OM : 2022 Annual Report & Sustainability Statement

Dear Shareholders,

2022 started on a strong note, with markets still running on a post-COVID stimulus rush carried over from 2021. The sentiment for ferroalloy pricing was also lifted with the outbreak of the war in Ukraine, before settling down as weaker global demand weighed in on markets. The anticipated shortage of ferroalloys caused by the war did not materialize, with Russia still an exporter of ferrosilicon, and with Ukraine's output largely displaced by the continued growth in production and exports from India.

These factors, acting in conjunction with a weak global macro environment in the second half of the year given energy prices in Europe and general lethargy in China, led ferroalloy prices to fall by 11% from 2021 to 2022. Nevertheless, as we previously shared, the Company was able to secure strong contracts in Q4 2021 which were subsequently delivered in 2022, allowing us to grow profit after tax by 10.2%. Prices further corrected towards the end of 2022, with ferroalloy markets in attrition mode, marked by strong price competition and with weaker producers reducing production or closing. This will be the dominant theme of 2023, exacerbated by inventory being released by traders (partly due to elevated costs of holding given high interest rates). It will be a challenging year but will also set in motion the conditions for the next market rally.

Energy security remains a dominant theme, viewed against the backdrop of current geopolitical uncertainty and Europe's power situation last winter. We believe that any company able to lock in power costs to produce a basic commodity efficiently and cleanly will be creating value, and OM Sarawak is in a unique position to do so.

Our production at OM Sarawak for the year was 357,000 tonnes, well within the guidance we gave at the beginning of the year. As previously mentioned, production was frontloaded to capture better prices in the first half of the year before macroeconomic conditions deteriorated. Consequently, major maintenance was pushed to commence in June 2022, and we are pleased to share that all maintenance for our manganese alloy furnaces has been completed as of April 2023. From production we generated an EBITDA of US$163 million, and US$197.0 million in cashflow from operations. Cash generation was elevated largely due to changes in working capital, with the unwinding (i.e. consumption) of raw material safety stock maintained during the COVID period when supply chains were considerably more fragile. Depreciation and amortisation as a share of EBITDA has also come down, with the accelerated depreciation of our mining assets in 2021 with the closure of the Bootu Creek mine in that year.

The cash generated from our operations was largely used to finance our acquisition of the remaining 25% of OM Sarawak from our former joint venture partner in December 2022 for US$120 million. We are pleased to have completed the acquisition and remain confident that this will allow us to focus growing organically at OM Sarawak through further investments in our final expansion phase. Besides the acquisition, we also repaid US$26 million to project finance lenders as part of our objective to continue lowering our gearing ratio.

After a series of engagement sessions with institutional investors in 2022, we recently formally implemented a dividend policy for 2023 onward. While a A$1.5 cents dividend was declared for FY2022, going forward the Company will target a distribution of 10-30% of net profit after tax, subject to the board's approval. As we continue working on reinvigorating our register, the dividend policy will allow us to pay a sustainable dividend even as we grow, and most importantly, allow institutional investors to forecast their returns. After our expansion and growth projects at OM Sarawak, we will be able to distribute more of our earnings to shareholders.

While we have been able to successfully complete the modification of two silicon metal furnaces, one furnace was suspended as of 12 April 2023 as it was not operating as anticipated within the framework of the Engineering, Procurement and Construction contract. A review is now underway in relation to rectification.

In addition, we have also made significant progress in our efforts to promote diversity and inclusion in our workforce. We firmly believe that a diverse and inclusive workplace is essential for our success and are committed to creating an environment where everyone feels valued and respected.

This year, we made advancements in obtaining assurances for our greenhouse gas (GHG) emissions. The level of assurance obtained required site visits with inspectors to verify data collection methods, ensuring that accurate and reliable numbers are reported. To have a comprehensive understanding of our products' total footprint, a cradle-to-gate Life Cycle Analysis (LCA) was also conducted on manganese ore and manganese alloy, in collaboration with the International Manganese Institute. Information gathered allowed us to provide transparent data to customers while assessing our emission impact.

