Aurizon : 2025 Aurizon Annual report

About this update from Aurizon Holdings Ltd.

2024 - 2025 Annual Report Contents FY2025 in Review 1 Chairman's Report 2 Managing Director & CEO's Report 3 Directors' Report 4 Operating and Financial Review 10 Remuneration Report 27 Auditor's Independence Declaration 41 Corporate Governance Statement 42 Financial Report 49 Shareholder Information 109 Glossary 111 Corporate Information 113 Our vision To be the first choice for bulk commodity transport solutions. Our purpose To grow regional Australia by delivering bulk commodities to the world. Our values SAFETY We know safe, we choose safe. PEOPLE We seek diverse perspectives. INTEGRITY We have the courage to do the right thing. CUSTOMER We strive to be the first choice for customers. EXCELLENCE We set and achieve ambitious goals. FY2025 in Review Result summary (Underlying and statutory continuing operations) ($M) FY2025 FY2024 VARIANCE VARIANCE % Total revenue and other income 3,952 3,844 108 3% Total revenue and other income Statutory 3,989 3,844 145 4% EBITDA 1,576 1,624 (48) (3%) Significant items (43) - (43) - - Proceeds from settlement of legal matters 37 - 37 - - Transformation costs (23) - (23) - - Goodwill impairment - Bulk (57) - (57) - EBITDA Statutory 1,533 1,624 (91) (6%) EBIT 844 917 (73) (8%) EBIT Statutory 801 917 (116) (13%) NPAT 348 406 (58) (14%) NPAT Statutory 303 406 (103) (25%) Free cash flow (FCF) 1 518 661 (143) (22%) Final dividend (cps) 6.5 7.3 (0.8) (11%) Total dividend (cps) 15.7 17.0 (1.3) (8%) Earnings per share (cps) 19.5 22.1 (2.6) (12%) Earnings per share Statutory (cps) 16.9 22.1 (5.2) (24%) Return on invested capital (ROIC) 8.1% 8.9% (0.8ppt) - EBITDA margin 39.9% 42.2% (2.3ppt) - Operating ratio 78.6% 76.1% (2.5ppt) - Above Rail Tonnes (m) 247.5 255.6 (8.1) (3%) Gearing (net debt / (net debt + equity)) 56.2% 52.2% (4.0ppt) - Overview › EBITDA down $48m (3%) to $1,576m: Network uplift in earnings driven by higher regulatory revenue, partly offset by higher maintenance costs and a reduction in external construction works Coal earnings flat with higher operating costs offset by an increase in revenue due to higher volumes and yield (price indexation and customer mix) Bulk contract growth was more than offset by the cessation of a rail maintenance contract, lower South Australian grain volumes and an increase in doubtful debt provisions. › Final dividend declared of 6.5 cps (fully franked) represents a payout ratio of 80% of underlying NPAT for continuing operations. › An on-market buy-back of up to $150m announced today following on from the completion of a $300m buy-back in FY2025. Outlook Group underlying EBITDA for FY2026 is expected to increase and be in the range of $1,680m - $1,750m, with full year dividends of 19 - 20 cps 2 . Sustaining capital expenditure is expected to be $610m - $660m (including ~$30m of transformation capital) and growth capital expenditure is expected to be $100m - $150m. Key assumptions: › Network: EBITDA expected to be higher than FY2025 with an increase in the regulatory revenue, partly offset by increased direct costs. Allowable Revenue is to be entirely recognised in underlying revenue, regardless of volumes railed › Coal: EBITDA expected to be higher than FY2025 driven by volumes and flat unit costs 3 , partly offset by lower yield (due to customer/corridor mix) expected with higher volumes › Bulk: EBITDA expected to be higher than FY2025 driven by the non-recurrence of provisions and increased grain volumes, partly offset by lower iron ore volumes › Other: EBITDA expected to be higher than FY2025 with improved Containerised Freight contribution offsetting the non-recurrence of the settlement of legal matters in FY2025 › No significant disruptions to supply chains and customers (such as major derailments, extreme/prolonged wet weather). Free cash flow (continuing operations) defined as net cash flow from operating activities, less non-growth capex and less interest paid. It does not include growth capex (FY2025: $107m, FY2024: $204m), payments for acquisitions (FY2025: $25m, FY2024: $nil) and cash flows from significant items (FY2025: $26m, FY2024: $nil). Dividends are ultimately determined by the Aurizon Board. Operating costs (excluding access and fuel), measured on an NTK basis. FY2025 IN REVIEW 1 Chairman's Report Dear fellow shareholders I am pleased to present our FY2025 Annual Report. The past financial year has presented challenging trading conditions for the Company, resulting in lower volumes and earnings. In response, significant work was undertaken - and continues into FY2026 - to reduce our cost base, streamline management structures, and re-position under-performing segments to support future growth in volumes and an expected increase in profitability and dividends in FY2026. Underlying Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for FY2025 was $1,576 million, representing a 3% decrease compared to FY2024. This outcome was below expectations, and both the Board and Executive team remain focused on a range of initiatives to improve performance and deliver stronger financial outcomes. These include: › a review of the Company's non-operational cost base, targeting further efficiency gains to be implemented during the 2025 calendar year and beyond › a review of the Group's capital and Network ownership structures › the management of the Bulk and Containerised Freight businesses to unlock commercial and operational synergies and streamline accountability under a single Group Executive. Despite the challenging environment, Aurizon maintained solid free cash flow and coupled with lower growth capital expenditure, this enabled an extension of our on-market buyback program. During FY2025, we completed share buybacks totalling $300 million and today announced an on-market buy-back of up to $150 million for FY2026. The Board has declared a final dividend of 6.5 cents per share, fully franked, taking total dividends for FY2025 to 15.7 cents. This compared to 17 cents per share for FY2024. We continue to execute our strategy of expanding into emerging markets in bulk and containerised freight, while optimising our long-standing, cash-generative positions in coal haulage and coal rail infrastructure. While trading conditions in bulk freight were challenging in FY2025, we remain confident in the long-term growth and earnings potential in these markets. Our focus is on structural growth opportunities in bulk commodities, agriculture, and critical minerals - sectors aligned with Australia's long-term economic trajectory and global demand for future-facing resources such as copper, nickel, rare earths, phosphate and grain. A clear example of this potential is the securing of contracts by Aurizon in June 2025 for a new long-term logistics solution for BHP Copper South Australia. This is anticipated to deliver revenue to Aurizon of approximately $1.5 billion in the first 10 years of delivering the contracts. Our services will support a world-class copper province with aspirations by BHP to significantly increase production in coming decades. Importantly, Aurizon has been able to secure this contract with a limited commitment of capital because we have tapped into existing assets across our South Australian footprint, including our recently-acquired terminal at Port Adelaide. This is the quality of opportunity that will underpin Aurizon's future growth: large-scale, integrated transport and logistics solutions with resilient earnings. The Board is pleased to see this development following a number of years of sustained investment and transformation. Aurizon now possesses industry-leading capabilities and assets across a national network, with strong exposure to resource and agricultural corridors. Whilst there were no changes to the Board during FY2025, significant work was undertaken as we prepare for a period of renewal. Long-standing director, Russell Caplan, will be retiring from the Board after 15 years of tremendous service. Russell was appointed to the Board in September 2010 at the time of Aurizon's IPO and listing on the ASX. Russell's wisdom, commercial and industrial experience, and corporate knowledge have been of great benefit to Aurizon. We expect to provide further information on appointments to the Board by the end of the current calendar year, including the plan for my own succession. I would like to acknowledge the continued dedication of our employees across Aurizon. Their commitment to delivering safe and reliable services to our customers has remained steadfast through the operational and business challenges this year. Finally, I wish to thank fellow shareholders for your continued trust and support. Tim Poole Chairman 18 August 2025 Managing Director & CEO's Report Dear fellow shareholders I begin my report with safety. In December 2024, we were deeply saddened by the loss of Troy Ernst, a highly-respected member of the New South Wales Coal team. Troy was killed in a road accident in the Hunter Valley when the Aurizon car in which he was travelling was struck by a truck. Aurizon and work colleagues have extended support for Troy's family during this very difficult time. In respect to operational safety in the business, Aurizon continues to use two primary safety metrics: Total Recordable Injury Frequency Rate (TRIFR) and Serious Injury and Fatality Frequency Rate (SIFR). Performance against both measures saw a slight deterioration during the year. These results reinforce the ongoing need for focus in effectively managing critical risks in our workplaces, supported by a range of initiatives to enhance safety performance and health and wellbeing for our employees. During the year, Aurizon continued its education and awareness campaign, Respect the sign. Lives are on the line. as we work to improve level crossing safety for our traincrew, motorists, and pedestrians. We have reached out to regional communities across Australia where our trains operate to urge responsible driving behaviour around level crossings. Social media for the campaign alone has reached around five million Australians, but equally our local teams have presented to more than 10,000 students in schools near rail corridors. I thank our employees for their outstanding work in engaging with young people in their local communities on this important safety message. Unfortunately level crossing incidents continue to be far too frequent, causing trauma to motorists, our traincrew, and the community. The rail industry, governments, and road user organisations are committed to continued education, together with ongoing investment and enforcement initiatives. In his report, the Chairman outlines the Company's financial outcomes during FY2025 with Underlying Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) of $1,576 million. This is below our expectations and reflects mixed results in the Company. This includes lower tonnages and an increase in doubtful debt provisions in the Bulk business, together with the deferral of ~$50 million of Network earnings until FY2027. We are committed to an ongoing program of work to reduce our cost base, make operations more efficient, and to deliver the growth in volumes and earnings to which we aspire. This work is well underway and already delivering cost savings and operational efficiencies. This includes: › a company-wide review to achieve efficiencies in non-operational parts of the business, including labour and external spend › the decision to manage the Bulk and Containerised Freight businesses under a single Group Executive to unlock synergies and streamline accountability › reviews completed to identify and implement cost and fleet optimisation opportunities for the Bulk East, Bulk Central, and Bulk West operations. It was pleasing during FY2025 to see returns from the strategic investments we have made in recent years in Bulk and Containerised Freight. This includes the growth of interstate container volumes with completion of the ramp-up of national linehaul services; the establishment of a regular landbridging service from the Asia-Pacific region through the Port of Darwin; and the winning of long-term, high-value logistics contracts for BHP Copper South Australia. These are good examples of how we can leverage recent investments to deliver supply chain solutions for customers. These investments include rail, port, and rollingstock assets in South Australia and the Northern Territory