Annual financial statement
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KELSIAN GROUP LIMITED APPENDIX 4E PRELIMINARY FINAL REPORT 1. Company details Name of entity: Kelsian Group Limited ABN: 49 109 078 257 Reporting period: For the year ended 30 June 2026 Previous period: For the year ended 30 June 2025 2. Results for announcement to the market 2026 2025 Change Change $'000 $'000 $'000 % Revenue from ordinary activities 2,402,713 2,208,909 193,804 9% Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA)(1) 297,984 277,176 20,808 8% Earnings Before Interest, Tax and Amortisation (EBITA)(1) 170,927 161,410 9,517 6% Earnings Before Interest and Tax (EBIT)(1) 137,881 128,208 9,673 8% Net Profit after Tax and before Amortisation (NPATA)(1) 96,571 87,696 8,875 10% Underlying EBITDA(1) 315,792 284,966 30,826 11% Underlying EBITA(1) 188,735 169,200 19,535 12% Underlying EBIT(1) 155,689 135,998 19,691 14% Underlying NPATA(1) 111,079 94,787 16,292 17% Profit from ordinary activities after tax attributable to the owners of Kelsian Group Limited 63,525 54,494 9,031 17% Underlying profit from ordinary activities after tax attributable to the owners of Kelsian Group Limited 78,033 61,585 16,448 27% (1) Underlying EBITDA, EBITA, EBIT and NPATA are financial measures which are not prescribed by Australian Accounting Standards. These non-IFRS measures represent the Group's underlying and recurring earnings from its operations and are determined by adjusting the statutory net profit after tax for items that are non-cash or non-operating in nature. The directors consider underlying profit and underlying EBITDA to represent the core earnings of the Group. 2026 2025 Significant items for the period $'000 $'000 Acquisition, transaction related costs and other 7,664 5,506 Group system costs 10,144 2,284 Total significant items 17,808 7,790 Tax effect of significant trading items and one off tax adjustments (3,300) (699) Refer to the commentary in the Directors' Report in the 'Review of operations' section. The profit for the Group after providing for income tax amounted to $63,525,000 (30 June 2025: $54,494,000). 3. Dividends Current period Amount per security Franked amount per security Cents Cents Fully Franked Final Dividend(1) 10.0 10.0 Fully Franked Interim Dividend (paid on 20 April 2026) 8.0 8.0 (1) Record date for determining entitlements to 2026 final dividend is 15 September 2026. Payment date for the final dividend is 21 October 2026.
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KELSIAN GROUP LIMITED APPENDIX 4E PRELIMINARY FINAL REPORT Previous period Amount per security Franked amount per security Cents Cents Fully Franked Final Dividend (paid on 21 October 2025) 9.5 9.5 Fully Franked Interim Dividend (paid 16 April 2025) 8.0 8.0 4. Dividend reinvestment plans Participation in the Dividend Reinvestment Plan (DRP) is offered to shareholders in Australia, New Zealand, the United Kingdom, Jersey, Canada and Qualified Institutional Buyers in the United States. Under the DRP, Kelsian shares will be issued at the average of the daily volume weighted average market price of Kelsian shares sold on ASX during the 10 trading days commencing 18 September 2026 with no discount. Refer to the updated Eligibility Notice to be released on same date as this report including minor changes for USA shareholders reflecting regulatory changes in the USA. The last date for receipt of election notices for the DRP 16 September 2026 5. Net tangible assets Reporting period Previous period Cents Cents Net tangible assets per ordinary security 42.56 33.22 Net tangible asset calculation includes right-of-use assets and lease liabilities. 6. Control gained over entities Name of entities (or group of entities) South Wales Transport (Neath) Ltd Date control gained 31 October 2025 7. Loss of control over entities Name of entities (or group of entities) Swan Transit Canning Pty Ltd (deregistered 27 May 2026) Swan Transit Group Pty Ltd (deregistered 24 June 2026) Swan Transit Kalamunda Pty Ltd (deregistered 27 May 2026) Swan Transit Marmion Pty Ltd (deregistered 27 May 2026) Swan Transit Midland Pty Ltd (deregistered 24 June 2026) Swan Transit South West Pty Ltd (deregistered 27 May 2026) Swan Transit Southern River Pty Ltd (deregistered 27 May 2026) Torrens Transit Group Pty Ltd (deregistered 27 May 2026) Torrens Transit Services (North) Pty Ltd (deregistered 27 May 2026) Transit (NSW) Group Pty Ltd (deregistered 24 June 2026) 8. Details of associates and joint venture entities Not applicable. 9. Foreign entities Details of origin of accounting standards used in compiling the report: Not applicable.
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KELSIAN GROUP LIMITED APPENDIX 4E PRELIMINARY FINAL REPORT 10. Audit qualification or review Details of audit/review dispute or qualification (if any): The financial statements have been audited and an unmodified opinion has been issued. 11. Attachments Details of attachments (if any): The Annual Report of Kelsian Group Limited for the year ended 30 June 2026 is attached. 12. Signed Signed ___________________________ Date: 26 August 2026 Fiona A Hele Chair
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 1 The Directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'Group' or 'Kelsian') consisting of Kelsian Group Limited (referred to hereafter as the 'Company' or 'parent entity') and the entities it controlled at the end of, or during, the year ended 30 June 2026. Directors The names and details of the Company’s Directors in office during the financial year or at the date of this report are set out below. Directors have been in office for the entire period unless otherwise stated. Fiona A. Hele (B.Com, FCA, FAICD) – Chair – Independent Non-Executive Director Ms Hele is an experienced non-executive director with a strong commercial and finance background. Ms Hele is a Chartered Accountant with over 30 years’ experience in both the private and public sectors specialising in strategic business advisory, mergers and acquisition, risk management and corporate governance. Ms Hele is a Fellow of the Institute of Chartered Accountants, Australia and New Zealand, and a Fellow of the Institute of Company Directors. Ms Hele is also a director of Argo Global Listed Infrastructure Limited and CEA Technologies Pty Ltd. Past directorships include the Adelaide Venue Management Corporation, South Australian Tourism Commission, Celsus Securitisation Pty Ltd, Prime Q, Adelaide Fringe Festival and SA Water Corporation. Ms Hele joined the Board in 2016 and was Chair of the Audit, Risk and Sustainability Committee until 1 July 2024 when she became Chair of the Board. She is currently a member of the Nominations Committee. Ms Hele is classified by the Company as an independent director. Terry J. Dodd – Independent Non-Executive Director Mr Dodd has extensive experience in business management and the marine industry. After qualifying as a commercial diver in the USA and working as a commercial diver in the onshore and offshore oil and gas industry, he successfully established a recreational diving business and a travel agency in North Queensland (after which he built both a marine construction and ferry business). Mr Dodd is Managing Director and owner of Pacific Marine Group Pty Ltd, one of Australia's largest marine construction and commercial diving companies. Mr Dodd was previously Managing Director of Sunferries, a ferry transport business based in Townsville, prior to its sale to Kelsian in March 2011 when Mr Dodd joined the Board of Kelsian. Mr Dodd is former deputy chair of the Australian Festival of Chamber Music as well as the former deputy chair of Commerce Queensland, and former chairman of Sydney Fast Ferries. Mr Dodd is Chair of the Nominations Committee, a member of the Finance and Audit Committee and is classified by the Company as an independent director. Diane J. Grady AO (BA Mills, MA Hawaii, MBA Harv, FAICD) – Independent Non-Executive Director Ms Grady has extensive international experience as a company director across a variety of industries. She has been a full time independent director since 1994 serving on a range of public company and not-for-profit boards, and was previously a partner of McKinsey & Co where she led the Consumer Goods, Marketing and Retailing practice in Australia and was a global leader of the Firm’s Organisation, Culture and Change Management practice. Ms Grady is currently a non-executive director on the Board of Grant Thornton and is on the Strategy Council of Apropela (formerly Heads Over Heels) a not for profit that supports women entrepreneurs seeking to scale up their businesses. Her former directorships include Tennis Australia, the Macquarie Group, Woolworths, BlueScope Steel, Goodman Group, Lend Lease, and Wattyl. She has also served as a Trustee of The Sydney Opera House, President of Chief Executive Women, Chair of Ascham School, and Chair of The Hunger Project Australia. Ms Grady is classified by the Company as an independent director. From 1 August 2025, Ms Grady became Chair of the Safety, Risk and Sustainability Committee and continues as a member of the People, Culture and Remuneration Committee. For all of the reporting period, Ms Grady was a member of the Finance and Audit Committee and the Nominations Committee. Jacqueline McArthur (B.Eng, MAICD) – Independent Non-Executive Director Ms McArthur is a highly experienced company director, currently on the Boards of Cleanaway Waste Management Ltd and Orora Limited. Ms McArthur was previously a non-executive director of Qube Holdings Ltd, Inghams Group Ltd, Tassal Group Ltd, InvoCare Ltd, and Blackmores Ltd. With over 25 years of experience at executive and board level across strategy, supply chain and logistics, sustainability, governance, and technology, Ms McArthur’s skills and experience are highly valued by the Kelsian Board. At board level she is actively engaged in the oversight of digital transformation, cyber resilience and the responsible adoption of artificial intelligence, drawing on hands-on experience leading large-scale enterprise resource planning (ERP), warehouse management (WMS) and transport management system transformations across her executive career at McDonald’s and Martin Brower. Her executive career includes serving as Managing Director of Martin Brower ANZ, a global distributor and supply chain services provider. In her time in the global McDonalds system, she was responsible for a supply chain worth $4.5bn across 38 markets. Ms McArthur was the 2016 Telstra NSW Business Woman of the Year and the overall 2016 Telstra Business Women’s Awards – Corporate and Private National winner. She holds a Bachelor of Engineering from the University of Sydney, completed the INSEAD International Executive Program and is a member of the Australian Institute of Company Directors. Ms McArthur is classified by the Company as an independent director. She is Chair of the People, Culture and Remuneration Committee and a member of the Safety, Risk and Sustainability Committee and the Nominations Committee.
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 2 Caroline A. Elliott (B.Ec, CA, GAICD) – Independent Non-Executive Director Ms Elliott is an experienced executive and non-executive director with more than 25 years' experience in senior leadership and governance roles across the retail, financial services, healthcare, transport and professional services sectors. She has held C-suite positions across a range of organisations, with extensive expertise in strategy, finance, governance, risk management and organisational transformation. Ms Elliott is currently a non-executive director of Cettire Limited (ASX:CTT); non-executive director of Wiltrust Nominees Pty Ltd ATF Edward Wilson Trust and non-executive director of The Cormack Foundation Pty Ltd. Previously, Ms Elliott was non-executive director and chair of the Finance, Audit and Risk Committee of St John Ambulance Australia (Vic); chair of the National Film and Sound Archive of Australia, a non-executive director and chair of the Audit and Risk Committee of DorsaVI Limited, a non-executive director of Cell Therapies Pty Ltd, Peter MacCallum Cancer Centre and Public Transport Ombudsman Limited. Ms Elliott is a Member of the Institute of Chartered Accountants, Australia and New Zealand, and Graduate of the Australian Institute of Company Directors. Ms Elliott is classified by the Company as an independent director. For all of the reporting period Ms Elliott was Chair of the Finance and Audit Committee and a member of the Nominations Committee. From 1 September 2025 Ms Elliott became a member of the People, Culture and Remuneration Committee. Terry A. Sinclair (MBA, MAICD) – Independent Non-Executive Director (appointed 1 September 2025) Mr Sinclair is an experienced company director/chair and an advisor to institutional investors, government agencies, and private equity. His leadership experience in operations and corporate development roles has been in organisations that typically operate in highly regulated environments with extensive distributed assets and infrastructure networks across Asia Pacific, and a dependence on complex supply chains and technology platforms. Mr Sinclair was most recently chair of Silk Logistics Holdings Limited (ASX:SLH) which was acquired by DP World in July 2025. He was also previously a non-executive director of Cleanaway Waste Management Limited (ASX:CWY), non-executive director (and inaugural chair) of Indara Digital Infrastructure and a senior advisor to Australian Super. Other previous board roles included non-executive director Faethm.ai Pty Ltd, Ovato Limited and Zoom2U Technologies, managing director of Service Stream Limited (ASX:SSM), chairman of AUX Investments (owned by Qantas and Australia Post), chairman of Star Track Express, director of Sai Cheng Logistics (China), and director of Asia Pacific Alliance (HK). Mr Sinclair is a Member of the Australian Institute of Company Directors and holds a Master of Business Administration (MBA), a Graduate Diploma in Management, and tertiary qualifications in Mining Surveying. Mr Sinclair is classified by the Company as an independent director. From 1 September 2025 Mr Sinclair became a member of the People, Culture and Remuneration Committee, the Safety, Risk and Sustainability Committee, and Nominations Committee. Neil E. Smith (MTM, BA) – Non-Executive Director (resigned 28 February 2026) Mr Smith was one of the founding shareholders and a former Director of the Transit Systems Group prior to the acquisition by Kelsian. He has over 30 years of commuter transport operations experience. Mr Smith commenced his career within the Sydney bus industry, before acquiring a number of bus operations in rural NSW and then Queensland. In 1995, Mr Smith joined with Graham Leishman and Lance Francis to found Transit Systems and in 2013, was a founding shareholder of Tower Transit. Mr Smith holds a Bachelor of Arts Degree and a Masters of Transport Management from the University of Sydney. He is an occasional lecturer at the Massachusetts Institute of Technology, the University of Sydney and the University of Johannesburg. Mr Smith was a member of the Safety, Risk and Sustainability Committee, member of the Nominations Committee and classified by the Company as a non-independent director. Lance E. Hockridge (FCILT, FIML, MAICD) – Independent Non-Executive Director (resigned 31 July 2025) Mr Hockridge has extensive international experience in the transportation, manufacturing and logistics sectors with a focus on safety, operational and financial transformation of businesses. Mr Hockridge was previously the Managing Director and CEO of Aurizon Holdings Limited (2010 to 2016) following the demerger of Queensland Rail and QR National from a government owned railway to an ASX50 company. Other notable accomplishments as an executive include the oversight of BHP’s global transport business, together with key roles in financial and operational reform in the heavy industrial sector and leading a major turnaround for BlueScope Steel’s North American operations. He also served as a director of Saudi Arabia Railways. Mr Hockridge is currently chair and member of AVADA Group Limited, Vivedus Pty Ltd, and Greenlink Australia Pty Ltd. Until 31 July 2025, Mr Hockridge was Chair of the People, Culture and Remuneration Committee, a member of the Safety, Risk and Sustainability Committee and a member of the Nominations Committee. Mr Hockridge was classified by the Company as an independent director.
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 3 Interest in the shares of the Company and related bodies Corporate Number of ordinary shares As at the date of this report, the interests of the Directors in the shares of the Company were: Fiona Hele 125,387 Terry Dodd 5,806,724 Diane Grady AO 36,763 Jacqueline McArthur 72,824 Caroline Elliott 10,000 Terry Sinclair (appointed 1 September 2025) - Neil Smith (resigned 28 February 2026) 22,980,428 Lance Hockridge (resigned 31 July 2025) 15,664 Joint Company Secretaries Joanne H. McDonald (LLB, B.Ec, GAICD, FGIA) (resigned effective 4 September 2026) Ms McDonald was appointed Company Secretary on 21 August 2018. Ms McDonald has over 30 years experience in governance, commercial and corporate law holding company secretarial and senior legal and commercial positions with listed private and statutory corporations. She holds a Bachelor of Laws (Hons) and Bachelor of Economics from the University of Adelaide as well as being a graduate of the Australian Institute of Company Directors and Fellow of the Australian Governance Institute. Ms McDonald was also Group Chief Legal and Risk Officer for the Company until 1 December 2025. As announced on 25 August 2026, Michelle Evans will be appointed as a joint Company Secretary effective 5 September 2026. Andrew D. Muir (B.Ec, MBA) Mr Muir was appointed Company Secretary on 1 June 2018. Mr Muir has also held a number of similar financial positions with other ASX listed and private companies. Mr Muir holds a Bachelor of Economics and a Master of Business Administration from the University of Adelaide. Mr Muir is also Group Chief Financial Officer of the Company. Principal activities During the financial year the principal continuing activities of the Group consisted of: ● domestic metropolitan public bus transport operations; ● international public bus and motorcoach transport operations; ● urban, regional and school bus charter and coach tours; ● domestic ferry services; ● tourism cruises, charter cruises and accommodated cruising; ● travel agency services and packaged holidays; and ● tourist accommodation. Dividends Dividends paid during the financial year were as follows: Consolidated 2026 2025 $'000 $'000 Interim fully franked dividend for the year ended 30 June 2026 paid 20 April 2026 of 8.0 cents (2025: 8.0 cents) per ordinary share 21,727 21,691 Final fully franked dividend for the year ended 30 June 2025 paid 21 October 2025 of 9.5 cents (2024: 9.5 cents) per ordinary share 25,797 25,630 47,524 47,321 Kelsian’s Directors declared a 10.0 cents per share fully franked final dividend payable on 21 October 2026 to shareholders registered on 15 September 2026. Total 2026 dividends of 18.0 cents represents a 44.0% return of underlying net profit after tax and before amortisation to shareholders, which is in line with the Company’s policy of returning 40% - 60% of net profit after tax and before amortisation, subject to business needs and ability to pay. The interim dividend for the half-year ended 31 December 2025 was 8.0 cents per share. The Board will continue to consider Kelsian’s growth requirements, its current cash position, market conditions and the need to maintain a healthy financial position, when determining future dividends. Participation in the Dividend Reinvestment Plan (DRP) is offered to shareholders in Australia, New Zealand, the United Kingdom, Jersey, Canada and Qualified Institutional Buyers in the United States. Under the DRP, Kelsian shares will be issued at the average of the daily volume weighted average market price of Kelsian shares sold on ASX during the 10 trading days commencing 18 September 2026 with no discount. Refer to the updated Eligibility Notice to be released on same date as this report including minor changes for USA shareholders reflecting regulatory changes in the USA. The DRP election date for determining participation is 16 September 2026.
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 4 Review of operations The profit for the Group after providing for income tax for the 12-month period ended 30 June 2026 amounted to $63,525,000 (30 June 2025: $54,494,000). Kelsian is a leading global operator of bus, motorcoach and marine services, trusted by governments and private clients to deliver safe, reliable and sustainable passenger transport solutions. With over 35 years of experience, Kelsian connects people and places across complex urban and regional networks in Australia, the UK, Singapore, the USA and the Channel Islands. Kelsian’s businesses include Transit Systems – one of Australia’s largest bus operators, All Aboard America! Holdings, Inc. (AAAHI) – the second-largest motorcoach operator in the USA, Tower Transit – spearheading bus franchising in the UK and Singapore, and SeaLink Marine & Tourism providing ferry services that connect commuters and regional communities around Australia. Kelsian delivered a record financial result in FY26 with Net Profit after Tax (NPAT) of $63.5 million, up 17% compared to FY25. This result demonstrates the resilience of the Group’s business model with over 90% of revenues being contracted or non-discretionary. The defensive and resilient nature of the Group’s earnings allowed a record result to be delivered notwithstanding continued inflationary pressures and the significant increase in global fuel prices during the second half of the financial year. The improved earnings margins reflected ongoing cost base and operational efficiency improvements, an increased contribution from industrial workforce transportation contracts in the USA, ongoing rail replacement bus service contracts in Australia and fuel price mitigation strategies for non-contracted operations. Revenue and earnings growth was achieved across all operating divisions through a combination of contract indexation, contract extensions and expansions, new contract wins and an improved result in the Marine and Tourism division. During FY26, the Group continued to streamline its operations, strengthen its balance sheet and increase exposure to long-term contracted transport services. These ongoing initiatives are expected to improve earnings quality, reduce capital intensity and enhance the Group's ability to allocate capital towards higher returning growth opportunities. Kelsian announced that it had entered into binding sale agreements to divest the Group’s Tourism Portfolio for an enterprise value of $161 million. The sale, which remains subject to conditions, including regulatory approvals, is expected to further strengthen the Group’s balance sheet and enhance its strategic focus on contracted bus, motorcoach and marine operations. FY26 Financial Results Overview ● Revenue of $2.4 billion, up 9% compared to FY25, reflecting continued growth across the Group's three operating divisions - Australian Bus, International Bus, and Marine and Tourism; ● Underlying Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) up 11% to $315.8 million, representing the highest result in the Group’s history; ● Underlying Earnings Before Interest and Tax (EBIT) increased 14% to $155.7 million; ● Underlying Net Profit After Tax and before Amortisation (NPATA) of $111.1 million up 17%; ● Net operating cash flow remained strong, reflecting the high quality of earnings and continued strong cash conversion across the Group; ● Leverage reduced further and is now within the Group’s target leverage range of between 2.0 and 2.5 times Underlying EBITDA; ● The Board declared a fully franked final dividend of 10 cents per share, taking the full year to 18.0 cents per share (FY25: 17.5 cents per share). FY26 Operational Highlights ● As at 30 June 2026, Kelsian employed over 13,300 people and operated 6,317 buses, and 122 vessels that delivered more than 384 million customer journeys over the last year; ● Continued successful operation of the Bankstown Rail Replacement services; ● Signed a two-year extension for Sydney Region 6 public bus services from 1 July 2026; ● Successfully awarded and commenced operations of the Queensland Ipswich and Logan bus services contract; ● Continued growth from existing and new USA employee transportation contracts; ● Acquired South Wales Transport in the United Kingdom, strengthening Kelsian’s position ahead of regional UK bus franchising opportunities; ● Awarded Liverpool City Region bus franchise contracts in the UK with operations to commence in January 2027; ● Re-awarded several key marine contracts, including the Southern Moreton Bay Islands passenger ferry and Moggill vehicle ferry services in Queensland; and ● Ongoing implementation of the Group-wide Workday finance and HR transformation program. Review of Operations - Australian Bus Division Kelsian is a leading Australian bus operator, delivering public transport bus services on behalf of governments in Western Australia, South Australia, New South Wales, Victoria, Queensland and the Northern Territory. The Group also operates charter, education, workforce, resources and specialist bus transport services around Australia. The Australian Bus division delivered a solid FY26 financial result, supported by contractual revenue indexation mechanisms that continued to provide effective protection against movements in key operating cost inputs, including fuel, labour and maintenance expenses.
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 5 A significant milestone during the year was securing the contract to deliver the Ipswich and Logan transformative bus improvement package. The successful commencement of the bus services in November marked Kelsian’s first competitively tendered bus contract award in Queensland and establishes a strong platform for future growth in the state. Since operations commenced, service performance has exceeded expectations, demonstrating the strength of Kelsian’s contract mobilisation expertise and operational capability. In New South Wales, Kelsian secured a two-year extension of its Sydney Region 6 contract with services under the extended contract commencing on 1 July 2026. The extension supports the next phase of the transition to a zero-emission bus fleet in Sydney. During the year, some Sydney operations continued to experience operational challenges due to delays in depot electrification and the rollout of replacement electric buses. These delays resulted in higher repairs and maintenance costs associated with operating older diesel vehicles. Pleasingly, these additional costs were offset by successful operational improvement initiatives and network service changes implemented during the year that have improved the efficiency of the services and improved performance outcomes. Australian State Governments continue to prioritise investment in public transport infrastructure and services and this investment continued during the period, supported by increased patronage across key markets. The Australian Bus division is well-positioned to benefit from sustained investment, expanding service networks and increasing demand for public transport across its key markets. Review of Operations – International Bus Division USA Kelsian’s USA operations delivered another strong result in FY26. Growth continued to be driven by industrial workforce transportation supporting LNG, energy and major industrial developments across Texas and Louisiana. To support increasing demand, AAAHI continued investing in fleet expansion, depot infrastructure and operational capability across the region. Several corporate employee shuttle contracts were renewed and expanded during FY26, reflecting the quality of service delivered to customers and the strength of long-term client relationships. The USA business remains well positioned to capitalise on continued investment in industrial developments, data centres and major infrastructure projects, which are expected to support ongoing demand for corporate workforce transportation services. United Kingdom and Channel Islands A highlight of the period was the successful award of the Liverpool City Region Combined Authority Bus Franchising Tranche 1, Category 2 contracts. These contracts are for an initial 5-year term from January 2027, with a 2-year extension option, involving 73 buses operating from two leased depot facilities and generating revenue of approximately A$80 million over the contract term. On 31 October 2025, Kelsian, acquired Swansea based bus operator South Wales Transport, expanding its regional operating footprint and strengthening its position ahead of upcoming bus franchising across Wales. Operations in the Channel Islands (LibertyBus) continue to deliver reliable, steady performance, and have been used as a primary case study demonstrating successful franchising in UK Government’s The Bus Franchising Manual, published in January 2026 by the Department for Transport (DfT) as guidance for other Local and Regional Authorities undertaking bus franchising. These developments further validate Kelsian’s long-term strategy of establishing operating platforms in targeted regional UK markets ahead of bus franchising reform and transition. The UK market remains a significant growth opportunity, with more than 10,000 buses expected to transition to franchised operating models over the medium term. Singapore Singapore delivered another stable and predictable financial result in FY26. The Sentosa Development Corporation contract commenced successfully in October 2025 and represents an important milestone as Kelsian’s first major contracted service outside the traditional government route bus network in Singapore. The Bulim contract was also expanded with additional services during the year supported by the strong operational and maintenance performance across the Singapore portfolio. Review of operations - Marine and Tourism Division The Marine and Tourism division delivered a resilient performance in FY26 despite continued cost pressures, particularly elevated diesel prices, and subdued consumer sentiment across certain tourism markets. Performance benefited from strong demand across contracted ferry operations, improved utilisation of new vessels and successful implementation of fuel mitigation strategies, including fare adjustments, fuel surcharges and operational efficiency initiatives. Kelsian continued preparations for commencement of the new 25-year Kangaroo Island ferry licence. While vessel delivery timelines resulted in revised mobilisation schedules, the project remains a strategically important long-term infrastructure-style contract for the Group. Following the expected completion of the Tourism Portfolio divestment in FY27, the retained Marine business will comprise predominantly contracted ferry operations supporting commuters, government transport networks and industrial customers.
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 6 Review of operations - Corporate A key milestone during the year was the announcement in February 2026 that Kelsian had entered binding agreements to sell the Tourism Portfolio to Journey Beyond (Experience Australia Group Pty Ltd ACN 614 713 003 and certain of its subsidiaries) for an enterprise value of $161 million. Work to satisfy conditions precedent for divestment of the Tourism Portfolio continued during the period and the transaction is expected to complete in 1HFY27. Following completion, Kelsian will emerge as a more focused global transport business centred on contracted marine, bus, and motorcoach operations. The retained marine portfolio will have lower earnings volatility, reduced capital intensity and greater exposure to long-term government and corporate-backed transport contracts. The rollout of the new global finance and human resources platform progressed well during FY26. The finance system went live in July 2026, and the human resources system is scheduled to go live in the first half of FY28. The new system is expected to improve governance, data visibility, process efficiency and decision-making capability across the Group while replacing multiple legacy systems. Outlook Kelsian enters FY27 with strong operational momentum, a strengthened balance sheet and a substantial pipeline of organic and inorganic growth opportunities. The Group remains focused on delivering operational excellence, completion of the divestment of the Tourism Portfolio, and disciplined capital allocation and organic growth guided by the Group’s Capital Management and Allocation framework. Key opportunities include contract extensions and service expansions within Australian Bus, continued growth in industrial and employee transportation in the United States, expansion through UK bus franchising opportunities, new bus contract opportunities in Singapore and New Zealand, and further marine transport opportunities across Australia and New Zealand. Supported by its predominantly contracted earnings base, strong market positions, disciplined capital allocation framework and operational excellence, Kelsian remains well positioned to deliver sustainable long-term earnings growth and shareholder value. Risk management To deliver our strategy it is important we understand and manage the risks that face the Group. Kelsian’s Risk Management Framework supports a holistic approach to business risk management, identifying and understanding material risks across our operating divisions then consolidating these with Group risks to produce a Group view of our material business risks. Material risks are reported to and reviewed by the Board, the Safety, Risk and Sustainability Committee and Group Executive as part of risk reporting processes. The Board Safety, Risk and Sustainability Committee, along with the Group Executive, monitor these risks to ensure the risk is within the Group’s risk appetite, whilst at the same time identifying and analysing emerging risks that we face in the pursuit of our objectives. The Group has in place a risk appetite framework which supports decision-making by setting the level of risk the Board is prepared to accept in pursuit of the Group’s strategic objectives and assists management in determining when matters should be escalated to the Board or relevant Committee. Risk management is also integrated into key business decision-making activities, including strategic planning, investment decisions, financial risk management and project/change management. Internal audits and risk reviews are undertaken to confirm risks are being effectively managed and Kelsian continually seeks to improve the quality of risk management information reported to the Board and the Safety, Risk and Sustainability Committee. The achievement of Kelsian’s strategic objectives and future financial performance is subject to various risks that arise from the activities and operations of the Group. The table below outlines our material risks that could affect results and performance. (Note this is not an exhaustive list nor in order of materiality.)
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 7 Risk Description Mitigation External Risks Economic Conditions Like all organisations, the Group is exposed to economic fluctuations which can impact on customer needs, supply chain costs and growth opportunities. The global economic outlook is looking uncertain, driven by geopolitical tensions, trade disputes, policy unpredictability which all have the potential to impact inflation and interest rates, supply chain costs, labour and fuel prices all of which increase uncertainty around financial resources In addition to hedging through financial instruments, the Group have natural hedging within many of its contracts to significantly manage this risk. This is further supported by innovative and efficient business operating models that support our clients in delivering safe, reliable, sustainable and economical solutions. Climate Change Climate change presents physical and transition risks and opportunities for Kelsian. Physical risks include the potential impacts of extreme weather and changing climate conditions on our people, assets, infrastructure and service delivery. Transition risks include changes in policy, regulation, technology, market expectations and decarbonisation requirements, including the transition to low and zero- emission fleet and infrastructure. Kelsian also recognises opportunities from increased demand for sustainable transport solutions. Kelsian manages climate-related risks and opportunities through its Risk Management Framework, Sustainability Framework, governance arrangements, operating business processes, and strategic and business planning activities. Further details, including mitigation and adaptation activities, are set out in the FY26 Sustainability Report. Geopolitical/ Government Policy Kelsian is exposed to risks of changes in government policies and regulations which may impact financially on the Group’s cost base or future prospects and opportunities for new or renewed contracts. The Group’s operations depend heavily on government policy, funding regimes and infrastructure plans initiatives continuing to support private company operators in public transport. Such changes have the potential to impact (both positively and adversely) on Kelsian’s profitability and future growth prospects. Kelsian manages these risks by putting in place dedicated resources to manage and monitor government policies and implement appropriate systems and processes to ensure compliance with changing regulatory environments. Kelsian, as far as possible, incorporates consideration of changes in regulatory requirements and government policies into its corporate and financial plans and forecasts.
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 8 Risk Description Mitigation Strategic Risks Competition/ Growth Kelsian provides its services and products to individuals, companies and government agencies across a range of economic sectors. This is carried out in competitive markets where we compete in areas of price, quality and service options. Failure to effectively compete in the market and/or develop new and innovative solutions could lead to non-renewal of contracts and failure to win new tenders. Should these crystallise these risks can impact on the financial performance of the Group. Kelsian has a dedicated Business Development Function who oversee the Group’s competitive tendering process as well as monitoring and assessing market conditions in areas where we bid/operate. This team also work with our operational divisions to identify and evaluate new business opportunities. Our continued focus in these areas will ensure Kelsian will continue to remain competitive and attractive to customers and clients who value these values in their business partner. Contracted Services A large proportion of the Group's revenue is secured through long-term government/commercial contracts. Such contracts attract inherent risks around achieving operational and financial performance. Unmanaged, these risks can impact on the Group's financial performance as well as our reputation and ability to renew and secure new contracts. As an experienced and established operator, Kelsian and its Operating Divisions have extensive expertise to ensure we meet the requirements and standards on all our contracts. This is backed up with excellent customer/client relations to ensure expectations are understood and managed. Kelsian’s financial and operational excellence models provide for effective financial monitoring of all business activities and efficient business operations. Integration Risk – Acquisitions There are potential integration risks associated with any acquisition, including due diligence risks, and risks that integration could take longer, be more complex or costly than expected, encounter unexpected challenges, divert management attention or that the anticipated benefits may not be achieved. Any material failure to fully integrate the operations of an acquired business, or material failure to achieve anticipated benefits, could adversely impact the operational performance and profitability of the Group. Kelsian manages these risks by applying robust integration processes which are supported by a Mergers & Acquisition Integration Framework. This incorporates risk management process to identify and assess the integration risks and then putting in place dedicated specialist resources to manage, monitor and report on the integration process. Integration and Transition Risks – New Public Transport Contracts There are potential integration and transition risks associated with commencing large new public transport services contracts including employee relations risks, reputational risks, risks of operating from new depots (delay and construction/suitability) and risks that transitioning services may be more complex or costly than expected, encounter unexpected challenges, divert management attention or attract adverse media attention. Kelsian manages these risks through use of robust transition processes including dedicated transition team planning and resources which it has developed during its experience in transitioning large public transport bus contracts over many years in Australia and Singapore. Operational Risks Financial Risks Kelsian’s continued ability to operate its business and effectively implement its business plans is exposed to a variety of financial risks including credit risk, interest and currency risk, liquidity risk as well as Balance Sheet risk. Information on how Kelsian manages its financial risks are outlined in the Notes of the Financial Report.
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 9 Risk Description Mitigation Operational risks continued Health & Safety Transport, tourism and hospitality inherently include safety risks many of which are outside our control. Significant safety incidents, or failings in our safety management systems, could result in reputational, legal and financial damage. Kelsian maintains a strong safety culture and is committed to continuous improvement and maintaining safety standards for all our operations. As part of this, the Group delivers an annual assurance program (external & internal) to monitor the effectiveness of safety risk management practices. Many operations are certified to AS 4801 / ISO 45001 with the remainder operating to equivalent standards. The Group conducts an annual internal and external assurance program to test the effectiveness of safety risk management practices and drive continuous improvement. The Group has dedicated professionals who provide governance, training and on the ground support to ensure consistent compliance and capability across the workforce. Environmental The nature of our activities some of which occur in some environmentally sensitive areas such as marine waters in Australia have the potential to cause harm to the environment if not managed appropriately. Failure to operate in accordance with environmental standards not only has the potential to result in environmental harm but also increases compliance costs, jeopardises our community relations and causes reputational damage with our stakeholders and investors. Kelsian manages environmental risks through risk assessments, operating procedures, environmental management controls, training, incident reporting and assurance activities. Environmental risks and controls are monitored by operating businesses and reported through management and Board Committee governance processes as appropriate. Cyber and Information Security Kelsian like any business faces an ever-changing cyber security threat and needs to have adequate arrangements in place to prevent, detect and respond to such threats ensuring no loss of or disruption to our systems and data. The Group aligns with ISO 27001 (Information Security Management) and the ACSC (Australian Cyber Security Centre) Essential 8 Maturity Model. We have an established suite of technical controls and procedural solutions, as well as routine activities, such as cyber awareness training, to ensure levels of security and resilience are at the optimum level. Our security arrangements are routinely reviewed, through external and internal reviews, and upgraded or reinforced as necessary to ensure Kelsian remains resilient to existing, new and emerging cyber threats. Workforce & Talent Management Employee costs represent the largest operating cost of the Group. In addition to the management of the various financial aspects of employee costs, the Group also face challenges around talent management - recruitment, retention and training, regulatory compliance and industrial relations management. Failing to manage these appropriately could have adverse financial, reputational and operational impacts. Kelsian has a dedicated People & Culture team that provides governance, support and expertise across all workforce matters. Kelsian has implemented workforce strategies, policies and remuneration frameworks to attract, retain and motivate our people, whilst ensuring succession planning is in place for critical roles. Kelsian is also experienced in industrial relations management and regularly assess labour market changes to inform financial planning and contractual arrangements. Operational Resilience As a key element of a location’s infrastructure, prolonged and unplanned interruption to Kelsian’s operations could significantly impact the financial performance of the Group and its reputation. Whilst a number of these risks are outside our control, we need to ensure that we manage those within our control and our response to their occurrence in order to provide high levels of availability and reliability of our services and products. Kelsian has a range of controls and strategies in place to manage such risks, including incident and crisis management plans, business continuity plans, asset inspection and maintenance procedures, capital asset renewal programs, customer service training, compliance programs as well as appropriate insurances. This also includes an annual program of crisis and incident management exercises involving all layers up to and including the Kelsian Board.