I am confident that our continued focus on sustainability and responsible business practices will not only benefit our Company but also contribute to building a better world for future generations.

I would like to express my gratitude to our shareholders, customers, and employees for their unwavering support, which has been critical to our success. We remain committed to creating value for our stakeholders and contributing to the betterment of society, growing as a sustainable ferroalloy producer to the world's steelmakers.

LOW NGEE TONG

Executive Chairman

DIRECTORS

LOW NGEE TONG

Executive Chairman

ZAINUL ABIDIN RASHEED

Independent

Deputy Chairman

JULIE ANNE WOLSELEY

Non-Executive Director &

Joint Company

Secretary

Mr Low is a qualified Mechanical Engineer, having graduated from the National University of Singapore. He has over 42 years of experience in the steel, ferro alloy and building materials industries in Asia. That experience was gained with Chiyoda Limited, a global Japanese civil engineering group, Intraco Limited, Intraco Resources Pte Limited, and C Itoh Limited, a significant Japanese metals trading house. Mr Low has demonstrated a significant network for marketing in China and internationally. He was the Chief Executive Officer of OMH since its incorporation and subsequent listing in 1998. In October 2008, Mr Low became the Executive Chairman of OMH. Mr Low's business relationships and reputation with several large multinational corporations in Asia have enabled OMH to successfully establish its profitable operations based in Singapore and extending to China, Malaysia, South Africa and Australia.

Mr Zainul Abidin graduated with a Bachelor of Arts (Honours) in Economics and Malay Studies from the University of Singapore. Mr Zainul was a Member of Parliament (from 1997-2011) and served as the Senior Minister of the State for the Ministry of Foreign Affairs of the Government of Singapore, a position he held since 2006. Prior to serving in government service, Mr Zainul had an illustrious career in journalism which included the positions of Editor of Berita Harian, The Singapore Business, The Sunday Times and Associate Editor of The Straits Times.

Mr Zainul currently serves as the Ambassador to Kuwait (Non-Resident) and was formerly the Foreign Minister's Special Envoy to the Middle East. Mr Zainul also used to serve as a Corporate Adviser to Singapore's Temasek International Pte Ltd, and is now a member of the Temasek Foundation Cares Board of Directors. He is a member of the Nanyang Technological University Board of Trustees and Board of Directors of Mediacorp.

Mr Zainul served numerous government agencies, councils and civic organizations including Executive Secretary of the Singapore Port Workers' Union, a member of the Board of Directors of the Port of Singapore Authority, President of the Singapore Islamic Religious Council, Chairman of the Malay Heritage Foundation, Chief Executive Officer of the Council for the Development of the Malay/Muslim Community (MENDAKI), the Council for Security Co-operation in the Asia Pacific, the National University of Singapore Council as well as being the Patron of the Singapore Rugby Union and Adviser to the Hockey Federation.

Mr Zainul Abidin is a member of the Company's Remuneration Committee.

Ms Wolseley holds a Bachelor of Commerce degree and is a Chartered Accountant. She is the Principal of a corporate advisory company and has over 31 years of experience as Company Secretary to a number of ASX-listed companies operating primarily in the resources sector. Previously Ms Wolseley was an Audit Manager both in Australia and overseas for an international accounting firm. Her expertise includes corporate secretarial, management accounting, financial and management reporting in the mining industry, IPOs, capital raisings, cash flow modelling and corporate governance. Ms Wolseley is also a board member of Aquinas College, an independent school for boys in Perth, Western Australia.

Ms Wolseley is a member of the Company's Audit and Remuneration Committees.