secured through the acquisition of One Rail in 2022 and Flinders Logistics in 2024. These positive developments also highlight the opportunities we have to grow our business in markets exposed to Australia's economic growth and the global energy transition which is driving increasing demand for commodities such as copper. Aurizon remains committed to our decarbonisation initiatives and our target of delivering net zero operational emissions by 2050. This includes a range of specific medium and long-term initiatives such as solar generation, vegetation offsets, and technology to reduce fuel usage and emissions, together with ongoing work to develop new-generation locomotives with low or zero emissions. In September, for example, we unveiled our first nature-based carbon-offsetting tree reserve adjacent to our rail corridor in north Queensland. This is an Australian-first for Aurizon and over the next 25 years the reserve is expected to generate more than 32,000 tonnes of carbon abatement. Aurizon was able to successfully implement this sustainability project, in part, through financial support from a Federal Government Carbon + Biodiversity (C+B) Pilot grant. Aurizon is developing two key platforms for our future fleet of freight trains: a Battery-Electric Locomotive and a Battery-Electric Tender. With the support of global technology partners, both of these leading-edge projects are underway here in Australia. Aurizon is also well positioned to leverage and adopt emerging decarbonisation technology from the global rail sector as it becomes available. Importantly, Aurizon continues to engage with customers to reinforce the current environmental and commercial benefits of using rail for bulk transport and logistics. A great example is the recent work we have secured with BHP Copper South Australia, servicing one of the world's largest copper provinces. By moving the majority of BHP Copper's tonnes from road to rail, and once fully operational, Aurizon will effectively replace an estimated 13 million kilometres of truck movements annually, with an estimated reduction in carbon emissions of ~20,000 tonnes a year compared to the existing road-based operation. That's equivalent to removing about 11,000 truck movements from South Australian roads per year. This represents one of the largest ever road to rail conversions of bulk transport in Australia. In closing, I want to express my sincere thanks to all our employees across Australia for their hard work and dedication during FY2025. This year brought its share of operational and commercial challenges but through skill, teamwork, and commitment, we continued to deliver safe, reliable, and efficient services to our customers. Andrew Harding Managing Director & CEO 18 August 2025 Aurizon Holdings Limited For the year ended 30 June 2025 The Directors of Aurizon Holdings Limited present their Directors' Report together with the Financial Report of the Company and its controlled entities (collectively the Consolidated Entity or the Group ) for the financial year ended 30 June 2025 and the Independent Auditors' Report thereon. This Directors' Report has been prepared in accordance with the requirements of Division 1 of Part 2M.3 of the Corporations Act . Board of Directors The following people are Directors of the Company, or were Directors during the reporting period: Tim Poole (Appointed 1 July 2015) (Chairman, Independent Non-Executive Director). Andrew Harding (Appointed 1 December 2016) (Managing Director & CEO). Marcelo Bastos (Appointed 15 November 2017) (Independent Non-Executive Director). Russell Caplan (Appointed 14 September 2010) (Independent Non-Executive Director). Tim Longstaff (Appointed 1 June 2023) (Independent Non-Executive Director). Sarah Ryan (Appointed 1 December 2019) (Independent Non-Executive Director). Lyell Strambi (Appointed 1 December 2019) (Independent Non-Executive Director). Samantha Tough (Appointed 1 September 2023) (Independent Non-Executive Director). Details of each Director's experience, qualifications, special responsibilities, and other directorships of listed companies as at the date of this Directors' Report are set out in the pages following. Tim Poole Experience: Mr Poole began his executive career in 1990 at PricewaterhouseCoopers (then Price Waterhouse) before joining Hastings Funds Management in 1995. He helped to build Hastings into a global investor in private market assets, principally equity and debt issued by infrastructure companies, and was the Managing Director from 2005 to 2007. Since retiring from Hastings, Mr Poole has been an investor and non-executive director of a range of public and private companies in sectors including infrastructure, transport, property, financial services, and mining. Mr Poole is a Non-executive Director of The Lottery Corporation. Qualifications: BCom. Special responsibilities: Chair of Nomination & Succession Committee. Member of People and Remuneration Committee. Member of Audit, Governance & Risk Management Committee. Australian Listed Company Directorships held in the past three years: McMillan Shakespeare Limited - Non-Executive Director (17 December 2013 - 31 August 2022); and Reece Limited - Non-Executive Director (28 July 2016 - 31 December 2024); (Chairman from 22 May 2023 - 1 November 2024). Andrew Harding Experience: Mr Harding was appointed Managing Director & CEO of Aurizon in December 2016. Mr Harding has more than 30 years' experience across the resource and rail sectors, as a leader committed to creating sustainable, productive businesses that make meaningful contributions to the community. Mr Harding has led initiatives to leverage Aurizon's core expertise in heavy haulage and rail infrastructure, and to drive improved safety and operational performance. Mr Harding champions the role of rail in decarbonising the nation's supply chains, leveraging the environmental, safety, and productivity benefits of rail freight for economic and community benefit. Prior to starting with Aurizon, Mr Harding was the global Chief Executive of Rio Tinto's Iron Ore business with responsibility for managing supply chains for the world's largest integrated portfolio of iron ore assets. Qualifications: BEng. (Mining Engineering), MBA. Special responsibilities: Managing Director & CEO of Aurizon. Director of Aurizon subsidiary companies including Aurizon Network Pty Ltd. Member of Safety, Health & Environment Committee. Australian Listed Company Directorships held in the past three years: None other than Aurizon Holdings Limited. Marcelo Bastos Experience: Mr Bastos has more than 35 years of experience globally in the mining industry. He has extensive experience in major project development, operations, logistics, and senior leadership in most of the major sectors of the mining industry including iron ore, gold, copper, nickel, zinc, and coal. Previously, Mr Bastos was the Chief Operating Officer of MMG Limited with responsibility for the business in four continents and a member of many of the company's Boards. Before MMG, he spent seven years with BHP Billiton where he served as President Nickel Americas, President Nickel West (based in Perth), and Chief Executive Officer and President of BHP Billiton Mitsubishi Alliance (based in Brisbane). Mr Bastos also had a 19-year career with Vale in a range of senior management and operational positions in Brazil, including General Manager of Carajas in the northern region and also Director of Non Ferrous - Copper business. Mr Bastos is currently a Non-Executive Director of Anglo American PLC (where he is Chair of the Global Workforce Advisory Panel) and a Non-Executive Director of IGO Limited. Mr Bastos is also a Technical Review Board Member of Sumitomo Corporation. He was an External Director (Non-Executive Independent) of Golder Associates from 2017 to 2021. Qualifications: BEng. Mechanical (Hons), MBA (FDC-MG), MAICD. Special responsibilities: Non-Executive Director of Aurizon Network Pty Ltd. Chair of Safety, Health & Environment Committee. Member of Nomination & Succession Committee. Australian Listed Company Directorships held in the past three years: lluka Resources Limited - Non-Executive Director (February 2014 - August 2024); IGO Limited - Non-Executive Director (July 2024 - ongoing). Russell Caplan Experience: Mr Caplan has extensive international experience in the oil and gas industry. In a 42-year career with Shell, he held senior roles in the upstream and downstream operations, and corporate functions in Australia and overseas. From 1997 to 2006, he had senior international postings in the UK, Europe, and the USA. From 2006 to July 2010, he was Chairman of the Shell Group of Companies in Australia. Mr Caplan is Chairman and Non-Executive Director of Horizon Roads Pty Ltd. He is a former Chairman of the Melbourne and Olympic Parks Trust, the Australian Institute of Petroleum, and Orica Limited, and Non-Executive Director of Woodside Petroleum Limited. Qualifications: LLB, FAICD, FAIM. Special responsibilities: Member of People and Remuneration Committee. Member of Audit, Governance & Risk Management Committee. Australian Listed Company Directorships held in the past three years: None other than Aurizon Holdings Limited. Tim Longstaff Experience: With a career spanning more than 35 years, Mr Longstaff brings a depth of experience in finance, accounting, strategy, acquisitions and divestments, debt and equity capital markets, risk management, and investor engagement amongst asset-intensive industrial companies. Mr Longstaff qualified as a Chartered Accountant with Price Waterhouse before a 25-year career in investment banking at first-tier global firms including JPMorgan, and Deutsche Bank in Australia and internationally. In this time, Mr Longstaff was a strategic partner, and advised the Boards and CEOs of leading Australian and global companies on transformational M&A and capital markets transactions. More recently, Mr Longstaff served as Senior Advisor to a Federal Cabinet Minister in the Trade & Investment and Finance portfolios. Through this experience, he brings global geo-political perspectives and insights into transport and infrastructure policies, the workings of government and regulated assets. Mr Longstaff is a Non-Executive Director of the ASX-listed Ingham's Group Limited, Perenti Limited, Nine Entertainment Co. Holdings Limited and also of The George Institute for Global Health. He is a member of the Takeovers Panel. Qualifications: BEc, FCA, FAICD, SF Fin. Special responsibilities: Non-Executive Director of Aurizon Network Pty Ltd. Chair of Audit, Governance & Risk Management Committee. Australian Listed Company Directorships held in the past three years: Inghams Group Limited - Non-Executive Director (20 January 2022 - ongoing); Perenti Limited - Non-Executive Director (16 August 2021 - ongoing); and Nine Entertainment Co. Holdings Limited (1 January 2025 - ongoing). Sarah Ryan Experience: Dr Ryan has approximately 30 years of international experience in the oil and gas industry. Initially, Dr Ryan spent 20 years in various technical, operational, and senior management positions, including 15 years with Schlumberger Limited both in Australia and overseas. Dr Ryan then spent 10 years as an equity analyst covering natural resources with institutional investment firm Earnest Partners, based in the US. Dr Ryan is currently a Non-Executive Director of ASX-listed entities Viva Energy Group Limited, Transurban Group, and Calix Limited, and a Non-Executive Director of Future Battery Industry Cooperative Research Centre and Karting Australia. Dr Ryan is also a member of Motorsport Australia's People, Remuneration and Nominations Committee. Dr Ryan is a former Non-Executive Director of ASX-listed Woodside Energy Group Ltd, Oz Minerals Limited and Norwegian-listed Akastor ASA. Dr Ryan is a Fellow of the Australian Academy of Technology and Engineering. Qualifications: PhD (Petroleum and Geophysics), BSc (Geophysics) (Hons 1), BSc (Geology), FTSE. Special responsibilities: Member of Audit, Governance & Risk Management Committee. Member of Safety, Health & Environment Committee. Member of Nomination & Succession Committee. Australian Listed Company Directorships held in the past three years: Calix Limited Non-Executive Director (1 January 2024 -ongoing); Transurban Group - Non-Executive Director (1 September 2023 - ongoing); Viva Energy Group - Non-Executive Director (18 June 2018 - ongoing); Woodside Energy Non-Executive Director (24 October 2012 - 28 April 2023); and OZ Minerals Limited - Non-Executive Director (17 May 2021 - 2 May 2023). Lyell Strambi Experience: Mr Strambi has a wealth of experience in the aviation sector both in Australia and abroad, spanning 40 years. In June 2022, Mr Strambi concluded his tenure as CEO and Managing Director of Australia Pacific Airports Corporation (APAC). Having been appointed in September 2015, during his time at APAC he was responsible for the operation and development of both the Melbourne and Launceston airports, and for overseeing a direct workforce of 300 staff and assets valued in excess of $10 billion. Prior to his role at APAC, Mr Strambi was the Chief Executive Officer of Qantas Airways Domestic, a role he held for three years following four years as the airline's Group Executive Operations. Between 2001 and 2008, Mr Strambi was based in London working in senior roles at Virgin Atlantic including Executive Director - Airline Services followed by six years as Chief Operating Officer. Mr Strambi is currently a Non-Executive Director of Brisbane Airport Corporation. He is a former Non-Executive Director of APAC, StarTrack Express, Traveland, and Southern Cross Distribution Systems, and was President of the Royal Flying Doctors SE. Mr Strambi is a Graduate and Fellow of the Australian Institute of Company Directors, and a Member of the Australian Institute of Management. Qualifications: BBus (Accy), FAICD. Special responsibilities: Chair of Aurizon Network Pty Ltd. Member of Safety, Health & Environment Committee. Member of Nomination & Succession Committee. Australian Listed Company Directorships held in the past three years: None other than Aurizon Holdings Limited. Samantha Tough Experience: Ms Tough has had a distinguished executive and non-executive career with experience in many industry sectors including energy, resources, agriculture, oil and gas, technology, water, and engineering. Ms Tough is Pro Vice Chancellor of Industry and Commercial at the University of Western Australia, Chair of Horizon Power, and a Director of the Clean Energy Finance Corporation and Rumin8 Pty Ltd. Ms Tough has experience in the regions of Western Australia and Australia generally, and has served on over 20 boards of listed, private, and government entities. She completed a Bachelor of Laws and Bachelor of Jurisprudence at UWA, and moved to the commercial sector early in her career. She has Fellow status with the Australian Institute of Company Directors. Qualifications: LLB, BJuris, FAICD. Special responsibilities: Chair of People and Remuneration Committee. Australian Listed Company Directorships held in the past three years: Fluence Corporation - Non-Executive Director (June 2021 - July 2023). FIGURE 1 - BOARD DIVERSITY 12.5% 12.5% 10+ 0-2 25% 8-10 Board tenure (years) FY25 12.5% 2-4 12.5% 6-8 25% 4-6 12.5% 69+ 12.5% 65-68 25% 53-56 12.5% 61-64 Board age (years) FY25 37.5% 57-60 25% FEMALE Board diversity FY25 75% MALE Note: This reflects the position as at 30 June 2025. Company Secretary David Wenck Mr Wenck was appointed Company Secretary in April 2021. He joined Aurizon in 2010 as Group General Counsel and has more than 30 years' experience in corporate and commercial law. Prior to joining Aurizon, David was a partner in a leading Australian law firm practising in corporate, commercial and competition law. David holds a Bachelor of Laws with Honours and is a member of the Australian Institute of Company Directors. Qualifications: LLB (Hons.), GDLP (UTS), MAICD. Nicole Allder Ms Allder was appointed Company Secretary in February 2023, having joined Aurizon as a Legal Counsel in 2018. She has more than 20 years' experience in providing in-house legal and company secretariat services. Prior to joining Aurizon, Nicole held positions at ASX-listed companies including General Counsel & Company Secretary at CSG Limited, and Deputy Company Secretary and Legal Counsel at the Virgin Australia Group. Nicole holds a Bachelor of Laws and a Graduate Diploma in Applied Corporate Governance. Qualifications: LLB, GradDipLP, GradDipACG. Board skills and experience The Board considers its Directors collectively have the range of skills, knowledge and experience necessary to direct the Company. The depth of experience held by the current Board members across key skill and experience areas is reflected in the matrix in Figure 2 on the following page. The Board is an advocate for diversity of thinking and its gender, age and tenure diversity is depicted in Figure 1. In instances where the Board recognises additional experience in a particular area would be beneficial to the Board's performance, the Board takes the approach of enhancing its experience in those areas, including through development opportunities such as conducting site visits, receiving further briefings from management and third parties, or undertaking workshops. In identifying and selecting potential new Directors, the Skills Matrix assists in identifying the experience and skills that will best equip the Board to fulfil its role. FIGURE 2 - BOARD SKILLS AND EXPERIENCE Significant skills and experience Limited skills and experience CATEGORY DESCRIPTION SKILLS AND EXPERIENCE MIX Leadership Both senior executive and non-executive director experience with a significant listed or private company. Strategy Experience developing, assessing and executing strategic plans to drive long-term growth and transformation. Industry experience Experience as a senior executive or advisor to a transport business, a regulated infrastructure business, or a business involved in bulk supply chains. Transactions and capital markets Experience in completing significant corporate transactions, equity/debt capital markets and capital management. Customer and business development Experience in business development and developing customer-focused strategies with detailed knowledge of Aurizon's customer base. Technology Experience in managing and protecting information, identifying emerging or disruptive technologies and in critically assessing technology projects. People and culture Experience in employee relations strategies, governing executive remuneration frameworks for listed companies, and overseeing workplace culture and safety. Sustainability Experience in climate-exposed industries, transition strategies and emerging technologies or sources of energy. Government, industry and community Experience working with government, government departments, relevant industry associations and community stakeholders. Financial expertise Qualifications or experience in accounting or financial reporting, and in assessing related reporting and internal controls. Risk management Experience in overseeing risk frameworks and controls, and in identifying and monitoring key risks and controls, and the effectiveness of risk and compliance functions. Governance Knowledge and experience of high standards of corporate governance for listed companies. Note: This reflects the position as at 30 June 2025. TABLE 1 - DIRECTORS' MEETINGS AS AT 30 JUNE 2025 AUDIT, GOVERNANCE PEOPLE & SAFETY, HEALTH NOMINATION AURIZON HOLDINGS & RISK MANAGEMENT REMUNERATION & ENVIRONMENT & SUCCESSION DIRECTOR BOARD COMMITTEE COMMITTEE COMMITTEE COMMITTEE A B A B A B A B A B T Poole 1 13 13 7 7 4 4 2 2 A Harding 1 13 13 4 4 M Bastos 13 13 4 4 2 2 R Caplan 13 12 7 7 4 4 T Longstaff 13 13 7 7 S Ryan 13 12 7 7 4 4 2 2 L Strambi 13 13 4 4 2 2 S Tough 13 11 4 4 A Number of meetings held while appointed as a Director or Member of a Committee. B Number of meetings attended by the Director while appointed as a Director or Member of a Committee. 1 In addition to the meetings above, a Committee of the Board comprising T Poole and A Harding met on two occasions. TABLE 2 - DIRECTORS' INTERESTS AS AT 30 JUNE 2025 DIRECTOR NUMBER OF ORDINARY SHARES T Poole* 250,500 A Harding 2,619,720 M Bastos 65,947 R Caplan 82,132 T Longstaff 57,500 S Ryan 68,000 L Strambi 71,392 S Tough 31,586 * Mr Poole also holds 10 Subordinated Notes. Details regarding remuneration and security interests of Directors is set out in the Remuneration Report. Only Mr Harding, Managing Director & CEO, receives performance rights, details of which are set out in the Remuneration Report. Directors' meetings The number of Board meetings (including Board Committee meetings) and number of meetings attended by each of the Directors of the Company during the financial year are listed above. During the year, the Aurizon Network Pty Ltd Board met on six occasions. Directors' interests Directors' interests set out in Table 2 are as at 30 June 2025. Principal activities The principal activities of entities within the Group during the year were: Network This segment manages the provision of access to the CQCN below rail infrastructure, and operation and maintenance of the network. Coal This segment provides transport of metallurgical and thermal coal from mines in Queensland and New South Wales to domestic customers and coal export terminals. Bulk This segment provides integrated supply chain services, including rail and road transportation, port services and material handling for a range of mining, metal, industrial and agricultural customers throughout Australia. This segment also manages the Tarcoola-to-Darwin rail infrastructure, the intrastate rail freight network in South Australia, and containerised freight services between Adelaide and Darwin. Other This segment includes Containerised Freight, which is not considered a separate reportable segment, as well as other revenue and central costs not allocated such as Board, Managing Director & CEO, Company Secretary, strategy and investor relations. Review of operations A review of the Group's operations for the financial year and the results of those operations are contained in the Operating and Financial Review as set out on Pages 10-26 of this report. Dividends A final dividend for FY2024 of 7.3 cents per fully paid ordinary share (60% franked) was paid on 25 September 2024 and an interim dividend for FY2025 of 9.2 cents per fully paid ordinary share (60% franked) was paid on 26 March 2025. Further details of dividends provided for, or paid, are set out in Note 15 to the consolidated financial statements. Since the end of the financial year, the Directors have declared to pay a final dividend for FY2025 of 6.5 cents per fully paid ordinary share. The dividend will be fully franked and is payable on 24 September 2025. State of affairs In the opinion of the Directors, there were no significant changes in the state of affairs of the Company that occurred during the financial year under review. Events since the end of the Proceedings against the Company The Directors are not aware of any current civil litigation proceedings, arbitration proceedings, administration appeals or criminal or governmental prosecutions of a material nature that are not set out in this report or Note 29 of the Financial Report in Details of the amounts paid to the auditor of the Company and its related practices for non-audit services provided throughout the year are as set out below: 2025 $'000 Other assurance services financial year which Aurizon Holdings is directly or indirectly The Directors are not aware of any events or developments which are not set out in this report or Note 30 of the Financial Report that have, or would have, a significant effect on the Group's state of affairs, its operations or its expected results in future years. concerned which are likely to have a material adverse effect on the business or financial position of the Company. Remuneration Report The Remuneration Report is set out on Pages 27-40 and forms part of the Total remuneration for other assurance services Other services Total remuneration for other services 338 - Likely developments Information about likely developments in the operations of the Group and the expected results of those operations are covered in the Chairman's Report set out on Page 2 of this report and the Managing Director & CEO's Report set out on Page 3 of this report, and at a high level in the outlook provided on Page 1 of this report. In the opinion of the Directors, disclosure of any further information would be likely to result in unreasonable prejudice to the Group. CEO and CFO declaration The Managing Director & CEO and Chief Financial Officer (CFO) have provided a written statement to the Board in