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 10 Risk Description Mitigation Operational risks continued Technology Technology is a key enabler of organisational success and failure to appropriately invest in fit for purpose technology solutions can result in operational inefficiencies, inability to remain competitive and could have adverse financial and operational impacts. Kelsian continues to invest in technology to drive innovation and operational efficiency across all operating divisions. The Kelsian Group IT Strategy drives investment in technology and digital capability across the Group and is recognised as a pre-requisite to achieving our objectives. A dedicated team of IT professionals support the ongoing delivery and realisation of the Group IT Strategy. Artificial Intelligence Artificial Intelligence presents both opportunities and risks for Kelsian. Appropriate use of AI can improve productivity, operational efficiency, decision-making and innovation across the Group. However, unmanaged or inconsistent use of AI tools may expose Kelsian to data leakage, intellectual property breaches, privacy and regulatory non-compliance, vendor and cyber risk, inaccurate or biased outputs, operational disruption, industrial relations issues, financial loss and reputational damage. Kelsian has established and is currently implementing a Group-wide AI governance framework and supporting controls to guide the responsible adoption of AI, ensuring benefits are realised while risks are effectively managed. AI governance and risk management is aligned with, and supported by the Group’s cyber security, data governance, procurement and risk management frameworks. Environmental regulation The Group’s operations are subject to various Australian Commonwealth, State and Territory environmental regulations as well as certain environmental regulations applicable to USA, Jersey, United Kingdom and Singapore activities. The types of key activities subject to these regulations relate to emissions reporting, storage of fuels and hazardous substances, regulatory controls on water quality, marine parks, noise, and other impacts of operating transport. Each operating Division has an environmental management framework and supporting environmental management systems to manage these risks, maintain standards and ensure compliance with applicable regulatory and licence requirements. Environmental performance is monitored by site and business division and information about the Group’s performance is reported to and reviewed by divisional management, Group Executive and the Safety, Risk and Sustainability Committee. All of the public bus operations within the Group’s business units (does not apply to USA motorcoach operations) have achieved or are working towards certification to ISO14001:2015. Marine safety systems applicable to our marine businesses also apply a systematic approach to managing environmental impacts of our marine businesses. Significant changes in the state of affairs Tourism Portfolio Divestment On 24 February 2026, Kelsian entered into binding agreements with Journey Beyond (Experience Australia Group Pty Ltd ACN 614 713 003 and certain of its subsidiaries) for the sale of the Tourism Portfolio within the Marine and Tourism operating segment for an enterprise value of $161 million on a cash and debt free basis and subject to customary working capital adjustments, pursuant to sale agreements (subject to certain conditions precedent) for 100% of the shares in SeaLink Fraser Island Pty Ltd (and its subsidiaries KBRV Resort Operations Pty Ltd and KBRV Services Pty Ltd), Captain Cook Cruises Pty Ltd, SeaLink Marina Pty Ltd, Vyscot Pty Ltd, Avonward Pty Ltd, SeaLink Tasmania Pty Ltd, SeaLink Northern Territory Pty Ltd, and assets of the businesses operating the Adelaide Sightseeing and SeaLink Whitsundays businesses. The Transaction is subject to approval by the Australian Competition and Consumer Commission and Foreign Investment Review Board, change of control consents for key contracts and authorisations, as well as other customary conditions for a transaction of this nature. Subject to satisfaction of all conditions precedent, completion is expected to occur in the first half of FY27. There were no other significant changes in the state of affairs of the Group during the financial year. Matters subsequent to the end of the financial year A fully franked dividend of 10.0 cents per share was declared by Kelsian’s Directors on 26 August 2026, representing a total payment of $27,165,669 to be paid 21 October 2026 based on the current number of ordinary shares on issue. On 2 July 2026, Kelsian announced a joint bid led by its Australian marine division, SeaLink, and established Auckland-based ferry operator Belaire Ferries, had been selected by Auckland Transport to operate Auckland's Western Package ferry services following a competitive tender process. The new Auckland Transport ferry services contracts are scheduled to commence with six vessels on 1 July 2027 and have an initial term of seven years, with an option to extend for a further two years. Kelsian will acquire Belaire Ferries and as part of the contract commitments, Kelsian has undertaken to procure five new vessels costing approximately A$31 million for the network during the contract term.
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 11 On 25 August 2026, Kelsian and Journey Beyond agreed not to proceed with the sale of Sealink Rottnest (total consideration of $15.2 million on a cash and debt free basis, subject to customary working capital adjustments). The parties are continuing to work towards satisfying necessary regulatory conditions for divestment of the Tourism Portfolio excluding Sealink Rottnest, the transaction is expected to complete in 1HFY27. Apart from the dividend declared and matters discussed above, no other matter or circumstance has arisen since 30 June 2026 that has significantly affected, or may significantly affect the Group's operations, the results of those operations, or the Group's state of affairs in future financial years. Meetings of Directors The number of meetings of the Company's Board of Directors ('the Board') and of each Board Committee held during the year ended 30 June 2026, and the number of meetings attended by each Director during the period were: Board Meetings Special Board Meetings Finance and Audit Committee Safety, Risk and Sustainability Committee People, Culture and Remuneration Committee Nominations Committee Attended Attended Attended Attended Attended Attended Total Number of meetings held 8 8 3 4 5 1 Fiona Hele 8 8 - - - 1 Terry Dodd 7 6 - - - - Diane Grady AO 8 7 3 4 5 1 Jacqueline McArthur 8 8 - 3 5 1 Caroline Elliott 8 8 3 - 4D 1 Terry Sinclair (appointed 1-Sep- 2025)3 7 7 - 4 4D 1 Neil Smith (resigned 28-Feb-2026)2 5 8 - 2C - -A Lance Hockridge (resigned 31-Jul- 25)1 N/A 1 - N/A N/A N/A Held: represents the total number of meetings held during the financial year. Attended: represents the number of meetings attended by a Director. To the extent that Directors who are not members of the relevant Committee attend Committee meetings as guests from time to time their attendance is not recorded in the table above. (1) Lance Hockridge, eligible to attend 1 Special Board Meeting (2) Neil Smith, eligible to attend 5 Board Meetings, 8 Special Board Meetings (3) Terry Sinclair, eligible to attend 7 Board Meetings, 7 Special Board Meetings Committee Membership During the reporting period the Company had the following Committees with membership for the period as follows: (A) not eligible for any committee meetings (B) eligible to attend 1 committee meeting (C) eligible to attend 2 committee meetings (D) eligible to attend 4 committee meetings Finance and Audit Committee People, Culture and Remuneration Committee Caroline Elliott (Committee Chair) Jacqueline McArthur (appointed Committee Chair 1-Aug-25) Terry Dodd Diane Grady AO (Member since 1-Sep-22) Diane Grady AO Caroline Elliott (Member since 1-Sep-25) D Terry Sinclair (Member since 1-Sep-25) D Lance Hockridge (former Committee Chair - ceased 31-Jul-25) A
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KELSIAN GROUP LIMITED DIRECTORS' REPORT 30 June 2026 12 Safety, Risk and Sustainability Committee Nomination Committee Diane Grady AO (Committee Chair and Member since 1-Aug-25) Terry Dodd (Committee Chair) Jacqueline McArthur (Member since 22-Aug-24, Committee Chair until 31-Jul-25) All Non-Executive Directors as Members Terry Sinclair (Member since 1-Sep-25) D Lance Hockridge (ceased 31-Jul-25) A Neil Smith (ceased 28-Feb-26) C Neil Smith (ceased 28-Feb-26) B Caroline Elliott (ceased 31-Jul-25) A Terry Sinclair (appointed 1-Sep-25) B Lance Hockridge (ceased 31-Jul-25) A Shares under option At 30 June 2026, there were no options and 2,607,377 (2025: 2,015,623) performance rights outstanding to acquire ordinary shares in the Company. No options or performance rights to acquire shares or interests in the Company or a controlled entity were granted since the end of the financial year. During the year no options or performance rights were exercised by employees. Indemnity and insurance of officers The Company has indemnified the Directors and executives of the Company for costs incurred, in their capacity as a Director or executive, for which they may be held personally liable, except where there is a lack of good faith. During the financial year, the Company paid a premium in respect of a contract to insure the Directors and executives of the Company against a liability 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. The Company is party to Deeds of Indemnity in favour of each of the Directors, referred to in this report who held office during the year and certain officeholders of the Company. The indemnities operate to the full extent permitted by law and are not subject to a monetary limit. Kelsian is not aware of any liability having arisen, and no claims have been made, during or since the financial year ending 30 June 2026 under the Deeds of Indemnity. Indemnity and insurance of auditor To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young Australia, as part of the terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been made to indemnify Ernst & Young during or since the financial year. 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. Non-audit services Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the auditor are outlined in note 30 to the financial statements. The Directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another person or firm on the auditor's behalf), is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are of the opinion that the services as disclosed in note 30 to the financial statements do not compromise the external auditor's independence requirements of the Corporations Act 2001 for the following reasons: ● all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of the auditor; and ● none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants (including Independence Standards) issued by the Accounting Professional and Ethical Standards Board, including reviewing or auditing the auditor's own work, acting in a management or decision-making capacity for the Company, acting as advocate for the Company or jointly sharing economic risks and rewards. Rounding of amounts The Company is of a kind referred to in Corporations 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 that Corporations Instrument to the nearest thousand dollars, or in certain cases, the nearest dollar. Auditor's independence declaration A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this Directors' report.
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KELSIAN GROUP LIMITED LETTER FROM CHAIR OF PEOPLE, CULTURE AND REMUNERATION COMMITTEE 30 June 2026 13 Dear Shareholders, On behalf of the Board, it is my pleasure to present Kelsian's Remuneration Report for the financial year ended 30 June 2026 ('FY26'). This Report summarises Kelsian Group Limited's (‘Kelsian’ or the ‘Group’) remuneration framework, governance, and outcomes for Key Management Personnel (Executives and Non-Executive Directors) (‘KMP’). Our approach to KMP remuneration is to strengthen alignment between executive reward, the delivery of our strategic transformation and the creation of sustainable long-term shareholder value. We remain focused on remuneration that is competitive, clearly aligned to performance and strategy, underpinned by strong governance, and transparent to shareholders. In FY26, we strengthened the remuneration framework in response to shareholder feedback, with all previously announced changes now fully implemented. FY26: Record performance and strong strategic delivery Kelsian delivered a record result in FY26, with strong revenue and earnings growth across the Group. This performance reflects the management team’s disciplined execution of strategic priorities, effective capital management and the resilience of the Group’s operating model. Our financial measures focus executives on delivering strong earnings and making disciplined capital allocation decisions that generate strong risk-adjusted returns. The strength and breadth of this record performance are reflected in1: ● Revenue up 9% to $2,402.7 million; ● EBITDA up 8% to $298.0 million; ● NPATA up 10% to $96.6 million; ● NPAT up 17% to $63.5 million; ● Underlying EBITDA (adjusted for one-off costs associated with M&A and abnormal items) up 11% to $315.8 million; ● Underlying NPATA up 17% to $111.1 million; ● Net Operating Cashflow $220.1 million; and ● Fully franked final dividend 10.0 cents per share. (1) All comparative references are to the 12 months ended 30 June 2025 (FY25) unless otherwise stated. This financial performance was supported by strong strategic execution across the Group, with a number of significant achievements during the year. These included: ● The award and successful transition of the Ipswich and Logan bus services, the Group's first competitively tendered franchised bus contract in Queensland; ● The acquisition of South Wales Transport in the UK, further strengthening the Group's position ahead of bus franchising in the region; ● The successful renewal of two important South East Queensland ferry contracts by the Queensland Department of Transport; ● Continued organic growth in the USA through the award and commencement of new contracts; ● The successful delivery of Bankstown rail replacement bus services; ● The successful commencement of the Sentosa Development Corporation bus service contract in Singapore; ● The award of Liverpool City Region Combined Authority bus franchising contracts; and ● The extension of the Group's largest contract, the Sydney Region 6 Bus Services Contract. Together, these achievements demonstrate continued progress against the Group’s strategy, strengthening the quality and duration of the contract portfolio, expanding our positions in key markets and supporting sustainable long-term value creation for shareholders. Nothing matters more than the safety of our people and the passengers who travel with us. It is the first measure against which the Board assesses executive performance, and it sits ahead of every financial and commercial outcome in this report. In FY26 the Board held Executives to account for visible safety leadership, the identification and control of the critical risks capable of causing the greatest harm, and the continued strengthening of a culture in which every person is accountable for safety and confident to raise a concern. That focus is reflected in improved outcomes: ● Lost Time Injury Frequency Rate (LTIFR) 24% improvement on FY25. ● Total Recordable Injury Frequency Rate (TRIFR) 23% improvement on FY25. FY26 Remuneration outcomes FY26 Short Term Incentive (STI) As previously disclosed, FY26 is the first year in which 50% of any STI award finally determined will be paid in cash and 50% deferred into Restricted Rights under the Kelsian Group Rights Plan. This strengthens alignment with shareholders by ensuring executives share in the longer-term value created after the performance year, while supporting retention. The FY26 STI Plan was weighted 50% to financial objectives, 15% to safety, and 35% to other operational measures. The Group CEO’s overall STI scorecard outcome was 136.85% of target, equivalent to 91.24% of maximum and including the conditional amounts subject to further Board decision and transaction completion described below. This reflects an outstanding year of financial and strategic delivery. The Group financial component delivered 147.22% of target, only marginally below the maximum outcome of 150% and consistent with the record result.
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KELSIAN GROUP LIMITED LETTER FROM CHAIR OF PEOPLE, CULTURE AND REMUNERATION COMMITTEE 30 June 2026 14 Tragically, during the reporting period a passenger died in an incident involving our Australian bus operations. An independent external review is underway and, as at the date of this report, remains in progress and is yet to be concluded. The Board has therefore assessed the safety component of the STI as payable on a conditional basis. The Board awaits the outcome of the safety review to make a final deliberation on payment of the safety component of the STI. This will be disclosed in the FY27 Remuneration Report. Safety remains the Group’s highest priority. The Board continues to have confidence in Kelsian’s safety management framework and its programme of continuous improvement. Key safety indicators improved during the year, with LTIFR 24% lower than FY25 evidencing the Group’s ongoing commitment to safety. Executive KMP were also assessed against operational objectives aligned to their specific strategic priorities and accountabilities, reinforcing accountability for strategy execution and measurable business outcomes. During FY26, the Board assessed a combined Growth and Transformation objective, weighted at 20% for the Group CEO. It covered progressing the Tourism Portfolio divestment and preparing the marine business for its next phase of growth. At year-end, the Board recognised 50% of the assessed outcome for Growth and Transformation objectives achieved during the reporting period. Individual outcomes reflected each Executive KMP’s accountability for these outcomes. The remaining 50% of the assessed outcome will become payable only upon successful completion of the main Tourism Portfolio transaction, which is subject to regulatory approval. Overall, these outcomes reflect the Board’s balanced approach to recognising performance delivered during FY26 while maintaining appropriate discretion, governance and alignment with shareholder interests. FY24-FY26 Long Term Incentive (LTI) The FY24 Performance Rights were tested at the end of FY26. The EPS CAGR tranche achieved maximum vesting, reflecting strong earnings growth over the three-year measurement period. The TSR tranche did not vest because the positive TSR gateway was not met. The resulting overall LTI outcome was 50% of maximum number of rights. This outcome reinforces the Board's commitment to ensuring executive reward is directly aligned with sustainable performance and long- term shareholder value, where Executives are rewarded only where sustained performance is delivered, with unearned incentive opportunities lapsing where performance measures are not met. Further details for both STI and LTI outcomes are set out in Section 5 of this report. FY26 Remuneration Framework Changes We continue to evolve our remuneration framework and practices to ensure they remain fit for purpose, aligned with our strategy and stakeholder interests, and support the attraction, retention and motivation of high-calibre executives. Our focus is on maintaining a remuneration approach that responds to the changing needs of the Group, reinforces accountability for performance and transformation, and strengthens alignment between executive reward and the delivery of sustainable long-term shareholder value. Following the first strike against the FY24 Remuneration Report, the Board undertook a comprehensive review and engaged with shareholders. The resulting remuneration framework changes, implemented for FY26, include: ● Variable remuneration will account for a greater proportion of Total Remuneration and will be more weighted towards longer term elements; ● 50% of the FY26 STI award is deferred into Restricted Rights; ● Minimum Shareholding Requirements have been introduced; ● As presented at the 2025 AGM, the FY26 LTI includes a third performance measure, Return on Invested Capital (ROIC), equally weighted with the other two LTI measures. The EPS measure has also been revised to underlying NPATA and adjusted for acquisitions; and ● The ASX Small Ordinaries Index will be used for the FY26 TSR Benchmark when assessing LTI performance rights measures. Looking Ahead The People, Culture and Remuneration Committee and the Board continue to regularly engage with shareholders and proxy advisors to seek feedback. We have continued to benchmark and review our remuneration approach and practices to ensure they remain fit for purpose, align with our strategy and stakeholder interests, and enable us to attract and retain talented executives. As the Group continues to evolve, we will review our remuneration framework to ensure it remains appropriately structured and aligned with changes to the organisation, our strategic priorities and future needs. On behalf of the Board, I invite you to review our FY26 Remuneration Report and look forward to welcoming you to our Annual General Meeting in October 2026. Signed ____________________ Jacqueline McArthur Chair, People, Culture and Remuneration Committee Kelsian Group Limited Date: 26 August 2026
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 15 The Remuneration Report comprises of the following sections: 1. Key Management Personnel (KMP) 2. Remuneration Governance Remuneration Principles 3. Overview of Financial Performance 4. Remuneration Framework Remuneration Framework and Details for Executive KMP Short-Term Incentive Program Long-Term Incentive Program 5. Remuneration Outcomes Fixed Remuneration STI Outcomes LTI Outcomes 6. NED Remuneration 7. Contractual Arrangement and Statutory Remuneration 8. Equity Holdings of KMP Options Equity Rights Shareholdings The Remuneration Report forms part of the Directors’ Report and sets out the remuneration framework and arrangements of Kelsian Group Limited (‘Group’ or ‘Kelsian’) for the Key Management Personnel (‘KMP’) of the Group, for the purposes of the Corporations Act 2001 and Accounting Standards for the financial year ended 30 June 2026. This information has been audited as required by Section 308 (3A) of the Corporations Act 2001.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 16 1. KEY MANAGEMENT PERSONNEL (KMP) The KMP for the purposes of this Remuneration Report are those having the authority and responsibility for planning, directing, and controlling major activities of the Group, directly or indirectly, including any Director (whether Executive or otherwise) of Kelsian. The term ‘Executive KMP’ includes the Group Chief Executive Officer, and other Group Executives who are KMP. The following persons set out in the table below were KMP for the reporting period 1 July 2025 to 30 June 2026. Members of the People, Culture and Remuneration Committee (‘PCRC’) are identified in the last column. TABLE 1.1: KMP FROM 1 JULY 2025 TO 30 JUNE 2026 NON-EXECUTIVE DIRECTORS (NEDs) Name Role Appointed Term as KMP in FY26 PCRC Fiona Hele Chair, Non-Executive Director 13 September 2016 Appointed Chair on 1 July 2024 Full Terry Dodd Non-Executive Director 28 March 2011 Full Diane Grady AO Non-Executive Director 1 September 2022 Full Yes Jacqueline McArthur Non-Executive Director 15 January 2024 Full Committee Chair 1 Caroline Elliott Non-Executive Director 17 June 2024 Full Yes 2 Terry Sinclair Non-Executive Director 1 September 2025 Part Yes 3 Neil Smith Non-Executive Director 16 January 2020 (Resigned 28 February 2026) Part Lance Hockridge Non-Executive Director 1 July 2020 (Resigned 31 July 2025) Part Committee Chair 4 Jeffrey Ellison AM Chair, Non-Executive Director 9 July 2008 (Retired 1 July 2024) N/A EXECUTIVE KMP Name Role Appointed Term as KMP in FY26 Graeme Legh Group Chief Executive Officer 16 January 2020 Full Andrew Muir Group Chief Financial Officer and Joint Kelsian Secretary 9 January 2017 Full Donna Gauci Chief Executive Officer - SeaLink Marine and Tourism 11 October 2013 (Retired 30 June 2026) Full Michael McGee Chief Executive Officer - Transit Systems 12 December 2022 Full James (Brent) Maitland Chief Executive Officer AAAHI 9 June 2025 Full Donna Gauci retired from the position of Chief Executive Officer SeaLink Marine and Tourism, effective 30 June 2026, after more than 21 years with SeaLink. The Board recognises Donna’s substantial contribution to the company and thanks her for her long-standing service. NOTE: Clinton Feuerherdt was not classified as a KMP during FY26 after he stepped down from the role of Managing Director and Group Chief Executive Officer and transitioned into a Strategic Advisor position effective 1 April 2025. Following the review of the personnel classified as KMP for FY26, the role of Managing Director Singapore ceased to be classified by Kelsian as a KMP for the reporting period (1 July 2025 to 30 June 2026). (1) Appointed Committee Chair from 1 August 2025. (2) Appointed Committee Member from 1 September 2025. (3) Appointed Committee Member from 1 September 2025. (4) Ceased as a Committee Chair 31 July 2025.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 17 2. REMUNERATION GOVERNANCE Kelsian’s Remuneration governance is illustrated below. While the Board retains ultimate responsibility, Kelsian’s Remuneration Principles and Policies are overseen through the People, Culture and Remuneration Committee.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 18 2. REMUNERATION GOVERNANCE (continued) The People, Culture and Remuneration Committee operates under a Charter5 that outlines its structure and responsibilities. The Charter is available on the Kelsian corporate website (www.kelsian.com/our-governance). Membership of the People, Culture and Remuneration Committee during the period 1 July 2025 to 30 June 2026 was comprised of the following Non-Executive Directors (NEDs) and chaired by an independent NED for the entire year: Jacqueline McArthur Non-Executive Director, Independent (Committee Chair) (appointed 1 August 2025) Lance Hockridge Non-Executive Director, Independent (Committee Chair) (ceased 31 July 2025) Diane Grady AO Non-Executive Director, Independent Caroline Elliott Non-Executive Director, Independent (appointed to Committee on 1 September 2025) Terry Sinclair Non-Executive Director, Independent (appointed to Committee on 1 September 2025) The People, Culture and Remuneration Committee met regularly throughout the year. The Group Chief Executive Officer, Group Chief People and Culture Officer and Group Chief Legal and Risk Officer attend Committee meetings by invitation, where management input is required. However, Executive KMP are not present during discussions related to their own remuneration arrangements. Specialist tax and legal advice was obtained during FY26 on the compliance of terms of equity incentive rights offered to participants located in Australia, the United Kingdom, Singapore and the United States, to ensure compliance with applicable regulatory requirements in all jurisdictions. The People, Culture and Remuneration Committee follows protocols around the engagement and use of specialist external advisors to ensure compliance with the relevant executive remuneration legislation. The recommendations that the People, Culture and Remuneration Committee makes to the Board are based on its independent assessment of the information and advice provided by specialist external advisors. No remuneration recommendations as defined in Section 9B of the Corporations Act 2001 were received from any external party providing the services described above. (5) The Charter of the Committee was reviewed and amended on 23 June 2026 as part of the biennial review of all Committee charters. 3. OVERVIEW OF FINANCIAL PERFORMANCE Kelsian's FY26 performance reflected revenue and earnings growth across all operating divisions, supported by contract indexation, contract extensions and expansions, new contract wins, increased contributions from industrial workforce transportation services in the USA, ongoing rail replacement services in Australia and an improved result from Marine and Tourism. The Group also continued to streamline its operations and increase its exposure to long-term contracted transport services. During the year, Kelsian entered into binding agreements to divest its Tourism Portfolio6, with completion of the transaction anticipated to occur during the first half of FY27 after satisfaction of conditions customary for transaction of this nature including change of control consents, and regulatory approvals from the Australian Competition and Consumer Commission (ACCC) and Foreign Investment Review Board (FIRB). At 30 June 2026 completion of the transaction remained subject to conditions. Accordingly, the financial performance of the businesses comprising the Tourism Portfolio was included in the Group’s financial results for the full year ended 30 June 2026. Statutory NPATA for the year ended 30 June 2026 was $96.6 million, compared with $87.7 million in FY25. The statutory NPATA result includes $17.8 million of significant items, comprising $7.7 million of acquisition, transaction-related costs and other items and $10.1 million of Group system costs, together with the associated tax effect and one-off tax adjustments. (6) Refer Kelsian announcement of 24 February 2026 via ASX for a description of the businesses comprising the Tourism Portfolio and the transaction for sale of those businesses.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 19 3. OVERVIEW OF FINANCIAL PERFORMANCE (continued) Underlying Earnings Before Interest, Tax (EBIT), was $155.7 million compared to an underlying EBIT of $136.0 million for FY25, an increase of 14.5%. The reconciliation and treatment of significant items are set out in the Operating and Financial Review. Having regard to FY26 financial performance, cash flow and the Group's capital requirements, the Board determined a fully franked final dividend of 10.0 cents per share, resulting in a full-year dividend of 18.0 cents per share and a payout of 44.0% of underlying NPATA. Kelsian’s share price performance during FY26 was a total return of 24.74% for the 12 months ending 30 June 2026, compared with the S&P ASX300 which was a total return of 7.21% for the same period. TABLE 3.1 Kelsian’s financial performance as measured by statutory Earnings Before Interest Tax Depreciation and Amortisation (EBITDA), Earnings Before Interest and Tax (EBIT), Net Profit After Tax and before Amortisation (NPATA) from continuing operations, earnings per share, gross dividends paid, the dividend paid per share, and the share price at year-end. 30 June 2022 7 30 June 2023 30 June 2024 30 June 2025 30 June 2026 $'000 $'000 $'000 $'000 $'000 Revenue 1,297,400 1,417,800 2,016,811 2,208,909 2,402,713 EBITDA 157,800 130,500 265,035 277,176 297,984 EBIT 82,100 53,100 121,751 128,208 137,881 NPATA 71,500 41,400 92,149 87,696 96,571 Gross Dividend Paid 34,900 37,100 47,143 47,321 47,524 Earnings Per Share (cents) 24.20 9.10 21.50 20.10 23.40 Dividend Paid Per Share (cents) 16.50 17.00 17.50 17.50 18.00 Share Price ($ per share) 5.87 7.26 5.15 3.79 4.47 Group CEO Overall Outcomes8 STI Outcomes - % of maximum 85% 55.5% 75.3% 100% 91.24% LTI Outcomes - % of maximum 100%9 100%10 nil11 nil12 50% (7) Restated to reflect the change in accounting treatment. (8) For the period of FY22 to FY25 reflects the STI outcome for the former Managing Director and Group CEO. This reflects both financial and non-financial outcomes. (9) Vesting outcome of FY20-FY22 LTI. (10) Vesting outcome of FY21-FY23 LTI. (11) Vesting outcome of FY22-FY24 LTI. (12) Vesting ou tcome of FY23-FY25 LTI. 4. REMUNERATION FRAMEWORK Remuneration Framework Overview and Details for Executive KMP (i) Objectives Kelsian's remuneration framework is designed to attract and retain capable executives, align reward with performance and strategy, and deliver outcomes that are fair and defensible in light of shareholder experience. It is based on the following principles: ● Remuneration is at levels that are competitive with market rates to attract, motivate and retain high calibre candidates; fixed remuneration is market-competitive and reflects role scope, complexity and capability; ● Executives are incentivised to drive long-term sustainable growth and increase shareholder value; ● Having financial performance as a core component of the reward framework design; and ● Remuneration is consistent with Kelsian’s Remuneration Principles. The People, Culture and Remuneration Committee reviews remuneration mix, market positioning and outcomes each year and recommends proposed Executive KMP outcomes to the Board. The Board considers performance, risk, conduct and shareholder experience before determining final awards.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 20 4. REMUNERATION FRAMEWORK (continued) (ii) Components - Overview The Remuneration Framework has three components and is summarised below: Fixed Elements Variable Elements Fixed Annual Remuneration (FAR) Short Term Incentive (STI) Long Term Incentive (LTI) Who Participates Executive KMP and other members of the Executive Team. Executive KMP and other members of the Executive Team. Executive KMP and other members of the Executive Team. How it is delivered Cash Cash Equity (Restricted Rights) Equity (Performance Rights) How it works Base salary, superannuation, and non- monetary benefits (for example motor vehicle benefits) 50% paid in cash. 50% of the total STI award are paid in the form of restricted rights to Kelsian shares under the Kelsian Group Rights Plan. The rights are in the form of Performance Rights over Kelsian ordinary shares under the Kelsian Group Rights Plan for no consideration. When is it delivered Annually. Whilst the Fixed Annual Remuneration is reviewed annually, increases are not guaranteed. After the performance period, following the finalisation and release of financial results for the performance period. Rights for the deferred element awarded are offered for the FY26 performance period following the release of financial results for FY26. Subject to Shareholders approving the Group CEO Performance Rights will be granted on or about November, but in any event within 2 months of the AGM. What it does Enables Kelsian to motivate, engage and retain the calibre of executives that can execute the Company’s strategy and continue to deliver value to shareholders. Rewards execution on annual performance against a balanced scorecard of performance measures focused on financial (50%), safety outcomes (15%) and individual personal objectives aligned with the Company’s strategic goals (35%). STI deferral into equity creates further alignment with shareholders. Supports the sustainable delivery of the Group's long-term strategic objectives, aligns executive outcomes with shareholder interests, and promotes long-term value creation. Other Executive KMP may receive their FAR in the form of cash and other fringe benefits (for example motor vehicle benefits). Variable payments are “at-risk” components paid to Executive KMP when agreed targets have been met, however, are discretionary and do not form part of the employment contract. (iii) Minimum Shareholding Policy Introduced in FY25, the Board has implemented a Minimum Shareholding Requirement Policy which requires each member of the Board and Group Executive, including Executive KMP, to accumulate a minimum shareholding of Kelsian shares within five years from the later of 1 July 2024 or the date of their appointment. For the Board Chair, the minimum shareholding level to be achieved is 150% of the annual base board fee and for Non-Executive Directors, 100% of the annual base board fee. For the Group CEO this level is 150% of FAR and for Group Executives, 100% of FAR. The quantum was set at the time of implementation of the MSR Policy or upon appointment. (iv) Remuneration Mix The composition of each Executive KMP's remuneration opportunity for FY26 was designed to support the objectives of the Group's executive remuneration framework, as outlined in Section 4.1, with a focus on aligning remuneration to sustainable long-term shareholder value creation. The charts below illustrate the weighting of fixed remuneration, STI and LTI for the Group CEO and Group CFO based on both their target and maximum remuneration opportunity. They represent the intended remuneration mix and do not reflect actual remuneration received during FY26. The Board retains discretion to make necessary adjustments to ensure the remuneration mix and incentive outcomes are appropriate and aligned to shareholder returns.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 21 4. REMUNERATION FRAMEWORK (continued) Short-term = Short-term pay and benefits including Fixed Remuneration and Non-deferred STI awards. Deferred and Long-term = Long-term benefits including Deferred STI and LTI equity awards. The three-year LTI represents the 2026-2028 LTI which applies to the Group CEO, Group CFO and other Executive KMP. Further details are provided in section 4.5.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 22 4. REMUNERATION FRAMEWORK (continued) Fixed Annual Remuneration (FY26) Fixed annual remuneration comprises base salary and statutory or market-appropriate retirement benefits, including superannuation for Australian-based executives and equivalent retirement arrangements for international executives. Executive KMP may receive their Fixed Annual Remuneration in the form of cash and other fringe benefits (for example motor vehicle benefits) where it does not create any additional costs to Kelsian and provides additional value to Executive KMP. Short Term Incentive Program (FY26) The Kelsian Group STI Plan was established to reward Executive KMP and other members of the executive team for strong performance levels and contributions to the Group over a 12-month performance period. STI payments are awarded to Executive KMP based on specific annual financial and operational targets and the achievement of set objectives which include stretch targets for both financial, operational and non-financial goals. STI performance is assessed against a balanced scorecard comprised of a set of performance objectives, which drive the Group’s short-term financial, strategic and operational objectives and set the platform for long-term success. Kelsian’s key objectives include financial outcomes and safety, growth, and operational outcomes. STI is at-risk remuneration and does not form part of an Executive KMP's fixed remuneration contractual entitlement. FY26 is the first year in which 50% of any STI award finally determined will be paid in cash and 50% deferred into Restricted Rights, subject to the terms of the Kelsian Group Rights Plan. This strengthens ongoing alignment between executive reward and shareholder interests. STI remuneration paid varies by Executive KMP depending on the impact on the Group and the division, achievement of defined business targets, achievement of specific Division EBIT targets as well as the extent to which the Group achieved financial performance targets for the year. The Board considered these results in determining final outcomes. Further information about the 2026 STI Plan is set out below. Please refer to section 5.2 for STI performance outcomes for 2026. TABLE 4.4 EXECUTIVE SHORT-TERM INCENTIVE PROGRAM FY26 Performance period 1 July 2025 to 30 June 2026. Maximum STI opportunity (150% of Target) The maximum stretch opportunity for each performance objective was set at 150% of Target. For each performance measure, a threshold level of performance was also set. This level had to be met to receive any STI. Group CEO 102.0% of Fixed Annual Remuneration (68% at Target) Group CFO 76.5% of Fixed Annual Remuneration (51% at Target) Other Executive 42.0% - 75.0% of Fixed Annual Remuneration KMP (28% - 50% at Target) The actual outcome depends on the Executive KMPs actual achievement against each Performance Objective. Non-deferred element Subject to the Board's final determination, 50% of FY26 STI awards are paid in cash after release of the FY26 financial results. If any FY26 STI amounts awarded are conditional on events or outcomes that are not yet determined at time of release of the FY26 financial results, 50% of those amounts will be paid in cash as soon as practical after satisfaction of the relevant condition. Deferred element Subject to the Board's final determination, 50% of FY26 STI awards are delivered as Restricted Rights under the Kelsian Group Rights Plan after release of the FY26 financial results. If any FY26 STI amounts awarded are conditional on events or outcomes that are not yet determined at time of release of the FY26 financial results, 50% of those amounts will be paid in the form of Restricted Rights as soon as practical after satisfaction of the relevant condition. The deferred equity rights are fully vested at Grant Date and in the form of Restricted Rights (called Restricted Share Units for USA employees) granted to the Executive KMP under and subject to the terms of the Kelsian Group Rights Plan. For Restricted Rights issued during FY2026, the rights will be subject to an exercise restriction until 31 August 2027 and have no service requirement applicable. The quantum of Restricted Rights granted is calculated using the 10-day volume-weighted average price (VWAP) after the date of release of full-year results for the financial year applied to the deferred amount awarded.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 23 Board discretion Board discretion may be applied to remuneration for delivery of outstanding performance for Executive KMP that were not foreseen at the time of target formulation. Discretion can also be applied to reflect the impact of acquisitions, disposals, other external factors or unexpected financial impacts made in the prior year as well as during the year. The consideration and application of discretion will be disclosed. Gate The safety component accounts for 15% of the Target STI award. There is a specific safety gate that applies, and in the event of a ‘Catastrophic Incident or Event’ (fatality or permanent impairment/disability from injury/illness), the Board will assess all available information relating to the incident and determine if the safety gate will result in a 0% outcome for the safety components of the STI. The consideration and application of the STI safety gate will be disclosed. Performance measures Performance Objectives are specific targets to be achieved in connection with Kelsian’s Strategic goals. Actual STI payments awarded to each Executive KMP depend on the extent to which specific measures, targets, initiatives and conditions for the FY26 (STI Targets) were met. STI Targets cover financial, operational and individual measures of performance. The Board sets and assesses the Group CEO's objectives and approves the objectives and final outcomes for other Executive KMP on recommendation from the Group CEO. Financial Measures: Measures up to 50% target Performance Areas & Weightings Rationale for choosing this measure. Group Profit Incentive Group CEO & Group CFO = 50% All Other Executive KMP = 20% Divisional or Business Unit Profit Incentive All Other Executive KMP = 30% Financial performance is the measure of whether the Group is being run efficiently and creating value for shareholders, which is why it carries the largest weighting in the short-term incentive. The measure is underlying EBIT assessed against the prior year, so that reward follows a demonstrable improvement in performance rather than the level of earnings in any single year. The Group Chief Executive Officer and Group Chief Financial Officer are measured entirely on Group earnings, consistent with their accountability for the whole Group. Other Executive KMP are measured on a combination of Group and divisional earnings, aligning each executive with the results they directly control while retaining a shared interest in the Group outcome. (FY26 measures: Underlying EBIT outcomes measured against prior year outcomes) Operational and Non-Financial: Measures up to 50% target Performance Areas & Weightings Rationale for choosing this measure. Group Safety Group CEO = 15% All other Executive KMP 15% Kelsian delivers services across public roads, remote regions and marine environments in multiple jurisdictions, where operating conditions vary and require active management of safety risk. The safety of employees, customers and the public is a core executive accountability. The safety measure combines outcome and leadership indicators and is subject to the Safety gate described above. The FY26 scorecard assessed safety achievements using Lost Time Injury Frequency Rate, an outcome measure, and the Safety Leadership Index, a lead indicator of the leadership and engagement required to prevent harm. (FY26 Measures: LTIFR and Safety Leadership Survey outcomes)
