian resident, “Australian resident” has the meaning provided in the Income Tax Assessment Act 1997. The determination of tax residency involves judgement as the determination of tax residency is highly fact dependent and there are currently several different interpretations that could be adopted, and which give rise to a different conclusion or residency. In determining tax residency, the consolidated entity has applied the following interpretations: • Australian tax residency The consolidated entity has applied current legislation and judicial precedent, including having regard to the Commissioner of Taxation’s public guidance in Tax Ruling TR 2018/5. Consolidated Entity Disclosure Statement FOR THE YEAR ENDED 30 JUNE 2026 Bhagwan Marine Limited Directors' declaration 81 1. In the opinion of the directors of Bhagwan Marine Limited (the ‘Company’): a) the consolidated financial statements and notes that are set out on pages 71 to 123 and the Remuneration report on pages 55 to 69 in the Directors’ report, are in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the consolidated entity's financial position as at 30 June 2026 and of its performance for the financial year ended on that date; and (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001 b) the Consolidated entity disclosure statement as at 30 June 2026 set out on page 124 is true and correct; and c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. 2. The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Managing Director and Chief Financial Officer for the financial year ended 30 June 2026. 3. There is reasonable grounds to believe that the Company and the group entities identified in note 25 will be able to meet any obligations or liabilities to which they are, or may become, subject to by virtue of the deed of cross guarantee between the Company and those group entities pursuant to ASIC Corporations (Wholly owned Companies) Instrument 2016/785. 4. The directors draw attention to note 1 to the consolidated financial statements, which includes a statement of compliance with International Financial Reporting Standards. Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001. On behalf of the directors Anthony Wooles Chairman and Non-Executive Director 27 August 2026 Perth, WA 124
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Bhagwan Marine Limited Directors' declaration 81 1. In the opinion of the directors of Bhagwan Marine Limited (the ‘Company’): a) the consolidated financial statements and notes that are set out on pages 71 to 123 and the Remuneration report on pages 55 to 69 in the Directors’ report, are in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the consolidated entity's financial position as at 30 June 2026 and of its performance for the financial year ended on that date; and (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001 b) the Consolidated entity disclosure statement as at 30 June 2026 set out on page 124 is true and correct; and c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. 2. The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Managing Director and Chief Financial Officer for the financial year ended 30 June 2026. 3. There is reasonable grounds to believe that the Company and the group entities identified in note 25 will be able to meet any obligations or liabilities to which they are, or may become, subject to by virtue of the deed of cross guarantee between the Company and those group entities pursuant to ASIC Corporations (Wholly owned Companies) Instrument 2016/785. 4. The directors draw attention to note 1 to the consolidated financial statements, which includes a statement of compliance with International Financial Reporting Standards. Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001. On behalf of the directors Anthony Wooles Chairman and Non-Executive Director 27 August 2026 Perth, WA Directors’ Declaration FOR THE YEAR ENDED 30 JUNE 2026 125 BHAGWAN MARINE ANNUAL REPORT 2026
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KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation. Independent Auditor’s Report To the shareholders of Bhagwan Marine Limited Report on the audit of the Financial Report Opinion We have audited the Financial Report of Bhagwan Marine Limited (the Company). In our opinion, the accompanying Financial Report of the Company gives a true and fair view, including of the Group’s financial position as at 30 June 2026 and of its financial performance for the year then ended, in accordance with the Corporations Act 2001, in compliance with Australian Accounting Standards and the Corporations Regulations 2001. The Financial Report comprises: • Consolidated statement of financial position as at 30 June 2026 • Consolidated statement of profit or loss and other comprehensive income, Consolidated statement of changes in equity, and Consolidated statement of cash flows for the year then ended • Consolidated entity disclosure statement and accompanying basis of preparation as at 30 June 2026 • Notes, including material accounting policies • Directors’ Declaration. The Group consists of the Company and the entities it controlled at the year end or from time to time during the financial year. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the APES 110 Code of Ethics for Professional Accountants (including Independence Standards) issued by the Accounting Professional & Ethical Standards Board Limited (the Code) that are relevant to audits of the financial report of public interest entities in Australia. We have fulfilled our other ethical responsibilities in accordance with these requirements. Emphasis of matter – restatement of comparative balances We draw attention to Note 29 to the Financial Report, which describes that deferred tax balances disclosed as comparatives in this Financial Report have been restated due to an error in the tax cost base of certain assets. Our opinion is not modified in respect of this matter. Key Audit Matters The Key Audit Matters we identified are: • Revenue Recognition • Acquisition Accounting Key Audit Matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Report of the current period. These matters were addressed in the context of our audit of the Financial Report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Revenue recognition ($235.9m) Refer to Note 4 to the Financial Report The key audit matter How the matter was addressed in our audit The Group derives the majority of its revenue from marine services to its customers, which requires the Group to analyse recognition over the period the service is provided. It is the Group’s policy to recognise revenue based on contractual rates as performance obligations are met. Revenue recognition was a key audit matter for us due to the quantum of the balance, and the significant audit effort we have applied in assessing the Group’s recognition and measurement of revenue. This was the result of the: • Quantum and high volume of services revenue recognised during the year. • Amount of accrued revenue recorded at year end for services rendered but not yet invoiced is prepared manually by the Group and is prone to greater risk of manipulation for fraudulent revenue recognition. In assessing this key audit matter, we involved senior audit team members who understand the Group’s business, industry and the economic environment it operates in. Our procedures included: • Understanding the nature of the Group’s revenue streams and the related revenue recording processes, systems and controls. • Evaluating the appropriateness of the Group’s accounting policies related to revenue recognition against the requirements of the accounting standard and our understanding of the business and industry practice. • Utilising data analysis to identify gross revenue transactions with higher risk characteristics to focus our further testing. • Testing a sample of revenue transactions throughout the year and checking: • The existence of an underlying contract with the customer; • The rates used to invoice customers against underlying documents such as customer contracts or customer acknowledgement letters; • Evidence of the service delivery to the customer against underlying 126
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KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation. Independent Auditor’s Report To the shareholders of Bhagwan Marine Limited Report on the audit of the Financial Report Opinion We have audited the Financial Report of Bhagwan Marine Limited (the Company). In our opinion, the accompanying Financial Report of the Company gives a true and fair view, including of the Group’s financial position as at 30 June 2026 and of its financial performance for the year then ended, in accordance with the Corporations Act 2001, in compliance with Australian Accounting Standards and the Corporations Regulations 2001. The Financial Report comprises: • Consolidated statement of financial position as at 30 June 2026 • Consolidated statement of profit or loss and other comprehensive income, Consolidated statement of changes in equity, and Consolidated statement of cash flows for the year then ended • Consolidated entity disclosure statement and accompanying basis of preparation as at 30 June 2026 • Notes, including material accounting policies • Directors’ Declaration. The Group consists of the Company and the entities it controlled at the year end or from time to time during the financial year. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the APES 110 Code of Ethics for Professional Accountants (including Independence Standards) issued by the Accounting Professional & Ethical Standards Board Limited (the Code) that are relevant to audits of the financial report of public interest entities in Australia. We have fulfilled our other ethical responsibilities in accordance with these requirements. Emphasis of matter – restatement of comparative balances We draw attention to Note 29 to the Financial Report, which describes that deferred tax balances disclosed as comparatives in this Financial Report have been restated due to an error in the tax cost base of certain assets. Our opinion is not modified in respect of this matter. Key Audit Matters The Key Audit Matters we identified are: • Revenue Recognition • Acquisition Accounting Key Audit Matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Report of the current period. These matters were addressed in the context of our audit of the Financial Report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Revenue recognition ($235.9m) Refer to Note 4 to the Financial Report The key audit matter How the matter was addressed in our audit The Group derives the majority of its revenue from marine services to its customers, which requires the Group to analyse recognition over the period the service is provided. It is the Group’s policy to recognise revenue based on contractual rates as performance obligations are met. Revenue recognition was a key audit matter for us due to the quantum of the balance, and the significant audit effort we have applied in assessing the Group’s recognition and measurement of revenue. This was the result of the: • Quantum and high volume of services revenue recognised during the year. • Amount of accrued revenue recorded at year end for services rendered but not yet invoiced is prepared manually by the Group and is prone to greater risk of manipulation for fraudulent revenue recognition. In assessing this key audit matter, we involved senior audit team members who understand the Group’s business, industry and the economic environment it operates in. Our procedures included: • Understanding the nature of the Group’s revenue streams and the related revenue recording processes, systems and controls. • Evaluating the appropriateness of the Group’s accounting policies related to revenue recognition against the requirements of the accounting standard and our understanding of the business and industry practice. • Utilising data analysis to identify gross revenue transactions with higher risk characteristics to focus our further testing. • Testing a sample of revenue transactions throughout the year and checking: • The existence of an underlying contract with the customer; • The rates used to invoice customers against underlying documents such as customer contracts or customer acknowledgement letters; • Evidence of the service delivery to the customer against underlying 127 BHAGWAN MARINE ANNUAL REPORT 2026