accordance with Section 295A of the Corporations Act. With regard to the financial records and systems of risk management and internal compliance in this written statement, the Board received assurance from the Managing Director & CEO and CFO that the declaration was founded on a sound system of risk management and internal control, and that the system was operating effectively in all material respects in relation to the reporting of financial risks. Indemnification and insurance of officers The Company's Constitution provides that the Company may indemnify any person who is, or has been, an officer of the Group, including the Directors and Company Secretary, against liabilities incurred while acting as such officers to the maximum extent permitted by law. The Company has entered into a Deed of Access, Indemnity and Insurance with each of the Company's Directors. No Director or officer of the Company has received benefits under an indemnity from the Company during or since the end of the year. The Company has paid a premium for insurance for Directors and officers of the Group. This insurance is against a liability for costs and expenses incurred by officers in defending civil or criminal proceedings involving them as such officers, with some exceptions. The contract of insurance prohibits disclosure of the nature of the liability insured against and the amount of the premium paid. Directors' Report for the financial year ended 30 June 2025. Rounding of amounts The amounts contained in this report and in the financial statements have been rounded to the nearest $1,000,000 unless otherwise stated (where rounding is applicable) in accordance with ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2016/191 . The Company is an entity to which the instrument applies. Non-audit services During the year, the Company's auditor, Deloitte Touche Tohmatsu (Deloitte), performed other services in addition to its audit responsibilities. The Directors are satisfied that the provision of non-audit services by Deloitte during the reporting period did not compromise the auditor independence requirements set out in the Corporations Act 2001 . All non-audit services were subject to the Company's Non-Audit Services Policy and do not undermine the general principles relating to auditor independence set out in APES 110 Code of Ethics for Professional Accountants as they did not involve reviewing or auditing the auditor's own work, acting in a management or decision-making capacity for the Company, or jointly sharing risks and rewards. Auditor's Independence Declaration A copy of the Auditor's Independence Declaration, as required under section 307C of the Corporations Act , is set out on Page 41. The Directors' Report is made in accordance with a resolution of the Directors of the Company. Tim Poole Chairman 18 August 2025 Consolidated Results (Underlying continuing operations unless stated) The Group's financial performance is explained using measures that are not defined under IFRS Accounting Standards and are therefore termed Non-IFRS measures. The Non-IFRS financial information contained within this Directors' Report and Notes to the Consolidated Financial Statements has not been audited in accordance with Australian Auditing Standards. The Non-IFRS measures used to monitor Group performance are EBITDA (Statutory and Underlying), EBITDA margin (Statutory and Underlying), EBIT (Statutory and Underlying), NPAT Underlying, Return on Invested Capital (ROIC), Net debt and Net gearing ratios. Each of these measures is discussed in more detail on Page 108. Annual comparison FINANCIAL SUMMARY ($M) FY2025 FY2024 VARIANCE Total revenue and other income 3,952 3,844 3% Statutory Total revenue and other income 3,989 3,844 4% Operating costs Employee benefits (1,149) (1,086) (6%) Energy and fuel (358) (391) 8% External track access (164) (146) (12%) Consumables (613) (582) (5%) Other (92) (15) (513%) EBITDA 1,576 1,624 (3%) Statutory EBITDA 1,533 1,624 (6%) Depreciation and amortisation (732) (707) (4%) EBIT 844 917 (8%) Statutory EBIT 801 917 (13%) Net finance costs (345) (333) (4%) Income tax expense (151) (178) 15% NPAT 348 406 (14%) Statutory NPAT 303 406 (25%) Earnings per share (cps) 1 19.5 22.1 (12%) Statutory earnings per share (cps) 1 16.9 22.1 (24%) Return on invested capital (ROIC) 2 8.1% 8.9% (0.8ppt) Net cash flow from operating activities 1,461 1,616 (10%) Total dividend per share (cps) 15.7 17.0 (8%) Gearing (net debt / (net debt + equity)) 56.2% 52.2% (4.0ppt) Net debt / EBITDA 3 3.3x 3.0x (0.3x) Net tangible assets per share ($) 2.3 2.3 - People (FTE) 5,988 5,930 1% Labour costs 4 / Revenue 29.0% 28.1% (0.9ppt) Calculated on weighted average number of shares on issue - 1,789m for FY2025 and 1,841m for FY2024. ROIC is defined as underlying rolling twelve-month EBIT divided by the average invested capital. The average invested capital is calculated as the rolling twelve-month average of net assets (excluding cash, borrowings, tax, derivative financial assets and liabilities). Net debt is defined as borrowings (both current and noncurrent) less cash and cash equivalents and excludes lease liabilities. Net debt for Network and Operations is adjusted for funds drawn under the Intra Group Loan Agreement. Network - Net debt / EBITDA: 4.1x (FY2024 3.9x), Operations - Net debt / EBITDA: 1.7x (FY2024 1.8x). FY2025 excludes $4m redundancy costs (FY2024 excludes $5m redundancy costs). EBITDA BY SEGMENT ($M) FY2025 FY2024 VARIANCE Coal 527 528 - Bulk 169 229 (26%) Network 956 930 3% Other (76) (63) (21%) Group (Continuing operations) 1,576 1,624 (3%) Group Performance Overview Group EBITDA decreased by $48m (3%) to $1,576m with lower earnings in Bulk partly offset by an uplift in Network. Coal earnings were flat with higher operating costs offset by an increase in revenue due to higher volumes and yield (price indexation and customer mix). The Network earnings uplift was driven by higher regulated revenue, partly offset by a reduction in external construction works and higher maintenance costs. Bulk contract growth was more than offset by the cessation of a rail maintenance contract, lower South Australian (SA) grain volumes and an increase in doubtful debt provisions, higher labour escalation and costs to support customer growth. The decrease in Other EBITDA was driven by higher capacity costs in Containerised Freight (full schedule operations from May 2024) partly offset by the settlement of legal matters. Depreciation increased by $25m or 4% mainly due to an increase in Network. EBIT decreased by $73m (8%), contributing to a 0.8ppt decrease in ROIC. Reconciliation to Statutory Earnings Underlying earnings is a non-statutory measure and is the primary reporting measure used by management and the Group's chief operating decision-making bodies for managing and assessing the financial performance of the business. Underlying earnings is derived by adjusting statutory earnings for significant items as noted in the following table: ($M) FY2025 FY2024 Underlying EBITDA 1,576 1,624 Depreciation and amortisation (732) (707) Underlying EBIT 844 917 Significant items (43) - Proceeds from settlement of legal matters 37 - Transformation costs (23) - Goodwill impairment - Bulk (57) - Statutory EBIT 801 917 Net finance costs (345) (333) Statutory Profit before tax 456 584 Income tax expense (153) (178) Statutory NPAT 303 406 Continuing operations significant items, net of tax 45 - Underlying NPAT 348 406 The difference between underlying and statutory items includes the significant items detailed below:: › proceeds from settlement of legal matters ($37m pre-tax, $28m post-tax), representing the majority of the proceeds, being the amount net of legal costs incurred by the Group in relation to the matters › transformation costs ($23m pre-tax, $16m post-tax) related to the review of non-operating cost base undertaken during FY2025 which primarily relates to redundancies ($18m) recognised as employee benefits expense; and › goodwill impairment ($57m) related to the Bulk cash-generating unit (CGU), refer to Note 9 of the Financial Report for further information. Other financial information BALANCE SHEET SUMMARY ($M) 30 JUNE 2025 30 JUNE 2024 Current assets 1,085 991 Property, plant and equipment (PP&E) 10,165 10,153 Other non-current assets 392 452 Total assets 11,642 11,596 Total borrowings 5,313 4,897 Other current liabilities 815 772 Other non-current liabilities 1,428 1,489 Total liabilities 7,556 7,158 Net assets 4,086 4,438 Gearing (net debt / (net debt + equity)) 56.2% 52.2% Balance Sheet Movements Current assets increased by $94m largely due to: › an increase in inventories of $32m predominately related to below rail renewal programs across Network and Bulk Central › an increase in trade and other receivables of $31m largely due to Network Take-or-Pay accruals › an increase in derivative financial instruments of $17m due to the classification of cross-currency interest rate swaps for Network Euro Medium Term Note (EMTN) 2 as current, partly offset by the settlement of the cross-currency interest rate swaps for Network EMTN 1 › an increase in cash and cash equivalents of $15m. Property, plant and equipment increased by $12m including capital additions of $686m and the acquisition of Flinders Logistics Pty Ltd (renamed Aurizon Port Services (SA) Pty Ltd) of $34m, largely offset by depreciation of $701m. Total borrowings increased by $416m largely due to: › net drawdowns, including transaction costs, of $229m from new debt issuance including Subordinated Notes and Medium-Term Notes, partly offset by the maturity of EMTN 1 › fair value movements of $179m. Other current liabilities increased by $43m due to income tax provisions for the current year of $50m. This was partly offset by a reduction in provisions of $4m (largely due to insurance and employee benefit provisions) and other current liabilities of $3m. Other non-current liabilities decreased by $61m due to net favourable movements on derivative financial instruments. Gearing (net debt / (net debt + equity)) was 56.2% as at 30 June 2025, an increase of 4.0ppts reflecting higher borrowings and reduced equity as a result of the on-market share buy-back. CASH FLOW SUMMARY ($M) FY2025 FY2024 Statutory EBITDA (Continuing operations) 1,533 1,624 Working capital and other movements (73) 1 Non-cash adjustments - asset impairments 59 1 Net cash inflow from Continuing operations 1,519 1,626 Interest received 7 8 Income taxes paid (70) (26) Principal elements of lease receipts 5 8 Net cash inflow from operating activities from Continuing operations 1,461 1,616 Net operating cash flows from Discontinued operations - - Net operating cash flows 1,461 1,616 Cash flows from investing activities Payments for PP&E and intangibles, net of interest paid on qualifying assets (697) (825) Payments for business combinations (net of cash acquired) (25) - Proceeds from sale of PP&E 15 6 Net cash outflow from investing activities from Continuing operations (707) (819) Net investing cash flows from Discontinued operations - 125 Net investing cash flows (707) (694) Cash flows from financing activities Net proceeds from / (repayment of) borrowings 236 (258) Payment of transaction costs related to borrowings (7) (12) Payments for buy-back of ordinary shares and share-based payments (301) (4) Interest paid (342) (340) Dividends paid to Company shareholders (297) (326) Principal elements of lease payments (28) (26) Net cash outflow from financing activities from Continuing operations (739) (966) Net financing cash flows from Discontinued operations - - Net financing cash flows (739) (966) Net increase / (decrease) in cash from Continuing operations 15 (169) Net increase in cash from Discontinued operations - 125 Free Cash Flow (FCF) 5 from Continuing operations 518 661 Cash Flow Movements Net cash inflows from operating activities from continuing operations decreased by $155m (10%) to $1,461m largely due to: › a decrease in EBITDA and unfavourable working capital movements with an increase in inventories and trade and other receivables › an increase in income taxes paid due to a higher instalment rate compared to the prior year. Net cash outflows from investing activities from continuing operations decreased by $112m (14%) to $707m due to a reduction in capital expenditure, partly offset by the acquisition of Flinders Logistics Pty Ltd (renamed Aurizon Port Services (SA) Pty Ltd) for $25m. Net cash outflows from financing activities from continuing operations decreased by $227m (23%) to $739m due to net proceeds from borrowings from new debt issuances including Subordinated Notes and Medium-Term Notes, partly offset by the repayment of EMTN 1 on maturity compared to net repayment of borrowings in the prior period. This was partly offset by the $300m on-market share buy-back completed during FY2025. 