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 24 Growth and Transformation Group CEO = 20% Other Executive KMP between 15% to 20% Growth and disciplined portfolio management support sustainable shareholder returns over time. In FY26, this measure focused on executing the Tourism Portfolio transaction and establishing a stronger, transport-focused position for future organic growth. This measure holds Executive KMP accountable for the divestment outcome, focused on progressing the sale on terms aligned with strategic objectives and shareholder value; and the Future Growth outcome, focused on operational and financial benefits expected for our next phase of growth. Performance is assessed having regard to the actions and outcomes within Executive KMP’s operational control. Where transaction completion depends on external conditions, the Board distinguishes management delivery achieved at year-end from the final completion outcome. The weighting varies across Executive KMP to reflect each role’s accountability for the Group’s growth, portfolio transformation and benefit realisation priorities. Operational Excellence Group CEO = 15% Other Executive KMP between 10% to 15% Operational excellence is how Kelsian converts its scale into stronger margins and more reliable service. This measure holds Executive KMP accountable for the operational initiatives that improve performance in the business they run efficiency, asset utilisation, service reliability and cost discipline assessed against business-specific operational and financial metrics. It complements the Group financial measure by rewarding the day-to-day execution that produces sustainable earnings, rather than the earnings result itself. Technology and Innovation Not applicable to the Group CEO. Other Executive KMP between 5% to 10% Investing in digital and data capabilities to enhance customer experience, drive innovation, strengthen customer attraction and retention, and safeguard the security and privacy of customer and employee information. Performance is assessed against whether the right solutions are integrated successfully to accelerate business growth and are market leading to underpin the long-term performance of Kelsian. (FY26 measures reflect achievement of selected projects and milestones) STI assessment The Board Chair reviews the Group CEO performance against the performance targets and objectives set for that year. The performance assessment of the Group CEO is reviewed by the People, Culture and Remuneration Committee and approved by the Board. The Group CEO assesses the performance of the other Executive KMP. The performance assessment of the other Executive KMP is reviewed by the People, Culture and Remuneration Committee and endorsed by the Board. End of Employment If the Executive’s KMP employment is terminated for cause, no STI will be paid. If the Executive KMP resigns before the end of the performance period or release of full-year financial accounts for the relevant performance period, the STI may be granted on a pro-rata basis in relation to the period of service completed, subject to the discretion of the Board and conditional upon the individual performance of the Executive KMP and taking into consideration the interests of Kelsian and its shareholders. Malus and Clawback The Board has the discretion to not pay or to reduce the amount of the STI otherwise payable, taking into consideration the interests of Kelsian and its shareholders. In the event of serious misconduct or a material misstatement in Kelsian’s financial statements, the Board may cancel the STI payment and may also clawback STI payments paid in previous financial years, to the extent this can be done in accordance with the applicable law.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 25 4. REMUNERATION FRAMEWORK (continued) Long-Term Incentive Program (FY26) To align the interests of Executive KMP with the creation of long-term shareholder value, Kelsian generally awards long-term incentives (LTI) in the form of Performance Rights. Performance Rights are granted at no cost to the executive and only vest if Kelsian meets specified performance hurdles. If an Executive KMP resigns before the Performance Rights have vested then any unvested rights are forfeited, unless and to the extent otherwise determined by the Board. Vesting conditions for Performance Rights are determined by the Board annually as part of each invitation with the conditions selected for Performance Rights being intended to create alignment with indicators of shareholder value creation over the measurement period. In response to feedback calling for the inclusion of a capital efficiency measure, the Board introduced Return on Invested Capital (ROIC) as a new FY26 LTI performance measure. ROIC performance hurdles will comprise 33.4% of the potential LTI opportunity, alongside EPS growth (33.3%) and TSR growth (33.3%), reinforcing the focus on disciplined capital management and long-term shareholder value. The ASX Small Ordinaries Index will be used for the FY26 TSR Benchmark when assessing the TSR performance rights measure. The Group CEO has a higher target LTI opportunity than Executive KMP, reflecting the broader accountability of the role for delivering the Group's long-term strategy, capital allocation and sustainable shareholder value creation. The remuneration mix will continue to be reviewed as part of the Board's regular assessment of executive remuneration. The Kelsian Group Limited Employee Share Trust was established in August 2022 to facilitate the acquisition and transfer of shares in Kelsian to eligible participants in accordance with Kelsian Group’s Rights Plan. The trustee of the Employee Share Trust changed to Pillar Custodial Services Pty Ltd ABN 37 097 300 377 from 19 December 2025, replacing the previous trustee Certane CT Pty Ltd ABN 12 106 424 088. Shareholder approval of the Kelsian Group Rights Plan was renewed at the 2025 AGM, with a vote in favour of 97.15%. This enables Kelsian to exempt issues of securities post the 2025 AGM under the Plan from the 15% limit on new securities issues, that may be made during any twelve-month period, pursuant to the ASX Listing Rules. Further information about the 2026 LTI Plan is set out below. Please refer to section 5.3 for LTI performance outcomes for 2026. TABLE 4.5 EXECUTIVE LONG-TERM INCENTIVE RIGHTS PLAN FY26 Maximum LTI Allocation Group CEO 102% of Fixed Annual Remuneration Group CFO 76% of Fixed Annual Remuneration Other Executive KMP 34% - 50% of Fixed Annual Remuneration LTI Instrument Awards are in the form of Performance Rights over ordinary shares in Kelsian for no consideration. The Performance Rights carry neither Rights to dividends nor voting. Measurement Period The LTI measurement period is three financial years commencing 1 July of each applicable financial year. Award timeline Awards are made annually at the discretion of the Board and were made to Executive KMP and others in FY26. Allocation methodology The number of rights is calculated by dividing this quantum by the face value of Kelsian shares (calculated as the 10-day volume-weighted average price (VWAP) following the release of full- year results for the financial year prior to the year of grant of rights) reduced by an estimated value in respect of dividends that may be paid on a Kelsian share during the measurement period. Performance conditions There are three tranches of Performance Rights with the following weighting of performance conditions, referred to as vesting conditions: Tranche 1: Earnings Per Share Compound Annual Growth Rate (EPS CAGR): 33.3% weighting at target performance. Tranche 2: Indexed Total Shareholder Return (iTSR): Total Shareholder Return (TSR) growth measured against the ASX Small Ordinaries Return Index, 33.3% weighting at target performance. Tranche 3: Return on Invested Capital (ROIC): 33.4% weighting at target performance. Overarching Gate for iTSR: Kelsian’s TSR must be positive. Subject to Board discretion, there is also a service-based condition that is met if employment with Kelsian is continuous for the period commencing on or around the grant date until the date the Performance Rights vest.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 26 What is EPS CAGR? EPS CAGR is a method for calculating the compound annual growth rate in the company’s earnings per common share. EPS CAGR will be calculated based on the Normalised EPS for the last year of the measurement period compared with the Normalised EPS for the financial year immediately prior to the commencement of the measurement period. Normalised EPS will be calculated based on Underlying Net Profit After Tax before Amortisation (NPATA) and will exclude the impacts of acquisitions made in the last year of the measurement period. What is iTSR? TSR is a method for calculating the return shareholders would earn if they held a notional number of shares over a period of time. iTSR measures the growth in a company’s share price together with the value of dividends during the period, assuming that all those dividends are reinvested into new shares. TSR CAGR is measured against the applicable index for Kelsian at the commencement of the first year of the measurement period for the Performance Rights. For Performance Rights issued during FY25 and FY24, this was the ASX200 Total Return Index reflecting Kelsian’s listing in the ASX200 Index between September 2021 and March 2025. This growth is measured against the total return of the ASX Small Ordinaries Index over the measurement period for Performance Rights issued during FY26. What is ROIC? Return on Invested Capital (ROIC) measures how efficiently the company allocates capital to generate profits. Returns are expected to at least exceed the company’s Weighted Average Cost of Capital (WACC) over time. Annual Group ROIC will be calculated as underlying Earnings Before Interest, Taxation and Amortisation (EBITA) divided by average Invested Capital. The average annual ROIC will be compared to the average pre-tax WACC over the measurement period. Why were the performance conditions selected? In selecting the performance conditions and the structure of the tranches the Board went through a process of consultation with external advisors, reviewing market trends and Kelsian’s strategic objectives in structuring the existing LTI plan. The Board reviews the performance conditions annually to determine the appropriate hurdles based on Kelsian’s strategy and prevailing market practice. Following its FY25 annual review of the most appropriate measures to align the interests of shareholders and management, the Board selected the following: • EPS CAGR as a measure of incentivising growth to reflect long-term growth yields for shareholders; and • TSR CAGR as an external measure of long-term return performance with the strongest link to shareholder returns; and • ROIC as a measure of how efficiently the company manages capital investments to create shareholder value.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 27 What level of performance is required for the Rights to vest? For Performance Rights granted in FY26, 33.3% of the Performance Rights will vest where the EPS CAGR performance is: EPS CAGR (annualised) of Kelsian Group CEO Executive KMP Percentage of Percentage of Performance Rights Performance Rights that vest that vest Less than 5% 5% Greater than 5% but less than 10% 10% and above Nil Nil 66.67% of Rights vest 50% of Rights vest Between 66.67% and Between 50% and 100% of Rights vest 100% of Rights vest 100% of Rights vest 100% of Rights vest For Performance Rights granted in FY26, 33.3% of the Performance Rights will vest where the TSR CAGR performance of Kelsian relative to the Total Return Index CAGR for the financial year in which the Performance Rights are granted is: TSR of Kelsian relative to ASX Small Ordinaries Total Return Index Group CEO Executive KMP Percentage of Percentage of Performance Rights Performance Rights that vest that vest Less than Index Return Index Return Greater than Index Return but less than 10% CAGR above Index Return Greater than or equal to Index Return + 10% CAGR above Index Nil Nil 66.67% of Rights vest 50% of Rights vest Between 66.67% and Between 50% and 100% of Rights vest 100% of Rights vest 100% of Rights vest 100% of Rights vest For Performance Rights granted in FY26, 33.4% of the FY26 Performance Rights will vest where the ROIC performance is as follows: Average annual Kelsian Group ROIC Group CEO Executive KMP Percentage of Percentage of Performance Rights Performance Rights that vest that vest Less than WACC+1% WACC+1% Greater than WACC+1% but less than WACC+2% WACC+2% Greater than WACC+2% but less than WACC+4% WACC+4% and above Nil Nil 33.33% of Rights vest 25% of Rights vest Between 33.33% and Between 25% and 66.67% Rights vest 50% Rights vest pro-rata pro-rata 66.67% of Rights vest 50% of Rights vest Between 66.67% and Between 50% and 100% of Rights vest 100% of Rights vest pro-rata pro-rata 100% of Rights vest 100% of Rights vest The average WACC that applied over the measurement period for assessment of ROIC performance requirements will be disclosed by the Board retrospectively as it will not be known at the time of grant.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 28 What happens to Performance Rights granted under the LTI Plan when an Executive ceases employment? If the Executive KMP’s employment is terminated for cause, or due to resignation, all unvested Performance Rights will lapse, unless the Board determines otherwise. In all other circumstances, unless the Board decides otherwise, a pro-rata portion of the Executive KMP’s Performance Rights, calculated in accordance with the proportion of the performance period that has elapsed, will remain on foot, subject to the performance condition as set by the Board. If and when the Performance Rights vest, shares will be allocated in accordance with the Plan Rules and any other condition of the grant. Can Kelsian apply malus or clawback to LTI awards? Where shares have been allocated to an Executive KMP and have been subsequently sold, require the Executive KMP to repay the net proceeds of such a sale to the extent this can be done in accordance with relevant laws. What happens in the event of a change in control? In the event of a change in control, the Board will exercise its discretion and determine the treatment of the unvested awards. 5. REMUNERATION OUTCOMES Fixed Annual Remuneration The Group CEO did not receive a fixed remuneration increase during FY26, having been appointed to the role in April 2025. The Board considered it appropriate to maintain the remuneration arrangements established on appointment, with remuneration to be reviewed as part of the Group's normal annual remuneration review cycle. During the period, for the annual remuneration review, Executive KMP received increases in fixed remuneration effective from the first full pay period post 1 July 2026. Increases ranged between 3.43% to 3.51% applied to Fixed Annual Remuneration. In determining the proposed increases the following factors were taken into account: the evolving scale and complexity of Group Executive roles, including global accountability, and the individual experience, capability, performance and contribution of each executive. During FY27, the Board will review the Executive Remuneration Framework to ensure it reflects the Group's evolving strategy following the completion of significant divestment activity. The review will consider whether performance objectives and remuneration outcomes appropriately support the next phase of the Group's strategy, including disciplined capital allocation, operational excellence, sustainable growth and long-term shareholder value creation. STI Outcomes Diagram 5.1 summarises the Group CEO's FY26 scorecard. Table 5.2 shows Executive KMP outcomes and separately identifies amounts not yet determined or conditional. For the STI objectives that were met, 50% of those amounts will be offered as Restricted Rights under the Kelsian Group Rights Plan, subject to exercise restrictions until 31 August 2027. Individual operational and non-financial STI measures for FY26 were established to drive the delivery of the Group's strategic priorities and key operational outcomes that support sustainable long-term value creation. These measures recognise that long-term shareholder value is achieved through the disciplined execution of strategic initiatives alongside strong financial performance. Individual performance objectives were tailored to each Executive KMP's area of accountability and included measures relating to operational excellence, customer outcomes, transformation, people leadership and strategic delivery. For FY26, these individual operational and non-financial measures represented 35% of the overall STI opportunity, providing an appropriate balance between financial outcomes and the successful execution of the Group's strategy.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 29 5. REMUNERATION OUTCOMES (continued) DIAGRAM 5.1: Group CEO FY26 Performance Objectives and Outcomes TABLE 5.1 Explanatory Notes: ● The STI for financial objective is awarded for threshold achievement of 95% of prior year underlying EBIT with a sliding scale of outperformance up to 115% of prior year underlying EBIT for a maximum award, capped at 150% of Target. ● A Safety Gate applies to the award of the Group Safety component. ● The STI for non-financial personal objectives for achievement of maximum award is capped at 150% of Target.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 30 5. REMUNERATION OUTCOMES (continued) Group CEO Performance Outcomes Summary Group EBIT FY26 EBIT performance exceeded target and was only marginally below stretch, reflecting a strong earnings result. The Board considered this outcome a key contributor to the overall STI assessment, consistent with the performance positioning illustrated in section 5.1. Group Safety The Group's FY26 LTIFR improved by 24% against FY25, achieving the stretch level for that metric. This result reflects the continued focus across the Group on strengthening safety leadership, embedding consistent safety practices, improving risk identification and hazard management, and reinforcing accountability at all levels of the organisation. The sustained improvement demonstrates that safety remains a core operational priority and highlights the effectiveness of initiatives implemented to reduce workplace injuries and foster a proactive safety culture across the Group. Tragically, during the reporting period, a passenger died in an incident involving our Australian bus operations. An independent external review is underway and, as at the date of this report, remains in progress and is yet to be concluded. The Board has therefore assessed the safety component of the STI as payable on a conditional basis. The Board awaits the outcome of the safety review to make a final deliberation on the payment of the safety component of the STI. This will be disclosed in the FY27 Remuneration Report. Growth and Transformation During FY26, management delivered against Growth and Transformation objectives spanning execution of the Tourism Portfolio divestment and the Group's continuing readiness for its next phase of growth. For the divestment component, the Board assessed progress in selling the Tourism Portfolio on terms aligned with the Group's strategic objectives and shareholder value, including the binding sale agreements entered into in February 2026. For the growth readiness component, the Board assessed management's progress in shaping a simpler, transport-focused business post-separation, and the steps taken toward realising the benefits expected to support future organic growth. Of the assessed award under the combined objectives, 50% of recognised delivery Growth and Transformation objectives achieved during the reporting period. The remaining 50% of the assessed outcome will become payable only upon completion of the main Tourism Portfolio transaction, which is currently subject to regulatory approval and other conditions. Until completion is confirmed, the amount will be retained by the Company. Operational Excellence Cost savings and efficiencies were achieved, with budget outperformance and margin improvement recorded. Outcomes fell short of maximum as certain integrations and system efficiencies are still being embedded across geographies, limiting delivery of full stretch expectations.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 31 5. REMUNERATION OUTCOMES (continued) TABLE 5.2 STI Remuneration Payable to Executive KMP for the current reporting period – STI achieved FY26 The table shows each Executive KMP's target and maximum opportunity, the assessed outcome by measure, amounts finally awarded and amounts forfeited. Amounts awarded on a conditional basis for FY26 STI safety and divestment objectives are included in the amounts reported below. Opportunity Financial Group and Divisional Financials Operational and Non-Financial Group Safety Operational and Non-Financial Individual Objectives Target STI Max STI Target Weight Achieved Forfeited Target Weight Achieved Forfeited Target Weight Achieved Forfeited Board Discre- tion % Target STI awarded STI $A awarded Exec KMP $ $ % % % % % % % % % % % $ Graeme Legh 612,000 918,000 50.0% 73.610% - 15.0% 22.500% - 35.0% 40.743% - - 136.8% 837,544 Andrew Muir 295,545 433,318 50.0% 73.610% - 15.0% 22.500% - 35.0% 39.040% - - 135.1% 399,422 Donna Gauci 136,220 204,330 50.0% 64.929% - 15.0% 7.500% 7.500% 35.0% 34.000% 1.000% - 106.4% 144,977 Michael McGee 147,700 221,550 50.0% 60.557% - 15.0% 18.750% - 35.0% 28.630% 6.370% - 107.9% 159,428 Brent Maitland 327,555 491,333 50.0% 74.444% - 15.0% 22.500% - 35.0% 39.500% - - 136.4% 446,929 TABLE 5.2 Explanatory Notes: ● 'Achieved' and 'Forfeited' represents the actual achieved and forfeited of the weighted performance measure out of Target 100%. In the example of Group Safety, this performance measure is weighted at 15% of the Target STI value. ● Amounts are included in the 'Achieved' column of the table for FY26 STI outcomes that have been awarded subject to conditions that if not fulfilled will result in those amounts not being paid. Where applicable to objectives of a KMP, those amounts are in connection with: - payment of the safety objective of the FY26 STI awards remains subject to further Board deliberation of the outcome of an external safety review that is not yet available as at the date of this report; and - 50% of the assessed outcome under the Growth and Transformation objective will become payable only upon completion of the main Tourism Portfolio divestment transaction. ● All values are shown in Australian Dollars for the purposes of this Remuneration Report. LTI Outcomes The LTI performance rights granted in FY24 consisted of potential vesting of rights after testing of two performance measure tranches: EPS CAGR annualised (50% weighting) and index TSR relative to the performance of the ASX200 Total Return Index (50% weighting). EPS CAGR (annualised) of Kelsian Percentage of Performance Rights that vest Less than 5% Nil 5% 50% of Rights vest Greater than 5% but less than 10% Between 50% and 100% of Rights vest 10% and above 100% of Rights vest TSR (annualised) of Kelsian relative to ASX200 Total Return Index (annualised) Percentage of Performance Rights that vest Less than Index TSR Nil Index TSR 50% of Rights vest Greater than Index TSR but less than 10% above Index TSR Between 50% and 100% of Rights vest pro-rata Greater than Index TSR + 10% 100% of Rights vest The overall outcome for the FY24 LTI award is 50% of maximum. For the FY24 Performance Rights, the EPS CAGR tranche was assessed using statutory NPATA and a 5.0% threshold. The outcome exceeded the maximum hurdle level and 100% of the EPS tranche has vested. The calculation of EPS CAGR for Kelsian is set to ensure that the measure is fit for purpose and reflects alignment with shareholder value creation. Accounting standards require Kelsian to recognise and amortise identifiable intangibles for acquisitions. The non-cash amortisation charge is excluded (i.e., added back) to statutory NPAT to determine EPS. Kelsian’s dividend policy specifically adds this non-cash amortisation chargeback when determining the dividend payout ratio. Assessment of the index TSR tranche shows that the Kelsian TSR for the period is negative. The Compound Annual Growth Rate (CAGR) of Kelsian’s share price during the three-year FY24-26 period was -26.98% compared with the CAGR of the S&P ASX200 which was 35.38%. The overarching gate of a positive shareholder return required for the TSR tranche was not achieved and consequently none of the TSR tranche for FY24 Performance Rights vested. The Board also retains the discretion to increase or decrease the extent of vesting in relation to each Tranche of Performance Rights if it forms the view that it is appropriate to do so given the circumstances that prevailed during the Measurement Period. No such discretion has been applied in relation to FY24 Performance Rights.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 32 Further details on the vested awards can be found in the table in Section 8. 6. NED REMUNERATION On appointment to the Board, all Non-Executive Directors enter into a contract for services with Kelsian in the form of a letter of appointment. The letter summarises the Board policies and terms, including compensation, relevant to the office of Director. To maintain their independence and impartiality, Non-Executive Directors’ rewards do not have any at-risk components. Fees and payments to Non-Executive Directors reflect the demands which are made on, and the responsibilities of, the Directors. Non-Executive Directors’ fees and payments are reviewed annually by the People, Culture and Remuneration Committee. For FY26, the Board Chair's fee increased by 3.79% to $283,942 per annum, inclusive of superannuation. The Board Chair does not receive additional fees for Committee participation. NED base and Committee fees increased by 3.96%, including the FY26 increase in the statutory Superannuation Guarantee rate for Australian Directors or the equivalent adjustment for overseas Directors. Committee Fees have been paid in addition to the base Board Member Fee for membership of specific Committees, excluding the Nomination Committee. Further details on the Board and Committee Fees can be found in the Table 6.2 below. TABLE 6.1: REMUNERATION FRAMEWORK AND DETAILS FOR NON-EXECUTIVE DIRECTORS (NEDs) Objectives The key objectives of Kelsian’s NED Remuneration Framework are to: • Secure and retain talented and qualified Directors – fee levels are set with regard to time commitment and workload, experience and expertise, risk and responsibility of the role, and market benchmarking of listed companies with a similar market capitalisation; • Promote independence and impartiality – fee levels do not vary according to the performance of the Group; and • Align Director and shareholder interests – Kelsian encourage its NEDs to build a long-term stake in the Group and Directors can acquire shares through acquisition on the market during permitted trading windows. Fee Structure Review NED fees are reviewed annually by the People, Culture and Remuneration Committee. The People, Culture and Remuneration Committee may, from time to time, receive advice from independent remuneration consultants to ensure NED fees and payments are appropriate and in line with the market. With respect to the NED Remuneration Principles, adopted by Kelsian, every two years a more detailed market review and benchmarking analysis of Director remuneration is undertaken including with appropriate use of external reports and input from independent remuneration experts. No review was undertaken in FY26. Fee Structure Non-Executive Directors receive fixed pay only, paid as director fees, and do not participate in any performance-based incentive plans. In addition, NEDs, excluding the Chair of the Board, receive Committee Chair and Membership fees for membership of specific Board Committees. Further details relating to the Committee Chair and Membership fees are set out in Table 6.2. Superannuation Compulsory superannuation guarantee contributions (SGC) are paid on the Director’s fee on behalf of all eligible NEDs. If a NED ceases to be eligible for SGC payments, the equivalent amount is paid in fees. Additional fees and reimbursements After considering the strategic importance of Board oversight of significant projects and initiatives, the Board may from time to time allocate additional responsibilities and commensurate fees to nominated directors. NEDs are entitled to be reimbursed for all business-related expenses. NEDs do not receive share options, rights, other incentives, or retirement benefits. Minimum Shareholding Requirement For the Board Chair this represents 150% of the annual base Board Fee. For Non-Executive Directors this represents 100% of the annual base Board Fee.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 33 Aggregate annual fee pool In accordance with Kelsian’s Constitution and ASX Listing Rules, the aggregate amount paid to all NEDs must not exceed the maximum determined and approved by shareholders in a General Meeting. The most recent determination of the maximum aggregate remuneration (‘pool’) for NEDs was at the Annual General Meeting of shareholders held on 24 October 2023, where the shareholders approved a pool of $1.75 million. The total Directors’ fees paid for FY26 were $1,232,231 which is less than the maximum approved pool. TABLE 6.2 BOARD AND COMMITTEE FEES FOR NEDs IN FY26 Chair13 Member Board/Committee $ $ Board base fee, including superannuation, per annum. 283,942 138,458 Safety, Risk and Sustainability Committee, including superannuation, per annum. 27,628 12,135 People, Culture and Remuneration Committee, including superannuation, per annum. 27,628 12,135 Finance and Audit Committee, including superannuation, per annum. 27,628 12,135 Nomination Committee14 nil nil (13) The Board Chair does not receive additional fees for Committee membership. (14) No fees are payable for membership of the Nomination Committee. 7. CONTRACTUAL ARRANGEMENTS AND STATUTORY REMUNERATION TABLE 7.1 GROUP CEO AND EXECUTIVE KMP EMPLOYMENT TERMINATION CONDITIONS Executive KMP Role Contract Type Fixed Annual Remuneration 30 June 2026 Notice Period by Kelsian Notice Period by Executive KMP Graeme Legh Group CEO Permanent Ongoing $900,000 6 Months 6 Months Andrew Muir Group CFO Permanent Ongoing $575,500 6 Months 6 Months Other Executive KMP - Permanent Ongoing - 6 Months 2-4 Months Termination Payment Executive KMP have termination benefits that are within the limit allowed by the Corporations Act 2001 without security holder approval. Where the Executive KMP is not employed for the full period of notice, a payment in lieu of notice may be made. The payment in lieu of notice is based on fixed remuneration unless other arrangements are required to align with applicable local employment legislation and rules.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 34 7. CONTRACTUAL ARRANGEMENTS AND STATUTORY REMUNERATION (continued) TABLE 7.2 NED REMUNERATION FOR THE YEARS ENDED 30 JUNE 2025 AND 30 JUNE 2026 Details of the nature and amount of each major element of the remuneration paid or payable to each Director are: Non- Executive Director Year Director fee 15 Short-term Incentive Non- Monetary Benefits Other Super- annuation Long-term Benefit LSL Perfor- mance Rights Total Fiona 2026 253,612 - - - 30,433 - - 284,045 Hele 2025 243,943 - - - 28,053 - - 271,996 Terry 2026 134,283 - - - 16,114 - - 150,397 Dodd 2025 129,730 - - - 14,919 - - 144,649 Diane 2026 167,115 - - - 20,054 - - 187,169 Grady AO 2025 140,029 - - - 16,103 - - 156,132 Jacqueline 2026 158,920 - - - 19,070 - - 177,990 McArthur 2025 153,330 - - - 17,633 - - 170,963 Caroline 2026 158,920 - - - 19,070 - - 177,990 Elliott 2025 153,023 - - - 17,598 - - 170,621 Terry 2026 117,911 - - - 14,149 - - 132,060 Sinclair16 2025 - - - - - - - - Lance 2026 16,557 - - - 1,987 - - 18,544 Hockridge17 2025 153,532 - - - 17,656 - - 171,188 Neil 2026 104,036 - - - - - - 104,036 Smith18 2025 144,467 - - - - - - 144,467 Jeffrey 2026 - - - - - - - - Ellison AM19 2025 4,548 - - - 523 - - 5,071 (15) Director fee is inclusive of both Board base fee and relevant Committee Membership Fees. (16) Appointed 1 September 2025. (17) Resigned 31 July 2025. (18) Resigned 28 February 2026. (19) Retired 1 July 2024. TABLE 7.3 EXECUTIVE KMP REMUNERATION FOR THE YEARS ENDED 30 JUNE 2025 AND 30 JUNE 2026 Details of the nature and amount of each major element of the remuneration paid or payable to each Executive are: Executive Director Year Salary Short-term Incentive Non- Monetary Benefits Other Super- annuation Long-term Benefit LSL Short-term Incentive - Restricted Rights Perfor- mance Rights20/21 Total Graeme 2026 868,629 418,772 - - 31,371 15,276 418,772 411,280 2,164,100 Legh 2025 1,076,275 420,109 1,527 - 11,023 97,330 206,919 (159,096) 1,654,087 Andrew 2026 548,752 199,711 - - 30,000 16,671 199,711 216,905 1,211,750 Muir 2025 528,014 184,317 - - 29,932 20,813 90,783 (41,858) 812,001 Donna22 2026 452,262 144,977 - - 30,000 11,409 - 19,701 658,349 Gauci 2025 455,452 72,209 - - 29,932 14,180 35,565 (14,078) 593,260 Michael 2026 496,830 79,714 - - 30,000 4,556 79,714 88,873 779,687 McGee 2025 478,804 88,041 - - 29,932 3,187 43,363 (37,197) 606,130 James (Brent) 2026 655,110 288,976 14,849 - - - 157,953 - 1,116,888 Maitland23 2025 26,952 - 76 - - - - - 27,028 Winston 2026 - - - - - - - - - Toh24/25 2025 637,911 100,564 - 11,989 19,116 - 49,531 (11,148) 807,963 Clinton26/27 2026 - - - - - - - - - Feuerherdt 2025 1,280,285 341,501 15,408 - 29,932 3,600 168,202 (147,980) 1,690,948
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 35 TABLE 7.3 Explanatory Notes: ● All values are shown in Australian Dollars for the purposes of this Remuneration Report. ● Non-monetary benefits represent the inclusion of reportable fringe benefits (such as the provision of motor vehicles). ● Short-term Incentive represents the cash component of the STI. STI cash is paid after the end of the financial year to which it relates but is allocated to the earning year. ● The balance of STI finally awarded is delivered as deferred STI. For FY26, this is 50% of the final financial and non-financial award. Amounts awarded on a conditional basis are included in the amounts reported above. ● Brent Maitland commenced employment in June 2025 on terms reflecting remuneration arrangements typical for his local jurisdiction, USA. Throughout FY26, the term of variable remuneration are being transitioned to STI deferral arrangement reflecting equity deferral applicable to all Kelsian KMP (50% of STI amounts paid). As a result of that transition period, deferral of equity for Mr Maitland's STI is at 35% of amounts paid for FY26. (20) The FY24 LTI PR grant did not fully meet the required hurdles and 50% of Performance Rights in connection with the measurement period FY24-FY26 are forfeited. As a result, the fair value previously expensed has been reversed. (21) The FY23 LTI PR grant did not meet the required hurdles and all Performance Rights in connection with the measurement period FY23-FY25 are forfeited. As a result, the fair value previously expensed has been reversed. (22) Donna Gauci retired 30 June 2026. As Ms Gauci is no longer an employee of Kelsian Group at the time of the proposed offer of restricted rights as part of her FY26 STI award, the Board determined that the FY26 STI payment would be settled wholly in cash. (23) James (Brent) Maitland is remunerated in US Dollars. (24) Winston Toh is remunerated in Singapore Dollars. Following the review of the personnel classified as KMP for FY26, the role of Managing Director Singapore ceased to be classified as KMP. (25) Other remuneration for FY25 relates to an additional cash payment of SGD $10,000 for Winston Toh in recognition for his achievements related to safety in FY24 and the ongoing benefit in FY25. (26) Clinton Feuerherdt was not classified as a KMP during FY26 after he stepped down from the role of Managing Director and Group Chief Executive Officer and transitioned into a Strategic Advisor position effective 1 April 2025. (27) Salary earnings noted in FY25 for Mr Feuerherdt also relate to long service leave entitlements paid out as at 31 March 2025. 8. EQUITY HOLDINGS OF KMP Options There were no options granted, awarded/forfeited, or exercised by KMP in FY25 or FY26. Equity Rights All equity transactions with KMP have been entered into under terms and conditions no more favourable than those Kelsian would have adopted if dealing on an arm's length basis. Equity rights in the form of Restricted Rights (called Restricted Share Units in the USA) are used to award equity to Executive KMP as part of the STI Plan. These types of Rights are fully vested at grant and subject to an exercise restriction of 12 months following the release of the Company’s full year results for the relevant financial year. The Restricted Rights will not be forfeited due to a cessation of employment event, such as resignation however they are subject to powers of forfeiture of the Board for unexercised rights. There were a total of 147,004 Restricted Rights issued in the 12-month period to 30 June 2026 with 75,333 of those being issued to Executive KMP. As of 30 June 2026, 155,012 Restricted Rights in total remained outstanding. Performance Rights (called Restricted Share Units with performance conditions in the USA) are generally granted to Executive KMP as part of an LTI Plan. When a participant ceases employment prior to the vesting of their Performance Rights or where the performance hurdle is not met, the Performance Rights are forfeited, unless and to the extent that the Board determines otherwise. Should all conditions be met, and rights exercised, one Ordinary Share is issued for each Restricted Right or Performance Right at no consideration. There were a total of 909,476 Performance Rights issued in the 12-month period to 30 June 2026 with 420,601 of those being issued to Executive KMP. As of 30 June 2026, 2,607,377 Performance Rights in total remained outstanding. There were no loans to Directors or Executive KMP during the 2026 financial year.