TAN PENG CHIN

Independent

Non-Executive

Director

DATO' ABDUL HAMID

BIN SH MOHAMED

Independent

Non-Executive

Director

TAN MING-LI

Independent

Non-Executive

Director

DIRECTORS

Mr Tan Peng Chin was the founder, managing director and consultant of Tan Peng Chin LLC until he retired from the firm on 31 December 2015. Mr Tan was also a Notary Public and Commissioner for Oaths from 1995 to 2015. He was an Accredited Mediator with the Singapore Mediation Center. Mr Tan's legal expertise includes corporate finance, banking, company and commercial laws, international trade, joint ventures and issues concerning shareholders and directors. In addition, Mr Tan has acted in numerous cross border transactions in the course of his legal career spanning more than 37 years. Mr Tan has served as an Independent Director in numerous Singapore- listed companies since 1996.

He was also a member of the Institutional Review Board of the Singapore National Cancer Center from 2007 to 2014. Mr Tan was instrumental in setting up Clarity Singapore Limited in 2010, a charity under the auspices of Caritas (the Catholic Church) to assist persons suffering from mental illnesses and was Chairman / Vice Chairman of the Board until his retirement from the Board in Oct 2021. Mr Tan has also volunteered with various charities including Christian Outreach for the Handicapped and the Roman Catholic Prison Ministry. He is also a director of Orchestra of Music Makers Ltd.

With his board experience in various companies in Asia and his legal expertise, Mr Tan is able to assist the Company in its strategic pursuits. He has been a Non-Executive Director since 14 September 2007.

Mr Tan is the Chairman of the Remuneration Committee.

Dato' Abdul Hamid Bin Sh Mohamed is a Fellow of the Association of Chartered Certified Accountant. He started off his career in an accounting firm before joining Bumiputera Merchant Bankers Berhad, a merchant and investment bank, and subsequently Amanah Capital Malaysia Berhad, another financial institution group owned by the largest unit trust fund in Malaysia then.

He eventually joined the Kuala Lumpur Stock Exchange ("KLSE"), now known as Bursa Malaysia, where he rose from Senior Vice President Strategic Planning & International Affairs, subsequently to Deputy President (Strategy and Development) and finally to the position of Chief Financial Officer. During his 5 years with KLSE, he led several major projects including the acquisition of Kuala Lumpur Options and Financial Futures Exchange, Commodity and Monetary Exchange of Malaysia and the subsequent merger of both exchanges to form the Malaysian Derivatives Exchange, as well as the acquisition of Malaysian Exchange of Securities Dealing and Automated Quotation. He also led KLSE's demutualisation exercise.

He holds directorships in various companies in Malaysia including Lembaga Tabung Haji (the National Pilgrims Fund Board), MMC Corporation Berhad (a listed company on Bursa Malaysia which was recently privatised), Maybank Investment Bank Berhad (a subsidiary and investment banking arm of Malayan Banking Berhad which is also listed on Bursa Malaysia), and Ekuiti Nasional Berhad (a Malaysian government-linked private equity company). He is currently the Executive Director (and major shareholder) of Symphony House Sdn Bhd, a privately owned investment holding company.

Other directorships outside Malaysia include Maybank IBG Holdings Limited in Singapore and PT Maybank Sekuritas Indonesia where both companies are involved with dealings in securities.

Dato' Abdul Hamid Bin Sh Mohamed is the Chairman of the Company's Audit Committee.

Ms Tan Ming-li is currently a partner of the Malaysian legal firm, Chooi & Company + Cheang & Ariff. She graduated with a double degree in Law (Hons) and Science from the University of Melbourne. She was called to the Malaysian Bar in 1994 and has been in legal practice for over 26 years. Her areas of expertise include corporate and securities laws where she is involved in advising on capital market transactions, mergers and acquisitions, corporate restructuring and corporate finance related work.

She currently serves as an independent director for CapitaLand Malaysia Trust, BP Plastics Holding Berhad and from 1 April 2023, she has been redesignated as a non- independant non-executive director of Tune Protect Group Berhad (companies listed on Bursa Malaysia) and Tune Insurance Malaysia Berhad, a subsidiary of Tune Protect Group Berhad.