5 Free Cash Flow (continuing operations) defined as net cash flow from operating activities, less non-growth capex and less interest paid. It does not include growth capex (FY2025: $107m, FY2024: $204m), payments for acquisitions (FY2025: $25m, FY2024: $nil) and cash flows from significant items (FY2025: $26m, FY2024: $nil). Funding The Group continues to be committed to diversifying its debt investor base and increasing average debt tenor. Aurizon Holdings funding activity during FY2025: › Issued an inaugural $500m of subordinated notes in May 2025, with a first call date in August 2030 and final legal maturity in 2055. Aurizon Network funding activity during FY2025: › €500m EMTN ($711m equivalent) repaid in September 2024, with funds drawn from existing bank debt facilities › $100m tap of existing AMTN private placement in November 2024 (previously $20m, subsequently $120m) maturing in December 2034 › $300m AMTN issued in December 2024 for 9-years, maturing in December 2033, with funds used to repay drawn bank debt › ¥5bn AMTN ($53m equivalent) issued in June for 15-years, maturing in 2040, with funds used to repay drawn bank debt › $1,090m of bank debt facilities re-financed in December 2024, maturing in December 2027, with an additional $50m of bank debt facilities sourced from existing lenders. Aurizon Operations funding activity during FY2025: › $250m reduction in syndicated revolving facility limit (originally $400m) in September 2024 and subsequent cancellation of remaining undrawn facility in June 2025 › $490m of bilateral bank debt re-financed in June 2025, maturing in July 2028 with an additional $180m of capacity added from existing and three new bilateral bank lenders expanding the total bilateral lending group to twelve banks › Cancellation and repayment of $200m syndicated term loan facility in June 2025. In respect of FY2025: › Weighted average senior debt maturity tenor was 4.9 years as at 30 June 2025 (FY2024: 4.6 years); inclusive of Aurizon Holdings' subordinated debt was 7.3 years › Group interest cost on drawn debt was 6.3% (FY2024: 6.2%) › Available liquidity (undrawn facilities plus cash) as at 30 June 2025 was $1,679m (FY2024: $2,031m) › Group gearing (net debt / (net debt + equity)) as at 30 June 2025 was 56.2% (FY2024: 52.2%) › Aurizon Network's gearing (net debt 6 / Regulatory Asset Base (excluding Access Facilitation Deeds)) as at 30 June 2025 was 65.6% (FY2024: 64.4%). Aurizon Network's net debt 6 / EBITDA as at 30 June 2025 was times (FY2024: 3.9 times) › Aurizon Operations' gearing (net debt 6 / (net debt + equity)) as at 30 June 2025 was 22.2% (FY2024: 25.9%). Aurizon Operations' net debt 6 / EBITDA as at 30 June 2025 was 1.7 times (FY2024: 1.8 times) › Aurizon Operations' and Aurizon Network's credit ratings have each been maintained at BBB+/Baa1. Dividend The Board has declared a final dividend for FY2025 of 6.5 cps (fully franked) based on a payout ratio of 80% in respect of underlying NPAT from continuing operations. The relevant final dividend dates are: › Ex dividend: 1 September 2025 › Record date: 2 September 2025 › Payment date: 24 September 2025. Tax The Group statutory income tax expense for FY2025 was $153m. The Group statutory effective tax rate 7 was 33.6%, which is more than 30% due to the non-deductible goodwill impairment allocated to the Bulk CGU. The Group statutory cash tax rate 8 was 29.0%, which is less than 30% primarily due to accelerated fixed asset related adjustments and the utilisation of capital losses. The Group underlying income tax expense for FY2025 was $151m. The Group underlying effective tax rate 9 was 30.4% due to the impact of non-deductible expenses. The Group underlying cash tax rate 10 was 25.5% which is less than 30% primarily due to accelerated fixed asset related adjustments and the utilisation of capital losses. Net debt is defined as borrowings (both current and non-current) less cash and cash equivalents and excludes lease liabilities. Net debt is adjusted for funds drawn under the Intra Group Loan Agreement. Statutory effective tax rate = income tax expense / statutory consolidated profit before tax. Statutory cash tax rate = cash tax payable / statutory consolidated profit before tax. Underlying effective tax rate = income tax expense excluding the impact of significant items / underlying consolidated profit before tax. Underlying cash tax rate = cash tax payable excluding the impact of significant items / underlying consolidated profit before tax. BUSINESS UNIT REVIEW NETWORK Network refers to the business of Aurizon Network Pty Ltd (Network) which operates the 2,670km Central Queensland Coal Network (CQCN). The open access network is the largest coal rail network in Australia, connecting multiple customers from more than 40 mines to five export terminals located at three ports. The CQCN includes four major coal systems (Moura, Blackwater, Goonyella and Newlands) and a connecting link, the Goonyella to Abbot Point Expansion (GAPE). FINANCIAL SUMMARY ($M) FY2025 FY2024 VARIANCE Total revenue and other income Track Access 1,375 1,340 3% Services and other 53 95 (44%) Total revenue and other income 1,428 1,435 - Energy and fuel (138) (160) 14% Operating costs (334) (345) 3% EBITDA 956 930 3% Depreciation and amortisation (372) (353) (5%) EBIT 584 577 1% Tonnes (m) 208.0 209.6 (1%) NTK (b) 50.7 51.0 (1%) Maintenance / NTK ($/'000 NTK) 3.4 3.0 (13%) Opex (including D&A) / NTK ($/'000 NTK) 16.7 16.8 1% Cycle Velocity (km/hr) 22.3 21.9 2% Usable Capacity % 81.8% 80.3% 1.5ppts Network Performance Overview Network EBITDA increased $26m or 3% to $956m in FY2025, driven by a reduction in operating costs (and energy and fuel) against flat revenue. Volumes were 208.0mt, 1.6mt (1%) lower than the prior year. Track Access revenue increased by $35m (3%): › Allowable Revenue increased by $75m, driven by the final reset Weighted Average Cost of Capital (WACC) of 8.51% in FY2025 compared to the preliminary reset WACC of 8.18% in FY2024 and a higher maintenance allowance, partly offset by a reduction in Allowable Revenue associated with customer funded infrastructure (historically offset with rebates in Other Access Revenue) › Volumes were below the regulatory forecast (216.7 million tonnes) resulting in an Allowable Revenue under-recovery of $38m (after Take-or-Pay of $32m), which will be recovered in FY2027, compared to an over-recovery of $19m in FY2024 › Net favourable Revenue Cap (excluding GAPE) movements of $9m in FY2025 relating to FY2022 and FY2023 › Electric Energy Charge (EC) revenue was lower in FY2025 by $25m due to the EC tariff reducing from $1.66 to $1.24 per EGTK'000 › GAPE revenue was higher in FY2025 by $13m primarily due to the reset of the risk-free rate from 1 July 2024 › Other Access Revenue was $20m higher than FY2024 largely due to lower customer funded infrastructure rebates (see above). Services and other revenue was lower by $42m (44%) in FY2025 primarily due to lower external construction revenue. Total operating costs decreased by $33m (7%). Energy charges decreased $22m (offset in Access Revenue) due to lower wholesale energy prices, partly offset by higher connection costs. Other operating costs decreased $11m primarily due to lower external construction costs associated with lower revenue partly offset by higher maintenance costs ($21m). Depreciation increased ($19m) (5%) with increasing ballast investment, light vehicle replacement and an asset life review. Network's 2024-2025 RAB roll-forward estimate is $6.2bn 11 (including Access Facilitation Deeds of $0.3bn) as at 1 July 2025. Regulation Update On 19 June 2025, the Queensland Competition Authority (QCA) published the Independent Expert's (IE) Annual Capacity Assessment Report which identified deliverable capacity exceeds committed capacity (for the assessment period 1 July 2025 to 30 June 2030) in all systems except Newlands/GAPE. The QCA had previously confirmed in September 2024 that it was appropriate for Network to implement the Almoola signals projects with a cost estimate of $2.4m and the trial for the use of the existing Collinsville Passing Loop at $0.9m. On 8 July 2025, Network and the Rail Working Group of the Queensland Resources Council (RWG) wrote to the QCA to advise a non-binding term sheet has been agreed which will be the basis for drafting a Draft Amending Access Undertaking (DAAU). Since mid-2024 Network and the RWG have been meeting to discuss the option of Network submitting to the QCA a DAAU to apply once the current Access Undertaking (UT5) ends on 30 June 2027. The content of the DAAU is still to be finalised by Network and the RWG over the coming months. The parties are committed to working towards a submission of the DAAU to the QCA during the December 2025 quarter, in line with the agreed term sheet. Includes deferred capital and as approved capital by the QCA on 30 January 2025. COAL Aurizon's Coal business transports coal from mines in the Newlands, Goonyella, Blackwater, Moura and West Moreton systems in Queensland (QLD) and the Hunter Valley and Illawarra coal systems in New South Wales (NSW), to domestic customers and coal export terminals. FINANCIAL SUMMARY ($M) FY2025 FY2024 VARIANCE Total revenue and other income Above Rail 1,290 1,266 2% Track Access 469 460 2% Other 18 17 6% Total revenue and other income 1,777 1,743 2% Track Access costs (483) (474) (2%) Fuel costs (96) (105) 9% Operating costs (excluding access and fuel) (671) (636) (6%) EBITDA 527 528 - Depreciation and amortisation (209) (213) 2% EBIT 318 315 1% Total tonnes hauled (m) 192.2 189.0 2% Total NTK (b) 43.6 43.5 - Above Rail Revenue / NTK ($/'000 NTK) 29.6 29.1 2% Opex (excluding access and fuel) / NTK ($/'000 NTK) 15.4 14.6 (5%) Opex (including D&A, excluding access and fuel) / NTK ($/'000 NTK) 20.2 19.5 (4%) Active locomotives (as at 30 June) 321 323 (1%) Active wagons (as at 30 June) 8,744 8,618 1% Coal Performance Overview Coal EBITDA decreased by $1m to $527m due to higher operating costs partly offset by an increase in revenue due to higher volumes and yield (price indexation and customer mix). Volumes increased 3.2mt (2%) to 192.2mt: › CQCN volumes increased by 1.2mt (1%) to 133.7mt with an uplift in Goonyella and Moura offset by declines in Blackwater and Newlands › NSW and South-East Queensland (SEQ), volumes increased by 2.0mt (3%) to 58.5mt mainly due to increased customer production in SEQ. Total Coal revenue increased by $34m (2%) to $1,777m largely due to higher volumes and track access revenue (largely pass through in higher access costs) and improved revenue yield. Net revenue yield improved due to price indexation partly offset by customer mix and lower fuel revenue from lower prices. Total operating costs increased by $35m (3%) to $1,250m largely due to the following: › track access costs increased by $9m (2%) due to higher CQCN access tariffs › fuel costs decreased by $9m (9%) with lower fuel prices › other operating costs increased $35m (6%) to $671m due to higher traincrew and maintenance costs associated with volume growth, along with the escalation of labour and materials and higher doubtful debt provisions. Operating costs (excluding access costs and fuel) per NTK increased by 5%. Depreciation decreased by $4m (2%), resulting in an underlying EBIT of $318m, a 1% increase compared to the prior year. The current FY2026 forecast contract position is 229mt (FY2025: 233mt). TrainGuard, the final Goonyella and Blackwater Branch line deployment phase is complete, with the first branch line operational service deployed in the fourth quarter of FY2025. BULK Aurizon's Bulk business provides integrated supply chain services, including rail and road transportation, port services and material handling for a range of mining, metal, industrial and agricultural customers throughout Australia. Aurizon's Bulk business also manages the Tarcoola-to-Darwin rail infrastructure, the intrastate rail freight network in South Australia and containerised freight services between Adelaide and