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documents such as customer approved activity schedules, progress claims or job reports; • We also checked customer receipts to bank statements. We compared our testing against amounts recorded in the Group’s general ledger; and • The timing of revenue recognition for consistency with timing of completed performance obligations and the Group’s revenue recognition policy. • Testing a sample of accrued revenue recorded as of year end for consistency of the financial year in which it should be recorded as revenue. Samples were checked against underlying documents such as customer approved contracts, progress claims or job reports. • Testing a sample of revenue recorded subsequent to year end for consistency of the financial year in which it should be recorded as revenue. Samples were checked against underlying documents such as customer approved contracts, progress claims or job reports. • Evaluating the adequacy of disclosures in the financial report using our understanding obtained from our testing and against the requirements of the accounting standard. Acquisition Accounting ($122.6m) Refer to Note 21 to the Financial Report The key audit matter How the matter was addressed in our audit On 31 March 2026, the Group acquired 100% of Riverside Marine Holdings Pty Ltd for consideration of $122.6m, resulting in the recognition of working capital, right-of-use assets, vessels, customer contracts and other intangible assets, and goodwill. This transactions are considered to be a key audit matter due to the: • Size of the acquisition having a significant impact on the Group’s Financial Report; Our procedures included: • We evaluated the acquisition accounting by the Group against the requirements of the accounting standards; • We read the underlying transaction agreements to understand the terms of the acquisition and nature of the assets and liabilities acquired; • We assessed the accuracy of the calculation and measurement of consideration paid to acquire Riverside • Group’s judgement and complexity relating to the determination of the fair values of assets and liabilities acquired in the transaction requiring significant audit effort. The Group engaged various external valuation experts to assess the fair value of certain assets including right-of-use assets, vessels, customer contracts and other intangible assets. • Group’s valuation model used to determine the fair value of acquired intangibles assets is complex and sensitive to changes in a number of key assumptions. This drives additional audit effort specifically on the feasibility of these key assumptions and consistency of application to the Group’s strategy. The key assumptions we focused on in the valuations of intangible assets included forecast earnings, discount rates and useful lives. We involved our valuation specialists to supplement our senior audit team members in assessing this key audit matter. Marine Holdings Pty Ltd based on the underlying transaction agreements and the Group’s bank statements; • Working with our valuation specialists, we assessed the Group’s external expert reports and; • Considered the objectivity, competence and scope of the Group’s external valuation experts; • Evaluated the valuation methodology used to determine the fair value of assets and liabilities acquired, considering accounting standard requirements and observed industry practices; • Assessed the key assumptions in the Group’s external valuation expert report prepared in relation to the identification and valuation of customer contracts and other intangible assets including: • Checking forecast earnings assumptions, including revenue and margin, for consistency with the Group’s valuation model used as part of the pre-acquisition due diligence process; and • Assessing key customer contracts by using our industry experience and knowledge of the terms and conditions of a sample of the underlying agreements and against the accounting standard requirements. • We independently developed a discount rate range considered comparable using publicly available market data for comparable entities, adjusted by risk factors specific to the Group and the industry it operates in; • We challenged the forecast cash flows assumptions for the entity acquired, as it forms part of the contingent consideration fair value. We assessed the feasibility of these assumptions and consistency of application to industry trends and expectations, and considered differences for the Group’s operations. We used our knowledge of the Group, past 128