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 36 8. EQUITY HOLDINGS OF KMP (continued) TABLE 8.1: EQUITY RIGHTS HELD BY KMP FOR THE YEARS ENDED 30 JUNE 2025 AND 30 JUNE 2026 KMP Grant date Fair Value per right $ Rights on issue 30 June 2025 (number) Granted (number) Lapsed/ cancelled (number) Vested and exercised (number) Rights on issue 30 June 2026 Vesting date Graeme Legh FY23 LTI Performance Rights 27/09/2022 $3.1095 52,577 - (52,577) - - 31/08/2025 FY24 LTI Performance Rights 02/11/2023 $4.8080 102,525 - - - 102,525 31/08/2026 STI Restricted Rights 10/10/2023 $6.1273 7,273 - - (7,273) - 10/10/2023 FY25 LTI Performance Rights 30/10/2024 $2.3255 178,482 - - - 178,482 31/08/2027 STI Restricted Rights 08/10/2024 $3.7014 42,768 - - (42,768) - 08/10/2024 FY26 LTI Performance Rights 11/11/2025 $5.0373 - 205,163 - - 205,163 31/08/2028 STI Restricted Rights 12/11/2025 $4.9995 - 41,388 - - 41,388 12/11/2025 Total 383,625 246,551 (52,577) (50,041) 527,558 Total $ 1,240,387 KMP Grant date Fair Value per right $ Rights on issue 30 June 2025 Granted (number) Lapsed/ cancelled (number) Vested and exercised (number) Rights on issue 30 June 2026 Vesting date Andrew Muir FY23 LTI Performance Rights 27/09/2022 $3.1095 28,894 - (28,894) - - 31/08/2025 FY24 LTI Performance Rights 02/11/2023 $4.1880 27,455 - - - 27,455 31/08/2026 STI Restricted Rights 10/10/2023 $6.1273 6,931 - - (6,931) - 10/10/2023 FY25 LTI Performance Rights 30/10/2024 $2.3255 91,318 - - - 91,318 31/08/2027 STI Restricted Rights 08/10/2024 $3.7014 20,142 - - (20,142) - 08/10/2024 FY26 LTI Performance Rights 11/11/2025 $5.0376 - 98,429 - - 98,429 31/08/2028 STI Restricted Rights 29/09/2025 $4.9995 - 18,158 - - 18,158 01/09/2026 Total 174,740 116,587 (28,894) (27,073) 235,360 Total $ 586,627 KMP Grant date Fair Value per right $ Rights on issue 30 June 2025 Granted (number) Lapsed/ cancelled (number) Vested and exercised (number) Rights on issue 30 June 2026 Vesting date Donna Gauci28 FY23 LTI Performance Rights 27/09/2022 $3.1095 14,852 - (14,852) - - 31/08/2025 FY24 LTI Performance Rights 02/11/2023 $4.8080 13,823 - - - 13,823 31/08/2026 STI Restricted Rights 10/10/2023 $6.1273 3,744 - - (3,744) - 10/10/2023 FY25 LTI Performance Rights 30/10/2024 $2.3255 37,865 - - - 37,865 31/08/2027 STI Restricted Rights 08/10/2024 $3.7014 4,648 - - (4,648) - 08/10/2024 STI Restricted Rights 29/09/2025 $4.9995 - 7,114 - - 7,114 01/09/2026 Total 74,932 7,114 (14,852) (8,392) 58,802 Total $ 35,566
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 37 8. EQUITY HOLDINGS OF KMP (continued) KMP Grant date Fair Value per right $ Rights on issue 30 June 2025 (number) Granted (number) Lapsed/ cancelled (number) Vested and exercised (number) Rights on issue 30 June 2026 Vesting date Michael McGee FY23 LTI Performance Rights 06/12/2022 $3.4910 14,139 - (14,139) - - 31/08/2025 FY24 LTI Performance Rights 02/11/2023 $4.8080 23,181 - - - 23,181 31/08/2026 STI Restricted Rights 10/10/2023 $6.1273 589 - - (589) - 10/10/2023 FY25 LTI Performance Rights 30/10/2024 $2.3255 48,696 - - - 48,696 31/08/2027 STI Restricted Rights 08/10/2024 $3.7014 8,008 - - - 8,008 08/10/2024 FY26 LTI Performance Rights 11/11/2025 $5.0376 - 40,083 - - 40,083 31/08/2028 STI Restricted Rights 29/09/2025 $4.9995 - 8,673 - - 8,673 01/09/2026 Total 94,613 48,756 (14,139) (589) 128,641 Total $ 245,283 KMP Grant date Fair Value per right $ Rights on issue 30 June 2025 (number) Granted (number) Lapsed/ cancelled (number) Vested and exercised (number) Rights on issue 30 June 2026 Vesting date James (Brent) Maitland FY26 LTI Performance Rights 11/11/2025 $5.0376 - 76,926 - - 76,926 31/08/2028 Total - 76,926 - - 76,926 Total $ 387,522 KMP Grant date Fair Value per right $ Rights on issue 30 June 2025 (number) Granted (number) Lapsed/ cancelled (number) Vested and exercised (number) Rights issued to KMP as at 30 June 2025 and remaining on issue as at 30 June 2026 (number) Vesting date Winston Toh29 FY23 LTI Performance Rights 27/09/2022 $3.4910 6,301 - (6,301) - - 31/08/2025 FY24 LTI Performance Rights 02/11/2023 $4.8080 5,661 - - - 5,661 31/08/2026 STI Restricted Rights 10/10/2023 $6.1273 1,312 - - (1,312) - 10/10/2023 FY25 LTI Performance Rights 30/10/2024 $2.3255 23,107 - - - 23,107 31/08/2027 STI Restricted Rights 08/10/2024 $3.7014 9,155 - - - 9,155 08/10/2024 Total 45,536 - (6,301) (1,312) 37,923 Total $ -
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 38 8. EQUITY HOLDINGS OF KMP (continued) KMP Grant date Fair Value per right $ Rights on issue 30 June 2025 (number) Granted (number) Lapsed/ cancelled (number) Vested and exercised (number) Rights issued to KMP as at 30 June 2025 and remaining on issue as at 30 June 2026 (number) Vesting date Clinton Feuerherdt30 FY23 LTI Performance Rights 06/12/2022 $3.1095 109,622 - (109,622) - - 31/08/2025 FY24 LTI Performance Rights 23/11/2023 $4.8080 104,162 - - - 104,162 31/08/2026 STI Restricted Rights 23/11/2023 $6.1273 18,031 - - (18,031) - 23/11/2023 FY25 LTI Performance Rights 19/11/2024 $2.4120 259,088 - - - 259,088 31/08/2027 STI Restricted Rights 19/11/2024 $3.7014 48,005 - - - 48,005 19/11/2024 Total 538,908 - (109,622) (18,031) 411,255 Total $ - TABLE 8.1 Explanatory Notes: ● FY23 LTI Performance Rights Lapsed on 28 August 2024. ● 50% (TSR Tranche) of F Y24 LTI Performance Rights to be cancelled following release of audited financial results for FY26. ● Where a person was a KMP in FY25 but is no longer a KMP for FY26 the table shows changes to their equity rights on issue whilst they were a KMP but does not include any new rights issued during FY26. ● A fair value cannot be assigned to Restricted Rights until after the applicable VWAP period prior to their issue. (28) Retired 30 June 2026. (29) Following the review of the personnel classified as KMP for FY26, the role of Managing Director Singapore ceased to be classified as KMP. (30) Clint on Feuerherdt stepped down from the role of Managing Director and Group Chief Executive Officer and transitioned into a Strategic Advisor position effective 1 April 2025. Shareholdings TABLE 8.2: SHAREHOLDINGS HELD BY KMP FOR THE YEARS ENDED 30 JUNE 2025 AND 30 JUNE 2026 Balance 30 June 2025 ^ Rights exercised Acquired / (Sold) Balance 30 June 2026 # Non-Executive Directors Fiona Hele 125,387 - - 125,387 Terry Dodd 5,846,439 - (39,715) 5,806,724 Diane Grady AO 35,337 - 1,426 36,763 Jacqueline McArthur 70,000 - 2,824 72,824 Caroline Elliott 10,000 - - 10,000 Terry Sinclair - - - - Lance Hockridge31 111,765 - (96,101) 15,664 Neil Smith32 24,305,622 - (1,325,194) 22,980,428 Jeffrey Ellison AM33 5,429,583 - Executive KMP - - - - Graeme Legh34 415,974 42,768 (1,306) 457,436 Andrew Muir 217,855 20,142 - 237,997 Donna Gauci35 70,184 4,648 465 75,297 Michael McGee 589 - 23 612 James (Brent) Maitland 93,000 - - 93,000 Winston Toh36 37,348 - - - Clint on Feuerherdt37 6,352,997 - - - TOTAL 43,122,080 67,558 (1,457,578) 29,912,132
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KELSIAN GROUP LIMITED REMUNERATION REPORT 30 June 2026 39 ^ The balance reflects the number of shares held as of 1 July 2025. # The balance reflects the number of shares held as of 30 June 2026. (31) Resigned 31 July 2025. (32) Retired 28 February 2026. (33) Retired 1 July 2024. This was the balance as at the end of 30 June 2025 while KMP. (34) 11,178 shares sold on conversion for remittance of tax payable on conversion in relevant foreign jurisdiction. (35) Retired 30 June 2026. (36) Following the review of the personnel classified as KMP for FY26, the role of Managing Director Singapore ceased to be classified as KMP. This was the balance as at the end of 30 June 2025 while KMP. (37) Clinton Feuerherdt stepped down from the role of Managing Director and Group Chief Executive Officer and transitioned into a Strategic Advisor position effective 1 April 2025. This was the balance as at the end of 30 June 2025 while KMP. Disclosures required in the Remuneration Report by the Corporations Act, particularly the inclusion of accounting values for LTI Performance Rights awarded but not vested, can vary significantly from the remuneration actually paid to Executives. This is because Accounting Standards require a value to be placed on the Performance Rights at the time it is granted to an Executive and then reported as remuneration even if ultimately the Executive does not receive any actual value, for example, because performance conditions are not met, and the Performance Rights do not vest. Signed in accordance with a resolution of the Directors. On behalf of the Directors ____________________ Jacqueline McArthur Chair, People, Culture and Remuneration Committee Kelsian Group Limited Date: 26 August 2026
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40 Auditor’s Independence Declaration to the Directors of Kelsian Group Limited As lead auditor for the audit of the financial report of Kelsian Group Limited and for the review of the selective sustainability information in the sustainability report for the financial year ended 30 June 2026, I declare to the best of my knowledge and belief, there have been: a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit and review; b. No contraventions of any applicable code of professional conduct in relation to the audit and review; and c. No non-audit services provided that contravene any applicable code of professional conduct in relation to the audit and review. This declaration is in respect of Kelsian Group Limited and the entities it controlled during the financial year. Nigel Stevenson Partner 26 August 2026 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Ernst & Young
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KELSIAN GROUP LIMITED CONTENTS 30 June 2026 41 Statement of profit or loss ......................................................................................................................................................................42 Statement of other comprehensive income............................................................................................................................................43 Statement of financial position ...............................................................................................................................................................44 Statement of changes in equity..............................................................................................................................................................46 Statement of cash flows.........................................................................................................................................................................47 Notes to the financial statements...........................................................................................................................................................48 Note 1. Material accounting policy information .................................................................................................................................48 Note 2. Critical accounting judgements, estimates and assumptions ...............................................................................................54 Note 3. Operating segments .............................................................................................................................................................55 Note 4. Revenue from contracts with customers ..............................................................................................................................57 Note 5. Other income ........................................................................................................................................................................58 Note 6. Income tax ............................................................................................................................................................................58 Note 7. Cash and cash equivalents ..................................................................................................................................................59 Note 8. Trade and other receivables.................................................................................................................................................60 Note 9. Inventories ............................................................................................................................................................................61 Note 10. Other assets .......................................................................................................................................................................61 Note 11. Non-current assets classified as held for sale ....................................................................................................................61 Note 12. Property, plant and equipment ...........................................................................................................................................62 Note 13. Right-of-use assets.............................................................................................................................................................63 Note 14. Intangibles ..........................................................................................................................................................................64 Note 15. Trade and other payables...................................................................................................................................................66 Note 16. Contract liabilities ...............................................................................................................................................................67 Note 17. Borrowings..........................................................................................................................................................................67 Note 18. Borrowings - ringfenced finance facilities ...........................................................................................................................68 Note 19. Lease liabilities ...................................................................................................................................................................69 Note 20. Derivative financial liabilities...............................................................................................................................................69 Note 21. Employee benefits ..............................................................................................................................................................70 Note 22. Provisions ...........................................................................................................................................................................70 Note 23. Other liabilities ....................................................................................................................................................................71 Note 24. Issued capital......................................................................................................................................................................71 Note 25. Reserves ............................................................................................................................................................................72 Note 26. Non-controlling interest.......................................................................................................................................................73 Note 27. Dividends............................................................................................................................................................................73 Note 28. Financial instruments..........................................................................................................................................................74 Note 29. Key management personnel disclosures............................................................................................................................78 Note 30. Remuneration of auditors ...................................................................................................................................................79 Note 31. Commitments .....................................................................................................................................................................80 Note 32. Related party transactions..................................................................................................................................................80 Note 33. Parent entity information.....................................................................................................................................................81 Note 34. Business combinations.......................................................................................................................................................82 Note 35. Interests in subsidiaries ......................................................................................................................................................83 Note 36. Interests in joint ventures....................................................................................................................................................85 Note 37. Deed of cross guarantee ....................................................................................................................................................85 Note 38. Events after the reporting period ........................................................................................................................................86 Note 39. Reconciliation of profit after income tax to net cash from operating activities ....................................................................87 Note 40. Earnings per share .............................................................................................................................................................87 Note 41. Share-based payments ......................................................................................................................................................88 Consolidated entity disclosure statement...............................................................................................................................................90 Directors' declaration .............................................................................................................................................................................93 Independent auditor's report to the members of Kelsian Group Limited................................................................................................94 Sustainability report................................................................................................................................................................................99 Independent auditor’s review report to the members of Kelsian Group Limited - Sustainability Report ..............................................111 General information The financial statements cover Kelsian Group Limited as the consolidated entity (referred to hereafter as 'Group' or 'Kelsian') consisting of Kelsian Group Limited and the entities it controlled at the end of, or during, the year. The financial statements are presented in Australian dollars, which is Kelsian's functional and presentation currency. Kelsian is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is: Level 3, 26 Flinders Street, Adelaide SA 5000 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. The financial statements were authorised for issue, in accordance with a resolution of Directors, on 26 August 2026. The Directors have the power to amend and reissue the financial statements.
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KELSIAN GROUP LIMITED STATEMENT OF PROFIT OR LOSS For the year ended 30 June 2026 Consolidated Note 2026 2025 $'000 $'000 The above statement of profit or loss should be read in conjunction with the accompanying notes 42 Revenue from contracts with customers 4 2,402,713 2,208,909 Other income 5 17,248 15,965 Interest income 4,111 4,209 Expenses Direct operating expenses: Direct wages (1,237,068) (1,138,521) Repairs and maintenance (164,128) (149,413) Fuel (180,245) (168,371) Subcontractor services (32,318) (36,547) Commission (14,044) (12,708) Meals and beverage (18,990) (18,163) Tour costs (10,718) (12,007) Depreciation (92,244) (89,933) Depreciation - ROUA (34,813) (25,833) Other direct expenses (152,311) (125,178) Administration expenses: Indirect wages (174,725) (166,764) General and administration (106,730) (106,319) Marketing (11,342) (8,559) Financing charges (62,097) (63,986) Amortisation (33,046) (33,202) Acquisition and transaction costs (19,358) (5,148) Total expenses (2,344,177) (2,160,652) Profit before income tax expense 79,895 68,431 Income tax expense 6 (16,370) (13,937) Profit after income tax expense from continuing operations 63,525 54,494 Profit after income tax expense for the year attributable to the owners of Kelsian Group Limited 63,525 54,494 Cents Cents Earnings per share for profit attributable to the owners of Kelsian Group Limited Basic earnings per share 40 23.4 20.1 Diluted earnings per share 40 23.2 20.0
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KELSIAN GROUP LIMITED STATEMENT OF OTHER COMPREHENSIVE INCOME For the year ended 30 June 2026 Consolidated 2026 2025 $'000 $'000 The above statement of other comprehensive income should be read in conjunction with the accompanying notes 43 Profit after income tax expense for the year attributable to the owners of Kelsian Group Limited 63,525 54,494 Other comprehensive (loss)/profit Items that may be reclassified subsequently to profit or loss Net change in the fair value of cash flow hedges taken to equity, net of tax 5,232 (5,206) Foreign currency translation of foreign operations, net of tax (30,033) 21,214 Other comprehensive (loss)/profit for the year, net of tax (24,801) 16,008 Total comprehensive income for the year attributable to the owners of Kelsian Group Limited 38,724 70,502
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KELSIAN GROUP LIMITED STATEMENT OF FINANCIAL POSITION As at 30 June 2026 Consolidated Note 2026 2025 $'000 $'000 The above statement of financial position should be read in conjunction with the accompanying notes 44 Assets Current assets Cash and cash equivalents 7 176,330 182,784 Trade and other receivables 8 256,938 232,869 Inventories 9 35,134 34,340 Derivative financial assets 157 - Current tax asset 76 - Other assets 10 34,206 30,266 502,841 480,259 Non-current assets classified as held for sale 11 5,751 - Total current assets 508,592 480,259 Non-current assets Property, plant and equipment 12 890,166 876,185 Right-of-use assets 13 178,960 170,863 Intangibles 14 915,493 958,863 Other assets 10 13,891 13,303 Total non-current assets 1,998,510 2,019,214 Total assets 2,507,102 2,499,473 Liabilities Current liabilities Trade and other payables 15 88,153 95,576 Contract liabilities 16 15,137 15,576 Borrowings - ringfenced finance facilities 18 9,838 10,232 Lease liabilities 19 42,313 22,925 Derivative financial liabilities 20 262 2,149 Current tax liabilities - 3,158 Employee benefits 21 127,731 120,981 Provisions 22 46,763 49,291 Other liabilities 23 112,655 90,643 Total current liabilities 442,852 410,531 Non-current liabilities Borrowings 17 801,903 806,321 Borrowings - ringfenced finance facilities 18 68,873 78,718 Lease liabilities 19 132,694 143,712 Derivative financial liabilities 20 277 5,707 Deferred tax liabilities 6 87,412 83,115 Employee benefits 21 9,025 7,871 Provisions 22 10,341 4,608 Other liabilities 23 1,111 975 Total non-current liabilities 1,111,636 1,131,027 Total liabilities 1,554,488 1,541,558
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KELSIAN GROUP LIMITED STATEMENT OF FINANCIAL POSITION As at 30 June 2026 Consolidated Note 2026 2025 $'000 $'000 The above statement of financial position should be read in conjunction with the accompanying notes 45 Net assets 952,614 957,915 Equity Issued capital 24 860,118 859,620 Reserves 25 12,055 33,855 Retained profits 80,438 64,437 Equity attributable to the owners of Kelsian Group Limited 952,611 957,912 Non-controlling interest 26 3 3 Total equity 952,614 957,915
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KELSIAN GROUP LIMITED STATEMENT OF CHANGES IN EQUITY For the year ended 30 June 2026 The above statement of changes in equity should be read in conjunction with the accompanying notes 46 Issued Retained Non- controlling capital Reserves profits interest Total equity Consolidated $'000 $'000 $'000 $'000 $'000 Balance at 1 July 2024 853,179 16,927 57,264 3 927,373 Profit after income tax expense for the year - - 54,494 - 54,494 Other comprehensive income for the year, net of tax - 16,008 - - 16,008 Total comprehensive income for the year - 16,008 54,494 - 70,502 Transactions with owners in their capacity as owners: Share-based payments - non cash (note 41) - 1,098 - - 1,098 Employee rights converted (note 41) 25 (178) - - (153) Dividend reinvestment plan 6,416 - - - 6,416 Dividends paid (note 27) - - (47,321) - (47,321) Balance at 30 June 2025 859,620 33,855 64,437 3 957,915 Issued Retained Non- controlling capital Reserves profits interest Total equity Consolidated $'000 $'000 $'000 $'000 $'000 Balance at 1 July 2025 859,620 33,855 64,437 3 957,915 Profit after income tax expense for the year - - 63,525 - 63,525 Other comprehensive loss for the year, net of tax - (24,801) - - (24,801) Total comprehensive (loss)/profit for the year - (24,801) 63,525 - 38,724 Transactions with owners in their capacity as owners: Share-based payments - non cash (note 41) - 3,001 - - 3,001 Dividend reinvestment plan 498 - - - 498 Dividends paid (note 27) - - (47,524) - (47,524) Balance at 30 June 2026 860,118 12,055 80,438 3 952,614
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KELSIAN GROUP LIMITED STATEMENT OF CASH FLOWS For the year ended 30 June 2026 Consolidated Note 2026 2025 $'000 $'000 The above statement of cash flows should be read in conjunction with the accompanying notes 47 Cash flows from operating activities Receipts from customers 2,372,345 2,224,754 Payments to suppliers and employees (inclusive of net GST) (2,097,019) (1,953,565) Interest received 4,111 4,209 Other income 15,710 14,581 Interest and other finance costs paid (62,097) (63,985) Income taxes paid (12,988) (20,822) Net cash from operating activities 39 220,062 205,172 Cash flows from investing activities Payments for purchase of business, net of cash acquired 34 (3,594) (2,957) Payments for property, plant and equipment 12 (130,164) (164,502) Payments for intangibles 14 (10,844) (578) Proceeds from disposal of property, plant and equipment 7,954 27,566 Net cash used in investing activities (136,648) (140,471) Cash flows from financing activities Drawdown of facilities 5,720 57,548 Payments for leases (31,930) (24,453) (Repayment)/drawdown of special purpose vehicle financing (14,816) (11,725) Dividends paid 27 (47,026) (40,905) Net cash used in financing activities (88,052) (19,535) Net (decrease)/increase in cash and cash equivalents (4,638) 45,166 Cash and cash equivalents at the beginning of the financial year 182,784 134,470 Effects of exchange rate changes on cash and cash equivalents (1,816) 3,148 Cash and cash equivalents at the end of the financial year 7 176,330 182,784
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 48 Note 1. Material accounting policy information The accounting policies that are material to the Group are set out below. The accounting policies adopted are consistent with those of the previous financial year, unless otherwise stated. New or amended Accounting Standards and Interpretations adopted The Group has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period and relevant. The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the Group. Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted. Basis of preparation These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate for for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards (IFRS) accounting standards as issued by the International Accounting Standards Board ('IASB'). Historical cost convention The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation of financial assets and liabilities at fair value through profit or loss, financial assets at fair value through other comprehensive income and derivative financial instruments. Critical accounting 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. Going concern The financial statements are prepared on a going concern basis. As at 30 June 2026, the Consolidated Statement of Financial Position reflected net current assets of $65,740,000 (2025: $69,728,000). 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 33. Principles of consolidation The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Kelsian Group Limited ('Company' or 'parent entity') as at 30 June 2026 and the results of all subsidiaries for the year then ended. Kelsian Group Limited and its subsidiaries together are referred to in these financial statements as the 'Group'. 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. 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. Non-controlling interest in the results and equity of subsidiaries are shown separately in the statement of profit or loss, statement of financial position and statement of changes in equity of the Group. Losses incurred by the Group are attributed to the non-controlling interest in full, even if that results in a deficit balance. 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 in profit or loss. Operating segments Operating segments are presented using the 'management approach', where the information presented is on the same basis as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the allocation of resources to operating segments and assessing their performance. Foreign currency translation The financial statements are presented in Australian dollars, which is Kelsian Group Limited's functional and presentation currency. 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. Foreign operations The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity. The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 1. Material accounting policy information (continued) 49 Revenue recognition The Group recognises revenue as follows: Revenue from contracts with customers Good transferred at a point in time Revenue from the transport of passengers, freight and accommodation is recognised at the time of delivery of the service to the customer. This is the time where the control is transferred and when each separate performance obligation in the customer contract is fulfilled given the short time services are provided (less than a day). This typically occurs on a departure date or booking date basis whereby customers who have paid for services have actually departed on those travel or accommodation services. The revenue is recognised in the month of the departure date. Some of the ferry and freight transportation have a series of performance obligations, but as the duration of these are short term the impact from splitting these contract into “distinct services” does not have material impact. Revenue in relation to retailing of travel services is recognised on a gross basis when customers have paid for their travel services. Revenue is recognised at the amount that reflects the consideration to which the Group expects to be entitled in exchange for transferring goods or services to a customer, excluding GST and after deduction of trade discounts. Trade Receivables typically do not contain a significant financing component. The general credit terms are overall short and aligned with market terms. Accounting estimates and judgements are made in order to determine time of delivery and account for income accruals when it is deferred. These accounting estimates and judgements are based on experience and continuous follow-up on services delivered. Services transferred over time Revenue from bus contracts to provide services is recognised over time as the services are delivered based on agreed contractual rates for delivery of the defined services. If services are increased or decreased, a pre-determined contractual adjustment on a per kilometre basis is made against the contractual rates. Contract revenue includes the revenue from any pre-operational phase, initial amount agreed in the contract plus any variations in contract work, claims and incentive payments, to the extent that it is probable that they will result in revenue and can be measured reliably. Other income Other income is recognised when it is received or when the right to receive payment is established. Interest Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset. Income tax 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; 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. 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. The parent entity and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under the tax consolidation regime. The head entity and each subsidiary in the tax consolidated group continue to account for their own current and deferred tax amounts. The tax consolidated group has applied the 'separate taxpayer within group' approach in determining the appropriate amount of taxes to allocate to members of the tax consolidated group. In addition to its own current and deferred tax amounts, the parent entity also recognises the current tax liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused tax credits assumed from each subsidiary in the tax consolidated group. Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts receivable from or payable to other entities in the tax consolidated group. The tax funding arrangement ensures that the intercompany charge equals the current tax liability or benefit of each tax consolidated group member, resulting in neither a contribution by the head entity to the subsidiaries nor a distribution by the subsidiaries to the parent entity. Cash and cash equivalents Cash and cash equivalents includes 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. These are held with the purpose of meeting short term cash commitments.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 1. Material accounting policy information (continued) 50 Trade and other receivables Trade receivables are initially recognised at transaction price and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement between 30-60 days. The Group has established a provision matrix that is based on its historical loss experience, adjusted for forward looking factors specific for the debtors and the economic environment. To measure the expected credit losses, trade receivables have been grouped based on days overdue. Other receivables are recognised at amortised cost, less any allowance for expected credit losses. Customer fulfilment costs Customer fulfilment costs are capitalised as an asset when all the following are met: (i) the costs relate directly to the contract or specifically identifiable proposed contract; (ii) the costs generate or enhance resources of the Group that will be used to satisfy future performance obligations; and (iii) the costs are expected to be recovered. Customer fulfilment costs are amortised on a straight- line basis over the term of the contract. Inventories Stock on hand is stated at the lower of cost and net realisable value. Cost comprises of purchase and delivery costs, net of rebates and discounts received or receivable. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. Derivative financial instruments Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at each reporting date. The accounting for subsequent changes in fair value depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. Derivatives are classified as current or non-current depending on the expected period of realisation. Cash flow hedges Cash flow hedges are used to cover the Group's exposure to variability in cash flows that is attributable to particular risks associated with a recognised asset or liability or a firm commitment which could affect profit or loss. The effective portion of the gain or loss on the hedging instrument is recognised in other comprehensive income through the cash flow hedges reserve in equity, whilst the ineffective portion is recognised in profit or loss. Amounts taken to equity are transferred out of equity and included in the measurement of the hedged transaction when the forecast transaction occurs. Cash flow hedges are tested for effectiveness on a regular basis prospectively to ensure that each hedge is highly effective and continues to be designated as a cash flow hedge. If the forecast transaction is no longer expected to occur, the amounts recognised in equity are transferred to profit or loss. If cash flow hedge accounting is discontinued, the amount that has been accumulated in OCI must remain in accumulated OCI if the hedged future cashflows are still expected to occur and released to profit or loss when the forecast transaction occurs. Otherwise the amount will be immediately reclassified to profit or loss as a reclassification adjustment. Hedges of a net investment Hedges of a net investment in a foreign operation include monetary items that are considered part of the net investment. Gains or losses on the hedging instrument relating to the effective portion of the hedge are recognised directly in equity whilst gains or losses relating to the ineffective portion are recognised in profit or loss. On disposal of the foreign operation, the cumulative value of any such gains or losses recognised directly in equity is transferred to profit or loss. Non-current assets or disposal groups classified as held for sale Non-current assets and assets of disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continued use. They are measured at the lower of their carrying amount and fair value less costs of disposal. For non-current assets or assets of disposal groups to be classified as held for sale, they must be available for immediate sale in their present condition and their sale must be highly probable. An impairment loss is recognised for any initial or subsequent write down of the non-current assets and assets of disposal groups to fair value less costs of disposal. A gain is recognised for any subsequent increases in fair value less costs of disposal of non- current assets and assets of disposal groups, but not in excess of any cumulative impairment loss previously recognised. Non-current assets are not depreciated or amortised while they are classified as held for sale. Interest and other expenses attributable to the liabilities of assets held for sale continue to be recognised. Non-current assets classified as held for sale and the assets of disposal groups classified as held for sale are presented separately on the face of the statement of financial position, in current assets. The liabilities of disposal groups classified as held for sale are presented separately on the face of the statement of financial position, in current liabilities. 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. Such assets are subsequently measured at either amortised cost or fair value depending on their classification. Classification is determined based on both the business model within which such assets are held and the contractual cash flow characteristics of the financial asset unless an accounting mismatch is being avoided. Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of recovering part or all of a financial asset, its carrying value is written off. Impairment of financial assets The Group recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon the Group's assessment at the end of each reporting period as to whether the financial instrument's credit risk has increased significantly since initial recognition, based on reasonable and supportable information that is available, without undue cost or effort to obtain.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 1. Material accounting policy information (continued) 51 Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate. For financial assets mandatorily measured at fair value through other comprehensive income, the loss allowance is recognised in other comprehensive income with a corresponding expense through profit or loss. In all other cases, the loss allowance reduces the asset's carrying value with a corresponding expense through profit or loss. Property, plant and equipment Property, plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment (excluding land) over their expected useful lives as follows: Buildings 14-60 years Leasehold improvements 4-22 years Plant and equipment 3-30 years Vessels 5-25 years Motor vehicles 3-20 years The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date. Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the assets, whichever is shorter. 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. Right-of-use assets A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset. Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter. Where the Group expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-of-use assets are subject to impairment or adjusted for any remeasurement of lease liabilities. The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as incurred. Intangible assets Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value at the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible assets are subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss arising from the derecognition of intangible assets are measured as the difference between net disposal proceeds and the carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed annually. Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation method or period. Goodwill Goodwill arises on the acquisition of a business. Goodwill is not amortised. Instead, goodwill is tested annually for impairment, or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Impairment losses on goodwill are taken to profit or loss and are not subsequently reversed. Brands and trademarks Significant costs associated with brands and trademarks are deferred and amortised on a straight-line basis over the period of their expected benefit, being their finite life of 10 years. Brands acquired in a business combination are not amortised on the basis that it has an indefinite life. Management considers that the useful life of brands is indefinite because there is no foreseeable limit to the cash flows this asset can generate. This is reassessed every year. Instead, it is tested annually for impairment, or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Customer contracts Customer contracts acquired in a business combination are amortised on a straight-line basis over the period of their expected benefit, being their estimated finite life of between 1 to 10 years. Software Significant costs associated with software are deferred and amortised on a straight-line basis over the period of their expected benefit, being their finite life of 5 years. Customer relationships Customer relationships acquired in a business combination are amortised on a straight-line basis over the period of their expected benefit, being their estimated finite life of between 1 to 10 years. Impairment of non-financial assets Goodwill and other intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other non- financial assets including right-of-use assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 1. Material accounting policy information (continued) 52 Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the present value of the estimated future cash flows relating to the asset using a pre- tax discount rate specific to the asset or cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a cash-generating unit. Trade and other payables Trade and other payables 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 30-60 days of recognition. Contract liabilities Contract liabilities represent the Group's obligation to transfer goods or services to a customer and are recognised when a customer pays consideration, or when the Group recognises a receivable to reflect its unconditional right to consideration (whichever is earlier) before the Group has transferred the goods or services to the customer. Borrowings 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. Lease liabilities A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group's incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred. Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset may fully written down after taking into account remaining lease term and any options to extend or terminate the agreement. 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. 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. Employee benefits Short-term employee benefits Employee benefits 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. Other long-term employee benefits The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are measured at the present value of expected future payments to be made in respect of services provided by employees up to the reporting date. 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 high quality corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows. Share-based payments Equity-settled and cash-settled share-based compensation benefits are provided to employees. Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash is determined by reference to the share price. The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the Group receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions. The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous periods.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 1. Material accounting policy information (continued) 53 The cost of cash-settled transactions are initially, and at each reporting date until vested, determined by applying either the Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows: ● during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied by the expired portion of the vesting period. ● from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at the reporting date. All changes in the liability are recognised in the Statement of Profit or Loss. The ultimate cost of cash-settled transactions is the cash paid to settle the liability. Market conditions are taken into consideration in determining fair value. Therefore, any awards subject to market conditions are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are satisfied. If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit as at the date of modification. If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the Group or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited. If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a modification. Fair value measurement When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market. Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. Classifications are reviewed at each reporting date and transfers between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value measurement. Valuation techniques for fair value measurements categorised within levels 1 and 2 Level 1 and 2 financial assets and liabilities have been valued using quoted market rates. This valuation technique maximises the use of observable market data where it is available and relies as little as possible on entity specific estimates. Valuation techniques for fair value measurements categorised within level 3 Level 3 financial assets and liabilities have been valued by using the discounted cash flows (DCF) method. For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where applicable, with external sources of data. Issued capital 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. Dividends Dividends are recognised when declared during the financial year and no longer at the discretion of the Company. Business combinations The acquisition method of accounting is used to account for business combinations regardless of whether equity instruments or other assets are acquired. The consideration transferred is the sum of the acquisition-date fair values of the assets transferred, equity instruments issued or liabilities incurred by the acquirer to former owners of the acquiree and the amount of any non-controlling interest in the acquiree. For each business combination, the non-controlling interest in the acquiree is measured at either fair value or at the proportionate share of the acquiree's identifiable net assets. All acquisition costs are expensed as incurred to profit or loss. On the acquisition of a business, the Group assesses the financial assets acquired and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic conditions, the Group's operating or accounting policies and other pertinent conditions in existence at the acquisition-date. Where the business combination is achieved in stages, the Group remeasures its previously held equity interest in the acquiree at the acquisition-date fair value and the difference between the fair value and the previous carrying amount is recognised in profit or loss. Contingent consideration to be transferred by the acquirer is recognised at the acquisition-date fair value. Subsequent changes in the fair value of the contingent consideration classified as an asset or liability is recognised in profit or loss. Contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 1. Material accounting policy information (continued) 54 The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-controlling interest in the acquiree and the fair value of the consideration transferred and the fair value of any pre-existing investment in the acquiree is recognised as goodwill. If the consideration transferred and the pre- existing fair value is less than the fair value of the identifiable net assets acquired, being a bargain purchase to the acquirer, the difference is recognised as a gain directly in profit or loss by the acquirer on the acquisition-date, but only after a reassessment of the identification and measurement of the net assets acquired, the non-controlling interest in the acquiree, if any, the consideration transferred and the acquirer's previously held equity interest in the acquirer. Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the provisional amounts recognised and also recognises additional assets or liabilities during the measurement period, based on new information obtained about the facts and circumstances that existed at the acquisition- date. The measurement period ends on either the earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the information possible to determine fair value. From time to time comparative balances are restated to better align with current year classification or for compliance with the Group’s accounting policies. Rounding of amounts The Company is of a kind referred to in Corporations 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 that Corporations Instrument to the nearest thousand dollars, or in certain cases, the nearest dollar. Note 2. Critical accounting judgements, estimates and assumptions The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. From time to time comparative balances are restated to better align with current year classification or for compliance with the Group’s accounting policies. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below. Sustainability-related disclosures The operations of the Group are exposed to climate-related risks and opportunities. Judgement has been exercised in considering the impacts that climate-related risks and opportunities have had, or may have, on the Group based on known information. The Group discloses estimates of the anticipated financial effects of these risks and opportunities in the sustainability report, which is not part of the financial statements. Other than as addressed in the sustainability report, there does not currently appear to be either any significant impact upon the financial statements or any significant uncertainties with respect to events or conditions which may impact the Group unfavourably as at the reporting date or subsequently as a result of climate-related risks and opportunities. Carrying value of property, plant and equipment The Group has assessed the carrying value of its tangible assets at the reporting date for indicators of impairment and, where applicable, reviewed the measurement of the carrying value of such tangible assets. Impairment of non-financial assets Intangible assets comprise of goodwill and other intangible assets with both finite and indefinite lives. Consistent with the Group’s accounting policies, it has evaluated the conditions specific to the Group and the assets subject to impairment to assess whether any impairment triggers that may lead to impairment have been identified. In doing this, the Group has reviewed the key assumptions in its previous annual impairment assessment to assess whether any changes to the assumptions within that impairment assessment would result in an impairment loss at 30 June 2026 (refer note 14). Fair value measurement hierarchy The Group is required to classify all assets and liabilities, measured at fair value, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and Level 3: Unobservable inputs for the asset or liability. Considerable judgement is required to determine what is significant to fair value and therefore which category the asset or liability is placed in can be subjective. The fair value of assets and liabilities classified as level 3 is determined by the use of valuation models. These include discounted cash flow analysis or the use of observable inputs that require significant adjustments based on unobservable inputs. 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 and finite life intangible assets. 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. Goodwill and other indefinite life intangible assets The Group tests annually, or more frequently if events or changes in circumstances indicate impairment, whether goodwill and other indefinite life intangible assets have suffered any impairment, in accordance with the accounting policy stated in note 1. The recoverable amounts of cash-generating units have been determined based on value-in-use calculations. These calculations require the use of assumptions, including estimated discount rates based on the current cost of capital and growth rates of the estimated future cash flows.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 2. Critical accounting judgements, estimates and assumptions (continued) 55 Impairment of non-financial assets other than goodwill and other indefinite life intangible assets The Group assesses impairment of non-financial assets other than goodwill and other indefinite life intangible assets at each reporting date by evaluating conditions specific to the Group and to the particular asset that may lead to impairment. If an impairment trigger exists, the recoverable amount of the asset is determined. This involves fair value less costs of disposal or value-in-use calculations, which incorporate a number of key estimates and assumptions including estimated discount rates based on the current cost of capital and growth rates of the estimated future cash flows. Estimation of unregulated revenue for bus contracts The Company has contracts with different government bodies to provide bus and ferry services across the Group. Management have assessed that where unregulated services are permitted under the respective contracts and such revenue streams are expected at contract inception to contribute to significant unregulated revenue compared to the total contract revenue, for the arrangement to fall out of scope of AASB Interpretation 12 'Service Concession Arrangements' (AASB Interpretation 12). The Company has exercised judgement on what is considered ‘significant’ in respect to unregulated revenue to cause a whole arrangement to fall out of scope of AASB Interpretation 12. Income tax The Group is subject to income taxes in the jurisdictions in which it operates. Significant judgement is required in determining the provision for income tax. There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Group recognises liabilities for anticipated tax audit issues based on the Group's current understanding of the tax law. Where the final tax outcome of these matters is different from the carrying amounts, such differences will impact the current and deferred tax provisions in the period in which such determination is made. Recovery of deferred tax assets Deferred tax assets are recognised for deductible temporary differences only if the Group considers it is probable that future taxable amounts will be available to utilise those temporary differences and losses. The Group applies judgement in estimating future taxable profits from internal budgets and forecasts. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised. Business combinations As discussed in note 1, business combinations are initially accounted for on a provisional basis. The fair value of assets acquired, liabilities and contingent liabilities assumed are initially estimated by the Group taking into consideration all available information at the reporting date, a key judgement of which is the identification, recognition and measurement of intangible assets recognised on acquisition. Fair value adjustments on the finalisation of the business combination accounting are retrospective, where applicable, to the period the combination occurred and may have an impact on the assets and liabilities, depreciation and amortisation reported. Note 3. Operating segments Identification of reportable operating segments For management purposes the Group is organised into four operating segments. The principal products and services of each of these operating segments are as follows: Marine and Tourism – operates throughout Australia providing vehicle and passenger ferry services, barging, coach tours and package holidays, lunch, dinner and charter cruises and accommodation facilities. Australian Bus – operates metropolitan public bus services on behalf of governments in Sydney, Melbourne, Perth, Adelaide and Stradbroke Island. Operates regional and remote bus services supporting the resources sector in Western Australia. Operates charter bus services in the Northern Territory. International Bus – operates metropolitan public bus services on behalf of governments in the United Kingdom, Channel Islands and Singapore. Operates charter motorcoaches for corporates, local and federal government and education sectors in the United States of America. Corporate (Head Office) – provides finance, domestic and international sales and marketing, information and technology, business development, fleet management, health and safety and administration and risk management support. These operating segments are based on the internal reports that are reviewed and used by the Board of Directors and Executive Committee (who are identified as the Chief Operating Decision Makers ('CODM')) in assessing performance and in determining the allocation of resources. There is no aggregation of operating segments. The CODM reviews underlying EBITDA (earnings before interest, tax, depreciation and amortisation). The accounting policies adopted for internal reporting to the CODM are consistent with those adopted in the financial statements. The information reported to the CODM is on a monthly basis. Intersegment transactions Transfer pricing between operating segments is on an arm’s length basis in a manner similar to transactions with third parties and inter- segment revenues are eliminated on consolidation.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 3. Operating segments (continued) 56 Intersegment receivables, payables and loans Intersegment loans are initially recognised at the consideration received. Intersegment loans receivable and loans payable that earn or incur non-market interest are not adjusted to fair value based on market interest rates. Intersegment loans are eliminated on consolidation. Major customers During the year ended 30 June 2026, approximately 62.8% (2025: 64.5%) of the Group's external revenue was derived from sales to governments. Operating segment information Marine and Tourism Australian Bus International Bus Corporate Total Consolidated - 2026 $'000 $'000 $'000 $'000 $'000 Revenue Sales to external customers 391,392 1,201,613 809,708 - 2,402,713 Interest received 29 260 619 3,203 4,111 Total revenue 391,421 1,201,873 810,327 3,203 2,406,824 Underlying EBITDA 75,591 134,425 144,974 (39,198) 315,792 Depreciation (18,768) (26,702) (45,728) (1,046) (92,244) Depreciation ROUA (1,907) (11,898) (20,404) (604) (34,813) Amortisation of customer contracts (1,005) (15,470) (16,571) - (33,046) Net finance costs (606) (8,978) (16,835) (31,567) (57,986) Acquisition and transaction expenses - - (336) (19,022) (19,358) Net foreign exchange gain - - - 1,550 1,550 Profit/(loss) before income tax expense 53,305 71,377 45,100 (89,887) 79,895 Income tax expense (16,370) Profit after income tax expense 63,525 Material items include: Direct labour (130,294) (732,862) (373,912) - (1,237,068) Assets Segment assets 413,931 901,269 1,097,909 93,993 2,507,102 Total assets 2,507,102 Liabilities Segment liabilities 74,005 314,646 237,352 841,073 1,467,076 Unallocated liabilities: Deferred tax liability 87,412 Total liabilities 1,554,488
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 3. Operating segments (continued) 57 Marine and Tourism Australian Bus International Bus Corporate Total Consolidated - 2025 $'000 $'000 $'000 $'000 $'000 Revenue Sales to external customers 368,048 1,151,338 689,523 - 2,208,909 Interest received 131 304 658 3,116 4,209 Total revenue 368,179 1,151,642 690,181 3,116 2,213,118 Underlying EBITDA 75,251 127,933 113,202 (31,420) 284,966 Depreciation (19,829) (26,320) (42,863) (921) (89,933) Depreciation ROUA (1,760) (11,463) (11,943) (667) (25,833) Amortisation of customer contracts (1,008) (15,952) (16,242) - (33,202) Net finance costs (398) (9,845) (17,017) (32,517) (59,777) Acquisition and transaction expenses - (22) (748) (4,378) (5,148) Net foreign exchange loss - - - (2,642) (2,642) Profit/(loss) before income tax expense 52,256 64,331 24,389 (72,545) 68,431 Income tax expense (13,937) Profit after income tax expense 54,494 Material items include: Direct labour (121,292) (696,907) (320,322) - (1,138,521) Assets Segment assets 394,569 971,472 1,039,891 93,541 2,499,473 Total assets 2,499,473 Liabilities Segment liabilities 53,947 234,604 534,849 635,043 1,458,443 Unallocated liabilities: Deferred tax liability 83,115 Total liabilities 1,541,558 Geographical information Sales to external customers Geographical non-current assets 2026 2025 2026 2025 $'000 $'000 $'000 $'000 Australia 1,593,006 1,519,386 1,140,929 1,191,145 Singapore 245,483 229,976 131,605 139,562 United Kingdom 47,067 42,864 89,057 80,408 United States of America 517,157 416,683 636,919 608,099 2,402,713 2,208,909 1,998,510 2,019,214 The geographical non-current assets above are exclusive of, where applicable, financial instruments and deferred tax assets. Note 4. Revenue from contracts with customers Consolidated 2026 2025 $'000 $'000 Goods transferred at a point in time 528,323 522,786 Services rendered over time 1,874,390 1,686,123 Revenue from contracts with customers 2,402,713 2,208,909
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 58 Note 5. Other income Consolidated 2026 2025 $'000 $'000 Net foreign exchange gain/(loss) 1,441 (926) Gain on disposal of property, plant and equipment 1,538 1,384 Other income 14,269 15,507 Other income 17,248 15,965 Other income earned includes grants, rebates and other sundry items. Note 6. Income tax Consolidated 2026 2025 $'000 $'000 Income tax expense Current tax 13,343 26,018 Deferred tax - origination and reversal of temporary differences 4,306 (10,945) Adjustment recognised for prior periods (1,279) (1,136) Aggregate income tax expense 16,370 13,937 Deferred tax included in income tax expense comprises: Decrease/(increase) in deferred tax assets 4,306 (10,945) Numerical reconciliation of income tax expense and tax at the statutory rate Profit before income tax expense 79,895 68,431 Tax at the statutory tax rate of 30% 23,969 20,529 Tax effect amounts which are not deductible/(taxable) in calculating taxable income: Share-based expenses 900 276 Non-taxable income (5,113) (4,949) Tax effect of other non-assessable foreign expenses (22) (193) Other (non-assessable income)/non-deductible expenses 3,335 2,863 23,069 18,526 Difference in overseas tax rates (4,922) (2,287) Adjustment recognised for prior periods (1,279) (1,136) Tax loss de-recognition/(recognition) 354 530 Adjustment recognised for prior periods - deferred tax (770) 3,131 Other (82) (4,827) Income tax expense 16,370 13,937 Consolidated 2026 2025 $'000 $'000 Amounts credited directly to equity Deferred tax assets (1,699) (988)
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 6. Income tax (continued) 59 Consolidated 2026 2025 $'000 $'000 Deferred tax liability Deferred tax liability comprises temporary differences attributable to: Amounts recognised in profit or loss: Tax losses 2,425 1,342 Allowance for expected credit losses 129 144 Employee benefits 41,734 41,102 Leases 18,330 27,427 Provisions 3,213 3,410 Property, plant and equipment (106,939) (106,397) Customer contracts and other intangible assets (46,785) (56,020) Other 367 3,520 (87,526) (85,472) Amounts recognised in equity: Derivative financial instruments 114 2,357 Deferred tax liability (87,412) (83,115) Movements: Opening balance (83,115) (93,929) Credited/(charged) to profit or loss (4,306) 10,945 Credited to equity 1,699 988 Additions through business combinations (note 34) (1,690) (1,119) Closing balance (87,412) (83,115) The Group has performed an assessment of its potential exposure to Pillar Two income taxes based on country-by-country reporting and financial information for the constituent entities in the Group. The Pillar Two effective tax rate in all material jurisdictions in which the Group operates is above 15%. The Group has not recognised any Pillar Two current tax expense. The Group applies the temporary mandatory exemption from recognising or disclosing deferred tax in relation to Pillar two taxes. Note 7. Cash and cash equivalents Consolidated 2026 2025 $'000 $'000 Current assets Cash on hand 341 1,599 Cash at bank 175,989 174,429 Cash on deposit - 6,756 176,330 182,784
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 60 Note 8. Trade and other receivables Consolidated 2026 2025 $'000 $'000 Current assets Trade receivables 225,867 200,296 Less: Allowance for expected credit losses (524) (569) 225,343 199,727 Other receivables 31,595 33,142 256,938 232,869 Allowance for expected credit losses Trade receivables are non-interest bearing. An allowance is made for trade receivables and other receivables as the Group applies a simplified approach in calculating expected credit losses (ECLs). Therefore, the Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. The ageing of the receivables and allowance for expected credit losses provided for above are as follows: Expected credit loss rate Carrying amount Allowance for expected credit losses 2026 2025 2026 2025 2026 2025 Consolidated % % $'000 $'000 $'000 $'000 Not overdue - - 220,532 208,113 - - 0 to 1 month overdue - - 22,585 17,905 - - 1 to 2 months overdue - - 6,416 4,300 - - 2 to 3 months overdue 0.59% 7.51% 5,921 1,985 35 149 Over 3 months overdue 24.35% 37.02% 2,008 1,135 489 420 257,462 233,438 524 569 Movements in the allowance for expected credit losses are as follows: Consolidated 2026 2025 $'000 $'000 Opening balance 569 903 Additional provisions recognised 35 213 Exchange differences (17) - Receivables written off during the year as uncollectable (56) (547) Unused amounts reversed (7) - Closing balance 524 569
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 61 Note 9. Inventories Consolidated 2026 2025 $'000 $'000 Current assets Goods held for resale - at cost 6,176 5,346 Less: Provision for impairment (31) (31) 6,145 5,315 Fuel at cost 5,092 3,884 Spare parts at cost 26,981 27,487 Less: Provision for impairment (3,084) (2,346) 35,134 34,340 Note 10. Other assets Consolidated 2026 2025 $'000 $'000 Current assets Prepayments 30,157 25,243 Deferred expenses 229 1,380 Other deposits 1,528 1,275 Deferred consideration receivable 1,542 1,618 Other current assets 750 750 34,206 30,266 Non-current assets Prepayments 2,450 2,233 Deferred consideration receivable 8,628 11,070 Contract assets 2,813 - 13,891 13,303 48,097 43,569 Prepayments include finance costs paid in advance as part of the successful debt facility refinancing completed in June 2024 and additional balances in relation to the new expanded regions in Sydney. Deferred expenses relate to the Singapore bus contract which commenced in September 2021 and will be amortised over the life of the contract. Deferred consideration receivable relates to the divestment of the Lea Interchange business in London in June 2022. The deferred component of the Lea Interchange divestment will be payable in ten equal instalments of 1.0m Pound Sterling on the anniversary of the sale for the remaining six years and is shown at present value converted to Australian dollars. Note 11. Non-current assets classified as held for sale Consolidated 2026 2025 $'000 $'000 Vessel 5,751 - A vessel with net book value of $5,751,000 currently operating on services to Kangaroo Island in South Australia has been reclassified as held for sale (refer note 12).
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 62 Note 12. Property, plant and equipment Consolidated 2026 2025 $'000 $'000 Non-current assets Land and buildings - at cost 152,680 155,243 Less: Accumulated depreciation (12,660) (11,654) 140,020 143,589 Leasehold improvements - at cost 22,663 18,078 Less: Accumulated depreciation (12,598) (9,142) 10,065 8,936 Plant and equipment - at cost 77,523 71,642 Less: Accumulated depreciation (46,945) (40,869) 30,578 30,773 Motor vehicles - at cost 702,260 640,253 Less: Accumulated depreciation (232,493) (179,140) 469,767 461,113 Vessels - at cost 259,776 255,557 Less: Accumulated depreciation (115,135) (104,533) Less: Accumulated impairment (2,086) (2,086) 142,555 148,938 Capital works in progress - at cost 97,181 82,836 890,166 876,185 Reconciliations Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below: Land and buildings Leasehold improve Plant and equipment Motor vehicles Vessels CWIP Total Consolidated $'000 $'000 $'000 $'000 $'000 $'000 $'000 Balance at 1 July 2024 125,194 8,464 27,321 449,201 143,635 71,196 825,011 Additions 33,170 1,751 7,205 74,497 1,959 45,361 163,943 Additions through business combinations (note 34) - 31 55 713 - - 799 Disposals (22,433) (85) (108) (5,583) (90) (3,140) (31,439) Exchange differences 3,539 109 223 3,310 - 64 7,245 Transfers in/(out) 5,853 2,321 5,556 934 16,540 (30,645) 559 Depreciation expense (1,734) (3,655) (9,479) (61,959) (13,106) - (89,933) Balance at 30 June 2025 143,589 8,936 30,773 461,113 148,938 82,836 876,185 Additions 117 1,678 8,660 81,797 476 37,828 130,556 Additions through business combinations (note 34) - 81 286 1,082 - - 1,449 Classified as held for sale (note 11) - - - - (5,751) - (5,751) Disposals (1,475) (40) (458) (4,016) (161) (11) (6,161) Exchange differences (3,189) (271) (410) (9,273) - (35) (13,178) Transfers in/(out) 2,808 3,003 1,142 4,451 11,641 (23,437) (392) Depreciation expense (1,830) (3,322) (9,415) (65,387) (12,588) - (92,542) Balance at 30 June 2026 140,020 10,065 30,578 469,767 142,555 97,181 890,166 At 30 June 2026, 2 vessels were under construction and 54 conventional buses (US), 1 conventional bus (UK and Singapore) and a further 39 conventional buses are on order under contract for delivery in FY27.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 12. Property, plant and equipment (continued) 63 At 30 June 2025, 4 vessels are under construction and 51 conventional buses (US), 23 conventional buses (UK and Singapore) and a further 8 conventional buses are on order under contract for delivery in FY26. Refer to note 17 for further information on assets pledged as security for financing arrangements. Note 13. Right-of-use assets Consolidated 2026 2025 $'000 $'000 Non-current assets Land and buildings - right-of-use 171,471 142,849 Less: Accumulated depreciation (61,573) (40,586) 109,898 102,263 Motor vehicles - right-of-use 93,527 89,358 Less: Accumulated depreciation (24,465) (20,758) 69,062 68,600 178,960 170,863 Reconciliations Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below: Land and Motor buildings vehicles Total Consolidated $'000 $'000 $'000 Balance at 1 July 2024 141,064 46,645 187,709 Additions 20,864 28,919 49,783 Additions through business combinations (note 34) - 1,630 1,630 Disposals (40,830) - (40,830) Revaluation decrements (245) - (245) Exchange differences 2,225 497 2,722 Transfers in/(out) (58) (4,015) (4,073) Depreciation expense (20,757) (5,076) (25,833) Balance at 30 June 2025 102,263 68,600 170,863 Additions 30,896 32,642 63,538 Additions through business combinations (note 34) 564 3,648 4,212 Disposals (482) (19,680) (20,162) Revaluation increments 34 - 34 Exchange differences (3,147) (1,566) (4,713) Transfers in/(out) - - - Depreciation expense (20,230) (14,582) (34,812) Balance at 30 June 2026 109,898 69,062 178,960 Current year acquired rights included $30,000,000 relating to coaches and $26,000,000 for property leases for All Aboard America!. Prior year acquired rights included $22,000,000 relating to coaches for All Aboard America! and $8,000,000 for leases as part of the sale and leaseback property transitions in the regional bus businesses in WA Right of use assets relinquished by the Group included $20,000,000 transferred to Transport for NSW in Region 6. In the prior year, Right of use assets relinquished by the Group included $31,400,000 relating to the option to purchase Hoxton Park depot which was held at 30 June 2024 and settled in July 2024. For other AASB 16 lease disclosures refer to: ● note 19 for lease liabilities at the reporting date; ● note 28 for undiscounted future lease commitments; and ● consolidated statement of cash flows for repayment of lease liabilities.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 64 Note 14. Intangibles Consolidated 2026 2025 $'000 $'000 Non-current assets Goodwill - at cost 717,187 733,485 Less: Accumulated impairment (7,983) (7,983) 709,204 725,502 Brands and trademarks - at cost 49,585 51,882 Customer contracts - at cost 171,915 176,962 Less: Accumulated amortisation (136,430) (127,902) 35,485 49,060 Software - at cost 1,180 1,164 Less: Accumulated amortisation (395) (264) 785 900 Other intangible assets - at cost 34,231 24,744 Less: Accumulated amortisation (14,486) (13,395) 19,745 11,349 Customer relationships - at cost 147,990 154,165 Less: Accumulated amortisation (47,301) (33,995) 100,689 120,170 915,493 958,863 Reconciliations Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below: Goodwill Brands and trademarks Customer contracts Software Other intangibles Customer relationships Total Consolidated $'000 $'000 $'000 $'000 $'000 $'000 $'000 Balance at 1 July 2024 713,488 51,329 61,538 913 12,778 133,338 973,384 Additions - - - 95 123 - 218 Additions through business combinations (note 34) 986 - 3,576 - - - 4,562 Exchange differences 11,028 553 366 - 388 1,566 13,901 Amortisation expense - - (16,420) (108) (1,940) (14,734) (33,202) Balance at 30 June 2025 725,502 51,882 49,060 900 11,349 120,170 958,863 Additions - - - 16 10,828 - 10,844 Additions through business combinations (note 34) 730 - 2,920 - - - 3,650 Exchange differences (17,028) (2,297) (494) - (271) (4,728) (24,818) Amortisation expense - - (16,001) (131) (2,161) (14,753) (33,046) Balance at 30 June 2026 709,204 49,585 35,485 785 19,745 100,689 915,493 There was no impairment of assets made in 2026 (2025: $Nil). See commentary below.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 14. Intangibles (continued) 65 Impairment Testing Goodwill and brands acquired through business combinations have been allocated to the following cash-generating units (CGUs): Brands Brands Goodwill Goodwill 2026 2025 2026 2025 '000 '000 '000 '000 All Aboard America! Holdings - USA 47,169 49,466 194,076 203,531 Transit - WA & NT - - 162,030 162,030 Tower Transit - Singapore - - 112,308 119,771 Transit - NSW - - 61,155 61,155 Transit - SA - - 59,649 59,649 Transit - Victoria (Sita) - - 45,727 45,727 SeaLink - South East QLD 712 712 33,156 33,156 Go West Tours - WA 2 2 17,929 17,929 Horizons West, WA 1,099 1,099 10,280 10,280 SeaLink - QLD - - 6,420 6,420 Fraser Island, QLD - - 3,500 3,500 Grand Touring, NT 603 603 1,318 1,318 Swan Valley Tours, WA - - 50 50 Tower Transit - UK - - 1,606 986 49,585 51,882 709,204 725,502 The recoverable amount of the Group's goodwill has been determined by value-in-use calculations using a discounted cash flow model. The cash flow projections are based on annual financial budgets approved by senior management and the Board, extrapolated using the growth rates below for a five-year period as approved by management together with a terminal value. The assumptions for determining the recoverable amount are based on past experience and senior management’s expectation for the future taking into consideration the longer-term recovery from COVID-19 and recent trading performance. A terminal value growth rate of 3.0% has been used for Marine and Tourism, Australia and International Public Bus CGUs (2025: 3.0% for Marine and Tourism CGUs and 1.5% for all Australian and International Public Bus CGUs). The terminal value growth rates are used to determine the terminal value of a CGU based on long range forecasts for CPI or comparable indices in the geographies we operate in. Key assumptions are those to which the recoverable amount of an asset or CGU is most sensitive. The key general assumptions used in the discounted cash flow models and value in use calculations are the pre-tax discount rates and the projected revenue growth rates detailed below. The pre-tax discount rates reflect management’s estimate of the time value of money and the Group’s weighted average cost of capital adjusted for, the risk-free rate and the volatility of the share price relative to market movements. Marine and Tourism Australian Bus International Bus % % % Discount rate used in impairment calculations for 2026 12.4% 10.8% 7.1%-10.4% Discount rate used in impairment calculations for 2025 11.8% 10.7% 7.8%-11.5% Management believes the projected revenue growth rates are prudent and justified given the current uncertainty of the market. Marine and Tourism CGUs Marine and Tourism CGUs have had growth rates applied of 3.0% (2025: 3.0%), this is based on historical experience and current operating trends within these CGUs. Australian Bus CGUs Contracted increases in revenue – all CGUs within the Australian Bus Segment have had contracted revenue grow by at least 1.5% (2025: 1.5%). This is based on the contracted nature of these businesses and the increases reflected in the contracts it has with its government clients. International Bus CGUs International CGUs have had growth rates applied of 1.5% (2025: 1.5%), this is based on historical experience and current operating trends within these CGUs.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 14. Intangibles (continued) 66 Sensitivity As disclosed in note 2, management has made assumptions and estimates in respect of impairment testing of goodwill. Should these assumptions and estimates not occur the resulting goodwill carrying amount may decrease. Summary of goodwill impairment testing Management has reviewed the changes to the key assumptions in the model and based on those changes have assessed there would not be an impairment of goodwill for any of the Group's CGUs (2025: $Nil). Management believes that other reasonable changes in the key assumptions on which the recoverable amount of each segment's goodwill is based would not cause the CGUs carrying amount to exceed its recoverable amount. Customer Contracts, Relationships and Other intangibles (Permits and Trademarks) As part of the Transit Systems Group acquisition in 2020, bus contracts in Australia and Singapore were acquired with a fair value of $134,700,000. In addition, $8,700,000 of intangible customer relationships were also recognised for Transit - Victoria (Sita). A further $15,400,000 of customer contracts associated with bus contracts in the resources sector were part of the Go West Tours acquisition on 1 July 2021. In addition, the asset acquisition of Dave's Transit in June 2022 resulted in a further $900,000 customer contracts being recognised. As part of the All Aboard America! Holdings Inc. acquisition, $49,800,000 of trademarks/brand names and $133,800,000 of customer relationship intangibles were recognised. As part of the Horizons West acquisition, $9,800,000 of customer relationship intangibles, $1,100,000 of software and $1,100,000 of trademarks/brand names were recognised. For the Grand Touring acquisition, $2,100,000 of customer relationships and $600,000 of trademarks/brand names were recognised. As part of the Huyton Travel Limited acquisition $2,700,000 in customer contract intangible was recognised as well as $900,000 in relation to the new school bus contracts acquired in WA. During the period the Group recorded amortisation of $33,046,000 (2025: $33,202,000) associated with customer contracts and permits with an associated reduction in the Deferred Tax Liability of $9,913,800 (2025: $9,946,800). Note 15. Trade and other payables Consolidated 2026 2025 $'000 $'000 Current liabilities Trade payables 49,903 48,637 BAS payable 13,742 16,038 Other payables 24,508 30,901 88,153 95,576 Refer to note 28 for further information on financial instruments. Trade creditors are non-interest bearing and are normally settled on 30-60 day terms.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 67 Note 16. Contract liabilities Consolidated 2026 2025 $'000 $'000 Current liabilities Contract liabilities 15,137 15,576 Reconciliation Reconciliation of the written down values at the beginning and end of the current and previous financial year are set out below: Opening balance 15,576 14,288 Deferred during the year 131,859 148,959 Recognised during the year (132,298) (147,671) Closing balance 15,137 15,576 Unsatisfied performance obligations The aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied at the end of the reporting period was $6,506,374,000 as at 30 June 2026 ($7,109,971,000 as at 30 June 2025) and is expected to be recognised as revenue in future periods as follows: Consolidated 2026 2025 $'000 $'000 Within one year 1,778,698 1,719,752 More than one year 4,727,676 5,390,219 6,506,374 7,109,971 There have been no significant contract changes impacting unsatisfied performance obligations this period. Note 17. Borrowings Consolidated 2026 2025 $'000 $'000 Non-current liabilities Commercial bills payable 801,903 806,321 Refer to note 28 for further information on financial instruments. Total unsecured liabilities Total facilities available decreased by $10,000,000 (2025: decreased $126,800,000) during the year releasing excess secured revolving credit not required. Total available facilities as at June 2026 were $970,660,000 (2025: $997,300,000) and is combined with letter of credit facilities of $180,000,000 (2025: $180,000,000). Interest bearing loans and borrowings have a fair value and carrying value of $801,903,000 (2025: $806,321,000). During the year $5,720,000 funds (2025: $66,400,000) were drawn down. As part of the renegotiated debt facilities, Kelsian entered into the following new three to five year facilities with evergreen provisions: ● Facility A: an unsecured AUD facility with a limit of AUD $630,000,000 (2025: AUD $640,000,000) 3, 4 and 5 year revolving credit facilities; ● Facility B: an unsecured USD facility with a limit of USD $234,000,000 (2025: USD $234,000,000) 3, 4 and 5 year revolving credit facilities; and ● Facility C: Implementation of global guarantee facility comprising a revolving letter of credit facility with a limit of $180,000,000 (2025: $180,000,000) and a term of 3 years from commencement, for the provision of letters of credit for material contract performance obligations (including the provision of new or refinanced performance bonds and bank guarantees).