Darwin. FINANCIAL SUMMARY ($M) FY2025 FY2024 VARIANCE Total revenue and other income Freight Transport 1,100 1,060 4% Other 22 36 (39%) Total revenue and other income 1,122 1,096 2% Access costs (117) (117) - Operating costs (excluding access costs) (836) (750) (11%) EBITDA 169 229 (26%) Depreciation and amortisation (131) (128) (2%) EBIT 38 101 (62%) Total tonnes hauled (m) 55.3 66.6 (17%) Bulk Performance Overview Bulk EBITDA decreased $60m (26%) to $169m driven by the cessation of a rail maintenance contract, lower SA grain volumes and an increase in doubtful debt provisions. This was partly offset by new customer contracts (minerals and iron ore). Operating costs (excluding access costs) increased by $86m (11%) largely driven by an increase in doubtful debt provisions, higher labour escalation and costs to support customer growth. Excluding doubtful debt provisions, operating costs increased by 3%. Depreciation $3m (2%) higher with increased capital expenditure to support growth resulting in EBIT decreasing by $63m (62%). During the period, Bulk executed contracts for an integrated rail, road and port logistics solution with a term of up to 15 years 12 with BHP's Copper South Australia operations, and ten-year contract extensions were signed for rail haulage for Minara (WA) and KML (WA). OTHER Other includes Containerised Freight, which is not considered a separate reportable segment, as well as other revenue and central costs not allocated such as the Board, Managing Director & CEO, Company Secretary, strategy and investor relations. ($M) FY2025 FY2024 VARIANCE Total revenue and other income 142 76 87% Operating costs (218) (139) (57%) EBITDA (76) (63) (21%) Depreciation and amortisation (20) (13) (54%) EBIT (96) (76) (26%) Other Performance Overview EBITDA decreased by $13m (21%), driven by higher capacity costs in Containerised Freight (full schedule operations from May 2024) partly offset by the settlement of legal matters of which a portion was included in underlying earnings, relating to costs incurred. Haulage and logistics tasks are contracted on a 5 year initial term with 3+2 year extensions subject to Aurizon meeting KPIs. Terminal and logistics tasks are contracted on a 10 year initial term with 5 year extension subject to Aurizon meeting KPIs. ADDITIONAL INFORMATION Risk Aurizon has a commitment to effective risk management as a key element of business success to sustain shareholder value, recognising that risk is characterised by both threat and opportunity. Aurizon fosters a risk-aware culture through a combination of leadership focus, training and the application of high-quality, integrated risk assessments to support informed decision-making and enable effective risk management. The Board is ultimately responsible for risk management, considering a wide range of risks within strategic planning, approving Aurizon's Enterprise Risk Management Framework and Appetite, and monitoring management's performance against the framework, including whether it operates within the Board's risk appetite (see Principle 7 on Page 47 of this report). Aurizon's Enterprise Risk Management Framework and Appetite, and supporting Risk Assessment Procedure, are aligned to the international standard for risk management (AS/NZS ISO 31000:2018). Risk management procedures and templates deployed throughout the business integrate the assessment of safety and non-safety risks, and support a consistent approach to comprehensive, proportionate and effective risk management. The Enterprise Governance, Risk and Assurance functions are responsible for providing oversight of the risk management framework, enterprise risk reporting to facilitate the early identification and proactive management of risk, as well as assurance LEGEND RISK IMPACT ICONS Health & Safety Strategy & Execution Financial Operational Stakeholder & Reputation Environment & Climate RISK INFLUENCE METER The risk influence meter is provided to acknowledge that there are internal and external contributions to all of the risks that the business is exposed to. The meter is subjective and reflects only one way to consider further the risks presented. LIMITED SIGNIFICANT INFLUENCE INFLUENCE A risk influence rating here means that Aurizon can significantly influence this risk; for instance, it is largely driven by internal factors or is readily managed. LIMITED SIGNIFICANT INFLUENCE INFLUENCE A risk influence rating here means that Aurizon has limited ability to influence this risk; for instance, it is largely driven by external factors or is complex to manage. on the effectiveness of the management of significant risks, to the Executive Committee and the Board. Aurizon's Enterprise Risk Profile is actively managed and regularly reported to the Board. It includes those material inherent risks related to the enduring nature of Aurizon's business, those that present an exposure linked to the changing operating landscape or point-in-time external factors, and those risk exposures we encounter driven by our strategy and aspirations to grow. Key risks have been grouped around three themes of operational, market and strategic risk. The commentary has been provided to describe and summarise each key risk, the nature of the potential impacts to Aurizon, our view on our ability to influence the risk and consequences being realised, and a description of management's response to that risk. This is not intended to be a comprehensive list of all risks that the business is or could be exposed to. It represents Aurizon's own assessment of these risks at a point in time and, given the complexities and nature of these risks, this information is subjective and may be subject to change. Investors need to form their own assessment and conclusions. OPERATIONAL RISK Major Hazard, Serious Injury or Fatality Given the nature and scale of Aurizon's operations, there are hazards in the business that, if not managed, have the potential to cause a serious injury or fatality. Aurizon's safety risk exposure is impacted by the diversity and scale of its operations - from train operations, on-track works, port operations, and heavy vehicle haulage. Incidents could include: › Level Crossing collisions - can result in death or significant injury to our people or members of the public. › Exposure to moving rollingstock - can result in death or significant injury to our people. › Road Vehicle Incident - death or injuries to our people from operating road vehicles. › Trespass - safety risks to employees and individuals due to persons illegally entering the rail corridor intentionally (theft or protest) or otherwise. The potential realisation of these risks could have direct safety, operational disruption, and reputational consequences including licence to operate. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Aurizon's commitment is keeping people safe and healthy. Our safety value 'We know safe, we choose safe' promotes leadership and personal accountability for safety. Aurizon's leadership team and Board regularly review safety performance, improvement strategies and activities across the business, aligned to a defined enterprise safety strategy. Refer to Page 25 for further information on safety. Cyber Security and Technology Reliance The cyber threat landscape is becoming increasingly sophisticated, and attacks are occurring more frequently, despite increased investment in cyber security by organisations and governments. Recent trends highlight increased coordination and automation by threat actors, leading to larger-scale attacks and greater operational risks. While previously data breaches may have been the main concern, widespread business disruption has steadily been on the rise. Aurizon relies on technology and is exposed to cyber-related risks which can arise through a multitude of vectors including malicious external hackers, insider threats, unintentional human error, obsolete or unsupported systems or through links to third parties. A cyber breach or other technology-related disruption could impact Aurizon's operations and impair its ability to provide services. Such an event could potentially result in financial losses, reputational damage, consequential safety, legal or regulatory action or other adverse consequences. Aurizon is reliant on fit-for-purpose technology to deliver services, maintain assets and transact business. Technology is rapidly evolving and if Aurizon does not effectively leverage advances in technology, it may become less efficient relative to competitors. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Aurizon has implemented cyber security controls to prevent, detect and respond to potential cyber security incidents including business continuity plans and response plans. Aurizon participates in external cross-industry collaboration forums and briefings where threat intelligence is shared, and specialist third- party advisers are used for monitoring and response capabilities. Aurizon continues to implement a multi-year cyber security transformation program to continue to enhance and uplift its ability to protect from, and respond to, cyber security incidents or other technology-related disruptions. Technology roadmaps are refreshed annually and technology upgrades progress through Aurizon's capital approval process including benefit identification. Severe Weather Aurizon owns and maintains rail track infrastructure in addition to other assets (rail and non-rail), maintenance facilities, depots and worksites across Australia. Maintaining a large physical footprint exposes Aurizon to risks caused by the increasing severity and prolonged nature of extreme weather events, such as flooding, bushfires, heatwaves and cyclones. These extreme weather events also impact our customers' production, and activities central to their supply chains (e.g. ability to transport goods and services required for their operations, port activities etc). Damage caused by destructive weather events could cause safety, health and environmental risks and operational disruption, increasing operational costs or driving financial losses, in addition to a reduction in demand for our services. LIMITED INFLUENCE SIGNIFICANT INFLUENCE For Aurizon-owned networks, management is responsible for infrastructure asset management, including condition monitoring and maintenance and renewal programs, to identify, prepare and remediate locations at greater risk of severe weather events. Aurizon invests in operational assets and maintains inventories to reduce the impact of weather events. Assessments of operational resilience are undertaken and consideration is made of resilience in engineering design. In addition, climate resilience and risk assessments are being progressively undertaken and updated on key assets. Seasonal planning, forecast and weather monitoring provide early warning of potential severe weather and planning time for safe provision of service. Incident management and business continuity planning, protocols and expertise are essential to manage a safe and effective response to severe weather events alongside periodic testing of readiness. RISK RISK DESCRIPTION AND POTENTIAL IMPACTS IMPACTS AND INFLUENCE MANAGEMENT RESPONSE Supply Chain Reliability Building resilient supply chains and effective inventory management is critical to optimise levels of supply and minimise costs, and ensure Aurizon's operational assets are appropriately maintained to enable uninterrupted service delivery. Ongoing global and geopolitical events continue to have increased supply chain complexity and challenged reliability, including evolving international trade relations tensions, cyber security risks, labour shortages, constraints on the availability of raw materials and risk of engaging with suppliers who are either directly or indirectly implicated in modern slavery. These risks may increase supply chain costs, lead times and delays in obtaining goods and services, which could result in operational disruption. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Aurizon is addressing these challenges by working closely with key suppliers, assessing and managing supply chain resilience and taking action to diversify supplier bases, including the creation of dual supply where possible. Our key focus remains on demand forecasting, refreshing inventory management approaches and strengthening inventory levels, and monitoring of emerging supply chain risks. In December 2024, Aurizon published its fifth Modern Slavery Statement, which addresses the Company's obligations contained in the Modern Slavery Act 2018 (Cth). People and Capability Aurizon's ability to manage its workforce is central to our strategy, value proposition, and ability to compete. This includes planning, attracting, and retaining individuals with the necessary skills and expertise. Ineffective workforce management can lead to material financial, operational, and reputational impacts. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Our workforce capability planning is integrated into our organisational and business strategy, utilising HR specialists, integrating people, processes and systems, and identifying and taking targeted action on capability hotspots. We also promote our employee value proposition and actively listen to employee feedback. We have implemented talent attraction and retention strategies, including a multi-media brand campaign, career progression pathways, competitive remuneration, and investment in learning and development programs. Greenhouse Gas Emissions, Metrics and Targets Aurizon is an emitter of greenhouse gases (GHG) through consumption of fossil fuels used in delivering services to customers and in the creation, purchase and utilisation of our assets. Under the Safeguard Mechanism reforms which commenced on 1 July 2023, Aurizon is required to maintain its Scope 1 emissions of its National Transport Facility (captured under the Safeguard Mechanism) below an annually declining regulated baseline. Failure to do so exposes Aurizon to direct carbon costs and/or regulatory action. Due to current technology constraints, Aurizon will be required to purchase and retire Australian Carbon Credit Units (ACCUs) to meet its Safeguard compliance obligation. A key challenge is Aurizon's ability to recover increased carbon-related costs from customers against the declining baseline. Should Aurizon not be able to recover this cost directly or indirectly, it may negatively impact financial performance including impairment of assets. These challenges are compounded by evolving Australian and international governments expectations on emissions management and reporting, which may further impact Aurizon. Aurizon has set targets for the reduction of emissions and emission intensity, while also focusing on operational growth. With a large, complex and multi-year decarbonisation program, there are risks relating to: › the ability to reduce those emissions as committed to the market, particularly as operations expand › the availability of technology at scale to meet those ambitions › the availability, efficiency and affordability of renewable energy and/or drop in fuels to power the transition › reliance on third parties, including the implementation of government policy, to facilitate the transition › costs such as decarbonisation technologies, energy sources or ACCUs › the targets, or actions taken in progressing towards those targets, not being considered sufficient to key stakeholders. These risks could result in increasing operational costs, damage to social licence, shareholder action or litigation or other reputational impacts. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Aurizon is taking action to: › design, invest and support the delivery of fleet decarbonisation projects and carbon abatement initiatives › incorporate the assessment of the impact on GHG emissions as part of investment decision-making › explore and engage opportunities via partnership agreements › upskill existing and new staff with appropriate skills › continue engagement with government and regulators regarding policy and advocacy to promote fair and equitable treatment of rail as a low carbon form of land-based freight transportation, and to stimulate the domestic biodiesel production industry › implement and progressively update its ACCU purchasing strategy. Aurizon provides accurate and timely reporting of emissions and provides information about the programs in hand to reduce those emissions. For more information on our approach to climate change, including risks relating to decarbonising and net zero, also refer to our annual Sustainability Report. Volume Throughput Aurizon has a key role in national and international supply chains, providing logistics solutions for customers across the country. Aurizon also manages and operates major rail infrastructure assets in Queensland, South Australia, and the Northern Territory, and relies on other network providers to enable operations in other locations. Ensuring efficient transportation of materials is critical for Aurizon and our customers to maximise volume and value. A deterioration in volumes transported could be driven by below rail asset condition, complexity in alignment and planning between key stakeholder interests, inadequate funding, operational performance, or impacts stemming from disruption, including weather related events. This risk could impact railed volumes, revenue, costs, customer sentiment and reputation. LIMITED INFLUENCE SIGNIFICANT INFLUENCE For Aurizon-owned networks, management is responsible for the development and delivery of network infrastructure asset management programs, including condition monitoring and maintenance and renewal programs, alongside structured funding arrangements with independent oversight. Management engages with operators and customers through customer forums, with oversight by regulatory bodies. For all networks which Aurizon operates on, management employs the following tools to drive: › engagement and structured access arrangements with Rail Infrastructure Managers › government lobbying and advocacy through Freight on Rail Group (FORG) › performance monitoring and management initiatives › programs to enhance operational planning and ability to respond flexibly › business continuity and asset resilience programs. Regulatory Risk of Access Undertaking Aurizon Network is subject to economic regulation under the Queensland Competition Authority Act 1997 (Qld), with the Central Queensland Coal Network (CQCN) operating under an approved Access Undertaking. The development and approval of the Access Undertaking for the next regulatory term (commencing 1 July 2027) presents a material regulatory risk to the business. Aurizon Network continues to engage with its customers, industry bodies, and the regulator (the Queensland Competition Authority (QCA)) to secure sustainable and commercially viable regulatory outcomes. Failure to secure appropriate pricing and regulatory settings may adversely impact revenue, constrain capital investment across the CQCN, limit operational performance and impair Aurizon's ability to meet the service performance expectations of its customers. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Aurizon Network remains committed to achieving sustainable and commercially viable regulatory outcomes for the CQCN through active engagement with the QCA, its customers and industry bodies. In accordance with the Queensland Competition Authority Act 1997 (Qld), Aurizon Network is progressing the development of a Draft Amending Access Undertaking based on the non-binding term sheet agreed with the Rail Working Group (RWG) of the Queensland Resources Council, which amends and extends the term of the existing Access Undertaking through continued structured and collaborative engagement including: › Stakeholder Engagement: Regular and transparent engagement with industry through the Queensland Resources Council, Quarterly Stakeholder Forums, Technical Working Groups, and direct consultations with individual customers and rail operators. › Internal Review and Strategic Planning: Ongoing assessment of regulatory, operational, and commercial priorities to inform the development of a fit-for-purpose access framework. › Economic and Financial Modelling: Development of robust forecasts and financial models to support the determination of Maximum Allowable Revenue (MAR), including the Weighted Average Cost of Capital (WACC) and reference tariffs. › Domestic Regulatory Monitoring: Aurizon Network continues to monitor the regulatory landscape for decisions from other regulators that may impact, influence or justify various positions including the WACC. RISK RISK DESCRIPTION AND POTENTIAL IMPACTS IMPACTS AND INFLUENCE MANAGEMENT RESPONSE Regulation and Compliance Aurizon's operations and financial performance are subject to legislative and regulatory oversight. Unfavourable regulatory changes may occur with respect to access regimes, rail accreditations, taxation, carbon reduction, environmental and industrial (including occupational health and safety) regulation and government policy and approval processes. Implementation of these changes may have a material adverse impact on project investment, Aurizon's profitability and business in general, as well as Aurizon's customers. Aurizon is also exposed to the risk of material regulatory breaches resulting in the loss of operating licences (e.g. rail accreditations), additional regulatory oversight and financial penalties. In the event of a loss of licence, critical business operations may not be supplied to customers, impacting profitability and reputation. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Aurizon is an active participant in consultation on future legislation (for example through the National Transport Commission), and provides participation and leadership within industry advocacy groups to bring influence on regulatory change as needed. In relevant jurisdictions where Aurizon is the Access Provider, prior to submissions being made to the relevant regulator, engagement with industry groups is sought to reduce the risk of adverse regulatory outcomes. To facilitate business compliance with legislative requirements, we provide comprehensive employee training and education, develop work systems that ensure adherence to our obligations - including the Employee Code of Conduct - and maintain rigorous internal quality assurance processes, checks, and controls. Aurizon's rail accreditation is actively managed through proactive engagement with the Office of the National Rail Safety Regulator. Dedicated resources are responsible for the active management of our licence. MARKET RISK Competition Aurizon may face competition from parties willing to compete at reduced margins, with lower returns or greater risk positions than Aurizon would accept. Market factors and changes in customer expectations may compel Aurizon to take on more risk or reduce rates to retain customers or win new work. Increased competition may come from new entrants or existing competitors and could include customers in-sourcing services, impacting Aurizon's competitiveness and posing a risk to future financial performance. LIMITED INFLUENCE SIGNIFICANT INFLUENCE To reduce our exposure to competition risk, management is focused on adopting a disciplined, data-driven approach to customer offers including balanced competitive pricing. We continue to be focused on delivering consistent, high-quality services that strengthen customer value and reduce price sensitivity. In addition, strategic targeting of suitable growth and new work winning opportunities is in place across all business units supported by a central strategy team. Counterparty Macroeconomic drivers may degrade overall counterparty quality and creditworthiness. A move from some to divest coal assets and new customer profiles are changing Aurizon's counterparty exposures. Deterioration of counterparty quality could stem from volatile commodity demand, access to funding, operational practices, production rates and commodity price, which increase the risk of a counterparty default, challenges of operator solvency, stranded asset risk or financial losses. LIMITED INFLUENCE SIGNIFICANT INFLUENCE The Aurizon Market Intelligence, Strategy and Business Unit teams work together to assess long-term demand planning and mine viability or customer commodity analysis, and support the strategic targeting of suitable growth opportunities. Counterparty credit quality is assessed and monitored by Treasury and Business Unit leadership teams, with appropriate steps taken to implement additional controls as needed. Evolving Commodity Demand Aurizon is leveraged to global demand for Australian bulk commodities driven by infrastructure development, energy generation (and storage), food consumption and containerised