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documents such as customer approved activity schedules, progress claims or job reports; • We also checked customer receipts to bank statements. We compared our testing against amounts recorded in the Group’s general ledger; and • The timing of revenue recognition for consistency with timing of completed performance obligations and the Group’s revenue recognition policy. • Testing a sample of accrued revenue recorded as of year end for consistency of the financial year in which it should be recorded as revenue. Samples were checked against underlying documents such as customer approved contracts, progress claims or job reports. • Testing a sample of revenue recorded subsequent to year end for consistency of the financial year in which it should be recorded as revenue. Samples were checked against underlying documents such as customer approved contracts, progress claims or job reports. • Evaluating the adequacy of disclosures in the financial report using our understanding obtained from our testing and against the requirements of the accounting standard. Acquisition Accounting ($122.6m) Refer to Note 21 to the Financial Report The key audit matter How the matter was addressed in our audit On 31 March 2026, the Group acquired 100% of Riverside Marine Holdings Pty Ltd for consideration of $122.6m, resulting in the recognition of working capital, right-of-use assets, vessels, customer contracts and other intangible assets, and goodwill. This transactions are considered to be a key audit matter due to the: • Size of the acquisition having a significant impact on the Group’s Financial Report; Our procedures included: • We evaluated the acquisition accounting by the Group against the requirements of the accounting standards; • We read the underlying transaction agreements to understand the terms of the acquisition and nature of the assets and liabilities acquired; • We assessed the accuracy of the calculation and measurement of consideration paid to acquire Riverside • Group’s judgement and complexity relating to the determination of the fair values of assets and liabilities acquired in the transaction requiring significant audit effort. The Group engaged various external valuation experts to assess the fair value of certain assets including right-of-use assets, vessels, customer contracts and other intangible assets. • Group’s valuation model used to determine the fair value of acquired intangibles assets is complex and sensitive to changes in a number of key assumptions. This drives additional audit effort specifically on the feasibility of these key assumptions and consistency of application to the Group’s strategy. The key assumptions we focused on in the valuations of intangible assets included forecast earnings, discount rates and useful lives. We involved our valuation specialists to supplement our senior audit team members in assessing this key audit matter. Marine Holdings Pty Ltd based on the underlying transaction agreements and the Group’s bank statements; • Working with our valuation specialists, we assessed the Group’s external expert reports and; • Considered the objectivity, competence and scope of the Group’s external valuation experts; • Evaluated the valuation methodology used to determine the fair value of assets and liabilities acquired, considering accounting standard requirements and observed industry practices; • Assessed the key assumptions in the Group’s external valuation expert report prepared in relation to the identification and valuation of customer contracts and other intangible assets including: • Checking forecast earnings assumptions, including revenue and margin, for consistency with the Group’s valuation model used as part of the pre-acquisition due diligence process; and • Assessing key customer contracts by using our industry experience and knowledge of the terms and conditions of a sample of the underlying agreements and against the accounting standard requirements. • We independently developed a discount rate range considered comparable using publicly available market data for comparable entities, adjusted by risk factors specific to the Group and the industry it operates in; • We challenged the forecast cash flows assumptions for the entity acquired, as it forms part of the contingent consideration fair value. We assessed the feasibility of these assumptions and consistency of application to industry trends and expectations, and considered differences for the Group’s operations. We used our knowledge of the Group, past 129 BHAGWAN MARINE ANNUAL REPORT 2026
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performance, business and customers, and our industry experience; • We assessed the fair value of the vessels acquired based on valuations performed by independent external valuation experts engaged by the Group, including assessing the appropriateness of the valuation methodology utilised; • We recalculated the goodwill balance recognised as a result of the transaction and compared it to the goodwill amount recorded by the Group; and • We assessed the adequacy of disclosures in the financial report using our understanding obtained from our testing and against the requirements of the accounting standard. Other Information Other Information is financial and non-financial information in Bhagwan Marine Limited’s annual report which is provided in addition to the Financial Report and the Auditor's Report. The Directors are responsible for the Other Information. Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not express an audit opinion or any form of assurance conclusion thereon, with the exception of the Remuneration Report and our respective assurance opinion. In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report. Responsibilities of the Directors for the Financial Report The Directors are responsible for: • preparing the Financial Report in accordance with the Corporations Act 2001, including giving a true and fair view of the financial position and performance of the Group, and in compliance with Australian Accounting Standards and the Corporations Regulations 2001 • implementing necessary internal control to enable the preparation of a Financial Report in accordance with the Corporations Act 2001, including giving a true and fair view of the financial position and performance of the Group, and that is free from material misstatement, whether due to fraud or error • assessing the Group and Company’s ability to continue as a going concern and whether the