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 17. Borrowings (continued) 68 Financing arrangements Unrestricted access was available at the reporting date to the following lines of credit: Consolidated 2026 2025 $'000 $'000 Total facilities Facility A - multi currency revolving credit 630,000 640,000 Facility B - USD revolving credit 340,661 357,252 Facility C - revolving letter of credit 180,000 180,000 1,150,661 1,177,252 Used at the reporting date Facility A - multi currency revolving credit 601,000 588,000 Facility B - USD revolving credit 200,903 218,321 Facility C - revolving letter of credit 129,907 119,919 931,810 926,240 Unused at the reporting date Facility A - multi currency revolving credit 29,000 52,000 Facility B - USD revolving credit 139,758 138,931 Facility C - revolving letter of credit 50,093 60,081 218,851 251,012 The AUD based facilities are provided on a floating rate basis referenced to the BBSY rate and the USD based facilities are provided on a floating rate basis referenced to the SOFR rate. As at year end, the balance of Facility A (AUD) $601,000,000 (2025: $588,000,000) had an average rate of 5.75% (2025: 5.22%) and Facility B (USD) $138,000,000 (2025: $143,000,000) had an average rate of 4.88% (2025: 5.75%) with the weighted average rate for combined facilities A and B (AUD and USD) 5.31% (2025: 5.36%). All current facilities are at floating rates. Committed financing facilities A and B total $970,661,000 (2025: $997,252,000) and were available to the Group at the end of the financial year. As at that date, $801,903,000 (2025: $806,321,000) of these facilities were in use. During the current year, there were no defaults or breaches. Financing cash flows During the period $5,720,000 (2025: $66,400,000) of borrowings were drawn down together with $9,988,000 increase (2025: $8,700,000 increase) in letters of credit drawn, the latter having no cash flow impact. Assets pledged as security All facilities are provided on an unsecured basis. Various guarantees/performance bonds have been provided as surety on a range of material operational contracts and lease contracts. Guarantees provided total $129,907,000 (2025: $119,919,000), the net increase relates to indexation of existing guarantees on the anniversary of the contract and increases required by actuarial assessment in relation to self insured workers compensation. Facility covenants The facility is subject to the following covenants, operating leverage ratio and financial charge cover ratio. The Group monitors compliance with its financial covenants on a monthly basis and reports compliance on a bi annual basis to its financiers. The Group has complied with all such requirements. There is no indication that the Group will have difficulty complying with these covenants. Note 18. Borrowings - ringfenced finance facilities In FY23, Kelsian established wholly owned special purpose Australian subsidiaries to own and operate government contracted bus assets used to service specific service regions in Sydney, NSW. These special purpose subsidiaries acquired the bus assets from the Kelsian operator entities using limited recourse ringfenced asset financing arrangements. These ringfenced financing arrangements are supported by government and have limited recourse to the broader Kelsian Group. The ringfenced finance arrangements are separate to Kelsian’s corporate debt facilities and have both a tenor aligned to the expiry of the associated bus services contracts and an amortisation profile that matches the residual values of the buses determined under the bus services contract (with these amounts being payable to the subsidiaries at the end of the bus services contract). In December 2023, a limited recourse asset financing facility of up to $40,000,000 was established for the purchase of 49 Battery-Electric buses for Region 6. In February 2024, limited recourse asset financing facilities totalling approximately $74,000,000 were established for contracted bus assets acquired from outgoing bus operators in Regions 2, 13 and 15. These ringfenced finance facilities are excluded from Kelsian's corporate debt facility financial covenant obligations. The ringfenced finance facility is not subject to financial covenants.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 18. Borrowings - ringfenced finance facilities (continued) 69 Government backed contracted assets with a vehicle termination payment obligation not in a ring-fenced finance facility total $32,260,000 as at 30 June 2026 (30 June 2025: $36,200,000). Excluding this contractual commitment, leverage (net debt to EBITDA) reduces to 2.37 times (30 June 2025: 2.56 times). Consolidated 2026 2025 $'000 $'000 Current liabilities Borrowings - ringfenced finance facilities 9,838 10,232 Non-current liabilities Borrowings - ringfenced finance facilities 68,873 78,718 78,711 88,950 The ringfenced facilities are provided on a floating rate basis referenced to the BBSW rate. As at year end, the balance of the ringfenced facilities was $78,711,000 (30 June 2025: $88,950,000) and had an average rate of 5.48% (30 June 2025: 5.48%). During the period $Nil,000 (2025: $Nil) of borrowings were drawn. Note 19. Lease liabilities Consolidated 2026 2025 $'000 $'000 Opening balance 166,637 179,124 Additions 61,031 43,867 Additions through business combinations (note 34) 4,212 1,847 Exchange differences (3,936) 1,389 Lease payments (principal) (41,567) (31,624) Lease related interest 9,637 7,170 Lease relinquishment (non-cash) (21,028) (35,136) Lease remeasurement 19 - Transfers 2 - 175,007 166,637 Short term lease payments of $4,036,000 were made during the period (2025: $1,032,000). Note 20. Derivative financial liabilities Consolidated 2026 2025 $'000 $'000 Current liabilities Interest rate swap contracts - cash flow hedges - 2,008 Fuel price swap contracts - cash flow hedges 262 141 262 2,149 Non-current liabilities Interest rate swap contracts - cash flow hedges 277 5,707 539 7,856 Refer to note 28 for further information on financial instruments.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 70 Note 21. Employee benefits Consolidated 2026 2025 $'000 $'000 Current liabilities Annual leave 77,659 71,818 Long service leave 48,540 47,918 Sick leave 324 346 Employee benefits 1,208 899 127,731 120,981 Non-current liabilities Long service leave 9,025 7,871 136,756 128,852 Note 22. Provisions Consolidated 2026 2025 $'000 $'000 Current liabilities Deferred consideration 26,913 29,294 Other provisions 19,850 19,997 46,763 49,291 Non-current liabilities Other provisions 10,341 4,608 57,104 53,899 Movements in provisions Movements in each class of provision during the current financial year are set out below: Motor claims Deferred consideration Other Workers compensation Total Consolidated - 2026 $'000 $'000 $'000 $'000 $'000 Carrying amount at the start of the year 12,645 29,294 341 11,619 53,899 Additional provisions recognised 7,006 - - 3,020 10,026 Additions through business combinations (note 34) - - 59 - 59 Amounts used (2,528) - - - (2,528) Payments (103) - - (1,043) (1,146) Exchange differences (414) (2,381) (232) (179) (3,206) Carrying amount at the end of the year 16,606 26,913 168 13,417 57,104
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 71 Note 23. Other liabilities Consolidated 2026 2025 $'000 $'000 Current liabilities Deferred consideration 712 497 Accrued expenses 103,009 77,371 Deferred revenue 3,164 7,288 Revenue received in advance 3,975 3,746 Other current liabilities 1,795 1,741 112,655 90,643 Non-current liabilities Deferred consideration 1,111 964 Subsidies and grants received in advance - 11 1,111 975 113,766 91,618 Note 24. Issued capital Consolidated 2026 2025 2026 2025 Shares Shares $'000 $'000 Ordinary shares - fully paid 271,656,692 271,542,854 860,118 859,620 Movements in ordinary share capital Details Date Shares $'000 Balance 1 July 2024 269,778,791 853,179 Conversion of rights 2 September 2024 7,273 $3.76 27 Dividend reinvestment 21 October 2024 1,353,877 $3.98 5,387 Dividend reinvestment 24 April 2025 402,913 $2.55 1,027 Balance 30 June 2025 271,542,854 859,620 Dividend reinvestment 22 October 2025 52,052 $4.93 258 Dividend reinvestment 20 April 2026 61,786 $3.87 240 Balance 30 June 2026 271,656,692 860,118 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. Share buy-back There is no current on-market share buy-back.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 24. Issued capital (continued) 72 Capital risk management The Group's objectives when managing capital are 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. The Group monitors capital on the basis of its gearing ratio. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debts. Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated as total borrowings less cash and cash equivalents. The Group is subject to certain financing arrangements covenants and meeting these are given priority in all capital risk management decisions. There have been no events of default on the financing arrangements during the financial year. The capital risk management policy remains unchanged from 30 June 2025. The gearing ratio at the reporting date was as follows: Consolidated 2026 2025 $'000 $'000 Current liabilities - trade and other payables (note 15) 88,153 95,576 Non-current liabilities - borrowings (note 17) 801,903 806,321 Total borrowings 890,056 901,897 Current assets - cash and cash equivalents (note 7) (176,330) (182,784) Net debt 713,726 719,113 Total equity 952,614 957,915 Total capital 1,666,340 1,677,028 Gearing ratio 43% 43% Note 25. Reserves Foreign currency reserve The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign operations to Australian dollars. It is also used to recognise gains and losses on hedges of the net investments in foreign operations. Hedging reserve - cash flow hedges The reserve is used to recognise the effective portion of the gain or loss of cash flow hedge instruments that is determined to be an effective hedge. Other capital reserves The reserve is used to recognise the value of equity benefits provided to employees and Directors as part of their remuneration, and other parties as part of their compensation for services.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 25. Reserves (continued) 73 Movements in reserves Movements in each class of reserve during the current and previous financial year are set out below: Share option surplus Cash flow hedging Foreign currency Total Consolidated $'000 $'000 $'000 $'000 Balance at 1 July 2024 1,513 (293) 15,707 16,927 Revaluation - gross - (7,437) - (7,437) Deferred tax - 2,231 - 2,231 Share based payment expense 1,098 - - 1,098 Employee rights converted (178) - - (178) Foreign currency translation - - 21,214 21,214 Balance at 30 June 2025 2,433 (5,499) 36,921 33,855 Revaluation - gross - 7,474 - 7,474 Deferred tax - (2,242) - (2,242) Share based payment expense 3,001 - - 3,001 Foreign currency translation - - (30,033) (30,033) Balance at 30 June 2026 5,434 (267) 6,888 12,055 Note 26. Non-controlling interest The non-controlling interest $3,000 (30 June 2025: $3,000), relates to Torrens Connect Pty Ltd which is a majority owned subsidiary in the consolidated group under accounting standards however operationally is a joint venture entity used to service the Torrens Transit Tram contract in South Australia. Note 27. Dividends Dividends Dividends paid during the financial year were as follows: Consolidated 2026 2025 $'000 $'000 Interim fully franked dividend for the year ended 30 June 2026 paid 20 April 2026 of 8.0 cents (2025: 8.0 cents) per ordinary share 21,727 21,691 Final fully franked dividend for the year ended 30 June 2025 paid 21 October 2025 of 9.5 cents (2024: 9.5 cents) per ordinary share 25,797 25,630 47,524 47,321 Participation in the Dividend Reinvestment Plan (DRP) is offered to shareholders in Australia, New Zealand, the United Kingdom, Jersey, Canada and Qualified Institutional Buyers in the United States. Refer to the current Eligibility Notice to be released on same date as this report including minor changes for USA shareholders reflecting regulatory changes in the USA. Under the DRP, Kelsian shares will be issued at the average of the daily volume weighted average market price of Kelsian shares sold on ASX during the 10 trading days commencing 18 September 2026 with no discount. The DRP election date for determining participation is 16 September 2026. The non-cash dividend reinvestment component of the dividend paid was $498,000 (FY25: $6,416,000). Franking credits Consolidated 2026 2025 $'000 $'000 Franking credits available at the reporting date based on a tax rate of 30% 103,057 111,214 Franking credits available for subsequent financial years based on a tax rate of 30% 103,057 111,214
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 74 Note 28. Financial instruments Financial risk management objectives The Group's activities expose it to a variety of financial risks: market risk (including foreign currency risk, price risk and interest rate risk), credit risk and liquidity risk. The Group's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. The Group uses derivative financial instruments such as forward foreign exchange contracts to hedge certain risk exposures. Derivatives are exclusively used for hedging purposes, i.e. not as trading or other speculative instruments. The Group uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in the case of interest rate, foreign exchange and other price risks and ageing analysis for credit risk. Risk management is carried out by senior finance executives ('finance') under policies approved by the Board of Directors ('the Board'). These policies include identification and analysis of the risk exposure of the Group and appropriate procedures, controls and risk limits. Finance identifies, evaluates and hedges financial risks within the Group's operating units. Finance reports to the Board on a monthly basis. Market risk Foreign currency risk The Group undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk through foreign exchange rate fluctuations. Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities denominated in a currency that is not the entity's functional currency. The risk is measured using sensitivity analysis and cash flow forecasting. The carrying amount of the Group's foreign currency denominated financial assets and financial liabilities at the reporting date were as follows: Assets Liabilities 2026 2025 2026 2025 Consolidated $'000 $'000 $'000 $'000 US dollars 202,173 218,753 200,903 218,321 Pound Sterling 1,928 2,096 26,913 29,294 Singapore dollars 1 612 - - 204,102 221,461 227,816 247,615 The Group had net current liabilities denominated in foreign currencies of $23,714,000 (assets of $204,102,000 less liabilities of $227,816,000) as at 30 June 2026 (2025: net current liabilities of $26,154,000, assets of $221,461,000 less liabilities of $247,615,000). Based on this exposure, had the Australian dollar weakened by 5%/strengthened by 5% (2025: weakened by 5.0%/strengthened by 5.0%) against these foreign currencies with all other variables held constant, the Group 's profit before tax for the year would have been $1,345,000 higher/lower (2025: $1,500,000 lower/higher) and equity would have been $941,500 higher/lower (2025: $1,000,000 lower/higher). The percentage change is the expected overall volatility of the significant currencies, which is based on management's assessment of reasonable possible fluctuations taking into consideration movements over the last 6 months each year and the spot rate at each reporting date. The net foreign exchange gain for the year ended 30 June 2026 was a non-cash unrealised gain of $1,441,000 (2025: loss of $926,000). There is no expectation the foreign exchange movements will be realised in the future as they relate to indefinite intercompany loans and provisions. Price risk The Group is not exposed to any significant price risk from fluctuations in fuel price as this is indexed in the bus contracts and passed through to the customer. Interest rate risk The Group's main interest rate risk arises from long-term borrowings. Borrowings obtained at variable rates expose the Group to interest rate risk. Borrowings obtained at fixed rates expose the Group to fair value interest rate risk. The policy is to maintain approximately 50% of current borrowings at fixed rates using interest rate swaps to achieve this when necessary.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 28. Financial instruments (continued) 75 As at the reporting date, the Group had the following average interest rate borrowings and interest rate swap contracts outstanding: 2026 2025 Weighted average interest rate Balance Weighted average interest rate Balance Consolidated % $'000 % $'000 Commercial bills - floating 5.31% 801,903 5.36% 806,321 Ringfenced finance facilities 5.48% 78,711 5.48% 88,950 Interest rate swap contracts - cash flow hedges 4.25% (399,056) 3.22% (406,342) Net exposure to cash flow interest rate risk 481,558 488,929 The Group has entered into interest rate swap contracts of $399,056,000 (2025: $406,342,000) that effectively hedges approximately 46% (2025: 50.0%) of the Company's exposure to fluctuations in interest rates from senior debt. An analysis by remaining contractual maturities is shown in the liquidity risk management section below. For the Group the commercial bills outstanding, totalling $801,903,000 (2025: $806,321,000) are interest only payment loans. Monthly cash outlays of approximately $3,550,000 (2025: $3,400,000) per month are required to service the interest payments. An official increase in interest rates of 0.5% and decrease of 1% (2025: increase of 0.5% and decrease of 1.0%) basis points would have an adverse effect on profit before tax of $4,009,000 and positive effect of $8,019,000 respectively (2025: adverse effect on profit before tax $4,000,000 and positive effect of $8,000,000 respectively). The percentage change is based on the expected volatility of interest rates using market data and analysts forecasts. There are no minimum principal repayments due (2025: nil). For the ringfenced facilities of $78,711,000 (2025: $88,950,000) repayments are principal and interest. Monthly cash outlays of approximately $1,186,000 per month (2025: $1,245,000) are required to service the repayments. An official increase in interest rates of 0.5% and decrease of 1% (2025: increase of 0.5% and decrease of 1.0%) basis points would have an adverse effect on profit before tax of $393,000 and positive effect of $787,000 respectively (2025: adverse effect on profit before tax of $71,000 and positive effect of $142,000 respectively). The percentage change is based on the expected volatility of interest rates using market data and analysts forecasts. The minimum principal repayments due were $13,446,000 (2025: $14,200,000). Credit risk Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has a strict code of credit, including obtaining agency credit information, confirming references and setting appropriate credit limits. The Group obtains guarantees where appropriate to mitigate credit risk. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial statements. The Group does not hold any collateral. Customer credit risk is managed by each business unit subject to the Group’s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on references, industry knowledge, ability to pay and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored with an analysis reported to the Board monthly. Material debtors are largely associated with government agencies and are reviewed by management taking into consideration the associated credit ratings and risk applicable to the relevant country (for international operations) or state within Australia and are generally considered relatively low risk. Generally, trade and other receivables are written off when there is no reasonable expectation of recovery. Indicators of this include the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual payments for a period greater than 1 year. There were no exposures that comprised more than 30% of trade receivables. Collection of this debt is generally not considered doubtful however some small provisions have been made for debts with the indicators of no reasonable recovery. Financial instruments and cash deposits Credit risk from balances with banks and financial institutions is managed by the Safety, Risk and Sustainability Committee in accordance with the Group’s policy. Investments of surplus funds are only placed with the Group's major bank. Liquidity risk Vigilant liquidity risk management requires the Group to maintain sufficient liquid assets (mainly cash and cash equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable. The Group manages liquidity risk using a liquidity planning tool and by maintaining adequate cash reserves and available borrowing facilities by continuously monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 28. Financial instruments (continued) 76 The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans, interchangeable limits, finance leases and hire purchase contracts. The Group’s policy is to ensure that the core funding limits have no less than a 12 month maturity date. The Group assessed the concentration of risk with respect to refinancing its debt and concluded it to be low. Access to sources of funding is sufficiently available and debt maturing within 12 months can be rolled over with existing or alternative lenders. Financing arrangements Unused borrowing facilities at the reporting date: Consolidated 2026 2025 $'000 $'000 Facility A - multi currency revolving credit 29,000 52,000 Facility B - USD revolving credit 139,758 138,931 Facility C - revolving letter of credit 50,093 60,081 218,851 251,012 Subject to the continuance of satisfactory credit ratings, the bank loan facilities may be drawn at any time and have an average maturity of 3 years with an evergreen option to extend the term of the facility (2025: 1.7 years). Remaining contractual maturities The following tables detail the Group's remaining contractual maturity for its financial instrument liabilities. Except for leases, the tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ from their carrying amount in the statement of financial position. Weighted average interest rate 1 year or less Between 1 and 5 years Over 5 years Remaining contractual maturities Consolidated - 2026 % $'000 $'000 $'000 $'000 Non-derivatives Non-interest bearing Trade payables 49,903 - - 49,903 Other payables 24,508 - - 24,508 BAS payables 13,742 - - 13,742 Financial guarantee contracts (on demand) 129,907 - - 129,907 Insurance bonds (on demand) 47,900 - - 47,900 Interest-bearing variable Commercial bills 5.31% 44,532 980,031 - 1,024,563 Ringfenced finance facility 5.48% 14,236 73,006 - 87,242 Interest-bearing - fixed rate Hire purchase 2.66% 3,733 6,082 2,442 12,257 Lease liability 6.32% 41,082 118,399 30,791 190,272 Total non-derivatives 369,543 1,177,518 33,233 1,580,294
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 28. Financial instruments (continued) 77 Weighted average interest rate 1 year or less Between 1 and 5 years Over 5 years Remaining contractual maturities Consolidated - 2025 % $'000 $'000 $'000 $'000 Non-derivatives Non-interest bearing Trade payables 48,637 - - 48,637 Other payables 30,901 - - 30,901 BAS payables 16,038 - - 16,038 Financial guarantee contracts (on demand) 119,919 - - 119,919 Insurance bonds (on demand) 318 - - 318 Interest-bearing variable Commercial bills 5.36% 43,247 836,876 - 880,123 Ringfenced finance facility 5.48% 14,945 77,004 10,245 102,194 Interest-bearing - fixed rate Hire purchase 4.86% 3,034 5,088 157 8,279 Lease liability 5.05% 32,372 107,250 38,041 177,663 Total non-derivatives 309,411 1,026,218 48,443 1,384,072 Details about the financial guarantee contracts are provided in note 17. The amounts disclosed in the above tables are the maximum amounts allocated to the earliest period in which the guarantee could be called upon. The Group does not expect these payments to eventuate. The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above. Fair value of financial instruments Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value. Valuation techniques for fair value measurements categorised within level 2 Derivative financial instruments have been valued using quoted market rates. This valuation technique maximises the use of observable market data where it is available and relies as little as possible on entity specific estimates. The interest rate swap is categorised as a level 2 within the fair value hierarchy with the fair value determined using a present value valuation technique based on market inputs (including interest rates) which are actively traded and quoted through the Australian banking system. The fuel forward contract is categorised as a level 2 within the fair value hierarchy with the fair value determined using a present value valuation technique based on market inputs (including commodity swap pricing) which are actively traded and quoted through the Australian banking system. The two product types we have under the fuel forward contract are PLATTS Sing Gas Oil 10ppm and ICE Gas Oil. Valuation techniques for fair value measurements categorised within level 3 Level 3 financial assets and liabilities have been valued by using the discounted cash flows (DCF) method.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 28. Financial instruments (continued) 78 The fair values of financial assets and liabilities, together with their carrying amounts in the statement of financial position, for the Group are as follows: 2026 2025 Carrying amount Fair value Carrying amount Fair value Consolidated $'000 $'000 $'000 $'000 Assets Cash on hand 341 341 1,599 1,599 Cash at bank 175,989 175,989 174,429 174,429 Cash on deposit - - 6,756 6,756 176,330 176,330 182,784 182,784 Liabilities Commercial bills 801,903 801,903 806,321 806,321 Ringfenced finance facilities 78,711 78,711 88,950 88,950 880,614 880,614 895,271 895,271 The fair value of the financial assets and liabilities is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Management assessed that cash and short-term deposits, trade receivables, trade payables, bank overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments. Note 29. Key management personnel disclosures Directors The following persons were Directors of Kelsian Group Limited during the financial year: Directors Fiona Hele Non-Executive Director and Chair Terry Dodd Non-Executive Director Diane Grady AO Non-Executive Director Jacqueline McArthur Non-Executive Director Caroline Elliott Non-Executive Director Terry Sinclair Non-Executive Director Appointed 1 September 2025 Neil Smith Non-Executive Director Resigned 28 February 2026 Lance Hockridge Non-Executive Director Resigned 31 July 2025 Other key management personnel The following persons also had the authority and responsibility for planning, directing and controlling the major activities of the Group, directly or indirectly, during the financial year: Senior executives Andrew Muir Group Chief Financial Officer and Joint Kelsian Secretary Graeme Legh Group Chief Executive Officer Donna Gauci Chief Executive Officer - SeaLink Marine and Tourism (retired 30 June 2026) Michael McGee Chief Executive Officer - Transit Systems James (Brent) Maitland Chief Executive Officer - AAAHI
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 29. Key management personnel disclosures (continued) 79 Compensation The aggregate compensation made to Directors and other members of key management personnel of the Group is set out below: Consolidated 2026 2025 $'000 $'000 Short-term employee benefits 6,378 7,699 Long-term benefits 48 139 Share-based payments 737 (411) 7,163 7,427 Note 30. Remuneration of auditors During the financial year the following fees were paid or payable for services provided by Ernst & Young, the auditor of the Company, its network firms and unrelated firms: Consolidated 2026 2025 $'000 $'000 Audit services - Ernst & Young Audit or review of the financial statements 725 629 Other services - Ernst & Young Preparation of the tax return 51 55 Fuel tax credit assurance review - 13 Other tax related 141 9 CbC Reporting obligations 18 17 Tax residency review - 10 210 104 935 733 Audit services - network firms Audit or review of the financial statements 349 374 Other services - network firms Other - 119 Tax residency review - 40 - 159 349 533 Other services - unrelated firms Preparation of the tax return 334 357 Other 66 52 400 409
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 80 Note 31. Commitments Consolidated 2026 2025 $'000 $'000 Capital commitments Committed at the reporting date but not recognised as liabilities, payable: Vessels 8,010 19,887 Buses and motor vehicles 35,777 41,926 Land - 1,672 Other 8,400 10,104 52,187 73,589 Note 32. Related party transactions Parent entity Kelsian Group Limited is the parent entity. Subsidiaries Interests in subsidiaries are set out in note 35. Key management personnel Disclosures relating to key management personnel are set out in note 29 and the remuneration report included in the Directors' report. Transactions with related parties The following transactions occurred with related parties at arm's length prices: Consolidated 2026 2025 $ $ Payment for goods and services: Pacific Marine Group Pty Ltd (associated with Terry Dodd) - Provision of marine piling services - 519,071 ST Property Trust No. 2 (associated with Neil Smith) - Rental for Hoxton Park bus depot operated by Transit Systems Group in Australia - 8,849 ST Property Trust - Balance paid for purchase of strategic land and buildings Hoxton Park which settled in July 2024(1) - 28,260,000 (1) On 13 May 2024 Kelsian entered into a contract to acquire on arms' length terms, the Hoxton Park bus depot in Sydney from ST Property Trust No. 2 (an entity controlled or jointly controlled by Neil Smith) for $31,400,000 The property value was supported by an independent valuation undertaken by Savills Valuations Sydney. A deposit of $3,140,000 was paid during FY24 and settlement took place on 31 July 2024. Receivable from and payable to related parties There were no trade receivables from or trade payables to related parties at the current and previous reporting date. Loans to/from related parties There were no loans to or from related parties at the current and previous reporting date. Terms and conditions All transactions were made on normal commercial terms and conditions and at market rates.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 81 Note 33. 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 Profit after income tax 55,804 52,319 Total comprehensive income 55,804 52,319 Statement of financial position Parent 2026 2025 $'000 $'000 Total current assets 18,641 12,167 Total assets 1,219,881 1,166,841 Total current liabilities 39,002 23,566 Total liabilities 345,655 318,568 Equity Issued capital 860,118 859,620 Hedging reserve - cash flow hedges (267) (5,499) Other capital reserves 5,434 2,433 Retained profits/(accumulated losses) 8,941 (8,281) Total equity 874,226 848,273 Guarantees entered into by the parent entity in relation to the debts of its subsidiaries The parent has entered into various cross-guarantees with its subsidiaries to support borrowings across the Group. Refer note 37 for further details. Contingent liabilities The parent entity had no contingent liabilities as at 30 June 2026 (2025: Nil). Capital commitments - Property, plant and equipment The parent entity had no capital commitments for property, plant and equipment as at 30 June 2026 (2025: Nil). Material accounting policy information The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 1, 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.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 82 Note 34. Business combinations Current period acquisition of South Wales Transport (Neath) (SWT) On 31 October 2025, Tower Transit Limited acquired 100% of the voting shares in South Wales Transport (Neath) Limited, a small-family owned bus operator in Swansea, Wales, for approximately £1.6 million that provides strategic contracts and assets in the regional bus contract market in the UK. SWT operates a fleet of approximately 49 vehicles (buses and coaches) throughout South Wales and beyond from a leasehold depot, with the majority of existing services under contract from Swansea Council, which will shortly be operating under the umbrella of Transport for Wales ahead of the upcoming Bus Franchise tenders, as well as local universities and schools. The acquired business would have contributed revenues of $11,306,000 and profit after tax of $270,000 for the 12-month period 1 July 2025 to 30 June 2026. Details of the acquisition are as follows: Fair value $'000 Trade and other receivables 914 Income tax refund due 26 Inventories 181 Prepayments 34 Plant and equipment 286 Leasehold improvements 81 Motor vehicles 1,082 Right-of-use assets 4,212 Customer contracts 2,920 Trade and other payables (743) Deferred tax liability (1,763) Employee benefits (95) Other provisions (59) Lease liability (4,212) Net assets acquired 2,864 Goodwill 730 Acquisition-date fair value of the total consideration transferred 3,594 The amounts disclosed above are provisional as at 26 August 2026. Prior period acquisition of Huyton Travel Limited (HTL Buses) On 20 February 2025, Tower Transit Limited acquired 100% of the voting shares in Huyton Travel Limited (HTL Buses) a small family- owned bus operator in Liverpool for approximately £1 million that provides strategic contracts and assets in the regional bus contract market in the UK. HTL Buses operates a fleet of approximately 65 vehicles (39 buses, 12 minibuses, 14 shuttle vehicles) throughout Merseyside and the North West from a leasehold depot, with the majority of existing services under contract from Merseytravel, the transport authority for the Liverpool region in the UK. The acquired business would have contributed revenues of $12.0m and profit after tax of $318,000 for the period 1 July 2024 to 30 June 2025 had it been held for the full period. The values identified in relation to the acquisition of Huyton Travel Limited are final as at 30 June 2026.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 83 Note 35. 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 1: Ownership interest Principal place of business / 2026 2025 Name Country of incorporation % % AAAHI Acquisition Corporation United States of America 100.00% 100.00% AAAHI Intermediate Holdings LLC United States of America 100.00% 100.00% AAAHI Tempco, LLC United States of America 100.00% 100.00% AAAHI Topco Corporation United States of America 100.00% 100.00% Ace Express Coaches, LLC United States of America 100.00% 100.00% All Aboard America! Holdings, Inc United States of America 100.00% 100.00% All Aboard America! School Transportation, LLC United States of America 100.00% 100.00% All Aboard Transit Services, LLC United States of America 100.00% 100.00% Australia Inbound Pty Ltd Australia 100.00% 100.00% Avonward Pty Ltd Australia 100.00% 100.00% Big Red Cat Pty Ltd Australia 100.00% 100.00% BITS Assets Pty Ltd Australia 100.00% 100.00% BITS Ferry Services Pty Ltd Australia 100.00% 100.00% Captain Cook Cruises Pty Ltd Australia 100.00% 100.00% CT Plus Guernsey Ltd Channel Islands 100.00% 100.00% CT Plus Jersey Ltd Channel Islands 100.00% 100.00% Curtis Island Assets Pty Ltd Australia 100.00% 100.00% Curtis Island Services Pty Ltd Australia 100.00% 100.00% First Class Transportation, LLC United States of America 100.00% 100.00% Hotard Coaches, Inc United States of America 100.00% 100.00% Huyton Travel Limited United Kingdom 100.00% 100.00% Industrial Bus Lines, Inc United States of America 100.00% 100.00% Jersey Public Bus Assets Limited(2) Channel Islands 100.00% - Kangaroo Island Adventure Tours Pty Ltd Australia 100.00% 100.00% Kangaroo Island Odysseys Pty Ltd Australia 100.00% 100.00% Kangaroo Island SeaLink Pty Ltd Australia 100.00% 100.00% KBRV Resort Operations Pty Ltd Australia 100.00% 100.00% KBRV Services Pty Ltd Australia 100.00% 100.00% Kelsian International Holdings Pty Ltd Australia 100.00% 100.00% Kelsian Marine NZ Limited(2) New Zealand 100.00% - Kelsian NZ Holdings Limited(2) New Zealand 100.00% - Kelsian SG Pte Ltd(2) Singapore 100.00% - Kelsian UK Limited United Kingdom 100.00% 100.00% Kelsian USA Inc. United States of America 100.00% 100.00% Lux Bus America Co United States of America 100.00% 100.00% Lux Leasing, LLC United States of America 100.00% 100.00% Magnetic Island Cruise Corporation Pty Ltd Australia 100.00% 100.00% McClintock Enterprises, Inc United States of America 100.00% 100.00% NT Bus and Coachlines Pty Ltd Australia 100.00% 100.00% PDW Pty Ltd Australia 100.00% 100.00% RiverCity Ferries Pty Ltd Australia 100.00% 100.00% S. V. Haoust Pty Ltd Australia 100.00% 100.00% Sea Stradbroke Services Pty Ltd Australia 100.00% 100.00% SeaCap Pte Ltd Singapore 100.00% 100.00% SeaLink Ferries Pty Ltd Australia 100.00% 100.00% SeaLink Fraser Island Pty Ltd Australia 100.00% 100.00% SeaLink KI Ferries Pty Ltd Australia 100.00% 100.00% SeaLink KI Holding Pty Ltd Australia 100.00% 100.00% SeaLink Marina Pty Ltd Australia 100.00% 100.00% SeaLink Marine Services QLD Pty Ltd Australia 100.00% 100.00% SeaLink Northern Territory Pty Ltd Australia 100.00% 100.00% SeaLink Queensland Pty Ltd Australia 100.00% 100.00% SeaLink SA Ferry Services Pty Ltd Australia 100.00% 100.00%
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 35. Interests in subsidiaries (continued) 84 Ownership interest Principal place of business / 2026 2025 Name Country of incorporation % % SeaLink Tasmania Pty Ltd Australia 100.00% 100.00% SeaLink Vessels Pty Ltd Australia 100.00% 100.00% Sita Coaches Pty Ltd Australia 100.00% 100.00% Sita Tours Pty Ltd Australia 100.00% 100.00% South Wales Transport (Neath) Ltd(3) United Kingdom 100.00% - STG Properties Pty Ltd Australia 100.00% 100.00% Stradbroke Assets Pty Ltd Australia 100.00% 100.00% Stradbroke Ferries Pty Ltd Australia 100.00% 100.00% Sunferries Travel Pty Ltd Australia 100.00% 100.00% Sureride Charter, Inc United States of America 100.00% 100.00% Swan Transit Canning Pty Ltd(4) Australia - 100.00% Swan Transit Group Pty Ltd(4) Australia - 100.00% Swan Transit Kalamunda Pty Ltd(4) Australia - 100.00% Swan Transit Marmion Pty Ltd(4) Australia - 100.00% Swan Transit Midland Pty Ltd(4) Australia - 100.00% Swan Transit Pty Ltd Australia 100.00% 100.00% Swan Transit Services (South West) Pty Ltd Australia 100.00% 100.00% Swan Transit Services (South) Pty Ltd Australia 100.00% 100.00% Swan Transit Services Pty Ltd Australia 100.00% 100.00% Swan Transit South West Pty Ltd(4) Australia - 100.00% Swan Transit Southern River Pty Ltd(4) Australia - 100.00% Territory Transit Holdings Pty Ltd Australia 100.00% 100.00% Territory Transit Pty Ltd Australia 100.00% 100.00% The Living Classroom Pty Ltd Australia 100.00% 100.00% The Port Jackson & Manly Steamship Company Pty Ltd Australia 100.00% 100.00% The South Australian Travel Company Pty Ltd Australia 100.00% 100.00% Torrens Connect Pty Ltd(1) Australia 55.00% 55.00% Torrens Transit Group Pty Ltd(4) Australia - 100.00% Torrens Transit Pty Ltd Australia 100.00% 100.00% Torrens Transit Services (North) Pty Ltd(4) Australia - 100.00% Torrens Transit Services Pty Ltd Australia 100.00% 100.00% Tower Transit Asset Holdings Limited(5) United Kingdom 100.00% - Tower Transit Europe Pty Ltd Australia 100.00% 100.00% Tower Transit Limited United Kingdom 100.00% 100.00% Tower Transit Operations Ltd United Kingdom 100.00% 100.00% Tower Transit Services Pte Ltd(2) Singapore 100.00% - Tower Transit Singapore Pte Ltd Singapore 100.00% 100.00% Tower Transit Training Singapore Pty Ltd Australia 100.00% 100.00% Transit (NSW) Group Pty Ltd(4) Australia - 100.00% Transit (NSW) Liverpool Pty Ltd Australia 100.00% 100.00% Transit (NSW) Services Pty Ltd Australia 100.00% 100.00% Transit Systems (Victoria) Pty Ltd Australia 100.00% 100.00% Transit Systems Finance Holdings Pty Ltd Australia 100.00% 100.00% Transit Systems MBF Pty Ltd Australia 100.00% 100.00% Transit Systems Melbourne Pty Ltd Australia 100.00% 100.00% Transit Systems NSW Pty Ltd Australia 100.00% 100.00% Transit Systems NSW GSBC2 Assets Pty Ltd Australia 100.00% 100.00%
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 35. Interests in subsidiaries (continued) 85 Ownership interest Principal place of business / 2026 2025 Name Country of incorporation % % Transit Systems NSW GSBC3 Assets Pty Ltd Australia 100.00% 100.00% Transit Systems NSW R6 Assets Pty Ltd Australia 100.00% 100.00% Transit Systems NSW SW Pty Ltd Australia 100.00% 100.00% Transit Systems NSW TTP Pty Ltd Australia 100.00% 100.00% Transit Systems Pty Ltd Australia 100.00% 100.00% Transit Systems Queensland Pty Ltd Australia 100.00% 100.00% Transit Systems WA Holdings Pty Ltd Australia 100.00% 100.00% Transit Systems WA Pty Ltd Australia 100.00% 100.00% Transit Systems West Pty Ltd Australia 100.00% 100.00% Transit Systems West Services Pty Ltd Australia 100.00% 100.00% TravelLink Pty Ltd Australia 100.00% 100.00% TravelLink Technology Pty Ltd Australia 100.00% 100.00% Vivonne Bay Outdoor Education Centre Pty Ltd Australia 100.00% 100.00% Vyscot Pty Ltd Australia 100.00% 100.00% WA Bus and Coachlines Pty Ltd Australia 100.00% 100.00% (1) Torrens Connect Pty Ltd is a subsidiary member of the consolidated group for accounting purposes but operationally functions as a joint venture. Refer note 26. (2) Incorporated during the year. (3) Acquired on 31 October 2025. Refer to note 34. (4) Deregistered during the year. (5) Restored to the UK register during the financial year for administrative purposes and currently pending voluntary dissolution. Note 36. Interests in joint ventures Kelsian has a 50% joint controlling interest in International Travel Technology Pty Ltd which was not trading at 30 June 2026 (2025: Not trading). Note 37. Deed of cross guarantee The parent has entered into various cross-guarantees with its subsidiaries to support borrowings across the Group. Pursuant to ASIC Corporations (Wholly-owned Companies) Instrument 2016/785, Kelsian Group Limited and the following subsidiaries have entered into a Deed of Cross Guarantee on 3 June 2019: Kangaroo Island SeaLink Pty Ltd, Captain Cook Cruises Pty Ltd, SeaLink Queensland Pty Ltd, Curtis Island Assets Pty Ltd, Curtis Island Services Pty Ltd, TSA Ferry Group Pty Ltd, Stradbroke Ferries Pty Ltd, Stradbroke Assets Pty Ltd, Sealink Ferries Pty Ltd, KBRV Resort Operations Pty Ltd and SeaLink Fraser Island Pty Ltd. On 9 June 2020 the following subsidiaries entered into a deed of assumption and also became parties to that Deed of Cross Guarantee: Transit Systems (Victoria) Pty Ltd (formerly Sita Bus Lines Pty Ltd), Sita Coaches Pty Ltd, Transit Systems Pty Ltd, Swan Transit Pty Ltd, Swan Transit Services Pty Ltd, Torrens Transit Pty Ltd, Torrens Transit Services Pty Ltd, Transit (NSW) Services Pty Ltd, Transit Systems West Pty Ltd, Transit Systems West Services Pty Ltd, Sita Tours Pty Ltd, Swan Transit Group Pty Ltd and Transit (NSW) Group Pty Ltd. On 25 June 2021, the following subsidiary entered into a deed of assumption and also became party to that Deed of Cross Guarantee: Transit NSW (Liverpool) Pty Ltd. On 23 June 2022, the following subsidiary entered into a deed of assumption and also became party to that Deed of Cross Guarantee: S.V. Haoust Pty Ltd (trading as Go West Tours). On 30 June 2023, the following subsidiaries entered into a deed of assumption and also became party to that Deed of Cross Guarantee: Transit Systems WA Holdings Pty Ltd, WA Bus and Coachlines Pty Ltd and Kelsian International Holdings Pty Ltd. On 25 June 2024, the following subsidiaries entered into a deed of assumption and also became parties to that Deed of Cross Guarantee: Swan Transit Services (South) Pty Ltd, Transit Systems NSW Pty Ltd and Transit Systems NSW SW Pty Ltd. On 27 June 2025, the Deed of Cross Guarantee entered into with the following subsidiaries was revoked by Revocation Deed: Sealink Queensland Pty Ltd, Transit Systems Queensland Pty Ltd, Stradbroke Assets Pty Ltd, Stradbroke Ferries Pty Ltd, Transit (NSW) Services Pty Ltd, Swan Transit Group Pty Ltd, Transit (NSW) Group Pty Ltd and Transit (NSW) Liverpool Pty Ltd.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 37. Deed of cross guarantee (continued) 86 The effect of the deed is that Kelsian Group Limited has guaranteed to pay any deficiency in the event of winding up any controlled entity or if they do not meet their obligations under the terms of overdrafts, loans, leases or other liabilities subject to the guarantee. The controlled entities have also given a similar guarantee in the event Kelsian Group Limited is wound up or it does not meet its obligations under the terms of the overdrafts, loans, leases or other liabilities subject to the guarantee. In reliance on ASIC Corporations (Audit Relief) Instrument 2016/784, subsidiary companies in the closed group (as described above) that are also large proprietary companies have complied with the terms of that instrument and relied on it for relief from individual auditing requirements for those companies as separate entities. The statement of profit or loss and other comprehensive income and statement of financial position are substantially the same as the Group and therefore have not been separately disclosed. Note 38. Events after the reporting period A fully franked dividend of 10.0 cents per share was declared by Kelsian’s Directors on 26 August 2026, representing a total payment of $27,165,669 to be paid 21 October 2026 based on the current number of ordinary shares on issue. Auckland ferry services contract win and acquisition of Belaire Ferries On 2 July 20 26, Kelsian announced a joint bid led by its Australian marine division, SeaLink, and estab lished Auckland-based ferry operator Belaire Ferries, had been se lected by Auckland Transport to operate Auckl and's Western Package ferry services follow ing a competitive tender process. The new Auckland Transport ferry services contracts are scheduled to commence with six vessels on 1 July 2027 and have an initial term of seven years, with an option to extend for a further two years. Kelsian will acquire Belaire Ferries and as part of the contract commitments, Kelsian has undertaken to procure five new vessels costing approximately A$31 million for the network during the contract term. Tourism Portfolio Divestment On 25 August 2026, Kelsian and Journey Beyond agreed not to proceed with the sale of Sealink Rottnest (total consideration of $15.2 million on a cash and debt free basis, subject to customary working capital adjustments). The parties are continuing to work towards satisfying necessary regulatory conditions for divestment of the Tourism Portfolio excluding Sealink Rottnest, the transaction is expected to complete in 1HFY27. Apart from the above and the dividend declared as disclosed in note 27, no other matter or circumstance has arisen since 30 June 2026 that has significantly affected, or may significantly affect the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 87 Note 39. Reconciliation of profit after income tax to net cash from operating activities Consolidated 2026 2025 $'000 $'000 Profit after income tax expense for the year 63,525 54,494 Adjustments for: Depreciation and amortisation 160,400 148,968 Share-based payments 3,001 917 Write off of assets - 245 Net loss/(gain) on disposal of non-current assets (1,538) 44,703 Foreign currency differences 12,595 (4,119) Change in operating assets and liabilities: Increase in trade and other receivables (23,155) (27,394) Increase in inventories (613) (2,391) Decrease in income tax refund due 4,093 - Increase in deferred tax assets (2,242) - Increase in derivative assets - (2,024) Increase in prepayments (5,097) (2,211) Increase in other operating assets (5,148) (380) Decrease in trade and other payables (16,926) (26,339) (Decrease)/increase in contract liabilities (439) 1,288 Increase in derivative liabilities 157 2,025 (Decrease)/increase in provision for income tax (3,158) 1,947 Increase/(decrease) in deferred tax liabilities 3,062 (9,654) Increase in employee benefits 7,904 8,973 Increase in other provisions 3,051 13,669 Increase in other operating liabilities 20,590 2,455 Net cash from operating activities 220,062 205,172 Note 40. Earnings per share Consolidated 2026 2025 $'000 $'000 Profit after income tax attributable to the owners of Kelsian Group Limited 63,525 54,494 Earnings per share Cents Cents Basic earnings per share 23.4 20.1 Diluted earnings per share 23.2 20.0 Number Number Weighted average number of ordinary shares used in calculating basic earnings per share 271,590,667 270,793,480 Adjustments for calculation of diluted earnings per share: Performance rights 2,331,731 1,756,303 Restricted rights 141,569 61,929 Weighted average number of ordinary shares used in calculating diluted earnings per share 274,063,967 272,611,712
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 88 Note 41. Share-based payments Consolidated 2026 2025 $'000 $'000 Recognised share-based payment expenses Expense arising from performance rights issued in 2023 - 312 Expense arising from performance rights issued in 2024 755 737 Expense arising from performance rights issued in 2025 999 993 Expense arising from performance rights issued in 2026 1,527 - Forfeited performance rights (280) (944) 3,001 1,098 Types of share option plans Employee Performance Rights Plan (EPRP) Performance rights are generally granted to senior executives with more than 12 months service. The EPRP is designed to align participants interests with those of shareholders. When a participant ceases employment prior to the vesting of their performance rights or where the performance hurdle is not met, the performance rights lapse. Should all conditions be met, one ordinary share is issued for each performance right for no consideration to the participant. For the 2026 EPRP issue, there are three tranches of Performance Rights with the following weighting of performance conditions: (a) Tranche 1: Earnings Per Share Compound Annual Growth Rate (EPS CAGR): 33.3% weighting at target performance; (b) Tranche 2: Indexed Total Shareholder Return (iTSR): Total Shareholder Return (TSR) growth measured against the ASX Small Ordinaries Return Index: 33.3% weighting at target performance; and (c) Tranche 3: Return on Invested Capital (ROIC): 33.4 % weighting at target performance. For the 2026 Performance Rights to vest, Kelsian must achieve the following conditions: Tranche 1 - a compound annual growth rate (CAGR) of earnings per share (EPS) measured over a three-year measurement period, commencing 1 July 2025 (2026 issue). For the 2026 issue a target threshold CAGR over that three-year period of 5% will result in 50% of the Performance Rights in Tranche 1 vesting, with pro rata vesting for the 2026 issue for achievement for between 5% and 10% of CAGR for the three-year measurement period. Tranche 2 - an Annualised Indexed TSR measured against the ASX Small Ordinaries Total Return Index for the period from 1 July 2025 to 30 June 2028 (2026 issue). A threshold annualised Kelsian TSR over that three year period meeting the Index will result in 50% of the Performance Rights in Tranche 2 vesting, with pro rata vesting of the remainder of the tranche for achievement a CAGR of up to 10% above the Index TSR for the three-year measurement period. Tranche 3 - Annual Group ROIC will be calculated as underlying Earnings Before Interest, Taxation and Amortisation (EBITA) divided by average Invested Capital. The average annual ROIC will be compared to the average pre-tax Weighted Average Cost of Capital (WACC) over the measurement period. Performance hurdles for vesting will be achieved where ROIC performance is as follows: Average annual Kelsian Group ROIC Group CEO - Percentage of Performance Rights that vest Other participants - Percentage of Performance Rights that vest Less than WACC+1% Nil Nil WACC+1% 33.33% of Rights vest 25% of Rights vest Greater than WACC+1% but less than WACC+2% Between 33.33% and 66.67% Rights vest pro rata Between 25% and 50% Rights vest pro rata WACC+2% 66.67% of Rights vest 50% of Rights vest Greater than WACC+2% but less than WACC+4% Between 66.67% and 100% Rights vest pro rata Between 50% and 100% Rights vest pro rata WACC+4% and above 100% of Rights vest 100% of Rights vest For the 2024 and 2025 EPRP issue there are two tranches of Performance Rights with the following weighting: (a) 50% for earnings per share growth (Tranche 1). (b) 50% for Total Shareholder Return (TSR) growth measured against companies in the ASX 200 Total Return Index (Tranche 2). For the 2024 and 2025 Performance Rights to vest, Kelsian must achieve the following conditions: Tranche 1 - a compound annual growth rate (CAGR) of earnings per share (EPS) measured over a three-year measurement period, commencing 1 July 2023 (2024 issue) and 1 July 2024 (2025 issue). For the 2024 and 2025 issues a target threshold CAGR over that three-year period of 5% will result in 50% of the Performance Rights vesting, with pro rata vesting for the 2024 and 2025 issue for achievement for between 5% and 10% of CAGR for the three-year measurement period.