freight. Key commodities hauled include steel-making coal, thermal coal, iron ore, alumina and bauxite, grain, and containerised freight. A quicker transition to clean energy technologies could impact Aurizon's customer volumes, exacerbate key market dependencies and commodity mix. A failure to recognise this transition could also lead to suboptimal investment decisions and missed opportunities for all Business Units. LIMITED INFLUENCE SIGNIFICANT INFLUENCE The Bulk Growth and Containerised Freight Strategies have been developed to set out a proactive approach to the evolution of commodity demand, resulting in diversification of markets and revenue streams and include fleet cascade opportunities from the Coal fleet to support growth in the Bulk and Containerised Freight growth. As part of the Strategy in Uncertainty framework (across coal, bulk and containerised freight markets), we undertake scenario analysis to enable the business to evaluate capital, fleet and haulage opportunities, and sustainability elements in the context of climate change risks. Sustainability and Funding Investor and shareholder expectations will continue to focus increasingly on Sustainability, and in particular on Environmental, Social and Governance (ESG) related issues and associated enterprise performance. As the transition to a lower carbon global economy continues to gain momentum, the availability and cost of debt or insurance may become more challenging for the mining and logistics sectors. Where these risks are unmitigated, they could impact the financial viability of our customers, restrict future mining investments, lead to increasing costs of finance and insurance, reduction in credit rating or, where investor expectations are unmet, damage to reputation and social licence to operate. LIMITED INFLUENCE SIGNIFICANT INFLUENCE In addition to the activities noted above, diversification of funding sources and early renegotiation of maturing debt helps to ensure capacity of funding and reduce impacts of increasing costs of funding. For the details of the maturity profile of existing financing arrangements, please refer to Note 18 of the Financial Report. Ongoing engagement with insurers and brokers allows closer understanding of market developments to allow policy design and renewal programs to be designed accordingly. For more information on our approach to climate change, including risks relating to financing and insurance, refer to our Climate Strategy and Action Plan and our annual Sustainability Report. Geopolitical Aurizon's customer base is exposed to global demand for Australian bulk commodities. Therefore, instability in global markets and trade relations could result in changes to customer profitability or viability, or disrupt global supply chains, which in turn affect Aurizon's financial performance. LIMITED INFLUENCE SIGNIFICANT INFLUENCE The Bulk Growth and Containerised Freight Strategies have been developed to set out a proactive approach to the evolution of commodity demand, resulting in diversification of markets and revenue streams. As part of the Strategy in Uncertainty (SIU) framework, considerations are made to opportunities and risks that emerge over the medium to long term, where the timing and magnitude is less certain. In addition to the fundamental drivers of Australian coal and bulk commodities, we also review more subjective factors, such as government policy and trade considerations. Active situation monitoring of political and international trade performance allows for the identification of impacts and appropriate planning. Macroeconomic Aurizon is exposed to changes in the macroeconomic environment. This includes economic growth driving or restricting demand for commodities hauled, as well as exposure to increasing costs in the delivery of services, in servicing debt obligations and through an exposure to the financial viability of key customers and suppliers. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Aurizon sources funding from both bank and debt capital markets (AMTN, EMTN, USPP) providing access to a diversified investor base. The ability to raise capital in a variety of markets allows Aurizon flexibility in its approach to refinancing activities and future capital raisings. Hedging strategies are employed to manage some financial exposures, including interest rate and foreign exchange risk. Aurizon employs a duration-based hedging strategy which is annually refreshed and presented to the Board. Escalation clauses in haulage contracts provide some protection against increasing costs through inflation recovery, and counterparty credit monitoring and supply chain resilience reviews consider financial viability to manage credit risk. Please refer to Note 18 of the Financial Report which sets out Aurizon's approach to Financial Risk Management. RISK RISK DESCRIPTION AND POTENTIAL IMPACTS IMPACTS AND INFLUENCE MANAGEMENT RESPONSE STRATEGIC RISK Delivering Bulk Growth Aurizon aspires to materially increase earnings from the Bulk business unit and therefore faces the risk of failing to achieve this growth. This could occur due to an inability to retain and extend existing contracts and identify and execute suitable growth opportunities, growth opportunities not materialising, or a lack of available resources and funding or other associated factors. Materialisation of these risks could result in financial losses, stranded assets, negative investor sentiment, reputational damage and failure to achieve strategic objectives. LIMITED INFLUENCE SIGNIFICANT INFLUENCE A clear strategy has been developed to achieve this aspiration by diversifying our Bulk portfolio and expanding our supply chain services. To support the delivery of our Bulk Growth strategy, allocation has been made of appropriate resources, funding and expertise, along with the identification and targeting of multiple success pathways for organic and inorganic growth, to support delivery of this strategic objective. Expansion of Containerised Freight Aurizon is establishing a nationally significant containerised freight supply chain, leveraging its existing national footprint and operational expertise. Currently, Aurizon is heavily reliant on one major customer and therefore is exposed to the performance to that counterparty, including to changes in demand from their customers, changes in their customer base, and to their overall financial performance. As this service offering expands, Aurizon will further be exposed to increased volume risk and is reliant on securing and delivering suitable growth opportunities - such as land-bridging and additional interstate freight forwarders - to capitalise on the investment. Aurizon may not be successful in executing this strategy as a result of lower than expected demand, ineffective planning, insufficient talent, resources and assets. Materialisation of these risks could result in financial losses, stranded assets, negative investor sentiment, reputational damage and failure to achieve strategic objectives. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Aurizon has formulated a strategy to facilitate the expansion of our Containerised Freight service offering. This strategy includes a prioritised plan for attracting customer demand in key corridors and to support the Landbridge concept. From an operational execution perspective, there are strategies for accessing and developing key terminals and pathing, procuring and managing the required rollingstock and other assets, and implementing suitable IT systems. It also includes leveraging existing containerised freight expertise and operations, and recruiting additional personnel with the necessary expertise and skill sets. Fleet Strategy Aurizon's ability to effectively serve its customers is significantly impacted by its ability to make optimal use of its long-life operational assets, including rollingstock fleet (locomotives and wagons). Suboptimal management of the Aurizon fleet could result in degraded operational performance, leading to financial losses attributable to performance penalties, foregone demand, or failure to deliver on key strategic objectives, such as growing non-Coal earnings. Lack of alignment or suboptimal development or execution of the near-and longer-term fleet strategy could also lead to erosion of customer and investor confidence as well as safety risks for employees and the broader public. As Aurizon prepares to decarbonise our fleet, new technology will need to be developed, validated and, where economical to do so, scaled. A range of technical, operational, supply-chain, and regulatory risks associated with the adoption of new technologies could lead to financial losses and/or delays in meeting our climate commitments. LIMITED INFLUENCE SIGNIFICANT INFLUENCE Aurizon regularly reviews both fleet allocation and performance to optimise service delivery. Track-based condition monitoring equipment and on-train telemetry systems provide real-time data to support efficient maintenance practices and asset performance management. Aurizon's Fleet Strategy combines Operational, Financial and Market Intelligence data to understand the value implications of fleet positions (e.g., long/ short; surplus/deficit) and prioritise specific interventions. For example, it is being applied to: › inform fleet allocation decisions › calibrate the optimal spend on assets › support for growth objectives › plan for potential decarbonisation pathways. Ultimately the strategy applies an enterprise lens to fleet decision-making that seeks to point assets to the right value-creating opportunities and time horizons so that Aurizon can sustainably achieve both its Free Cash Flow resilience objectives and Decarbonisation ambitions. Sustainability Aurizon keeps stakeholders informed of our corporate governance and financial performance via announcements to the Australian Securities Exchange (ASX) and our website. In addition, we take a direct approach to reporting environmental, social and governance (ESG) disclosures to our stakeholders with the publication of our annual Sustainability Report. We recognise that our climate change disclosures are one of the key interests to stakeholders. Since 2017, we have incorporated recommendations from the Financial Stability Board's Final Report: Recommendation of the Task Force on Climate-related Financial Disclosures (TCFD) in our annual Sustainability Report. In FY2021, we published our Climate Strategy and Action Plan (CSAP). The strategy builds on our existing work in reducing our carbon footprint. We recognise that we all have a responsibility to act on climate change - government, business, and the general community - so we can achieve an effective transition to a low-carbon future. Aurizon is committed to managing its operational activities and services in a sustainable manner, and has continued to monitor performance against key sustainability targets and objectives, which include: › a net-zero operational emissions (Scope 1 and 2) by 2050 target › an additional emissions intensity reduction target of 10% by 2030 to maintain an emphasis on improving existing capabilities and assets in the near term › two primary safety metrics to measure safety outcomes across the enterprise: Serious Injury and Fatality Frequency Rate (SIFRa+p) and Total Recordable Injury Frequency Rate (TRIFR) › gender representation on the Board › representation of women in senior executive roles › representation of women in the workforce › representation of Aboriginal and Torres Strait Islander men and women in the workforce. Details on our progress against the targets and objectives, together with the steps that are taken by the Board to ensure there is effective governance and oversight, are published in Aurizon's Sustainability Report. Safety At Aurizon, we are committed to protecting our people and the communities in which we operate. During FY2025, our Safety Strategy has continued to prioritise building and implementing simple systems and processes, understanding and controlling safety risks, and building leadership and capability with a strong in-field presence. In FY2025, we continued to progress safety initiatives including the deployment of External Precise GPS (EPG) technology to enhance real-time tracking of rail safety workers in addition to transitioning to an improved fatigue risk management framework aimed ...

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