Dyno Nobel Limited

Good morning and welcome to Dano Nobel Limited's 2026 full year results briefing. This is Tom Dixon speaking and I'm joined this morning by our CEO and Managing Director, Mauro Neves, and our Group CFO, Nitesh Naidoo. Materials we will be covering today have been lodged with the Australian Securities Exchange and are available on the ASX and Dano Nobel websites. At the end of the presentation, we'll have time for questions and an audio recording will also be made available on the company's website. I'll draw your attention to the disclaimer on slide two. and slide three of the presentation. And before we move into the main presentation, I'd like to begin with an acknowledgement of country. I acknowledge the first peoples of the land, sea and waters across the various locations that we are living and working from today. I pay my respect to elders past and present. Thank you. I'll now hand over to Mauro.

Thank you, Tom. Good morning, everyone, and welcome. Nitesh and I are pleased to present Dino Nobel's 2026 full year results. I'll start with our 2026 highlights and the outlook for fiscal year 27. Then I'll cover our progress on safety, our transformation, and the next drivers of growth, new markets, premium technology, and energetics. Nitesh will then take you through our financial performance, capital investment, balance sheet, and shareholder returns. I'll return with our closing remarks on why we believe in Dino Nobel's future, then we'll take your questions. Let me begin with the results and how we are building a stronger base for growth. Fiscal year 26 was a strong year for Dino Nobel. Our explosives business delivered a record result with underlying EBIT of $485 million, up 12% year-on-year. We delivered on our financial year 26 commitments. Our transformation program generated $51 million in net benefits. At the end, our exit run rate stood at 70% of our $300 million EBIT uplift ambition. We completed our move to a pure-play explosives company. The sale of Fossard Hill marked the final step in separating our fertilizer business. Safety and reliable delivery remain our foundation. In the second half, we recorded zero process safety incidents and saw a clear improvement in TRIFA. In our growth markets, We won new customer projects in Ghana, Tanzania, Brazil, Canada, and Western Australia. Our privileged assets and vertical integration continue to create advantage. The Morambar de Boroneking project is complete, and Cheyenne remains on track for completion in the first quarter of financial year 27. We also made tangible progress in energetics, with approximately US$1 billion of US government-funded TNT and IMX projects, now progressing at Dray and Kentucky. Such results keeps us on track for our $600 million EBIT ambition in financial year 28. By the end of financial year 27, we expect our exit run rate to reach about 85% to 95% of our uplift ambition. Safety comes first, today and always. Our full year TRIFA was 1.01 compared with 0.95 in financial year 25. That's not where we want to be, but it does not tell the full story of our progress throughout the year. TRIFA fell from 1.25 in the first half to 0.77 in the second half. Strong leadership in the field, early identification of hazards, and a sharper focus on high-risk work began to deliver results. Process safety also improved. Incidents fell by 81% and we recorded zero process safety incidents in the second half. No incidents were classified as serious harm in financial year 26. At 80% of our sites, there were no recordable injuries. Injury severity fell by 41%. We also recorded no major environmental incidents. We welcome this progress But the work is not done. Our triple target remains 0.76. We will keep building the leadership, systems, and behaviors required to achieve zero harm for everyone, everywhere. Now to the financial results. Group revenue was $3.941 billion. EBIT was $504 million excluding individually material items. Our statutory profit after tax, including IMI's, was $66 million. That compares with a loss of $53 million in the previous period. Group revenue and earnings reduced year on year, as we reshaped our portfolio through the sale of the fertilizers. The keyest measure of the ongoing business is the Diamond Nobel explosives result. Explosives revenue rose 10%. to $3.406 billion. EBITDA rose 8% to $759 million. Underlying EBIT increased 12% to a record $485 million. ROIC, excluding fertilizers, rose from 5.2% to 6.7%. This reflects a strong explosives business and the impact of turnarounds in financial year 25. We returned $574.4 million through our buyback program, at an average price of $3.01 per share. We have announced a final dividend of $0.05 per share, bringing total financial year 26 dividends to $0.096 per share. $0.096 per share. At the end, net debt to EBITDA was 2.1 times within our policy range. For financial year 27, we expect underlying EBIT of about $515 to $555 million, subject to the assumptions and risks set out in this presentation. The transformation program delivered $51 million in net benefits during financial year 26. Commercial actions made the largest contribution. New customer wins, repricing, and more the use of our premium technology delivered $51 million. Priority growth markets added $19 million. Changes to how we operate, buy and manufacture also delivered gains across our cost base. These gains were partially offset by $55 million in temporary headwinds and other impacts. This included about $14 million from foreign exchange and $11 million in added depreciation. Inflation also has an impact. Unplanned downtime at Cheyenne and supply limits from the Waller turnaround accounted for about $16 million. The core drivers of our transformation remain intact. Better contracts, firm pricing discipline, stronger manufacturing, and growth in markets where we can win are delivering results. In financial year 27, we expect another $30 to $70 million in net transformation benefits. Priority growth markets offer the largest opportunity. New contracts will start in Africa and Latin America with further growth in Canada, Asia, and WA. We expect a further $20 to $30 million from our commercial actions. These include commercial customer wins, repricing, better product bundling, and wider use of premium technology. Manufacturing, supply chain, and procurement actions are expected to add up to $15 million. We will unlock more production capacity through the bottlenecking and improved efficiency. About $25 million in offsets will reduce those gains. These include the scheduled maintenance at Muromba and our foreign exchange assumptions. In this table, you can see our progress since financial year 23. From financial year 24 to 26, we delivered $185 million in net transformation benefits. Commercial benefits totaled $154 million gross. Operations added $83 million. And growth markets added $59 million. Against those gains, we had $111 million in offsets. Depreciation, stranded costs, inflation, and temporary operating impacts are examples of such offsets. Underlying explosives EBIT rose from $300 million in financial year 23 to $485 million in financial year 26. We exit financial year 26 with a run rate of $510 million. That puts us at 70% of our $300 million uplift ambitions. By the end of financial year 27, we expect that run rate to reach about 85% to 95%. We remain on track for the $600 million ambition in financial year 28. This is not the result of any single action. It comes from stronger commercial delivery, lasting change to our operations, disciplined growth, and a more focused business. As we show it in our recent Invest Today, we see five powerful megatrends supporting long-term growth across our markets. Electrification and the energy transition are driving critical minerals demand, with copper material moved expected to grow by around 50% from 2021 to 2031. Supply chain security is also driving investment, with around $30 billion mobilized for critical minerals reshoring in the United States. At the same time, more than 1 trillion of AI-related infrastructure investments is projected over the next three to five years, supporting demand for commodities, material, and energy. Declining oil grades, down an estimated 6% to 8%, are increasing the need for productivity, technology, and technical expertise. And in defense energetics, The market is expected to double by 2035, creating a compelling adjacent growth opportunity. Importantly, each of these trends aligns closely with our capabilities and competitive strengths we have, giving us confidence in the long-term outlook for our business. Our growth is gaining traction through customer wins in metals and in the priority regions we share at our investor day. Metals rose 70% in 26 measured by revenue. The share of Exposys revenue grew by 4 percentage points. In North America, Metals revenues rose 29% as we brought in new customers. Canada delivered revenue growth of more than 40%. New operations including Agnico Eagle's Hope Bay and Skinner's SK Creek In Australia, we won more than 10 new Hasbrox sites over the past 12 months. We continue to grow our presence in WA. In Asia, the Capital Light model is now operating in Malaysia. We see further opportunities in PNG, the Philippines, and India.

Across Africa and Latin America, we won four new sites, including projects in Ghana, Tanzania, and Brazil.