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KELSIAN GROUP LIMITED NOTES TO THE FINANCIAL STATEMENTS 30 June 2026 Note 41. Share-based payments (continued) 89 Tranche 2 - an Annualised Indexed TSR measured against the ASX200 Total Index Return for 1 July 2023 (2024 issue) and 1 July 2024 (2025 issue). A threshold annualised Kelsian TSR over that three year period meeting the Index will result in 50% of the Performance Rights vesting, with pro rata vesting of the remainder of the tranche for achievement of CAGR of up to 10% above the Index TSR for the three-year measurement period. The amount recognised as an expense is only adjusted when performance rights do not vest due to non‑market‑related conditions. The fair value of the performance rights granted is estimated at the date of grant using a custom binomial lattice pricing model, taking into account terms and conditions upon which the performance rights were granted. Effective date issued 2026 Issue 2025 Issue 2024 Issue Number of Performance Rights issued 909,476 1,278,178 552,610 Minimum hurdle share price Nil Nil Nil Dividend yield 3.5% 4.40%-4.50% 2.60%-2.80% Expected volatility (as per valuation) 40% 35% 35% Risk free interest rate 3.4% 4.4%-4.5% 4.1%-4.3% Expected life (years) 2.7 2.7 2.6-2.7 Valuation per performance right (Tranche 1 - KMP) $6.054 $1.162 $2.627 Valuation per performance right (Tranche 1 - CEO) $6.054 $1.236 $2.472 Valuation per performance right (Tranche 2 - KMP) $4.529 $3.489 $5.749 Valuation per performance right (Tranche 2 - CEO) $4.529 $3.588 $5.586 Performance rights Number Weighted average Number Weighted average (000's) exercise price (000's) exercise price 2026 2025 Outstanding at the beginning of the year 2,015 n/a 974 n/a Granted (under the Employee Performance Rights Plan) 910 $Nil 1,278 $Nil Forfeited (318) $Nil (237) $Nil Exercised - n/a - n/a 2,607 2,015
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KELSIAN GROUP LIMITED CONSOLIDATED ENTITY DISCLOSURE STATEMENT As at 30 June 2026 90 Place formed / Ownership interest Entity name Entity type Country of incorporation % Tax residency Kelsian Group Limited Body corporate Australia - Australia AAAHI Acquisition Corporation Body corporate United States of America 100.00% United States of America AAAHI Intermediate Holdings LLC Body corporate United States of America 100.00% United States of America AAAHI Tempco, LLC Body corporate United States of America 100.00% United States of America AAAHI Topco Corporation Body corporate United States of America 100.00% United States of America Ace Express Coaches, LLC Body corporate United States of America 100.00% United States of America All Aboard America! Holdings, Inc Body corporate United States of America 100.00% United States of America All Aboard America! School Transportation, LLC Body corporate United States of America 100.00% United States of America All Aboard Transit Services, LLC Body corporate United States of America 100.00% United States of America Australia Inbound Pty Ltd Body corporate Australia 100.00% Australia Avonward Pty Ltd Body corporate Australia 100.00% Australia Big Red Cat Pty Ltd Body corporate Australia 100.00% Australia BITS Assets Pty Ltd Body corporate Australia 100.00% Australia BITS Ferry Services Pty Ltd Body corporate Australia 100.00% Australia Captain Cook Cruises Pty Ltd Body corporate Australia 100.00% Australia CT Plus Guernsey Ltd Body corporate Channel Islands 100.00% United Kingdom CT Plus Jersey Ltd Body corporate Channel Islands 100.00% United Kingdom Curtis Island Assets Pty Ltd Body corporate Australia 100.00% Australia Curtis Island Services Pty Ltd Body corporate Australia 100.00% Australia First Class Transportation, LLC Body corporate United States of America 100.00% United States of America Hotard Coaches, Inc Body corporate United States of America 100.00% United States of America Huyton Travel Limited Body corporate United Kingdom 100.00% United Kingdom Industrial Bus Lines, Inc Body corporate United States of America 100.00% United States of America Jersey Public Bus Assets Limited(2) Body corporate Channel Islands 100.00% United Kingdom Kangaroo Island Adventure Tours Pty Ltd Body corporate Australia 100.00% Australia Kangaroo Island Odysseys Pty Ltd Body corporate Australia 100.00% Australia Kangaroo Island SeaLink Pty Ltd Body corporate Australia 100.00% Australia KBRV Resort Operations Pty Ltd Body corporate Australia 100.00% Australia KBRV Services Pty Ltd Body corporate Australia 100.00% Australia Kelsian International Holdings Pty Ltd Body corporate Australia 100.00% Australia Kelsian Marine NZ Limited(2) Body corporate New Zealand 100.00% New Zealand Kelsian NZ Holdings Limited(2) Body corporate New Zealand 100.00% New Zealand Kelsian SG Pte Ltd(2) Body corporate Singapore 100.00% Singapore Kelsian UK Limited Body corporate United Kingdom 100.00% United Kingdom Kelsian USA Inc. Body corporate United States of America 100.00% United States of America Lux Bus America Co Body corporate United States of America 100.00% United States of America Lux Leasing, LLC Body corporate United States of America 100.00% United States of America Magnetic Island Cruise Corporation Pty Ltd Body corporate Australia 100.00% Australia McClintock Enterprises, Inc Body corporate United States of America 100.00% United States of America NT Bus and Coachlines Pty Ltd Body corporate Australia 100.00% Australia PDW Pty Ltd Body corporate Australia 100.00% Australia RiverCity Ferries Pty Ltd Body corporate Australia 100.00% Australia S. V. Haoust Pty Ltd Body corporate Australia 100.00% Australia Sea Stradbroke Services Pty Ltd Body corporate Australia 100.00% Australia SeaCap Pte Ltd Body corporate Singapore 100.00% Singapore SeaLink Ferries Pty Ltd Body corporate Australia 100.00% Australia SeaLink Fraser Island Pty Ltd Body corporate Australia 100.00% Australia SeaLink KI Ferries Pty Ltd Body corporate Australia 100.00% Australia SeaLink KI Holding Pty Ltd Body corporate Australia 100.00% Australia SeaLink Marina Pty Ltd Body corporate Australia 100.00% Australia SeaLink Marine Services QLD Pty Ltd Body corporate Australia 100.00% Australia SeaLink Northern Territory Pty Ltd Body corporate Australia 100.00% Australia SeaLink Queensland Pty Ltd Body corporate Australia 100.00% Australia SeaLink SA Ferry Services Pty Ltd Body corporate Australia 100.00% Australia SeaLink Tasmania Pty Ltd Body corporate Australia 100.00% Australia SeaLink Vessels Pty Ltd Body corporate Australia 100.00% Australia
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KELSIAN GROUP LIMITED CONSOLIDATED ENTITY DISCLOSURE STATEMENT As at 30 June 2026 91 Place formed / Ownership interest Entity name Entity type Country of incorporation % Tax residency Sita Coaches Pty Ltd Body corporate Australia 100.00% Australia Sita Tours Pty Ltd Body corporate Australia 100.00% Australia South Wales Transport (Neath) Ltd(3) Body corporate United Kingdom 100.00% United Kingdom STG Properties Pty Ltd Body corporate Australia 100.00% Australia Stradbroke Assets Pty Ltd Body corporate Australia 100.00% Australia Stradbroke Ferries Pty Ltd Body corporate Australia 100.00% Australia Sunferries Travel Pty Ltd Body corporate Australia 100.00% Australia Sureride Charter, Inc Body corporate United States of America 100.00% United States of America Swan Transit Canning Pty Ltd(4) Body corporate Australia - Australia Swan Transit Group Pty Ltd(4) Body corporate Australia - Australia Swan Transit Kalamunda Pty Ltd(4) Body corporate Australia - Australia Swan Transit Marmion Pty Ltd(4) Body corporate Australia - Australia Swan Transit Midland Pty Ltd(4) Body corporate Australia - Australia Swan Transit Pty Ltd Body corporate Australia 100.00% Australia Swan Transit Services (South West) Pty Ltd Body corporate Australia 100.00% Australia Swan Transit Services (South) Pty Ltd Body corporate Australia 100.00% Australia Swan Transit Services Pty Ltd Body corporate Australia 100.00% Australia Swan Transit South West Pty Ltd(4) Body corporate Australia - Australia Swan Transit Southern River Pty Ltd(4) Body corporate Australia - Australia Territory Transit Holdings Pty Ltd Body corporate Australia 100.00% Australia Territory Transit Pty Ltd Body corporate Australia 100.00% Australia The Living Classroom Pty Ltd Body corporate Australia 100.00% Australia The Port Jackson & Manly Steamship Company Pty Ltd Body corporate Australia 100.00% Australia The South Australian Travel Company Pty Ltd Body corporate Australia 100.00% Australia Torrens Connect Pty Ltd(1) Body corporate Australia 55.00% Australia Torrens Transit Group Pty Ltd(4) Body corporate Australia - Australia Torrens Transit Pty Ltd Body corporate Australia 100.00% Australia Torrens Transit Services (North) Pty Ltd(4) Body corporate Australia - Australia Torrens Transit Services Pty Ltd Body corporate Australia 100.00% Australia Tower Transit Asset Holdings Limited(5) Body corporate United Kingdom 100.00% United Kingdom Tower Transit Europe Pty Ltd Body corporate Australia 100.00% Australia Tower Transit Limited Body corporate United Kingdom 100.00% United Kingdom Tower Transit Operations Ltd Body corporate United Kingdom 100.00% United Kingdom Tower Transit Services Pte Ltd(2) Body corporate Singapore 100.00% Singapore Tower Transit Singapore Pte Ltd Body corporate Singapore 100.00% Singapore Tower Transit Training Singapore Pty Ltd Body corporate Australia 100.00% Australia Transit (NSW) Group Pty Ltd(4) Body corporate Australia - Australia Transit (NSW) Liverpool Pty Ltd Body corporate Australia 100.00% Australia Transit (NSW) Services Pty Ltd Body corporate Australia 100.00% Australia Transit Systems (Victoria) Pty Ltd Body corporate Australia 100.00% Australia Transit Systems Finance Holdings Pty Ltd Body corporate Australia 100.00% Australia Transit Systems MBF Pty Ltd Body corporate Australia 100.00% Australia Transit Systems Melbourne Pty Ltd Body corporate Australia 100.00% Australia Transit Systems NSW Pty Ltd Body corporate Australia 100.00% Australia
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KELSIAN GROUP LIMITED CONSOLIDATED ENTITY DISCLOSURE STATEMENT As at 30 June 2026 92 Place formed / Ownership interest Entity name Entity type Country of incorporation % Tax residency Transit Systems NSW GSBC2 Assets Pty Ltd Body corporate Australia 100.00% Australia Transit Systems NSW GSBC3 Assets Pty Ltd Body corporate Australia 100.00% Australia Transit Systems NSW R6 Assets Pty Ltd Body corporate Australia 100.00% Australia Transit Systems NSW SW Pty Ltd Body corporate Australia 100.00% Australia Transit Systems NSW TTP Pty Ltd Body corporate Australia 100.00% Australia Transit Systems Pty Ltd Body corporate Australia 100.00% Australia Transit Systems Queensland Pty Ltd Body corporate Australia 100.00% Australia Transit Systems WA Holdings Pty Ltd Body corporate Australia 100.00% Australia Transit Systems WA Pty Ltd Body corporate Australia 100.00% Australia Transit Systems West Pty Ltd Body corporate Australia 100.00% Australia Transit Systems West Services Pty Ltd Body corporate Australia 100.00% Australia TravelLink Pty Ltd Body corporate Australia 100.00% Australia TravelLink Technology Pty Ltd Body corporate Australia 100.00% Australia Vivonne Bay Outdoor Education Centre Pty Ltd Body corporate Australia 100.00% Australia Vyscot Pty Ltd Body corporate Australia 100.00% Australia WA Bus and Coachlines Pty Ltd Body corporate Australia 100.00% Australia (1) Torrens Connect Pty Ltd is a subsidiary member of the consolidated group for accounting purposes but operationally functions as a joint venture. Refer note 26. (2) Incorporated during the year. (3) Acquired on 31 October 2025. Refer to note 34. (4) Deregistered during the year. (5) Reinstated during the year.
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KELSIAN GROUP LIMITED DIRECTORS' DECLARATION 30 June 2026 93 In the Directors' opinion: ● the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; ● the attached financial statements and notes comply with International Financial Reporting Standards accounting standards as issued by the International Accounting Standards Board as described in note 1 to the financial statements; ● the attached financial statements and notes give a true and fair view of the Group's financial position as at 30 June 2026 and of its performance for the financial year ended on that date; ● there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; ● at the date of this declaration, there are reasonable grounds to believe that the members of the Extended Closed Group will be able to meet any obligations or liabilities to which they are, or may become, subject by virtue of the deed of cross guarantee described in note 37 to the financial statements; and ● the information disclosed in the attached consolidated entity disclosure statement is true and correct. The Directors have been given the declarations required by section 295A of the Corporations Act 2001. 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 ___________________________ Fiona A Hele Chair 26 August 2026
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94 Independent auditor’s report to the members of Kelsian Group Limited Report on the audit of the financial report Opinion We have audited the financial report of Kelsian Group Limited (the Company) and its subsidiaries (collectively the Group), which comprises the consolidated statement of financial position as at 30 June 2026, the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, notes to the financial statements, including material accounting policy information, the consolidated entity disclosure statement and the directors’ declaration. In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including: a. Giving a true and fair view of the consolidated financial position of the Group as at 30 June 2026 and of its consolidated financial performance for the year ended on that date; and b. Complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. 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 Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to audits of the financial report of public interest entities in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key audit matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial report of the current year. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context. We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial report section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial report. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial report. A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation
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95 Impairment of Intangible Assets Why significant How our audit addressed the key audit matter The Group carries a significant amount of goodwill and other intangible assets. As stated in Note 14 to the financial statements, the carrying value of goodwill and other intangible assets are tested annually for impairment. The Group performed its annual impairment test and determined the recoverable amount on a value in use basis of its individual cash generating units (CGUs), to which the goodwill was allocated. The Group’s impairment assessment resulted in no impairment for the year. Goodwill impairment was considered a key audit matter because impairment assessment requires estimation and significant judgement in respect of assumptions used in the value in use calculation. The Group makes assumptions in respect of future market and economic conditions such as economic growth, expected inflation rates, demographic developments, revenue and margin Key assumptions relating to the impairment test are disclosed in Note 14 to the financial statements. Key assumptions used in the impairment testing are inherently subjective and changes in certain assumptions can lead to significant changes in the recoverable amount of these assets. For this reason, we consider impairment of intangibles be a key audit matter and draw attention to the information in Note 14 to the financial statements. Our audit procedures included the following: ▪We considered the relationship between market capitalisation and net assets of the Group. ▪We assessed management’s determination of CGUs and allocation of goodwill to the CGUs. ▪We agreed the forecast cash flows used in the impairment model to Board approved budgets for the 2027 financial year. ▪We tested the mathematical accuracy of the cash flow models, including the terminal value calculations used to estimate value in use for the Group’s CGU’s for impairment assessment purposes and the models compliance with the requirements of Australian Accounting Standards. ▪We evaluated the Group’s key input assumptions used in the impairment model, analysed the extent to which the outcome of the impairment test was sensitive to changes in key assumptions and assessed the historical accuracy of the Group’s budgeting process. ▪We involved our valuation specialists to evaluate the reasonableness of the discount rate and the short and long- term growth rates used in the Group’s impairment models for its CGUs. ▪We considered external market data and assessed the historical accuracy of the Group’s forecasting and tested that the forecast revenue and margins were consistent with the most recent board-approved cash flow forecasts. ▪We compared the recoverable amount calculated within the value in use models to the carrying value recorded at 30 June 2026. ▪We assessed the adequacy of the disclosures in Note 14 to the financial statements. Information other than the financial report and auditor’s report thereon The directors are responsible for the other information. The other information comprises the information included in the Company’s 2026 Annual Report other than the financial report and our auditor’s report thereon and the Company’s Sustainability Report. Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon in this auditor’s report, with the exception of the Remuneration Report and our related assurance opinion. We have issued a separate auditor’s report on selective sustainability information included in the Sustainability Report. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, 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. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation
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96 Responsibilities of the directors for the financial report The directors of the Company are responsible for the preparation of: ▪The financial report (other than the consolidated entity disclosure statement) that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001; and ▪The consolidated entity disclosure statement that is true and correct in accordance with the Corporations Act 2001; and for such internal control as the directors determine is necessary to enable the preparation of: ▪The financial report (other than the consolidated entity disclosure statement) that gives a true and fair view and is free from material misstatement, whether due to fraud or error; and ▪The consolidated entity disclosure statement that is true and correct and is free of misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the financial report Our objectives are 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 the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and 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 this financial report. As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: ▪Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. ▪Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. ▪Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosur es made by the directors. A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation
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97 ▪Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. ▪Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation. ▪Plan and perform the Group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the Group as a basis for forming an opinion on the Group financial report. We are responsible for the direction, supervision and review of the audit work performed for the purposes of the Group audit. We remain solely responsible for our audit opinion. We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated to the directors, we determine those matters that were of most significance in the audit of the financial report of the current year and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on the audit of the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in pages 16 to 39 of the directors’ report for the year ended 30 June 2026. In our opinion, the Remuneration Report of Kelsian Group Limited for the year ended 30 June 2026, complies with section 300A of the Corporations Act 2001. A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation
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98 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 responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. Nigel Stevenson Partner Adelaide 26 August 2026 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Ernst & Young
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 99 1. Basis of preparation This Report represents a complete set of climate-related disclosures for Kelsian Group Limited and its subsidiaries ('Kelsian' or 'the Group') for the financial year ended 30 June 2026. It has been prepared in accordance with the Australian Accounting Standards Board (AASB) S2 Climate-related Disclosures and the requirements of the Corporations Act 2001. This Report has been prepared for the same consolidated reporting entity and reporting period as the Group’s Consolidated Financial Statements and should be read in conjunction with the Group’s Consolidated Financial Statements. Given this is the first year of reporting under AASB S2, Kelsian has applied available transition reliefs permitted under Appendix C of AASB S2 and has not disclosed (1) comparative information and (2) Scope 3 greenhouse gas (GHG) emissions. This Report contains forward-looking statements, including statements made throughout this document regarding the Group’s current intentions, expectations, assessments and assumptions in relation to climate-related risks and opportunities, future operating conditions, policy and regulatory developments, and the resilience of the Group’s strategy and business model under different climate-related scenarios. Forward-looking statements are based on information available to Kelsian as at the date of this Report and involve known and unknown risks, uncertainties, assumptions and other factors that may cause actual outcomes to differ materially from those expressed or implied. These factors include, but are not limited to, changes in government policy and regulation, funding arrangements under service contracts, technology development and availability, economic conditions, and the inherent uncertainty associated with climate projections and scenario analysis. Statements relating to scenario analysis, climate resilience and future pathways are not predictions or forecasts and should not be relied upon as indications of future performance. They reflect assessments made for the purpose of complying with AASB S2 requirements and to inform stakeholders of how climate-related considerations are integrated into the Group’s strategy and risk management processes. 2. Judgements and uncertainties 2.1 Judgements The preparation and presentation of this Report involves applying judgements to determine what information is relevant, reliable and useful for disclosure. This includes interpreting reporting requirements and making informed decisions in areas where the standard allows flexibility. Key judgements applied are summarised below: TOPIC DESCRIPTION Materiality assessment To identify relevant climate related risks and opportunities and material information, Kelsian exercised judgement in assessing potential impacts and likelihood of occurrence of risks and opportunities that could reasonably be expected to affect the Group’s prospects. These judgements are informed by the previous work it has undertaken under Task Force on Climate- related Financial Disclosures (TCFD), external views and publications on industry-relevant risks and opportunities, and the scenario analysis undertaken. Greenhouse gas (GHG) emissions Kelsian exercised judgement in determining the organisational and operational boundaries for GHG emissions reporting and selecting appropriate emissions factors. These judgements were made to provide a reasonable and supportable basis for emissions reporting in the Group’s first year of reporting under AASB S2. See ‘Emissions calculation methodology’ for more detail. Scenario selection Kelsian undertook climate-related scenario analysis during the reporting period as part of its assessment of climate resilience. The analysis was conducted using externally developed climate-related assumptions, selected to capture a range of plausible future transition and physical risk outcomes relevant to the Group’s operations and value chain. Management exercised judgement in selecting scenarios that were globally recognised, methodologically credible and appropriate to the Group’s operating footprint, contractual arrangements and exposure to both physical and transition risks. See ‘Climate resilience and scenario analysis’ in section 6.5 for more detail.
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 100 2.2 Measurement uncertainty Measurement uncertainty in this Report arises from data gaps, external factors and forward-looking information. This relates to: TOPIC DESCRIPTION GHG emission factors GHG quantification is unavoidably subject to significant inherent limitations because of incomplete scientific knowledge and inherent limitations in the nature of, and methods used for, determining emissions factors and data. The selection by management of different but acceptable emissions factors or measurement techniques may result in materially different GHG emissions reported. Resilience assessment Kelsian’s assessment of climate resilience is subject to significant uncertainty, reflecting the inherent limitations of climate scenario analysis, the long-term nature of the risks considered, and the complex interplay between global scenario assumptions, domestic regulation and energy transition policies. Importantly, the scenarios considered do not represent forecast outcomes. For physical climate-related risk assessments, these rely on external climate models and internal assumptions about asset vulnerability. Kelsian engaged an external service provider to generate location specific climate hazard projections derived from multiple credible climate information sources. These inputs involve significant levels of measurement uncertainty due to variability in climate projections and assumptions about adaptation measures. The resilience assessment is also subject to uncertainty arising from assumptions regarding future asset configuration, technology availability, policy implementation, energy market developments and adaptation responses. The analysis assumes a broadly static portfolio and does not seek to predict future acquisitions, divestments, contract renewals or changes in customer demand. Actual outcomes may differ materially from those reflected in the scenarios considered. Financial effects uncertainty Measurement uncertainty also arises in assessing anticipated financial effects of climate- related risks and opportunities. This reflects uncertainty in the timing and severity of physical climate events, the pace and design of regulatory and policy change, future technology costs, customer and government responses, and the extent to which contractual protections, funding support or other mitigations remain available. As a result, qualitative disclosures have been provided where the financial effect could not be estimated reliably. 3. Introduction Kelsian is Australia’s largest integrated multi-modal transport provider and tourism operator, dedicated to delivering journeys through safe and intelligent transport solutions that enhance the sustainability and liveability of the communities we serve. Headquartered in Adelaide since 1989, Kelsian has consistently demonstrated agility in uncertain times and is uniquely positioned for future growth. Our Group is comprised of: ● Transit Systems Group: Operating domestic public transport contracts and charter services across six Australian states and territories; ● All Aboard America! Holdings (‘AAAHI’): Providing motorcoach services in seven states in the southwestern United States; ● SeaLink Marine & Tourism: Connecting travellers with some of Australia’s most iconic holiday destinations and experiences; and ● Tower Transit: Operating international public transport contracts in Singapore, the Channel Islands, and the United Kingdom. As at 30 June 2026, Kelsian directly employed over 13,300 people and operates 6,317 buses, and 122 vessels that delivered more than 384 million customer journeys over the last year. 4. Governance 4.1 Board oversight The Kelsian Board has oversight of the Group's enterprise risks and opportunities including climate-related risks and opportunities that could reasonably be expected to affect the Group’s prospects. These risks and opportunities are considered as part of strategic planning, acquisitions, divestments and capital allocation decisions. Where trade‑offs arise between climate‑related considerations and other business objectives, the Board considers the associated risks, opportunities, costs, benefits and alignment with the Group’s strategy and risk appetite before determining the most appropriate course of action. Oversight of climate-related matters is embedded within the Board’s formal governance arrangements, including relevant Board and committee charters. The Board is supported by the Safety, Risk and Sustainability Committee, which is a committee of the Board and has delegated responsibility for detailed oversight of the Group’s sustainability and climate-related risk profile. The Safety, Risk and Sustainability Committee oversees the adequacy of the Group’s risk management framework as it relates to climate- related risks and opportunities, including the processes used to identify, assess, manage and monitor those risks. The Committee provides guidance on the Group’s sustainability positioning and ESG risk treatment strategies, and reports to the Board on climate-related matters. Sustainability is a standard agenda item at quarterly Safety, Risk & Sustainability Committee meetings. The Committee receives updates from Management (via paper) at each Committee meeting, which includes information on climate-related risks and opportunities, and progress against climate-related targets. The Committee also reviews climate-related targets and transition actions proposed by Management prior to recommendation to the Board for approval.
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 101 All Directors have access to the papers of all Board Committees and are invited to attend Committee meetings and engage directly with matters under consideration. At the Board meeting following each Safety, Risk and Sustainability Committee meeting, the Chair of the Committee provides a verbal update to the Board on key matters considered by the Committee. Through access to Committee papers, attendance rights and updates provided by the Committee Chair at Board meetings, all Directors are informed of climate-related risks and opportunities and progress against climate-related targets. During FY26, all Directors were informed of the Group's climate-related risks and opportunities on two occasions through this governance process. The Board undertakes an annual review of its collective skills, experience and diversity to assess whether it is appropriately positioned to lead and oversee the Group’s strategy and performance. This review is supported by a Boards skills matrix, with each Director undertaking a self-assessment against defined competency areas, which includes corporate sustainability and climate-related risk management. As at 25 September 2025, two Directors are assessed as having advanced capability, four as having intermediate, and two as having basic experience in and understanding of corporate sustainability practices to manage the impact of the business on the environment and community, and managing potential business impacts of climate change/transition. 4.2 Executive management oversight Executive management is responsible for the day-to-day management of climate-related risks and opportunities, and for implementing the strategic direction and oversight set by the Board. Management’s responsibilities include identifying, assessing, managing and monitoring climate-related risks and opportunities, and integrating these considerations into operational decision-making and business planning. Overall executive accountability for climate-related matters sits with the Group Chief Legal and Risk Officer, supported by the Head of Risk, Assurance and ESG, with additional financial oversight provided by the Group Chief Financial Officer. Operating business leadership teams are responsible for overseeing climate-related risks and opportunities within their areas of control, supported by central risk, sustainability and assurance functions. This includes an annual review of climate-related risks and opportunities. These activities are supported by internal controls and procedures embedded within the Group’s risk management, assurance and reporting processes. Management oversight is further supported by governance and assurance mechanisms, including the Executive Risk Committee, the Group Chief Legal and Risk Officer and the Internal Audit function. Management monitors performance against climate-related metrics and targets on an ongoing basis. This includes annual greenhouse gas emissions reporting and periodic reporting on progress against emissions reduction targets, as applicable to specific business units. To coordinate the delivery of climate-related initiatives, a Climate Change Steering Committee has been established to provide oversight over outcomes of climate risk and opportunity assessments and other climate-related reports prior to their submission to Board Committees, and considers actions required to support compliance with climate-related disclosure requirements. The Climate Change Steering Committee meets quarterly, with progress updates provided to the Safety, Risk and Sustainability Committee. Refer to the table below for further detail. SUMMARY OF BOARD AND MANAGEMENT GOVERNANCE COMMITTEES No. of CRROs* updates in FY26 Climate Change Steering Committee 2 • Approved approach and work program to comply with requirements of AASB S2. • Reviewed all climate related reports prior to being provided to Board Committees for oversight. Executive Risk Committee 4 • Reviewed preliminary outcomes of climate risks and opportunities workshops and modelling. • Reviewed risk and resilience assessments of CRROs identified and approach adopted. Board Safety, Risk and Sustainability Committee 2 • Reviewed progress against climate related targets. • Received progress updates on approach to complying with requirements of AASB S2 and agreed work program. • Reviewed preliminary outcomes of climate risks and opportunities workshops and modelling. • Reviewed risk and resilience assessments of CRROs identified and approach adopted. Board Finance and Audit Committee 2 • Received progress updates on approach to complying with requirements of AASB S2 and agreed work program. * Climate-related risks and opportunities.