use of the going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless they either intend to liquidate the Group and Company or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the Financial Report Our objective is: • to obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud or error; and • to issue an Auditor’s Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the Financial Report. A further description of our responsibilities for the audit of the Financial Report is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/media/bwvjcgre/ar1_2024.pdf. This description forms part of our Auditor’s Report. Report on the Remuneration Report Opinion In our opinion, the Remuneration Report of Bhagwan Marine Limited for the year ended 30 June 2026, complies with Section 300A of the Corporations Act 2001. Directors’ responsibilities The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act 2001. Our responsibilities We have audited the Remuneration Report included in pages 55 to 69 of the Directors’ report for the year ended 30 June 2026. Our responsibility is to express an opinion as to whether the Remuneration Report complies in all material respects with Section 300A of the Corporations Act 2001, based on our audit conducted in accordance with Australian Auditing Standards. KPM_INI_01 SIG _01 PAR_NAM_01 PAR_POS_01 PAR_DAT_01 PAR_CIT_0 KPMG Hayden Rutters Partner Perth 27 August 2026 130
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performance, business and customers, and our industry experience; • We assessed the fair value of the vessels acquired based on valuations performed by independent external valuation experts engaged by the Group, including assessing the appropriateness of the valuation methodology utilised; • We recalculated the goodwill balance recognised as a result of the transaction and compared it to the goodwill amount recorded by the Group; and • We assessed the adequacy of disclosures in the financial report using our understanding obtained from our testing and against the requirements of the accounting standard. Other Information Other Information is financial and non-financial information in Bhagwan Marine Limited’s annual report which is provided in addition to the Financial Report and the Auditor's Report. The Directors are responsible for the Other Information. Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not express an audit opinion or any form of assurance conclusion thereon, with the exception of the Remuneration Report and our respective assurance opinion. In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report. Responsibilities of the Directors for the Financial Report The Directors are responsible for: • preparing the Financial Report in accordance with the Corporations Act 2001, including giving a true and fair view of the financial position and performance of the Group, and in compliance with Australian Accounting Standards and the Corporations Regulations 2001 • implementing necessary internal control to enable the preparation of a Financial Report in accordance with the Corporations Act 2001, including giving a true and fair view of the financial position and performance of the Group, and that is free from material misstatement, whether due to fraud or error • assessing the Group and Company’s ability to continue as a going concern and whether the use of the going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless they either intend to liquidate the Group and Company or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the Financial Report Our objective is: • to obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud or error; and • to issue an Auditor’s Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the Financial Report. A further description of our responsibilities for the audit of the Financial Report is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/media/bwvjcgre/ar1_2024.pdf. This description forms part of our Auditor’s Report. Report on the Remuneration Report Opinion In our opinion, the Remuneration Report of Bhagwan Marine Limited for the year ended 30 June 2026, complies with Section 300A of the Corporations Act 2001. Directors’ responsibilities The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act 2001. Our responsibilities We have audited the Remuneration Report included in pages 55 to 69 of the Directors’ report for the year ended 30 June 2026. Our responsibility is to express an opinion as to whether the Remuneration Report complies in all material respects with Section 300A of the Corporations Act 2001, based on our audit conducted in accordance with Australian Auditing Standards. KPM_INI_01 SIG _01 PAR_NAM_01 PAR_POS_01 PAR_DAT_01 PAR_CIT_0 KPMG Hayden Rutters Partner Perth 27 August 2026 131 BHAGWAN MARINE ANNUAL REPORT 2026
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ADDITIONAL ASX INFORMATION 88 Additional information is given in accordance with ASX Listing Rule 4.10 and not shown elsewhere in this Annual Report is as follows. The information is current as of 12 August 2026. Stock Exchange Listing The Company’s ordinary fully paid shares are listed on the Australian Securities Exchange (ASX) under ASX Code: BWN. Distribution Schedule of Ordinary Shares quoted on the ASX The distribution schedule of the Company’s fully paid ordinary shares, as quoted on the ASX, is as follows: Share spread Number of shareholders Shares Percentage of shares on issue (%) 1 - 1,000 114 84,441 0.02 1,001 - 5,000 366 1,002,180 0.25 5,001 - 10,000 197 1,597,633 0.40 10,001 - 100,000 667 24,768,608 6.24 100,001 and over 216 369,698,596 93.09 Total 1,560 397,151,458 100.00 There were 212 holders of less than a marketable parcel of shares (<$500 in value) based on the closing market price of Bhagwan Marine Limited shares on 12 August 2026. Top 20 Shareholders of Ordinary Fully Paid Shares (ASX: BWN) Name of registered holder Number of shares Percentage of shares on issue (%) Matilda Mae Kannikoski 73,635,669 18.54 Velrosso Pty Ltd <harvey 1995 a/c> 51,178,717 12.89 Lauri Keven Kannikoski 27,042,947 6.81 AEW Holdings Pty Ltd <aew capital a/c> 25,000,000 6.29 Fullahead Pty Ltd <the hk campbell trust 99 a/c> 24,390,244 6.14 Guru Pty Ltd <kannikoski family a/c> 17,080,513 4.30 UBS Nominees Pty Ltd 12,857,877 3.24 Claire Mina Campbell Stokes & Drew Kenneth Campbell <the Maryon Campbell Family Trust a/c> 12,195,122 3.07 Inverary Pty Ltd <the wright family trust a/c> 12,195,122 3.07 T Mitchell Pty Ltd <the T Mitchell s/f a/c> 6,552,929 1.65 J P Morgan Nominees Australia Pty Limited 5,025,274 1.27 Citicorp Nominees Pty Limited 4,542,433 1.14 Southern Steel Investments Pty Ltd 3,552,268 0.89 Brazil Farming Pty Ltd 3,254,501 0.82 BNP Paribas Nominees Pty Ltd <hub24 custodial serv ltd> 3,113,777 0.78 BNP Paribas Nominees Pty Ltd <ib au noms retailclient> 2,751,917 0.69 BNP Paribas Noms Pty Ltd 2,560,668 0.64 Warbont Nominees Pty Ltd <unpaid entrepot a/c> 2,354,211 0.59 Offshore Plant Hire Pty Ltd <the DMG family a/c> 2,338,707 0.59 Netwealth Investments Limited <wrap services a/c> 2,081,861 0.52 TOTAL 295,770,753 74.48 ADDITIONAL ASX INFORMATION 89 Substantial shareholders of Ordinary Fully Paid Shares Substantial shareholders are as follows, and information is as at the date of the substantial shareholders notice provided to the Company and to the ASX: Substantial Holder Number of shares held Percentage of shares on issue The Kannikoski Family (note 1) 120,424,125 30.32 Velrosso Pty Ltd 48,916,522 12.32 Bhagwan Marine Limited (note 2) 48,780,488 12.28 Anthony Wooles (note 3) 25,000,000 6.29 Fullahead Pty Ltd and Hume Kenneth Campbell (note 4) 24,390,244 6.14 1. The Shares held by the Kannikoski Family compromise Shares held directly by Lauri Kannikoski (27,042,947 Shares), an indirect interest through Guru Pty Ltd (17,080,513 Shares), an entity that Lauri and his wife, Kerren Kannikoski, control, and an indirect interest in the Shares held by Lauri’s mother, Matilda Kannikoski, who has provided Lauri (jointly with Lauri’s sister) with an enduring power of attorney over Matilda’s Shares (73,635,669 Shares), and Shares held by Lauri and Kerren Kannikoski as trustees for the Kannikoski Superannuation Fund (2,074,996 Shares), and Shares held by Bhagwan Properties Pty Ltd as Trustee for the Kannikoski Property Trust (590,000 Shares). 2. The Company has an aggregate voting power of 12.28% in the Company, as a consequence of restrictions on the disposal of shares under voluntary escrow arrangements, which give the Company a deemed 'relevant interest' in its own shares under section 608(1)(c) of the Corporations Act 2001 (Cth). The voluntary escrow arrangements were disclosed on 31 March 2026 and relate to the escrow arrangements for vendors of Riverside Marine. The Shares issued are subject to voluntary escrow, with 50% escrowed for 12 months and 50% for 24 months, pursuant to voluntary escrow deeds entered into with the relevant vendors of Riverside Marine. 3. Anthony Wooles holds indirect interests in Shares through AEW Holdings Pty Ltd (AEW Capital Account), an entity that Anthony controls. 4. Shares were acquired under the scrip consideration for the Company’s acquisition of Riverside Marine. The Shares are subject to voluntary escrow, with 50% escrowed for 12 months and 50% for 24 months, pursuant to voluntary escrow deeds entered into with the relevant vendors of Riverside Marine. Unquoted securities – Performance rights The number of unquoted securities on issue as at 12 August 2026 is set out below. No holder held more than 20% of the number of performance rights or share rights on issue. The Performance Rights were issued under the Company’s Employee Incentive Awards Plan, which was approved by Shareholders on 12 November 2024. The Share Rights were issued under the Company’s Prospectus and Incentive Awards Plan. Further details on the Performance Rights and Share Rights are set out in the Remuneration Report within this Annual Report. Number of holders Number on issue Performance Rights issued under the Bhagwan Marine Awards Incentive Plan 16 5,672,774 Share Rights issued under the Bhagwan Marine Awards Incentive Plan. 13 783,586 The distribution schedule of the Company’s, unquoted Performance Rights and Share Rights is as follows: Performance Rights spread Number of holders Performance Rights and Share Rights Percentage of shares on issue (%) 1 - 1,000 - - - 1,001 - 5,000 - - - 5,001 - 10,000 - - - 10,001 - 100,000 6 238,808 3.70 100,001 and over 13 6,217,552 96.30 Total 21 6,456,360 100.00 Additional ASX Information 132
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ADDITIONAL ASX INFORMATION 88 Additional information is given in accordance with ASX Listing Rule 4.10 and not shown elsewhere in this Annual Report is as follows. The information is current as of 12 August 2026. Stock Exchange Listing The Company’s ordinary fully paid shares are listed on the Australian Securities Exchange (ASX) under ASX Code: BWN. Distribution Schedule of Ordinary Shares quoted on the ASX The distribution schedule of the Company’s fully paid ordinary shares, as quoted on the ASX, is as follows: Share spread Number of shareholders Shares Percentage of shares on issue (%) 1 - 1,000 114 84,441 0.02 1,001 - 5,000 366 1,002,180 0.25 5,001 - 10,000 197 1,597,633 0.40 10,001 - 100,000 667 24,768,608 6.24 100,001 and over 216 369,698,596 93.09 Total 1,560 397,151,458 100.00 There were 212 holders of less than a marketable parcel of shares (<$500 in value) based on the closing market price of Bhagwan Marine Limited shares on 12 August 2026. Top 20 Shareholders of Ordinary Fully Paid Shares (ASX: BWN) Name of registered holder Number of shares Percentage of shares on issue (%) Matilda Mae Kannikoski 73,635,669 18.54 Velrosso Pty Ltd <harvey 1995 a/c> 51,178,717 12.89 Lauri Keven Kannikoski 27,042,947 6.81 AEW Holdings Pty Ltd <aew capital a/c> 25,000,000 6.29 Fullahead Pty Ltd <the hk campbell trust 99 a/c> 24,390,244 6.14 Guru Pty Ltd <kannikoski family a/c> 17,080,513 4.30 UBS Nominees Pty Ltd 12,857,877 3.24 Claire Mina Campbell Stokes & Drew Kenneth Campbell <the Maryon Campbell Family Trust a/c> 12,195,122 3.07 Inverary Pty Ltd <the wright family trust a/c> 12,195,122 3.07 T Mitchell Pty Ltd <the T Mitchell s/f a/c> 6,552,929 1.65 J P Morgan Nominees Australia Pty Limited 5,025,274 1.27 Citicorp Nominees Pty Limited 4,542,433 1.14 Southern Steel Investments Pty Ltd 3,552,268 0.89 Brazil Farming Pty Ltd 3,254,501 0.82 BNP Paribas Nominees Pty Ltd <hub24 custodial serv ltd> 3,113,777 0.78 BNP Paribas Nominees Pty Ltd <ib au noms retailclient> 2,751,917 0.69 BNP Paribas Noms Pty Ltd 2,560,668 0.64 Warbont Nominees Pty Ltd <unpaid entrepot a/c> 2,354,211 0.59 Offshore Plant Hire Pty Ltd <the DMG family a/c> 2,338,707 0.59 Netwealth Investments Limited <wrap services a/c> 2,081,861 0.52 TOTAL 295,770,753 74.48 ADDITIONAL ASX INFORMATION ADDITIONAL ASX INFORMATION 89 Substantial shareholders of Ordinary Fully Paid Shares Substantial shareholders are as follows, and information is as at the date of the substantial shareholders notice provided to the Company and to the ASX: Substantial Holder Number of shares held Percentage of shares on issue The Kannikoski Family (note 1) 120,424,125 30.32 Velrosso Pty Ltd 48,916,522 12.32 Bhagwan Marine Limited (note 2) 48,780,488 12.28 Anthony Wooles (note 3) 25,000,000 6.29 Fullahead Pty Ltd and Hume Kenneth Campbell (note 4) 24,390,244 6.14 1. The Shares held by the Kannikoski Family compromise Shares held directly by Lauri Kannikoski (27,042,947 Shares), an indirect interest through Guru Pty Ltd (17,080,513 Shares), an entity that Lauri and his wife, Kerren Kannikoski, control, and an indirect interest in the Shares held by Lauri’s mother, Matilda Kannikoski, who has provided Lauri (jointly with Lauri’s sister) with an enduring power of attorney over Matilda’s Shares (73,635,669 Shares), and Shares held by Lauri and Kerren Kannikoski as trustees for the Kannikoski Superannuation Fund (2,074,996 Shares), and Shares held by Bhagwan Properties Pty Ltd as Trustee for the Kannikoski Property Trust (590,000 Shares). 2. The Company has an aggregate voting power of 12.28% in the Company, as a consequence of restrictions on the disposal of shares under voluntary escrow arrangements, which give the Company a deemed 'relevant interest' in its own shares under section 608(1)(c) of the Corporations Act 2001 (Cth). The voluntary escrow arrangements were disclosed on 31 March 2026 and relate to the escrow arrangements for vendors of Riverside Marine. The Shares issued are subject to voluntary escrow, with 50% escrowed for 12 months and 50% for 24 months, pursuant to voluntary escrow deeds entered into with the relevant vendors of Riverside Marine. 3. Anthony Wooles holds indirect interests in Shares through AEW Holdings Pty Ltd (AEW Capital Account), an entity that Anthony controls. 4. Shares were acquired under the scrip consideration for the Company’s acquisition of Riverside Marine. The Shares are subject to voluntary escrow, with 50% escrowed for 12 months and 50% for 24 months, pursuant to voluntary escrow deeds entered into with the relevant vendors of Riverside Marine. Unquoted securities – Performance rights The number of unquoted securities on issue as at 12 August 2026 is set out below. No holder held more than 20% of the number of performance rights or share rights on issue. The Performance Rights were issued under the Company’s Employee Incentive Awards Plan, which was approved by Shareholders on 12 November 2024. The Share Rights were issued under the Company’s Prospectus and Incentive Awards Plan. Further details on the Performance Rights and Share Rights are set out in the Remuneration Report within this Annual Report. Number of holders Number on issue Performance Rights issued under the Bhagwan Marine Awards Incentive Plan 16 5,672,774 Share Rights issued under the Bhagwan Marine Awards Incentive Plan. 13 783,586 The distribution schedule of the Company’s, unquoted Performance Rights and Share Rights is as follows: Performance Rights spread Number of holders Performance Rights and Share Rights Percentage of shares on issue (%) 1 - 1,000 - - - 1,001 - 5,000 - - - 5,001 - 10,000 - - - 10,001 - 100,000 6 238,808 3.70 100,001 and over 13 6,217,552 96.30 Total 21 6,456,360 100.00 133 BHAGWAN MARINE ANNUAL REPORT 2026
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ADDITIONAL ASX INFORMATION ADDITIONAL ASX INFORMATION 90 Voting rights The voting rights attached to each class of equity securities are set out below: Ordinary shares: Every member present at a meeting of the Company in person or by proxy shall have one vote and upon a poll each share shall have one vote. Performance rights and share rights (unquoted): No voting rights Shares held in voluntary escrow As at the date of this report, a total of 48,780,488 shares are subject to voluntary escrow and are already quoted on the ASX. The voluntary escrow arrangements were disclosed on 31 March 2026 and relate to the escrow arrangements for vendors of Riverside Marine. The Shares issued are subject to voluntary escrow, with 50% escrowed for 12 months and 50% for 24 months, pursuant to voluntary escrow deeds entered into with the relevant vendors of Riverside Marine. Compliance statement under ASX LR 4.10.19 Bhagwan confirms that it used cash and assets in a form readily convertible to cash, at the time it was admitted to the ASX (being 26 July 2024) to the date of this Annual Report, in a way that was consistent with its business objectives as stated in its Replacement Prospectus dated 28 June 2024. Annual Report Under the Corporations Act 2001 regarding the provision of Annual Reports to shareholders, the default option for receiving Annual Reports is an electronic copy via Bhagwan Marine’s website at www.investors.bhagwanmarine.com. Corporate Governance Statement Bhagwan Marine’s 2026 Corporate Governance Statement is available on the Company’s website at: www.bhagwanmarine.com.au. Bhagwan Marine also operates with a number of Policies, which are available on its website. 2026 Annual General Meeting The Company’s 2026 Annual General Meeting will be held on 23 October 2026 in Perth, Western Australia, unless otherwise advised. Members of our Board and Management team will be available to answer questions pertaining to the Company’s performance and operations. Dividend Payment Method The Company does not issue dividend payments by cheque to shareholders. Shareholders should provide the share registry with their Australian or New Zealand nominated Australian bank, credit union, building society or nominated account. Shareholder Information and Email Alert Service Information about Bhagwan Marine, including its announcements, presentations and reports, can be accessed on our Investorhub website: www.investors.bhagwanmarine.com Shareholders can also register to receive an email alert notifying them of new Bhagwan Marine’s media releases, financial announcements, or presentations 134
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ADDITIONAL ASX INFORMATION 91 Registered Office and Head Office Level 11, 15-17 William Street Perth, Western Australia 6000 Telephone: +61 8 9424 2300 Email: investor.relations@bhagwanmarine.com Directors Anthony Wooles – Chair and Non-Executive Director Tracey Horton AO – Independent Non-Executive Director Loui Kannikoski – Managing Director & CEO Andrew Wackett – Executive Director - Finance Joint Company Secretaries Cheryl Williams – CFO and Company Secretary Darryl Edwards – Company Secretary Stock Exchange Listing Australian Securities Exchange (ASX) ASX Code: BWN Australian Legal Adviser Clayton Utz Level 27, QV1 Building 250 St Georges Terrace Perth, Western Australia 6000 Share Registry Automic Pty Ltd Level 5, 191 St Georges Terrace Perth, Western Australia 6000 Telephone: +61 1300 288 664 Website: www.automicgroup.com.au Auditor KPMG Level 8, 235 St Georges Terrace Perth, Western Australia 6000 InvestorHub Bhagwan’s InvestorHub provides shareholders, stakeholders, and potential investors with a central location to access recent ASX announcements, company news, and other key updates. The platform will also feature videos, project insights, and industry news, providing investors with opportunities to stay up to date and communicate with the Company’s leadership team. We invite you to stay connected with our investment community at www.investors.bhagwanmarine.com ADDITIONAL ASX INFORMATION 135 BHAGWAN MARINE ANNUAL REPORT 2026
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0 50 100 150 200 250 300 350 400 Bhagwan Revenue TVI Revenue Riverside Revenue Catalyst Investment Partners and Anthony Wooles invested in BWN Launched BWN Maintenance & Engineering Division Acquired Marine and Towage Services Limited Acquired MDT Marine Pty Ltd establishing presence in QLD Acquired Broadsword Marine Contractors, NT Acquired Delta Subsea Port of Melbourne maintenance contract 5-year contract with multinational oil and gas company North West Shelf Acquired Riverside Marine expanding presence in QLD and northern Australia Successful IPO and listing on ASX Advanced decommissioning strategy with Barrow Island contract award 2006 $m 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Acquired Dalmarine establishing presence in Dampier to service oil and gas market Construction support contract for Gorgon gas project Acquired Workboats Northern Australia Pty Ltd, Darwin Launched BWN Subsea Division IMR master services agreement with multinational oil and gas client in the Pilbara WA Construction of new marina, Port Hedland waterfront TVI decommissioning project North West Shelf Our business was founded in 2000 by the Kannikoski family in Geraldton, Western Australia, with a single vessel. The fleet grew rapidly servicing construction work for the energy industry, with the nature of our services transitioning as projects moved to production and then decommissioning. From 2015, we began to diversify and successfully won contracts for clients across broader industry sectors such as ports, resources, civil construction and defence. Our Proud History Bhagwan Houtman 136
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0 50 100 150 200 250 300 350 400 Bhagwan Revenue TVI Revenue Riverside Revenue Catalyst Investment Partners and Anthony Wooles invested in BWN Launched BWN Maintenance & Engineering Division Acquired Marine and Towage Services Limited Acquired MDT Marine Pty Ltd establishing presence in QLD Acquired Broadsword Marine Contractors, NT Acquired Delta Subsea Port of Melbourne maintenance contract 5-year contract with multinational oil and gas company North West Shelf Acquired Riverside Marine expanding presence in QLD and northern Australia Successful IPO and listing on ASX Advanced decommissioning strategy with Barrow Island contract award 2006 $m 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Acquired Dalmarine establishing presence in Dampier to service oil and gas market Construction support contract for Gorgon gas project Acquired Workboats Northern Australia Pty Ltd, Darwin Launched BWN Subsea Division IMR master services agreement with multinational oil and gas client in the Pilbara WA Construction of new marina, Port Hedland waterfront TVI decommissioning project North West Shelf 137 BHAGWAN MARINE ANNUAL REPORT 2026
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Level 11, Australia Place, 15-17 William Street, Perth WA 6000 T +61 8 9424 2300 E investor.relations@bhagwanmarine.com bhagwanmarine.com Australia’s Largest ASX Listed Marine Solutions Provider