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 102 5. Risk management 5.1 Process overview Kelsian manages its climate-related risks and opportunities pursuant to the Group’s Risk Management Policy and Risk Management Framework, which aligns with the principles of ISO 31000:2018 risk management – Guidelines. The approach to identifying, assessing, prioritising, managing, monitoring and communicating climate-related risks and opportunities is consistent with all other types of business- related risks and the Group’s enterprise risk management processes, rather than through standalone or parallel systems. Climate-related risk and opportunity registers are reviewed and updated at least annually through structured workshops with operating business leadership teams and Group executives. These reviews consider changes in risk exposure, emerging climate-related trends and developments, and the effectiveness of existing risk treatment actions. Outcomes are used to refresh risk assessments and support ongoing management and Board Committee oversight of climate-related risks and opportunities. For the purposes of identifying climate related risks and opportunities, Kelsian assumed that global GHG emissions and the physical impacts of climate change will be consistent with the Intergovernmental Panel on Climate Change (IPCC)'s SSP2-4.5. This scenario reflects a ‘middle-of-the-road’ pathway with moderate policy action and emissions stabilising over time, resulting in warming of approximately 2.1 to 3.5°C by 2100. 5.2 Physical climate-related risks and opportunities The physical climate exposure assessment focused on Kelsian's 114 operating locations globally. With assistance from an external subject matter expert, downscaled climate projections from the Munich Re Climate Change suite and climate scenario analysis aligned with Shared Socioeconomic Pathways (SSP1-2.6, SSP2-4.5, and SSP5-8.5) were used to identify potential inherent exposures to a range of physical climate hazards including heat stress, heat-humidity stress, water scarcity, drought, river flooding, storm surge, tropical cyclones, subsidence, fire weather, precipitation stress, and cold stress across multiple climate scenarios and time horizons. The modelling approach incorporated comprehensive geocoding and climate hazard scoring across operating locations and screened exposures across multiple future conditions to identify physical climate hazards that may affect the Group’s operations and assets. Following identification, the outputs of the modelling were assessed to determine whether the identified physical climate hazards could reasonably be expected to affect the Group’s prospects over the short, medium and long term. This assessment drew on insights and disclosures from previously undertaken climate-related risk assessments under the TCFD framework and considered a range of qualitative and quantitative factors consistent with the Group’s Risk Management Framework, including the potential severity and frequency of climate hazards and the number of operating locations potentially impacted. As part of this assessment, Kelsian also considered whether changing physical climate conditions could give rise to climate-related opportunities. No physical climate-related opportunities were identified that could reasonably be expected to affect the Group’s prospects. 5.3 Transition climate-related risks and opportunities Transition climate risks and opportunities were identified through a structured and collaborative process involving facilitated workshops with each operating business. Workshops involved senior executives across Operations, People and Culture, HSEQ, Finance and Legal functions. In advance of the workshops, research was undertaken to establish the transition context relevant to each operating business, drawing on insights and disclosures from previous risk assessments under the TCFD framework and external references. Workshops were used to identify potential transition risks and opportunities and to assess them in a structured manner. This was supplemented by benchmarking risks and opportunities identified against externally published industry reports such as the BIC Policy Position Paper Driving Towards Zero Emissions 2024, UNEP Climate Risks in the Transport Sector and maritime industry research journals. Following the workshops, climate- related transition risks and opportunities were documented within risk registers. Transition risks and opportunities were assessed at a divisional level to inform an enterprise view and assessment of potential impact (financial and non-financial consequences such as operational, regulatory and reputational) on the Group’s prospects. This included consideration of their likelihood, potential impacts and inherent risk ratings, as per the Group’s risk criteria (risk rating scale of ‘Low’, ‘Medium’, ‘High’ and ‘Very High) and Risk Management Framework. 6. Strategy 6.1 Strategic context and time horizons For the purposes of assessing climate-related risks and opportunities, the Group applies the following time horizons which broadly aligns with the Group’s strategic and business planning processes: ● Short term: 1 – 5 years; ● Medium term: 5 – 15 years; and ● Long term: greater than 15 years. The short-term horizon aligns with Kelsian's strategic planning, operating contract and capital allocation cycles, including fleet and vessel renewal, maintenance programs, depot and infrastructure upgrades, contract mobilisations and operational efficiency initiatives. It also reflects the period over which climate-related risks, regulatory developments and decarbonisation requirements can be reasonably assessed and incorporated into business planning and investment decisions. The medium-term horizon captures the period over which more significant changes in transport technology, climate policy, customer expectations and government procurement requirements are expected to emerge. This timeframe supports assessment of fleet transition pathways, infrastructure requirements, changing demand patterns and climate-related risks and opportunities that may influence the Group's strategic position.
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 103 The long-term horizon aligns with global decarbonisation pathways and net-zero objectives commonly used in climate-related scenario analysis. It supports assessment of longer-term transition risks and opportunities, asset resilience, evolving stakeholder expectations and the long-term sustainability of Kelsian's business model under different climate scenarios. 6.2 Climate-related risks and opportunities Kelsian has assessed a range of climate-related risks and opportunities (identified on an inherent basis) across our operating businesses and geographies to determine those that could be reasonably expected to affect our prospects. The assessment considered both: ● Climate-related physical risks, including acute and chronic climate hazards that may affect assets, operations or service continuity; and ● Climate-related transition risks, including policy and regulatory change, technology transition, market expectations and reputational considerations. Kelsian also assessed climate-related opportunities, particularly those arising from the global transition to lower-emission transport systems, increasing government and customer focus on decarbonisation. The following table contains information about our climate-related risks and opportunities identified that could reasonably be expected to affect our prospects, the time horizon in which Kelsian considers the effects of each climate-related risk and opportunity could reasonably occur, and the amount of Kelsian’s assets that are vulnerable to or aligned to the climate-related risk or opportunity disclosed. TYPE CLIMATE-RELATED RISKS OR OPPORTUNITIES TIME HORIZON ASSETS VULNERABLE TO RISKS/ALIGNED TO OPPORTUNITIES Physical Risk (Acute) Extreme Weather Events Short (S), medium (M) Fire Weather Stress Extreme weather events impact Kelsian’s vessels, terminals, depots, fleet and operations, resulting in service disruptions, asset damage, increased and long-term (L) # / % of global locations affected – 55 / 48% Precipitation Stress recovery costs and financial losses. # / % of global locations affected – 28 / 25% Other (Tropical Cyclone, River Flood, Storm Surge, Subsidence) # / % of global locations affected – 25 / 21% Physical Risk (Chronic) Extreme Heat Impacts on our S, M and L impacts Heat Stress Workforce, Assets and Infrastructure Prolonged extreme heat affects Kelsian's workforce, fleet and infrastructure, resulting in reduced increasing over time # / % of global locations affected – 50 / 44% Heat Humidity Stress productivity, increased maintenance costs, safety impacts and operational disruption. # / % of global locations affected – 65 / 57% Transition Risk Government Policy and Decarbonisation Requirements S, M and L with increasing impacts over time # / % of global locations affected – 61 / 54% (Tower Transit Singapore, Tower Changes in climate-related regulation and government decarbonisation requirements to transition to lower- emission transport solutions may increase compliance obligations and result in additional operating and capital expenditure associated with fleet replacement and supporting infrastructure across Kelsian's transport operations. Transit UK and Transit Systems) 6.3 Effects on business model and value chain and strategy and decision-making responses Kelsian does not expect our identified climate-related risks and opportunities to fundamentally alter its business model or strategy given existing mitigations in place as noted in the table below. The Group manages these risks through established governance arrangements, with roles, responsibilities and resourcing embedded across relevant functions, supporting ongoing monitoring and response without the need for material changes to current organisational structures. In our Australian public bus operations, we have set a target to reduce Scope 1 carbon intensity by at least 50% by 2035 from a FY22 baseline, with a pathway to net zero by 2050. This is supported by an established decarbonisation approach and glidepath, primarily driven through investment in zero-emission buses and supporting infrastructure under government-funded service contracts, and is embedded within operational and capital planning processes. The following table contains information about the current and anticipated effects of our identified climate-related risks and opportunities on the Group’s business model and value chain, and how the Group has and/or plans to respond to climate-related risks and opportunities in our strategy and decision-making.
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 104 RISK/ OPPORTUNITY CURRENT AND ANTICIPATED EFFECTS ON BUSINESS MODEL AND VALUE CHAIN MITIGATION OR ADAPTATION EFFORTS (DIRECT AND INDIRECT) Extreme Weather Events Extreme weather events may disrupt Kelsian’s transport and tourism operations, damage assets, and reduce customer demand, leading to potential financial losses and service delivery impacts. Extreme weather events have not had a significant impact on Kelsian’s business model or value chain during the reporting period. • Weather monitoring • Response and recovery plans & annual exercises • Contracts include force majeure clauses which would be triggered and prevent potential contractual penalties • Insurance Program Many mobile assets on our balance sheet may be relocated where operationally feasible in advance of or during an extreme weather event to minimise potential losses. Additional Mitigations • Divestment of our tourism portfolio With over 100 operating locations globally, our diversified geographic footprint reduces concentration of exposure to extreme weather events, helping to limit the potential for a single event to disrupt a significant proportion of the Group’s operations or financial performance. Extreme Heat Impacts on our Workforce, Assets and Infrastructure Increasing temperatures and prolonged extreme heat conditions may expose Kelsian’s transport network, assets, and workforce to sustained environmental stress, potentially leading to higher operating costs, reduced asset efficiency, reduced productivity, workforce injuries, and potential disruption to service delivery and long-term financial performance. Extreme heat impacts have not had a significant impact on our workforce, assets and infrastructure during the reporting period. • Assets maintained through preventative maintenance programs • Maintain climate-controlled fleet and facilities to manage heat stress and support safe and reliable operations • Global HSEQ Frameworks and Standards to manage workforce risks • Delivery of ongoing safety training and workforce wellbeing programs • Ability to recover costs through contractual mechanisms and pricing structures Government Policy and Decarbonisation Requirements Potential for increasingly stringent climate-related regulations and government decarbonisation requirements in some operating markets which could increase operating and capital costs and require investment in lower-emission fleet and supporting infrastructure, impacting Kelsian’s financial performance. • Investments in zero-emission buses (ZEBs) and depot electrification under government contracts • Staged fleet transition aligned to the government mandates, funding availability and contract requirement • Established contractual mechanisms and indexation arrangements that enable recovery of Kelsian’s public bus transport operations (Transit Systems Australia, Tower Transit UK and Singapore) are primarily exposed to this risk as governments in these jurisdictions are driving decarbonisation through mandated fleet transitions and net zero targets, supported by funding and long-term service contracts. decarbonisation-related costs • Active engagement with government clients to align decarbonisation pathways, funding and infrastructure requirements • Ongoing monitoring of climate policy and regulatory developments across jurisdictions In Kelsian’s Australian and United Kingdom public transport operations (Transit Systems Australia and Tower Transit UK), transition to low and zero‑emission fleets and supporting infrastructure is largely driven by government mandates under long‑term service contracts. These contracts incorporate the cost recovery of fleet electrification and depot upgrades into pricing and funding arrangements, reducing Kelsian’s direct financial exposure. Kelsian has established capability and experience in delivering electrification programs, supported by an existing ZEB fleet and operational electrified depots. In Tower Transit Singapore, the Singapore government’s Bus Contracting Model further limits exposure, with government ownership of fleet and infrastructure removing the requirement for capital investment in electrification, while Kelsian is only contracted to operate services. Government policy and decarbonisation requirements have not significantly impacted Kelsian's business model or value chain during the reporting period. 6.4 Financial position, financial performance and cash flows The following table contains information about the current and anticipated effects of our identified climate-related risks and opportunities on the Group’s financial position, financial performance and cash flows for the reporting period (current financial effects) and over the short, medium and long term (anticipated financial effects).
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 105 RISK/OPPORTUNITY FINANCIAL EFFECT Extreme Weather Events Current Financial Effects • No material financial effects have occurred from extreme weather events in FY26. Significant Risk of a Material Adjustment in FY27 • No significant risk of material adjustment to the carrying amounts of assets and liabilities in the next reporting period. Anticipated Financial Effects • Whilst we factor in potential disruptions which are inherent in our operations, there remains significant uncertainty regarding the timing, frequency and severity of such events. As a result, the level of measurement uncertainty remains sufficiently high that any estimate would not provide decision-useful information to users of the report. Extreme Heat Impacts on Workforce, Assets and Infrastructure Current Financial Effects • No material financial effects have occurred from extreme heat impacts on our assets and infrastructure or workforce in FY26. Significant Risk of a Material Adjustment in FY27 • No significant risk of material adjustment to the carrying amounts of assets and liabilities in the next reporting period. Anticipated Financial Effects • While potential increases in maintenance and capital expenditure may arise, these are generally recoverable through our service contracts. However, there remains significant uncertainty regarding the timing, severity and extent of future extreme heat impacts. As a result, the level of measurement uncertainty remains sufficiently high that any estimate would not provide decision-useful information to users of the report. Government Policy and Decarbonisation Requirements Current Financial Effects • No material financial effects have occurred due to climate policy changes and mandated decarbonisation requirements in FY26. Significant Risk of a Material Adjustment in FY27 • No significant risk of material adjustment to the carrying amounts of assets and liabilities in the next reporting period. Anticipated Financial Effects • Climate policy changes and government decarbonisation requirements may result in increased operating and capital costs associated with fleet replacement and supporting infrastructure. These costs are generally recoverable through contractual arrangements, government funding mechanisms or pricing structures. However, there remains significant uncertainty regarding future policy settings, the pace of decarbonisation and transition pathways across jurisdictions. As a result, the level of measurement uncertainty remains sufficiently high that any estimate would not provide decision-useful information to users of the report. 6.5 Climate resilience and scenario analysis Kelsian undertook climate-related scenario analysis during the reporting period as part of its assessment of climate resilience. The analysis was conducted using externally developed climate-related scenarios, selected to capture a range of plausible future transition and physical risk outcomes relevant to the Group’s operations and value chain. To assess climate-related physical risks, Kelsian undertook data-led risk modelling and applied three IPCC Shared Socioeconomic Pathways (SSPs) representing a range of temperature and emissions outcomes: IPCC SSPs ASSUMPTIONS SSP1-2.6 (lower warming scenario) • A ‘sustainability’ pathway with rapid emissions reductions and a transition to net zero. • This is expected to limit global warming to below 2°C relative to pre-industrial time. • SSP1-2.6 was used as a proxy for a lower warming scenario in the physical risk modelling due to the availability of more robust, location-specific datasets, and is not expected to materially impact the overall conclusions of the Group’s climate resilience assessment. SSP5-8.5 (higher warming scenario) • A high‑emissions ‘fossil-fuelled development’ pathway, where emissions rise significantly through to mid‑century. • This results in substantially higher warming of approximately 3.3 to 5.7°C by 2100. These scenarios were used to assess exposure to physical climate-related hazards across the Group’s operations and value chain, which included heat stress, flooding, storm surge, fire weather and water scarcity. These scenarios support the Group’s assessment of our reasonably expected physical climate-related risks and opportunities across a range of plausible climate futures.
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 106 To assess climate-related transition risks, Kelsian applied two scenarios developed by the Network for Greening the Financial System (NGFS), representing a range of transition pathways and policy outcomes: NGFS SCENARIO ASSUMPTIONS Net Zero 2050, representing an orderly transition consistent with limiting global warming to approximately 1.4°C. • Strong and tightening policy settings (e.g. carbon pricing, regulation, mandates) • Rapid decarbonisation of energy systems (renewables dominate, fossil fuels decline sharply) • Accelerated electrification across transport and infrastructure • Significant investment in low‑emission technology and infrastructure • Limited physical climate impacts (~1.5°C warming) Current Policies, representing limited additional climate policy action and higher long-term temperature outcomes. • No material strengthening of existing climate policies beyond today • Continued reliance on fossil fuels and slower energy transition • Limited carbon pricing / weak regulatory pressure • Gradual, market driven rather than policy driven transition • High cumulative emissions leading to significant warming (~3°C+) • Severe and escalating physical climate impacts (heat, extreme weather, asset damage) These scenarios were used to assess transition risks and opportunities arising from changes in climate policy, regulation, market dynamics, technology and stakeholder expectations under orderly, delayed and limited-action transition pathways. Kelsian considers the selected scenarios to be relevant for assessing its resilience because they are globally recognised and widely used frameworks, which reflect differing combinations of policy ambitions, market responses and physical climate outcomes. Kelsian acknowledges that scenario analysis involves inherent uncertainty and does not represent forecasts. The scenario analysis was undertaken using the following time horizons: ● Short term: 1 – 5 years; ● Medium term: 5 – 15 years; and ● Long term: greater than 15 years. 6.6 Transition Risk and Opportunity Resilience Outcomes The scenario analysis indicates that transition risk exposure across the Group remains low under both scenarios, primarily reflecting the contracted nature of our public transport operations, where government funding, mandates and cost recovery mechanisms support fleet transition. Under a lower warming scenario (Net Zero 2050), increased exposure is observed in relation to fleet and infrastructure decarbonisation costs in operations where assets are owned, as well as in marine operations, where transition pathways are constrained by higher costs and the limited maturity of low‑emission vessel technologies and supporting infrastructure. These exposures are expected to be managed through staged investment aligned to technology maturity, contract structures and cost recovery mechanisms.
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 107 POTENTIAL IMPACTS FROM SCENARIOS CLIMATE RELATED TRANSITION RISK NET ZERO 2050 (NGFS) CURRENT POLICIES (NGFS) Government Policy and Decarbonisation Requirements Government-backed Public Bus and Ferry Service Contracts • Short term – impacts are limited as policy settings continue to develop across both bus and marine sectors. • Medium to long term – strengthening Government-backed Public Bus and Ferry Service Contracts • Across bus and ferry operations, impacts are expected to remain limited over the short to long term, reflecting no material strengthening of existing policy settings. decarbonisation requirements may increase operating and capital costs across fleet and infrastructure. • Resilience – impacts are not expected to be • No significant changes to capital investment or infrastructure requirements, with operations expected to continue broadly under current contractual arrangements. material to the Group’s prospects, reflecting: o established contractual pass-through mechanisms; o government funding/support arrangements established electrification capability across operations; and o ability to stage investment over time. • Resilience - no material impact to the Group's overall prospects, given stable regulatory environment and existing commercial protections. • Marine considerations – transition for marine assets is expected to be slower, reflecting the lower maturity of low‑emission vessel technology and supporting infrastructure. This may result in higher capital costs and a more staged transition profile, managed through staged investment aligned to technology maturity, contract structures and cost recovery mechanisms. Shuttle and Charter Operations Shuttle and Charter Operations • Short term – impacts are limited given evolving policy settings and relatively low levels of mandated electrification in key markets (e.g. U.S). • Impacts are expected to remain limited across the short to long term, with minimal policy-driven pressure to transition fleet or infrastructure. • Medium to long term – tightening decarbonisation requirements in some jurisdictions may require targeted fleet and infrastructure investment where assets are owned. • Capital investment requirements are expected to be low, and operations largely continue unchanged. • Resilience – no material impact to the Group’s prospects given stable policy settings and existing • Resilience – impacts are not expected to be material to the Group’s prospects due to: contractual arrangements. o diversified operations across jurisdictions; o customer ownership structures; o contractual protections and cost recovery mechanisms; and o transition is expected to occur gradually, aligned to jurisdictional requirements. 6.7 Physical Risk Resilience Outcomes Kelsian’s exposure to physical climate risks is expected to remain broadly consistent across IPCC-selected scenarios and time horizons based on outcomes of external physical risk modelling. While the frequency or severity of certain hazards may increase over time across our operating locations, the overall impact at a Group level is not expected to materially differ from our current operating conditions. Kelsian’s globally diversified footprint reduces concentration of exposure against extreme weather, containing impacts to single locations or business units. Potential impacts are also managed through various direct and indirect mitigation and adaptation efforts such as response and recovery planning, preventative maintenance programs and operational resilience initiatives. 7. Metrics and targets 7.1 Climate-related metrics This section provides a comprehensive overview of our climate-related performance metrics for the reporting period. 7.2 Greenhouse gas emissions and emissions calculation methodology Kelsian measures greenhouse gas (GHG) emissions in accordance with the Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (2004). For this reporting period, Kelsian has disclosed absolute gross Scope 1 and Scope 2 emissions, measured in metric tonnes of carbon dioxide equivalent (tCO2‑e):
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 108 GREENHOUSE GAS EMISSIONS UNIT 2026 Scope 1 emissions (gross) tCO2-e 428,164 Scope 2 emissions (location based) (gross) tCO2-e 17,596 The Scope 1 and Scope 2 inventory covers Kelsian and its controlled entities, with emissions-producing activities across two Australian operating businesses, Transit Systems Group and SeaLink Marine & Tourism, and three international operating businesses, All Aboard America! Holdings, Tower Transit Singapore and Tower Transit UK. Kelsian has defined its organisational boundary using the operational control approach. This approach was considered the most appropriate basis for its transport operations, as it aligns emissions reporting with the assets and activities over which the Group has authority to implement operating policies. SCOPE EMISSIONS SOURCES DATA SOURCES CALCULATION METHOD ASSUMPTIONS AND ESTIMATES 1 Combustion of natural gas on-site (stationary) Supplier invoices (CCF/MMBtu) Consumption based No assumptions or estimations 1 Combustion of diesel onsite (stationary) Supplier invoices (kL) Consumption based No assumptions or estimations 1 Combustion of fuels by fleet (petrol) Supplier invoices (kL/gal) Consumption based No assumptions or estimations 1 Combustion of fuels by fleet (diesel) Supplier invoices (kL/gal) Consumption based No assumptions or estimations 1 Combustion of fuels by fleet (natural gas) Supplier invoices (m3) Consumption based No assumptions or estimations 2 Purchased electricity Supplier invoices (kWh) Consumption based No assumptions or estimations For Scope 2, emissions are reported using the location-based method, applying grid average emission factors per state for Australian and American operations and per country for operations in Singapore and the United Kingdom. A market-based method has not been applied, as Kelsian has not entered any contractual energy instruments during the reporting period. Emission factors applied in calculating Kelsian’s Scope 1 and Scope 2 greenhouse gas emissions for the reporting period were selected based on the relevant emissions source and operating jurisdiction. The Group used the latest published emission factors available at the time the calculations were prepared, where applicable. Global warming potential (GWP) values were not applied separately, as the emission factors used were already expressed on a carbon dioxide equivalent (CO 2-e) basis. The key emission factor sources are summarised below. REGION/LOCATION SOURCE REFERENCE Australia National Greenhouse Accounts (NGA) Factors Department of Climate Change, Energy, the Environment and Water (2025) National Greenhouse Accounts Factors 2025 Singapore Singapore Energy Statistics Energy Market Authority (2025) Singapore Energy Statistics United Kingdom Greenhouse gas reporting: conversion factors Department for Energy Security and Net Zero (2025) Greenhouse gas reporting: conversion factors 2025 United States U.S. EPA Emissions & Generation Resource Integrated Database (eGRID) (electricity) U.S. Environmental Protection Agency (2024) eGRID U.S. EPA Title 40 Mandatory Greenhouse Gas Reporting U.S. Environmental Protection Agency (2016) 40 CFR Part 98, Subpart C, Table C- 1: Default CO₂ Emission Factors and High Heat Values for Various Types of Fuel GHG data quality is managed through Kelsian's data ownership framework, under which each operating business has an assigned Data Owner accountable at business unit level for the completeness and accuracy of its emissions source data, with oversight consolidated at Group level by the Kelsian Group Financial Controller. Activity data is captured from consolidated invoices and operational records. Data quality is validated through reconciliation of consumption data against financial records and investigation of anomalies with the relevant Data Owners, and emission factors are reviewed annually against the most recent publicly available sources. 7.3 Financial metrics The assets and business activities vulnerable to climate-related transition risks, physical risks and climate-related opportunities are described in Section 6.2. Kelsian did not deploy any capital expenditure, financing or investment specifically towards climate-related risks and opportunities during FY26.
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 109 In FY26, climate-related considerations were not linked to executive remuneration outcomes, and no specific climate-related performance targets were included in executive incentive arrangements. Kelsian does not currently apply an internal carbon price in its decision-making processes and does not currently rely on carbon credits to achieve any greenhouse gas emissions targets. 7.4 Climate-related targets Kelsian has established a target to reduce Scope 1 greenhouse gas emissions intensity in its Australian public bus operations by at least 50% by 2035 relative to an FY22 baseline and to achieve net zero Scope 1 greenhouse gas emissions in its Australian public bus operations by 2050. Progress towards the 2035 target is measured using Scope 1 greenhouse gas emissions intensity, expressed as tonnes of carbon dioxide equivalent (tCO2-e) per $ million revenue. The targets were established having regard to the decarbonisation objectives of the Group's Australian government clients, and the anticipated transition of Australian public transport fleets to zero-emission buses. Achievement of the targets is expected to occur primarily through the progressive and full transition of the bus fleet to zero-emission buses and supporting depot infrastructure, consistent with government client’s emissions reduction objectives. Achievement of the targets is also dependent on the timing and extent of government client requirements, funding arrangements and associated investment in zero-emission buses and supporting infrastructure across the Group's Australian public bus operations. The targets and methodology used to establish them have not been validated by an independent third party and were not derived using a formal sectoral decarbonisation approach. Progress against the targets is monitored and reported through the Group's governance and reporting processes described in Section 4 of this Report. Performance against the 2035 target is assessed against the FY22 baseline emissions intensity of 203 tCO2-e per $ million revenue. In FY26, Scope 1 greenhouse gas emissions from Australian public bus operations were 215,014 tCO2-e and emissions intensity was 179 tCO2-e per $ million revenue, representing a 12% reduction in emissions intensity from the FY22 baseline and continued progress towards our targets. Kelsian does not currently rely on carbon credits to achieve its emissions reduction targets. The Group has not established a separate interim gross emissions reduction target associated with its 2050 net zero target beyond the 2035 emissions intensity target disclosed above. 8. Abbreviations and definition of key terms ABBREVIATION FULL TERM tCO2-e Tonnes of carbon dioxide equivalent TERM DEFINITION Scope 1 greenhouse gas emissions Direct greenhouse gas emissions that occur from sources that are owned or controlled by an entity, including fuel combustion in cars, buses and marine vessels. Scope 2 greenhouse gas emissions Indirect greenhouse gas emissions from the generation of purchased or acquired electricity, steam, heating or cooling consumed by an entity. Purchased and acquired electricity is electricity that is purchased or otherwise brought into an entity’s boundary. Scope 2 greenhouse gas emissions physically occur at the facility where electricity is generated. Scope 3 greenhouse gas emissions Indirect greenhouse gas emissions (not included in Scope 2 greenhouse gas emissions) that occur in the value chain of an entity, including both upstream and downstream emissions. Scope 3 greenhouse gas emissions include the Scope 3 categories in the Greenhouse Gas Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard (2011).
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KELSIAN GROUP LIMITED SUSTAINABILITY REPORT 30 June 2026 110 Directors' declaration In the opinion of the Directors of Kelsian Group Limited (the 'Company'), I state that the Company has taken reasonable steps to ensure that the substantive provisions of the Sustainability Report of the Company and its subsidiaries (collectively the 'Group') for the year ended 30 June 2026, as presented on pages 99 to 110, are in accordance with the Corporations Act 2001, including: ● complying with Australian Sustainability Reporting Standard AASB S2 Climate-related Disclosures and any further requirements determined under section 296C(2) of the Corporations Act 2001; and ● containing the climate statement disclosures required by section 296D of the Corporations Act 2001. This report is made in accordance with a resolution of Directors of Kelsian Group Limited pursuant to 296A(6) of the Corporations Act 2001, as modified by section 1707C(2) of the Corporations Act 2001. On behalf of the Board ___________________________ Fiona A Hele Chair 26 August 2026
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111 Independent auditor’s review report to the members of Kelsian Group Limited Conclusion We have conducted a review of the following information in the Sustainability Report of Kelsian Group Limited (the Company) and its subsidiaries (collectively the Group) for the year ended 30 June 2026 (the ‘selective sustainability information’) as required by Australian Standard on Sustainability Assurance ASSA 5010 Timeline for Audits and Reviews of Information in Sustainability Reports under the Corporations Act 2001 issued by the Auditing and Assurance Standards Board (AUASB): Selective sustainability information Criteria: Reporting requirement of AASB S2 Climate-related Disclosures (AASB S2) (including related general disclosures required by Appendix D) Location in Sustainability Report Governance Paragraph 6 Section 4 Governance and sub section 4.1, 4.2 on Pages 100,101 Strategy (risk and Subparagraphs 9(a), 10(a) and Sub section 6.2 Climate-related opportunities) 10(b) risks or opportunities within Section 6 Strategy on Page 102 Scope 1 and 2 emissions Subparagraphs 29(a)(i)(1) to (2) and 29(a)(ii) to (v) Sub section 7.2 Greenhouse gas emissions within Section 7 Metrics and targets on Pages 107, 108 The requirements of AASB S2 identified in the table above form the criteria relevant to the selective sustainability information and apply under Division 1 of Part 2M.3 of the Corporations Act 2001 (the Act). We have not become aware of any matter in the course of our review that makes us believe that the selective sustainability information specified in the table above does not comply with Division 1 of Part 2M.3 of the Corporations Act 2001. Basis for conclusion Our review has been conducted in accordance with Australian Standard on Sustainability Assurance ASSA 5000 General Requirements for Sustainability Assurance Engagements (ASSA 5000) issued by the AUASB. Our review includes obtaining limited assurance about whether the selective sustainability information is free from material misstatement. In applying the relevant criteria, we note that subsection 296C(1) of the Act includes a requirement to comply with AASB S2. Our conclusion is based on the procedures we have performed and the evidence we have obtained in accordance with ASSA 5000. The procedures in a review vary in nature and timing from, and are less in extent than for, an audit. Consequently, the level of assurance obtained in a review is substantially lower than the assurance that would have been obtained had an audit been performed. See the Summary of the Work performed section of our report. A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation
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112 Our responsibilities under ASSA 5000 are further described in the Auditor’s responsibilities section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Act and the ethical requirements of APES 110 Code of Ethics for Professional Accountants (including Independence Standards) issued by the Accounting Professional & Ethical Standards Board Limited (November 2018 incorporating all amendments to June 2024) (the Code) that are relevant to reviews of the selective sustainability information of public interest entities in Australia. We have also fulfilled our other ethical responsibilities in accordance with these requirements and the Code. Our firm applies Australian Standard on Quality Management ASQM 1 Quality Management for Firms that Perform Audits or Reviews of Financial Reports and Other Financial Information or Other Assurance or Related Services Engagements, which requires the firm to design, implement and operate a system of quality management, including policies and procedures regarding compliance with ethical requirements, professional standards, and applicable legal and regulatory requirements. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our conclusion. Other information The directors of the Company are responsible for the other information. The other information comprises the Company’s Annual Report, but does not include the selective sustainability information and our review report thereon. Our conclusion on the selective sustainability information does not cover the other information and we do not express any form of assurance conclusion thereon in this review report. We have issued a separate auditor’s report on the Financial Report and the Remuneration Report. In connection with our review of the selective sustainability information, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the selective sustainability information, or our knowledge obtained when conducting the review, or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities for the selective sustainability information The directors of the Company are responsible for: ▪ The preparation of the selective sustainability information in accordance with the Act; and ▪ Designing, implementing and maintaining such internal control necessary to enable the preparation of the selective sustainability information, in accordance with the Act that is free from material misstatement, whether due to fraud or error. A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation
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113 Inherent limitations As discussed on page 1 of the Sustainability Report, climate-related risk management is an emerging area, and often uses data and methodologies that are developing and uncertain. The Report contains forward looking statements, including climate-related scenarios, targets, assumptions, climate projections, forecasts, statements of future intentions and estimates and judgements that have not yet occurred and may never occur. We do not provide assurance on the achievability of this prospective information. Greenhouse gas emissions quantification is subject to significant measurement uncertainty, which arises because of incomplete scientific knowledge used to determine emissions factors and the values needed to combine emissions of different gases. The comparability of sustainability information between entities and over time may be affected by inconsistencies in the methods to estimate or measure those emissions, due to different, but acceptable, methods applied. Auditor’s responsibilities Our objectives are to plan and perform the review to obtain limited assurance about whether the selective sustainability information, defined in the Conclusion section of our report, is free from material misstatement, whether due to fraud or error, and to issue a review report that includes our conclusion. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence decisions of users taken on the basis of the selective sustainability information. As part of a review in accordance with ASSA 5000, we exercise professional judgement and maintain professional scepticism throughout the engagement. We also: ▪ Perform risk assessment procedures, including obtaining an understanding of internal control relevant to the engagement, to identify and assess the risks of material misstatements, whether due to fraud or error, at the disclosure level but not for the purpose of providing a conclusion on the effectiveness of the entity’s internal control. ▪ Design and perform procedures responsive to assessed risks of material misstatement at the disclosure level. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Summary of the work performed A review is a limited assurance engagement and involves performing procedures to obtain evidence about the selective sustainability information. The nature, timing and extent of procedures selected depend on professional judgement, including the assessed risks of material misstatement at the disclosure level, whether due to fraud or error. In conducting our review, the procedures we performed included, but were not limited to: ▪ Considered the completeness of Group’s assessment of climate-related risks and opportunities ▪ Conducted interviews with key personnel to understand the process for collecting, collating and reporting the selective sustainability information during the reporting period A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation
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114 ▪ Read minutes of relevant committees to understand matters discussed and decisions made with respect to climate-related disclosures ▪ Assessed the appropriateness of the reporting boundaries applied ▪ Undertook analytical review procedures to support the reasonableness of the selective sustainability information ▪ Evaluated the appropriateness of emission factors applied in the greenhouse gas emission processes ▪ Agreed the selective sustainability information disclosures made in the report with the underlying records ▪ Evaluated the presentation and disclosure of the selective sustainability information against the requirements of AASB S2 Ernst & Young Nigel Stevenson Partner 26 August 2026 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation