ANNUAL REPORT 2024 Table of Contents Five Year Summary 2 Chairman’s Message 5 Chief Executive Officer’s Overview 9 Financial Overview 13 Group Structure 17 Property 20 Building Products Australia 24 Building Products North America 30 Investments 36 Health and Safety 39 Overview of Sustainability 46 Building Products Strategy and Targets 47 Environment 49 i p Brickworks Annual Report 2024 Community Support 62 Our Global Workforce 65 Board of Directors 73 Executive Management 77 Corporate Governance 81 Directors’ Report 85 Chairman of the Remuneration and Nomination Committee Letter 91 Remuneration Report 94 Auditor’s Independence Declaration 119 Consolidated Income Statement 121 Consolidated Statement of Other Comprehensive Income 122 Riviere Austral Bricks La Paloma Glazed White and La Paloma Miro, GB Masonry Wedge Breeze Blocks in Porcelain Brisbane, QLD Brickworks Annual Report 2024 p 01 Consolidated Balance Sheet 123 Consolidated Statement of Changes in Equity 124 Consolidated Statement of Cash Flows 125 Notes to the Consolidated Financial Statements 126 Consolidated Entity Disclosure Statement 171 Directors’ Declaration 175 Independent Auditor’s Report 177 Statement of Shareholders 183 Corporate Information 184 * This is an alternative measure of earnings that excludes significant items, which are separately disclosed in the consolidated financial statements. $(119)m Statutory NPAT s130% $61m Underlying NPAT* s88% 67¢ Total full year dividend per share i3% 11.7% 25-year Total Shareholder Return (TSR) Versus All Ordinaries Accumulation Index +3.2% 1 This is an alternative measure of earnings that excludes significant items, which are separately disclosed in the consolidated financial statements. Five Year Summary 2020 2021 2022 2023 2024 $152m $288m $746m $508m $61m Underlying net profit after tax1 $284m $454m $1,058m $784m $157m 2020 2021 2022 2023 2024 Total EBITDA1 59.0¢ 61.0¢ 63.0¢ 65.0¢ 67.0¢ 2020 2021 2022 2023 2024 Dividends $898m $851m $1,095m $1,182m $1,089m 2020 2021 2022 2023 2024 Total revenue 02 p Brickworks Annual Report 2024 All revenue and earnings measures exclude significant items and discontinued operations unless otherwise stated. 2020 2021 2022 2023 2024 Growth $000 $000 $000 $000 $000 % Total revenue 898,420 850,922 1,095,353 1,181,859 1,089,414 (8%) Building Products Australia EBITDA 93,567 97,668 204,851 100,479 102,473 2% Building Products Australia EBIT 39,513 47,768 152,8691 52,809 41,290 (22%) Building Products North America EBITDA 26,773 26,414 48,475 39,868 43,461 9% Building Products North America EBIT 10,061 8,525 24,932 12,795 13,726 7% Property2 129,437 252,679 643,689 505,517 (109,964) (122%) Investments2 50,771 96,946 180,712 158,707 137,346 (13%) Head office and other expenses (16,849) (19,417) (19,803) (20,433) (16,656) 18% Total EBITDA3 283,699 454,290 1,057,924 784,138 156,660 (80%) Total EBIT3 212,933 386,501 982,399 709,395 65,742 (91%) Finance costs (25,964) (18,735) (20,154) (53,100) (78,650) (48%) Income tax (35,218) (80,090) (216,101) (148,066) 74,155 150% Underlying net profit after tax3 151,751 287,676 746,144 508,229 61,247 (88%) Significant items net of tax 175,495 (44,892) 123,592 (102,965) (178,482) N/A Discontinued operations net of tax (including significant items) (29,168) (3,621) (15,345) (10,570) (1,650) N/A Net profit after tax (including significant items and discontinued operations) 298,078 239,163 854,391 394,694 (118,885) (130%) Per share earnings and dividends4 Basic earnings per share (cents) 242.1 192.2 645.5 293.9 (88.2) (130%) Underlying earnings per share (cents)3 123.3 231.2 563.7 378.7 45.4 (88%) Final dividend per share (cents) 39.0 40.0 41.0 42.0 43.0 2% Total dividends per share (cents) 59.0 61.0 63.0 65.0 67.0 3% Ratios Net tangible assets per share ($)5 14.08 13.78 18.34 19.96 19.42 (3%) Statutory return on shareholders’ equity 12.4% 9.6% 26.2% 11.1% (3.5%) (132%) Underlying return on shareholders’ equity3 6.3% 11.6% 22.9% 14.3% 1.8% (87%) Interest cover ratio (underlying) 8.4 17.8 35.2 13.0 0.8 (94%) Gearing (net debt to equity) 18.9% 20.9% 15.1% 18.3% 20.2% (10%) 1 Includes $89.076 million profit from sale of land into the BKW Manufacturing Trust (FY2022). 2 There is no depreciation or amortisation within Property or Investments, therefore EBIT and EBITDA are equivalent. 3 This is an alternative measure of earnings that excludes significant items, which are separately disclosed in the consolidated financial statements. 4 The Earnings Per Share measure was restated for FY2020-FY2023 to reflect the adjustments to the weighted average number of shares outstanding during these periods. Refer to note 2.4 of the financial statements. 5 The Net Tangible Assets calculation excludes right-of-use assets. Lease liabilities are included and reduce the net tangible assets per share. Brickworks Annual Report 2024 p 03 All revenue and earnings measures exclude significant items and discontinued operations unless otherwise stated. / 04 / Brickworks Limited / Annual Report 2022 Bronte House Bowral Bricks in Chillingham White Bronte, NSW 04 p Brickworks Annual Report 2024 * This is an alternative measure of earnings that excludes significant items, which are separately disclosed in the consolidated financial statements. $(119)m Statutory NPAT s130% $61m Underlying NPAT* s88% (88.2)¢ Statutory earnings per share s130% 45.4¢ Underlying earnings per share* s88% 43¢ Final dividend per share i2% 67¢ Total full year dividend per share i3% Brickworks Annual Report 2024 p 05 Chairman's Message On behalf of your Board of Directors, I am pleased to present Brickworks’ Annual Report for the 2024 financial year (FY2024). In the face of challenging macroeconomic conditions, Brickworks diversified business model has again proved resilient, enabling the Company to focus on long-term value creating initiatives. FY2024 Highlights and Group Result During FY2024, Brickworks has continued to execute on a range of initiatives to deliver long-term shareholder value. Key highlights for the year include: ◗ Substantial completion of our Oakdale West Estate, which is now one of the most valuable industrial property precincts in the country. ◗ Securing development approval for our Oakdale East Stage 2 Estate, and the start of construction of the cornerstone facility for Amazon. ◗ An uplift in underlying EBITDA from our building products operations in Australia and North America, despite difficult market conditions. ◗ Substantial completion of our new brick plant in Sydney – the most advanced brick production facility in the country. ◗ Completion of our plant rationalisation program in North America (reducing from 16 operating plants to 8), creating a more efficient and cost-effective network for future operations. ◗ A $263 million increase in the value of the Company’s listed investments in Soul Patts (ASX: SOL) and FBR (ASX: FBR). Despite these notable achievements, the Group recorded a Statutory loss of $119 million in FY2024, primarily as a result of a non-cash devaluation within Property and a non-cash impairment within Building Products. The significant property devaluation was reported in the first half, and reflects capitalisation rate expansion across the industry, in response to higher interest rates. Pleasingly, conditions have stabilised across the property industry over the past six months, as many central banks around the world begin to pivot towards expansionary monetary policy. The Building Products impairment was recorded in the second half, and primarily relates to Austral Masonry and Brickworks North America. Both of these businesses have been impacted over the past six months by a deterioration in building activity across key markets. In response to the weaker demand, production has been scaled-back, resulting in a delay in the realisation of efficiency benefits from major investments and plant rationalisation activities. The resilience of our diversified business model has once again provided the stability to maintain our long-term investment focus through these periods of cyclical weakness, to ensure we are well placed to maximise returns when the market recovers. Leadership Succession In April, we announced the retirement of Managing Director, Lindsay Partridge. Lindsay’s final day with Brickworks was on 31 July 2024, after 39 years of service with the Company, including 25 years as leader. 06 p Brickworks Annual Report 2024 Belvedere Hotel La Paloma Miro and La Paloma Special Shapes Comb in Miro Woody Point, QLD On behalf of the Board, I would like to thank Lindsay for his outstanding leadership and the remarkable contribution he made in growing and reshaping Brickworks from a small brick making business to an ASX200 listed company comprising multi-national building products operations and large-scale industrial property interests. During his time with us, Lindsay made an extraordinary contribution to Brickworks and to the wider Australian building, construction and housing industry. Following an orderly transition period, our new Chief Executive Officer, Mark Ellenor, is now well settled in the role. Mark is a familiar face to all of us at Brickworks, having started with the company as a graduate 25 years ago and building an impressive career with the Company across many leadership roles. Most recently, Mark was President of our North American operations for five years before returning to Australia in August 2023 to take up the Chief Operating Officer role for the Group, including responsibility across both the Building Products and Property businesses. The Board looks forward to partnering with Mark and the executive leadership team, to lead Brickworks through the next chapter of growth. Dividends and Capital Management The Directors have declared a fully franked final dividend of 43 cents per share, up 2% on the prior year. This brings total dividends for the year to 67 cents per share, up 2 cents or 3%. We are proud of our long history of increasing dividends and the stability that this provides our shareholders. We have not reduced the dividend for 48 years and this is a testament to our strong financial position, prudent capital management and our diversified business model. Net debt increased by $29 million during FY2024 to finish the year at $682 million, with gearing of 20%. Over the past five years the Company has undergone a significant transformation program, underpinned by considerable investment, including expansion into North America and several major capital projects. During this time our asset base has increased significantly, and now stands at $5.8 billion. With our major investment program now complete, our focus has turned to increasing cash generation from our enlarged asset base. Chairman’s Message Brickworks Annual Report 2024 p 07 Board and Governance Brickworks has a strong and stable Board that is committed to acting in the best interests of shareholders and ensuring that Brickworks is well positioned for future growth. It is critical that the Board retains the diversity and breadth of skills and experience relevant to safeguard the ongoing success of the Company. As such, the Board regularly reviews its capabilities and composition to ensure an optimal mix of skills, knowledge and experience. At last year’s Annual General Meeting, Michael Millner retired from the Board, following 25 years of service. I would like to thank Michael for his invaluable contribution to the Company during that time. In June, we were pleased to welcome Todd Barlow to the Board as a non-executive director. Todd has been CEO and Managing Director of Soul Patts since 2015, having previously been the Managing Director of Pitt Capital Partners Limited for five years. We look forward to leveraging Todd’s deep experience to assist us in achieving performance objectives across our diversified portfolio. With the retirements of Lindsay and Michael and the appointment of Todd, the Board now consists of six Directors, including two representatives from Soul Patts. Also in June, we announced the appointment of Malcolm Bundey as Deputy Chair. Malcolm has been a non-executive director since October 2019 and is also Chair of the Remuneration and Nomination Committee. With the re-establishment of the Independent Board Committee, Deborah Page has been appointed as the Lead Independent Director. In Conclusion Over the last 6 months we have successfully transitioned to new leadership, representing the start of a new chapter in our history of long-term value creation. We are confident that Brickworks diversified portfolio of attractive assets offers shareholders compelling value, stability, and good prospects for long term growth. The Board extends our thanks to our dedicated workforce, for their ongoing efforts and commitment. I would also like to thank my fellow directors and our shareholders for your continued support. Robert Millner AO Chairman 08 p Brickworks Annual Report 2024 08 p Brickworks Annual Report 2024 * This is an alternative measure of earnings that excludes significant items, which are separately disclosed in the consolidated financial statements. ADGE Hotel Bowral Bricks in Simmental Silver and Bowral Blue Surry Hills, NSW TRIFR 9.7 Total Recordable Injury Frequency Rate s9.35% $157m Total EBITDA* s80% 1,852 Total Employees s8.6% Brickworks Annual Report 2024 p 09 Chief Executive Officer’s Overview As I step into the role of Chief Executive Officer, I feel a great deal of responsibility to continue the legacy built by previous leaders, such as Lindsay, and guide the organisation through its next phase of growth. Having been with Brickworks for over 25 years, I am excited to be working with a talented team of individuals whom I already know well and deeply respect, as we embark on this exciting new chapter together. Safety Before outlining the financial results in more detail, I will take some time to reflect on our workplace safety performance and sustainability initiatives. Workplace health and safety is our number one priority, as it safeguards our most valuable asset, our people, while fostering a productive and positive environment where our teams can thrive. During the year, our safety performance improved, with fewer injuries being recorded across the organisation. The total recordable injury rate (injuries per million hours worked) has decreased to 9.7 in FY2024, down from 10.76 in the prior year. Most pleasing was the continued downward trend being achieved in our injury rate across North American operations. This is a key focus, as we seek to ensure safety outcomes are reduced to levels comparable with our Australian operations. We continue to strive towards our ultimate goal of zero harm, through disciplined implementation of safety management systems and procedures, together with behavioural leadership and safety training programs. Sustainability We are achieving strong progress across many aspects of sustainability. In Australia, carbon emissions have followed a general downward trend, with a 56% decrease in Scope 1 and Scope 2 emissions compared to the base year, 2006. In North America, we have achieved a 19% energy efficiency improvement since our first acquisition in 2018. Whilst we are proud of the progress we have already made, we were pleased to announce a new carbon target in FY2023: to achieve a 15% reduction in Scope 1 and 2 greenhouse gas emissions by 2030, from a 2022 baseline, across our combined Australian and North American operations. This target is complemented by continued investment into developing feasible renewable biomethane opportunities and our sustainable product strategies. In our Property business, we aim to be industry leaders in sustainable industrial property design and development. This is demonstrated by our latest developments at Oakdale West, where all buildings have sustainable design initiatives incorporated including drought-resistant landscaping, rainwater harvesting, electric vehicle charging stations and 5% of parking dedicated to electric vehicles, LED lighting and recycling facilities. 6 The FY2023 TRIFR has been restated to reflect the date of injuries being incurred (rather than the treatment date). 10 p Brickworks Annual Report 2024 Brickworks is also active in the community and has a long- standing partnership with the Children’s Cancer Institute, having made direct and indirect contributions of more than $5 million since 2002. More information about our sustainability initiatives are contained in our 2024 Sustainability Report. Divisional Performance Across the Property Trusts, gross rent continues to grow strongly, driven by the completion of new facilities and the significant mark-to-market uplift being achieved on re-leasing, where rental caps do not apply. Net income was relatively steady, with the increase in gross rent being offset by higher borrowing costs and the impact of the M7 Hub sale (discussed below). A key milestone for the year was the substantial completion of the Oakdale West Estate. Construction of the final facilities was completed in the second half of the year, however handover of the facilities has been delayed due to protracted industrial action against Endeavour Energy by the Electrical Trades Union. The Oakdale West Estate was sold into the Industrial JV Trust in 2017 and has been fully developed over the past 7 years. With a blue-chip tenant base on long leases, the total value of the Estate is currently $1.5 billion (100% share), making it the most valuable Estate in the portfolio. Demand for well-located logistics facilities remains strong, driven by the continued growth of online shopping, the need for more productive and sustainable assets, and limited supply. With Oakdale West now complete, focus has turned to the Oakdale East Stage 2 Estate, with development work well underway at this site. A non-cash devaluation of the Property Trusts was reported in the first half of the year. Pleasingly, valuations held-up in the second half, reflecting more stabilised conditions in the property market, after the volatility caused by rapid increases in interest rates across 2022 and 2023. The sale of the M7 Hub Estate was completed in the first half. This was one of the first precincts developed within the Industrial JV Trust and is the smallest of the fully developed Estates. This sale delivered $117 million in gross proceeds and was able to be executed quickly, tax efficiently and with limited transaction costs. Building Products EBITDA was higher in both Australia and North America. In Australia, a range of significant cost reduction and business re-structuring initiatives were implemented to streamline operations. This included the consolidation of Austral Bricks and Austral Masonry into one operating division. These initiatives were offset by the impact of lower sales as a result of a downturn in building activity. In North America, the business completed a five-year plant rationalisation program, which has resulted in a total of nine plants being closed over that period, as we have integrated new bolt-on acquisitions. While disruptive to the business throughout the implementation phase, the end result of this process is a more efficient plant network and a more focused capital investment program. Daniel Robertson Overland Range Chief Executive Officer’s Overview Brickworks Annual Report 2024 p 11 Margins have improved in North America, however subdued building activity has resulted in a delay in realising the full benefit of these rationalisation initiatives. Although Investments earnings were down on the prior year, the market value of our shareholdings in Soul Patts and FBR Limited was up by $263 million. Group Outlook and Priorities Although macroeconomic conditions may cause some short- term challenges across our portfolio, each of our businesses have a strong long-term outlook. Within Property, structural trends towards e-commerce and the digital economy will continue to drive demand for our prime industrial facilities for many years to come. Land supply challenges have also been exacerbated by increased construction and financing costs, and a range of planning and approvals issues. All these factors have driven up rent for prime industrial property in western Sydney over the past two years. We are focused on meeting this demand, with our Oakdale East Stage 2 precinct being one of the only large-scale industrial property sites currently under development in Western Sydney. Whilst the long-term prospects of the Property Trust are very strong, as always, short-term Property earnings will depend on the timing of development activity and land sale transactions, and the impact of any revaluations. Within Building Products, housing approvals in Australia are currently at the lowest level in more than a decade. Meanwhile, in North America, market conditions are weak across the Midwest and Northeast regions in our core non-residential and multi-residential markets. As a result, demand is expected to remain relatively subdued in the next twelve months across both countries, providing an opportunity to sequentially take plants offline to complete maintenance work and manage stock levels. In Australia, the critical housing shortage has emerged as a key priority across all levels of government, driving ambitious building targets and long-overdue reforms to facilitate increased housing supply. Therefore, looking beyond the short-term market weakness, we expect conditions to improve significantly. Following our recent plant investments, we are well placed to deliver strong returns when conditions improve. In North America, we have modernised our manufacturing fleet and consolidated operations over the past five years, whilst integrating several acquisitions. The more stable plant footprint and increased utilisation is expected to result in improved manufacturing performance. Capital spend will be significantly reduced in the next few years, with the rationalised plant footprint having available capacity to meet expected demand. Investments is expected to continue to deliver a stable and growing stream of earnings and dividends over the long-term. Our People Finally, I would like to thank our people. We are a diverse business with 27 manufacturing sites currently operating across Australia and North America. I am incredibly fortunate to inherit a talented and dedicated workforce of over 1,850 employees. It is their hard work and unwavering commitment that are the driving force behind our achievements and the smooth transition into my new role as CEO. In May, we were pleased to appoint Steve Bell as President Brickworks North America, after having been Acting President since November 2023. Steve has over 30 years’ experience in manufacturing and is highly regarded amongst the North American team, having been a member of the senior leadership team for many years. He will continue to focus on strengthening organisational performance and growing sales. Finally, I would also like to take this opportunity to thank the Board of Directors for their trust and support. I am excited to lead our company forward, and I am confident that with the dedication and expertise of our people, we will achieve great things together. Mark Ellenor Chief Executive Officer $682m Net debt i4.5% 20% Gearing (net debt/equity) i10% $157m Total EBITDA* s80% $66m Total EBIT* s91% $104m Cashflow from operating activities i7% 12 p Brickworks Annual Report 2024 * This is an alternative measure of earnings that excludes significant items, which are separately disclosed in the consolidated financial statements. Point Leo Bowral Bricks in Chillingham White Mornington Peninsula, VIC Financial Overview Highlights ◗ Statutory NPAT down 130% to a loss of $119 million and Underlying NPAT (Continuing Operations) down 88% to $61 million. FY2024 earnings were adversely impacted by: ◗ Property sales and non-cash property revaluations, with a loss of $231 million recorded in FY2024, compared to a profit of $381 million in FY2023; and ◗ Non-cash Building Products impairments of $135 million (post-tax) in FY2024, in accordance with AASB 136 ◗ Investments EBITDA down 13% to $137 million. Value of listed investments up $263 million to $3.383 billion ◗ Property EBITDA ex revaluations and sales of $121 million, down 3%. Value of Property Trust assets down $267 million to $2.007 billion ◗ Building Products Australia EBITDA up 2% to $102 million ◗ Building Products North America EBITDA up 9% to $43 million ◗ Net debt up to $682 million; gearing 20% ◗ Final dividend of 43 cents fully franked, up 1 cent or 2% Earnings Brickworks Limited (“Brickworks” or the “Company”) posted a Statutory Net Loss After Tax of $119 million for the year ended 31 July 2024. The Underlying Net Profit After Tax from continuing operations was $61 million. Underlying earnings were adversely impacted by a non-cash property devaluation of $215 million (vs. $112 million gain in FY2023) and a $15 million loss on property sales (vs. $269 million profit in FY2023). Group Earnings Before Interest, Tax, Depreciation and Amortisation (‘EBITDA’) was $157 million in financial year 2024, compared to $784 million in the prior year. Excluding the impact of the property revaluations and property sales, EBITDA was $387 million in FY2024, down 4% on the prior year. FY2023 FY2024 Change Underlying EBITDA $m $m % Building Products Australia 100 102 2% Building Products North America 40 43 9% Property – ex revaluations/sales 124 121 (3%) Investments 159 137 (13%) Group Expenses (20) (17) 18% Underlying EBITDA ex property revaluations/sales 403 387 (4%) Property revaluations 112 (215) (292%) Property sales 269 (15) (106%) Underlying EBITDA – Continuing Operations 784 157 (80%) Brickworks Annual Report 2024 p 13 On sales revenue of $646 million (down 12%), Building Products Australia EBITDA was $102 million, up 2% on the prior year. Margins improved as a result of ongoing rationalisation of the portfolio to focus on higher performing business units, overhead cost reductions, price increases and productivity improvements across most operations. On relatively steady revenue of $442 million, Building Products North America delivered a 9% increase in EBITDA, to $43 million. Excluding the impact of property sales in North America, EBITDA was up 29%. Margins were higher, due to the implementation of price increases and improved plant utilisation following the completion of a five-year plant rationalisation program. Excluding revaluations and land sales, Property EBITDA was $121 million, down by 3%. Net rental income was broadly steady, with a strong increase in gross rent being offset by higher borrowing costs in the Property Trust and the sale of the M7 Hub Estate during the year. A non-cash devaluation of $215 million was recorded on Property Trust assets, reflecting an increase in capitalisation rates across the portfolio to 5.2% (4.1% at July 2023) and follows $615 million in revaluation gains being delivered in the prior five years as capitalisation rates compressed. In addition, a loss of $16 million was booked following the M7 sale. At the end of the year, Brickworks’ share of the net asset value within its Property Trusts was $2.007 billion (vs. $2.274 billion at 31 July 2023), after taking into account the development profits, impact of revaluations and the property sale. Investments EBITDA was $137 million, down 13%, driven mainly by a decline in the contribution from New Hope Corporation to Washington H. Soul Pattinson & Company (“Soul Patts”) (ASX: SOL) earnings. The market value of Brickworks’ 26.1% shareholding in Soul Patts was $3.383 billion at 31 July 2024, up by $263 million compared to 31 July 2023. Brickworks also holds a 15.3% stake in FBR Limited (ASX: FBR), with a market value of $35 million at the end of the period. An underlying income tax benefit of $74 million was recorded, due primarily to a deferred tax benefit associated with the property devaluation and utilising unrecognised capital tax losses, following the M7 Hub Estate sale. Net borrowing costs were $79 million, up from $53 million in the prior year, due to a higher average interest rate on debt and additional leases. Significant items decreased NPAT by $178 million for the year. This comprised: ◗ A non-cash impairment of $135 million (net of tax) based on AASB 136. This includes an impairment of $55 million (net of tax) to Austral Masonry and an impairment of $69 million (net of tax) to Brickworks North America. Both of these businesses have been impacted by a delay in realisation of the full benefits of recent major investments, following scaled back production in response to a decline in building activity across key markets. ◗ Restructuring and site closure costs of $11 million (net of tax), primarily relating to employee severance payments associated with restructuring activities within Building Products. ◗ Plant commissioning costs of $10 million (net of tax), associated with the new Horsley Park brick plant in Australia and the Rocky Ridge plant in North America. ◗ Legal costs of $11 million, primarily associated with the ongoing proceedings filed against BGC (Australia) Pty Ltd and Midland Brick Pty Ltd seeking unspecified damages for various alleged contraventions of sections 46 and 50 of the Competition and Consumer Act. ◗ A $15 million benefit in relation to significant items from Investments. ◗ A $16 million cost arising from the net impact of the income tax expense in respect of the equity accounted Soul Patts profit, offset by the impact of fully franked Soul Patts dividend income, adjusted for the movements in the franking account and the circular dividend impact. ◗ Other costs of $11 million (net of tax), including advisory and IT implementation costs. Gross Tax Net Significant Items $m $m $m Impairment of non-current assets (189) 54 (135) Restructuring and site closure costs (16) 5 (11) Plant commissioning costs (14) 4 (10) Legal costs (11) – (11) Significant items relating to Investments 15 – 15 Income tax from the carrying value of SOL – (16) (16) Other costs, including advisory and IT implementation (15) 4 (11) Total (Continuing Operations) (230) 51 (178) Discontinued operations contributed an after-tax loss of $2 million for the period. This primarily relates to closure costs within Austral Precast. Statutory Earnings Per Share (‘EPS’) was a loss of 88 cents, and Underlying EPS from continuing operations was 45 cents. 14 p Brickworks Annual Report 2024 Financial Overview Cash Flow Total cash flow from operating activities was $104 million, up 7% from $97 million. The increase in cash generation was achieved despite challenging market conditions across Building Products operations and the adverse impact of plant commissioning and restructuring costs, legal costs, higher borrowing costs and an increase in working capital. Capital expenditure has been elevated for several years, as the Company has undertaken a major reinvestment program to improve the efficiency and reduce the carbon intensity of manufacturing operations. With this program now reaching a conclusion, capital expenditure reduced to $73 million for the financial year, down from $114 million in the prior year. Major project spend during the period included the completion of a new brick plant at Horsley Park in New South Wales, and upgrade works at the Rocky Ridge (Maryland) and Adel (Iowa) plants in North America. $117 million in gross proceeds were received in the first half, following the sale of Brickworks’ 50% interest in the M7 Hub Estate, part of the Industrial JV Trust. All proceeds were distributed to Brickworks, reported as investing cashflow. Balance Sheet During the year total shareholders’ equity was down $179 million to $3.382 billion, primarily reflecting the statutory loss and impact of dividends paid to shareholders. Net tangible assets (‘NTA’) per share was $19.42 at 31 July 2024, down from $19.96 at 31 July 2023. Total interest-bearing debt was $744 million at the end of the year. After including cash on hand, net debt was $682 million, an increase of $29 million during the year. Gearing (net debt to equity) was up slightly to 20%. Net working capital was $351 million at 31 July 2024, including finished goods inventory of $287 million. Although finished goods units were relatively steady during the year, the value was up $23 million, due to higher unit costs. Dividends Directors declared a fully franked final dividend of 43 cents per share for the year ended 31 July 2024, up 2% from 42 cents. Together with the interim dividend of 24 cents per share, this brings the total dividends paid for the year to 67 cents per share (fully franked), up 2 cents or 3% on the prior year. Darling Point House Bristile Roofing Curvado – Aitana and Lucentum Darling Point, NSW Brickworks Annual Report 2024 p 15 Front + York Belgian Gray Wirecut, Silver City Wirecut Brooklyn, New York 16 p Brickworks Annual Report 2024 Group Structure Brickworks has a diversified corporate structure that has delivered stability of earnings over the long term. There are four divisions within the Brickworks Group structure: Brickworks Annual Report 2024 p 17 Building Products Australia Building Products North America Property Investments 18 p Brickworks Annual Report 2024 Property The Property division was originally established to maximise the value of land that is surplus to the Building Products business. Over time, the Property division has evolved and now consists of two Joint Venture Property Trusts with Goodman Group, plus 100% owned land holdings, both operational and for development. Brickworks holds a 50% interest in the Industrial JV Trust. This was established in 2005, for the specific purpose of capturing the initial valuation uplift from re-zoning and then benefitting from the long-term value appreciation and the stable, growing annuity-style income stream derived from the developed assets. This Trust has grown to become one of Australia’s leading industrial property portfolios and is exposed to long-term structural tailwinds associated with the transition to e-commerce and the digital economy. Through the long- standing (~20 years) relationship with Goodman Group, the Trust has developed a portfolio of prime A-grade facilities with blue-chip tenants such as Amazon, Woolworths, Coles, DHL, Telstra and Australia Post. The Industrial JV Trust has total assets of $5.0 billion. After including debt, Brickworks 50% share of the Industrial JV Trust has an equity value of $1,804 million. Brickworks also holds a 50.1% interest in the Brickworks Manufacturing Trust. This comprises a portfolio of 15 manufacturing plants, tenanted by the Group’s Australian Building Products businesses. The Brickworks Manufacturing Trust has total assets of $406 million and no debt. Brickworks 50.1% ownership had an equity value of $203 million as at 31 July 2024. Along with its interest in the Industrial JV Trust and the Brickworks Manufacturing Trust, Brickworks retains around 5,000 hectares of 100%-owned operational and development land across Australia and North America. This includes a number of sites earmarked for future development. Building Products Australia Building Products Australia is a leading manufacturer and distributor of building products across all Australian states. Since 2002, the Building Products Group has grown from a two- state brick manufacturer, in New South Wales and Queensland, to a diversified national building products business. Group Structure Brickworks Annual Report 2024 p 19 In total, Building Products Australia comprises 19 manufacturing sites (currently operating), and a vast network of company- owned design centres, studios and resellers across the country. The portfolio includes key brands such as Austral Bricks (Australia’s largest clay brick manufacturer), Austral Masonry and Bristile Roofing. The portfolio also includes a 33% interest in the Southern Cross Cement joint venture. Building Products North America Brickworks North America has a leading position in the Midwest, Northeast and Mid-Atlantic states, and has a strong focus on architectural and premium products. It has eight currently operating brick manufacturing sites, complemented by company-operated distribution outlets, design studios (New York, Philadelphia and Baltimore) and an extensive reseller network. Investments Investments consists primarily of a 26.1% interest8 in ASX-listed Washington H. Soul Pattinson (‘Soul Patts’) (ASX: SOL), which had a market capitalisation of $12.814 billion as at 31 July 2024. The market value of Brickworks stake in Soul Patts was $3.348 billion at this date. Soul Patts is a diversified investment house with a portfolio encompassing strategic investments in major listed companies, a large cap equity portfolio, private equity investments, interests in a wide range of emerging companies and a structured yield portfolio. The investment in Soul Patts dates back to 1968 and delivers a stable dividend stream that provides Brickworks with security to weather periods of weaker building products demand. Investments also includes a 15.3% stake in FBR Limited (‘FBR’) (ASX: FBR). At the end of the year, the market value of Brickworks stake in FBR was $35 million. Callington Mill Distillery Austral Bricks San Selmo Reclaimed in Reclaimed Original Oatlands, TAS 8 On 30 August, Soul Patts issued 6.6 million shares, resulting in Brickworks’ ownership interest reducing to 25.7%. 20 p Brickworks Annual Report 2024 Property delivered an EBITDA loss of $110 million in FY2024, compared to a profit of $506 million in the prior year. Property Earnings Year Ended July 2023 2024 Change $m $m % Rental Income (100%) 149 163 9% Borrowing & Other Costs (50) (65) (30%) Net Trust income (100%) 99 98 (1%) Net Trust Income (BKW 50%) 50 49 (1%) Development Profit 78 75 (5%) Admin/Other (4) (3) 20% EBITDA Ex Revaluations, Sales 124 121 (3%) Revaluations 112 (215) (292%) Property Trust Sales – (16) NA Brickworks Land Sales 269 1 NA Total EBITDA 506 (110) (122%) The loss was primarily due to the non-cash revaluation of properties with two independent valuation processes completed during the year. The first revaluation, in December 2023, resulted in a significant devaluation of $233 million, reflecting a 100-basis point expansion in capitalisation rates across the portfolio. Conditions stabilised in the second half, with the subsequent June 2024 revaluation resulting in an $18 million profit being recorded, as higher market rent more than offset the impact of a further 17 basis point expansion in capitalisation rates. At 31 July 2024, the average capitalisation rate across the portfolio was 5.2%, up from 4.1% at July 2023. The increase in capitalisation rates over the year, followed several years of strong revaluation gains, underpinned by structural demand drivers such as the transition to online shopping. In December, Brickworks announced the sale of its 50% interest in the “M7 Hub”, one of the Estates held by the Industrial JV Trust. The M7 Hub comprises three multi-unit industrial properties, located near the M7 motorway on Old Wallgrove Road, Eastern Creek (NSW). The units were sold to JV partner, Goodman Group. The sale delivered $117 million in gross proceeds and resulted in a $16 million loss due to the sale value being below the 31 July 2023 book value. The transaction was able to be executed quickly, tax efficiently and with limited transaction costs. All sale proceeds were distributed to Brickworks. The M7 Hub was one of the first sites developed within the Industrial JV Trust and is the smallest of the fully developed Estates. When all facilities were fully completed in 2012, Brickworks’ 50% interest in the M7 Hub was worth $46 million. The sale price represents a 154% increase since that time. The sale provided an opportunity to release funds, following a period of heavy investment across the Group, including to enable the release of significant additional development land at Oakdale East. Property Brickworks Annual Report 2024 p 21 Excluding the impact of the devaluations and property sales, Property EBITDA was $121 million, down by 3% on a like-for-like basis with the prior year. Strong demand, caused by structural trends across the economy and a lack of appropriately zoned and approved land, is driving growth in market rent for industrial property in Western Sydney. Compared to the prior year, rental income within the Property Trusts was up 9% to $163 million (100% share), driven by contracted increases and new developments, offset by the sale of the M7 Hub in January, which impacted rental income in the second half. Higher interest rates and debt levels resulted in a significant increase in borrowing costs. After including borrowing and other costs, net trust income was $98 million (100% share). Brickworks’ 50% share of this income was $49 million, down marginally on the prior year. A highlight of the year was the completion of seven new facilities at Oakdale West, providing 69,275m2 of gross lettable area. This included the completion of facilities for Maersk, EBOS and Luxottica. These completions resulted in a development profit of $75 million being recorded. The final four facilities at this Estate were also fully constructed, however these facilities did not achieve practical completion in FY2024 due to the ongoing industrial action by the Electrical Trade Union against Endeavour Energy, resulting in the power connection being delayed. With no clarity on when this industrial action will be resolved, the Industrial JV Trust is implementing mitigation plans, including the use of electric generators, to allow tenants to occupy the completed facilities as soon as possible. Property administration and other expenses totalled $3 million, including holding costs on properties awaiting development. Property Trust Asset Value As at 31 July 2024, the total value of developed assets held within the two Property Trusts was $4.5 billion. The annualised rent generated from these assets is $180 million and the weighted average lease expiry is 8.2 years (7.5 years for the Industrial JV Trust). The average capitalisation rate across the portfolio is 5.2%, and there is 16,800m2 of vacant space at Oakdale West. This results in a 98% occupancy level for the Industrial JV Trust. Oakdale West Industrial Estate Western Sydney, NSW 22 p Brickworks Annual Report 2024 Property Developed Assets Asset Value Rent WALE9 Cap. Rate Gross Lettable Area10 $m $m/year years % ‘000m2 Interlink 659 25 3.0 5.3% 192.2 Oak Central 835 34 2.9 5.3% 245.2 Oak East 1 170 7 9.0 5.1% 37.1 Oak South 624 24 4.5 5.3% 177.3 Rochedale 320 16 8.0 5.6% 126.5 Oak West 1,512 57 13.2 4.9% 304.8 Ind. JV Trust 4,119 162 7.5 5.2% 1,083.1 Man. Trust 406 18 14.2 6.0% NA Total 4,525 180 8.2 5.2% NA Including $872 million worth of land to be developed, the total value of assets held within both Property Trusts was $5.4 billion at the end of the year. Borrowings of $1.4 billion are held within the Industrial JV Trust, giving a total net asset value of $4.0 billion. Brickworks’ 50% share of net asset value is $2.0 billion, down by $267 million during the year. Gearing within the trusts was 26% at the end of the year, up from 21% at 31 July 2023. This comprises gearing of 28% within the Industrial JV Trust (well below the covenant of 60%), and no debt within the Brickworks Manufacturing Trust. The gearing within the Industrial JV Trust increased following the devaluation of the portfolio and the sale of the M7 Hub Estate, with the sale proceeds being distributed to Brickworks and existing debt maintained within the Trust. Additional borrowings were also used to fund the ongoing development activity at Oakdale West. Year Ended July 2023 2024 Change $m $m % Developed assets 4,907 4,525 (8%) Land to be developed11 878 872 (1%) Total Property Trust assets 5,786 5,397 (7%) Borrowings (1,239) (1,383) (12%) Net Property Trust assets 4,547 4,013 (12%) Brickworks 50% share 2,274 2,007 (12%) Gearing on leased asset12 21% 26% 24% 9 Weighted average lease expiry (by income). 10 Gross Lettable Area. 11 Includes facilities under development. 12 Borrowings / total assets. 13 Source: Savills Research. Property Trusts – Development Pipeline The Industrial JV Trust continues to experience strong lease enquiry for large-sized industrial facilities at Oakdale East Stage 2. Structural trends are driving customers to seek well- located facilities and sophisticated supply chain solutions, with consumers increasingly demanding faster and more flexible delivery of goods. In addition, supply of suitable land is scarce, particularly in western Sydney where competing sites have been impacted by a range of planning and approvals issues. Over the past few years, supply challenges have also been exacerbated by increasing construction and financing costs. All these factors have driven up rent for prime industrial property in western Sydney by around 80% in the past three years13, although the growth rate moderated in the second half of FY2024 and appears to have plateaued in recent months. The current passing rent within the Industrial JV Trust of $149/m2 is now 31% below the estimated market rent, providing the opportunity to increase rents as leases are renewed. The Industrial JV Trust is well placed to meet the strong demand and benefit from the higher market rents. Oakdale West will reach practical completion by the end of 2024 (subject to resolution of ongoing industrial action by the Electrical Trade Union against Endeavour Energy), with 54,300m2 of new facilities already committed to tenants including Bevchain and DB Schenker, leaving just one facility of 15,500m2 available for rent. At Oakdale East Stage 2, construction of a cornerstone 58,000m2 facility for Amazon is well underway, and due for completion in the third quarter of calendar year 2025. As one Brickworks Annual Report 2024 p 23 of the few large-scale “shovel ready” development estates in western Sydney, strong demand exists for the next available site, which will accommodate a 38,000m2 facility. The remaining 155,000m2 of gross lettable area will be released progressively as earthworks and servicing is completed across the estate. Given the strong demand, the estate is expected to be fully built out within four to five years. Development opportunities are also being pursued in the Brickworks Manufacturing Trust. During the year, a 13-hectare site adjoining the Rochedale brick factory was purchased by the Trust. When consolidated with adjacent surplus land at the Rochedale site (already held within the Trust), the site could provide 22 hectares of industrial land, delivering up to 115,000m2 of gross lettable area. This project is currently in planning stages, with the aim of lodging development applications in 2025. Including Oakdale East Stage 2 and the additional development at Rochedale, total market rent potential from existing Property Trust assets is around $341 million (100% share), assuming current market rent and no vacancies across the portfolio14. This compares to the passing rent of $180 million on currently leased facilities. The uplift from new developments (+$90 million) is expected to be achieved within around five years as developments are completed and new tenants secured. The uplift on existing facilities (+$72 million) will be progres sively realised as leases expire and will be subject to the extent to which tenants exercise extension options. Over the next five years, at least 30% of this mark-to-market uplift can be achieved, representing the existing vacancies and leases that expire during this period that do not have rental increase caps. An additional 18% of leases (by rent) expire within the next five years but have an extension option in favour of the tenant that includes a rental increase cap (these caps are typically 5% or 10%). The mark-to-market uplift on these leases will depend on whether the tenant exercises the extension option. Operational and Development Land The largest additional parcel of land for potential development is at Craigieburn in Victoria, directly south of the Wollert factory site. This site is now being considered for industrial re-zoning by the state government. With an expected yield of around 600,000m2 of GLA, if sold into the Industrial JV Trust, this site will extend the development pipeline well beyond the next five years. In conjunction with Goodman Group, due diligence and feasibility studies has been ongoing into the industrial development of 77 hectares parcel of land adjacent to the Mid-Atlantic plant in Pennsylvania. The site, located close to the I-78 motorway linking New York to Washington D.C., is currently zoned industrial. Applications to develop three facilities, providing a total area of 185,000m2, were lodged with local authorities in mid-2023 and entitlement is expected to be achieved by early 2025. Oakdale West Industrial Estate Western Sydney, NSW 14 Forecasts assume market rent of $223/m2 in western Sydney and $160/m2 in Brisbane (Rochedale), representing management’s estimate of current average market rent for Trust facilities in those locations. Building Products Australia Market conditions Residential commencements continued to decline during FY2024, with total starts of 155,700 for the year to June 2024 being the lowest level since 2012. Nationally, detached house commencements were down 10% on the prior year. This follows a decline of 17% in FY2023. Across the states, the steepest decline was in New South Wales, down 22%, with the other major east coast markets of Victoria and Queensland also down by around 10%. Multi-residential commencements were also down by 10% in FY2024, with broad-based weakness across all major states. The decline in multi-residential starts has been driven by a circa 50% fall in high rise (4-storey or more) apartment construction over the past five years. This segment has been severely impacted by higher interest rates and the approximate 40% rise in construction costs since the start of the pandemic15. These cost impacts, together with government levies and taxes, have made apartment construction economically unfeasible in many areas of the major capital cities. Non-residential building activity has varied significantly across the country. During FY2024 there was increased activity in Western Australia (up 15%) and Queensland (up 22%), offset by declines in Victoria (down 22%) and New South Wales (down 1%). 24 p Brickworks Annual Report 2024 AUSTRALIA INTERNATIONAL BRANDS 15 Source: Macro Business. Brickworks Annual Report 2024 p 25 The National Site of Recognition for Thalidomide Survivors and their Families Austral Bricks Venetian Glass Bricks in Arctic Crystal Canberra, ACT 26 p Brickworks Annual Report 2024 Change in Commencements (FY2024 v FY2023)16 Detached Multi-Residential Non-Residential -1% -12% -22% -7% -22% -3% -18% -10% -10% -7% 22% 22% -14% 3% -15% -40% 15% -10% -10% -4% -24% AUS TAS WA SA QLD VIC NSW -20 -30 -40 -10 0 10 20 Building Products Australia 16 Source: BIS Oxford Economics Australian Building Forecasts, June 2024. Figures shown are for the 12 months ended in June. Overview of FY2024 Result Year Ended July 2023 2024 Change $m $m % Revenue 734 646 (12%) EBITDA 100 102 2% EBIT 53 41 (22%) EBITDA margin 13.7% 15.9% 16% Revenue for the year ended 31 July 2024 was down 12% to $646 million. The decrease was broad based, reflecting the lower building activity across all key markets. EBIT from continuing operations was $41 million, down 22% on the prior year. Excluding depreciation and amortisation, EBITDA was up marginally to $102 million, resulting in an EBITDA margin of 16%. The improved EBITDA margin was the result of the implemen- tation of price increases and productivity improvements across most operations. In addition, restructuring initiatives implemented over the past 18 months have streamlined operations and removed costs in many areas of the business. These initiatives include the consolidation of Austral Bricks and Austral Masonry into one operating division, a restructure of Bristile Roofing and a rightsizing of divisional support functions. 2024 New Arrivals GB Masonry GB Vertico Building Products Australia Revenue by State and location map WA $32m SA $32m QLD $143m NSW (incl. ACT) $212m VIC $202m TAS $13m Export $12m Total $646m Brick Plant Masonry Plant Roofing Plant Cement Terminal (JV) Design Studio Brickworks Annual Report 2024 p 27 28 p Brickworks Annual Report 2024 Building Products Australia Nationally, the new Austral Bricks and Masonry business unit (including Advanced Cladding Systems and the Company’s 33% interest in Southern Cross Cement) incurred a 12% decrease in sales revenue, to $560 million for the year. Revenue in Western Australia was significantly lower, due to the exit from brick operations in that region. The decline in high rise residential construction accelerated in 2H2024, particularly in Sydney, and has had a significant impact on Austral Masonry sales, which have a high exposure to this segment. Several measures have been taken to control stock and manage working capital, in response to subdued demand, as we move through the cyclical low in building activity. The Oakdale masonry plant was operated on a reduced shift structure, and several kilns across the country were temporarily taken offline during the year, with the opportunity taken to complete maintenance activities. In addition, Plant 1 at Horsley Park in New South Wales was mothballed, effective July 2024, following the successful ramp up of the new Plant 2 facility. With the mothballing of Plant 1, spare capacity at the Rochedale plant in Queensland will also be utilised to cost effectively supply the New South Wales market. It is expected that Plant 1 will return to production when conditions improve in the coming years. Commissioning of the new brick plant at Horsley Park (Plant 2) was substantially completed during the second half. This project was commenced in 2019 and faced a number of challenges throughout the pandemic. Now operating at design capacity, the plant is the most fuel efficient and has the lowest unit labour cost and wastage level of any brick plant across the Group. In FY2024, the new plant demonstrated a 57% improvement in energy intensity compared to FY2018. Advanced Cladding Systems has been established to focus on commercialising thin brick cladding systems, a product category that is experiencing growing demand, particularly in high-rise commercial and multi-residential segments. Since launching in FY2023, the response from customers has been positive, with strong sales momentum and customer enquiry being achieved during the year. Bristile Roofing (including Capital Battens) earnings were well ahead of the prior year, on a 15% decrease in revenue to $93 million. The decline in revenue was primarily attributable to the difficult market conditions and an increased focus on “supply only” of roof tiles in Queensland and New South Wales (rather than a “supply and install” approach). More broadly, the roof tile market has experienced significant rationalisation over the past six months, with the exit of a major competitor, and this is expected to support improved plant utilisation and efficiency. Riviere Austral Bricks La Paloma Glazed White and La Paloma Miro, GB Masonry Wedge Breeze Blocks in Porcelain Brisbane, QLD Brickworks Annual Report 2024 p 29 $646m Revenue s12% 954 Full Time Employees s13% TRIFR 7.9 Safety i8% Revenue by State NSW 33% QLD 22% VIC 31% SA 5% TAS 2% WA 5% Export 2% Revenue by End Market Detached 68% Multi-Residential 19% Non-Residential 13% Brickworks Annual Report 2024 p 29 Building Products Australia Highlights 30 p Brickworks Annual Report 2024 Change in Commencements (FY2024 v FY2023)16 Market Conditions Building Products North America’s key regional exposure is in the Midwest, Northeast and Mid-Atlantic. Combined, these three regions make up around 91% of total sales revenue. There is a broad end-market exposure, with the non-residential segment making up 37% of sales, single family homes 39% and multi-family residential 19%. Overall, building activity in the United States has been mixed during financial year 2024, varying significantly by region and segment. There has been a decline in non-residential and multi-residential activity across the country. This was most severe in the key Northeastern region where non-residential activity was down by 27% year on year and multi-residential activity was down by 13%. A surplus of multi-residential construction following the pandemic in 2021 and 2022 led to oversupply in this market and a subsequent decline, while non-residential building has stalled, despite resilience in some pockets, such as the education sector. Building Products North America USA Other South Midwest Mid-Atlantic Northeast 20 30 10 0 -10 -20 -30 Single Family Multi-Residential Non-Residential -10% -13% -12% 19% -27% 8% 1% -5% 19% -9% 18% -15% 27% -13% 19% -7% -13% 19% 16 Source: Dodge Analytics USA Building Starts Forecast – June 2024. Figures shown are for the 12 months ended in June. NORTH AMERICA ME NY VA WV PA MI OH IN WI MN ND SD NE IA MO KY TN NC SC KS OK AR TX LA MS AL GA FL VT NH MA RI CT NJ MD DC DE IL Brickworks Annual Report 2024 p 31 Brick Plants Design Studio Brickworks Supply Centre Building Products North America Location map 32 p Brickworks Annual Report 2024 By contrast, there was relative strength within the single- family residential segment, where building activity was up by 19% nationwide, albeit this is not the core market for Brickworks’ products. High interest rates are limiting the amount of established home inventory coming to market (with homeowners reluctant to refinance into new homes at higher interest rates), forcing new home buyers to seek newly constructed homes. This dynamic is providing a tailwind for the single- family home segment, which may reverse if interest rates decline. Building Products North America Overview of FY2024 Result Year Ended July17 2023 2024 Change A$m A$m % Revenue 447 442 (1%) EBITDA 40 43 9% EBIT 13 14 7% EBITDA (ex-Property Sales) 33 42 29% EBIT (ex-Property Sales) 6 13 113% EBITDA margin (ex-Property Sales) 7.5% 9.8% 31% 17 An average exchange rate for each half year period is used to convert from US$ to AU$. The conversion rates used are: 1H2024 US$0.65; 2H2024 US$0.66; 1H2023 US$0.67; 2H2023 US$0.67. Front + York Belgian Gray Wirecut, Silver City Wirecut Brooklyn, New York $442m Revenue s1% 898 Full Time Employees s4% TRIFR 11.6 Safety s19% Building Products North America Highlights Revenue by Region North East 21% Mid Atlantic 10% Mid West 60% South 6% Other 3% Revenue by End Market Detached 41% Multi Residential 20% Non Residential 39% Brickworks Annual Report 2024 p 33 34 p Brickworks Annual Report 2024 Building Products North America Brick sales volume in North America was lower during the period, due primarily to a significant reduction in sales to the oversupplied southern home builder market (such as Texas), with sales to this region down 22% from the prior year. Reduced building activity in key non-residential markets also impacted sales. Despite the lower sales volume, revenue of $442 million for the year ended 31 July 2024 was broadly in line with the prior year, due to a combination of price increases and a mix shift towards higher value products. EBITDA for the year was up 9% to $43 million. Last year’s result included a $7 million profit from the sale and leaseback of a retail outlet, and this year’s result includes a $0.3 million profit on the sale of a surplus quarry. Excluding the impact of these property sales. EBITDA for the year was up 29% and EBIT was up 113%, to $13 million. Margins continue to improve, following the implementation of price increases and the rationalisation of the plant network over the past five years. High wages continue to have an impact on margins, with unit labour costs up by around 12% on the prior year, partially offsetting the benefits of improved plant efficiency. With production scaled back to meet demand, the full benefits of the plant rationalisation program have not yet been delivered. The Rocky Ridge plant in Maryland is in the final stages of re-commissioning and will produce a range of moulded bricks specifically tailored for the UK market. In addition, the plant will produce US modular brick, which will support an increase in demand for this product on the east coast, as well as a premium long format brick, which is also growing in popularity. The long format brick will be unmatched in the US market, with no domestic equivalent. The first shipments to the UK (as part of the 10 million brick p.a. supply agreement executed in 2023), are now underway. Private Residence Brenta Raw, San Selmo Great Neck, New York Brickworks Annual Report 2024 p 35 The Vesterheim Museum Columbia Roman Maximus Decorah, Iowa 36 p Brickworks Annual Report 2024 Investments Washington H. Soul Pattinson & Company Limited (Soul Patts) ASX Code: SOL Brickworks holds 94.3 million shares in Soul Patts, representing a 26.1% ownership interest, with the initial investment dating back to 1968. This shareholding is an important source of earnings and cash flow diversification for the Company and has been a key contributor to Brickworks’ success for more than five decades. The market value of Brickworks shareholding in Soul Patts was $3.348 billion at 31 July 2024, up $241 million for the year. Soul Patts has delivered strong returns to Brickworks, with 25-year total shareholder return of 12.5% per annum (to 31 Jul 2024), 4.0% per annum ahead of the All-Ordinaries Accumulation Index. Shareholder returns comfortably exceed the benchmark over most time periods. The investment in Soul Patts returned an underlying contribution of $136 million for the year ended 31 July 2024, down 15% from $160 million in the prior year. The decrease was primarily due to a lower contribution from New Hope Corporation. During the period normal cash dividends of $86 million were received, up 15% on the prior year normal dividends. Soul Patts holds a diversified portfolio of investments. A break- down of Soul Patts assets as at 31 July 2024 is shown in the chart below. Investments consists of Brickworks shareholdings in Soul Patts (ASX: SOL) and FBR (ASX: FBR), in addition to interest income on cash holdings. The EBITDA from Investments was down 13% to $137 million for the year ended 31 July 2024. Soul Patts Investment Assets Strategic 51% Large caps 21% Private equity 12% Emerging companies 9% Credit 6% Property 1% Brickworks Annual Report 2024 p 37 $137m EBIT from Total Investments s13% Strategic investments include significant stakes in a number of listed companies including Brickworks, TPG Telecom, New Hope Corporation and TUAS. Other assets include a portfolio of ASX listed large cap companies, private equity investments, a portfolio of listed and unlisted emerging companies, structured yield and direct ownership of property. FBR Limited (FBR) ASX Code: FBR Brickworks made an initial seed investment in FBR in 2006 and over the past two years has made further investments to increase its stake. This included an acquisition of 76.3 million shares in January 2024, as part of an institutional placement by FBR. At 31 July 2024, Brickworks held 731.7 million shares in FBR, representing a 15.3% shareholding. FBR has commenced the commercialisation process for a bricklaying robot that has the potential to build walls faster than traditional methods, and with much reduced labour. As the largest brick maker in the country, Brickworks has much to benefit from the success of FBR. At the end of the period, the market value of Brickworks stake in FBR was $35 million, up by $22 million over the year. 779 Flatbush Avenue Malmö Brooklyn, New York TRIFR 9.7 Total Recordable Injury Frequency Rate s9% 38 p Brickworks Annual Report 2024 Brickworks Annual Report 2024 p 39 Health and Safety There is no task that we undertake that is so important that we can’t take the time to find a safe way to do it. Strategy Brickworks is committed to reducing health and safety risks for its employees, contractors, and the public. Central to this commitment is safety leadership, which is essential for developing a resilient safety culture within the company and creating an effective framework for managing health and safety risk. Brickworks' Workplace Health and Safety (WHS) Strategy 2023- 2030 defines the Company’s vision and framework for achieving WHS objectives, targets, and regulatory compliance. The innovative use of technology and integrated systems to mitigate workplace hazards, reflects Brickworks' approach to managing evolving WHS challenges and emerging trends in workplace safety. Brickworks Safety Health Environment Management System is the cornerstone of the Health and Safety Strategy, offering a comprehensive framework that integrates policies, procedures, and practices to identify and mitigate risk. This system aligns with ISO 45001 requirements with a strong emphasis on continuous improvement processes. The system promotes transparency, accountability, and collaboration among stakeholders, facilitating a universal approach to health and safety management across all levels of the business globally. Brickworks' cloud-based health and safety management software serves as a comprehensive centralised repository for occupational health and safety data. A specialised reporting platform, Power BITM is integrated with this WHS database platform to enable efficient data retrieval, and analysis, empowering users to track trends, generate reports, and gain insights into health and safety performance. This software suite provides powerful data transformation tools and interactive visualisations accessible directly from their smartphones or tablets, enabling flexibility and informed, data-driven decision- making from any location. At Brickworks, measuring safety performance is fundamental to our commitment to workplace health and safety. We track key metrics such as injury rates, injury severity, near-miss incidents, the number of functional checks on safety devices, and workplace inspections. Due to our low injury rates, we now drive safety performance using lead indicator activity measures by site. This approach helps us manage key critical risks, build the capacity to be safe and maintain operational continuity and resilience. By employing advanced data analytics, we monitor trends and assess the effectiveness of safety initiatives, enabling data-driven management decisions. Benchmarking against industry peers ensures that we remain competitive and continuously improve our safety practices. Brickworks recognises the importance of managing psychosocial health and is committed to providing a supportive, productive, and healthy work environment for all employees. This commitment is clearly stated within the company's health and safety policy statement. The company has implemented mental health awareness programs and provided access to professional counselling services. Initiatives include an ongoing mental health first aid program, qualifying employees in mental health first aid, as well as eLearning courses and an onsite physiotherapy program to assist employee wellbeing which has positively impacted attendance and employee retention. Additionally, promoting work-life fitness and encouraging open communication through various channels has supported harmonious and productive work environments. 40 p Brickworks Annual Report 2024 Brickworks demonstrates its commitment to contractor safety through clear objectives, stringent pre-screening and induction procedures, meticulous permit-to-work processes, and integrated safety protocols. Regular evaluations and risk management strategies are employed to establish a secure working environment for contractors. The Company's strict adherence to safety guidelines within contractual agreements further emphasises our dedication to maintaining the highest safety standards. In FY2024, Brickworks prioritised several key initiatives aimed at enhancing our safety program. Conducting medical assessments for workers before they commence employment ensures that potential recruits are physically and mentally fit for the specific demands of their roles, reducing the risk of workplace injuries and enhancing overall safety. Brickworks conducts random fit-for-work assessments in Australia to promptly detect and address any instances of alcohol, drug, or substance use among employees and contractors, aiming to maintain a safe and secure working environment Furthermore, Brickworks' occupational hygiene program plays a pivotal role in safeguarding the health and well-being of all workers, ensuring compliance with health and safety standards, promoting a productive and sustainable work environment. Brickworks e-learning training promotes employee health and safety knowledge and skills and ensures adherence to safety regulations. This learning platform provides a centralised repository for a diverse range of training materials, including interactive modules, videos, quizzes, and management system procedures. It also features integrated tracking and reporting capabilities, enabling efficient monitoring of training undertaken against employee training plans. This has been a very effective health and safety tool. Comprehensive emergency preparedness procedures address a wide range of scenarios, from natural disasters to man- made crises, ensuring the safety of personnel, facilities, and communities. Frequent drills and training sessions empower the workforce to respond skilfully to emergencies, demonstrating a commitment to operational security and community welfare. In 2014, Brickworks adopted a cautious management approach by implementing Biological PPE kits across all operational facilities. This proactive measure allowed the company to respond swiftly to the emerging COVID hazards in its Australian operations in 2020. Brickworks understands the critical importance of regular audits of our safety management systems and processes. To ensure the highest standards of safety and compliance, Brickworks conduct both internal and external audits. These audits are designed to validate the effective application of the management system procedures and processes, identifying any non-conformance areas. Internal audits allow us to self- assess and promptly address any issues, while external audits provide an objective evaluation from industry experts. This dual Health and Safety Brickworks Annual Report 2024 p 41 approach not only reinforces our commitment to health safety but aligns Brickworks with regulatory requirements and industry standards, adopting a culture of continuous improvement and accountability within the company. Our strategy for FY2024 focused on achieving continued reductions in injury rates for company employees, contractors, and others. Specific annual objectives and targets are set by the executive leadership team and communicated across the organisation to ensure alignment and commitment to our long- term safety goals. SAFETY Continue reductions in injury rates. FY19 FY25 10.69 9.73 FY23 FY24 21.1 Brickworks Total Recordable Injury Frequency Rate (TRIFR)18 FY19 FY20 FY21 FY22 FY24 TRI / million hours worked 25 20 15 10 5 0 FY23 21.1 16.3 14.3 12.2 9.7 10.7 18 FY2023 restated to include injuries that occurred in FY2023 but were reclassified during FY2024. Previously stated figures for FY2023 – Brickworks Consolidated - 8 LTI, 34 MTI, LTIFR (1.9), TRIFR (10.0). 19 FY2023 restated to include injuries that occurred in FY2023 but were reclassified during FY2024. Previously stated figures for FY2023 Australia - 1 LTI, 13 MTI, LTIFR (0.4), TRIFR (6.4). Performance (Group) Since the acquisition of the North American operation in December 2018, Brickworks has continuously improved its consolidated total recordable injury frequency rate. Notably, in FY2024, this rate decreased marginally from 10.718 to 9.7, highlighting further progress in a challenging year. This achievement is primarily attributed to the continued successful integration of health and safety technologies and practices developed in Australia into our North American operations. As this work progresses, we anticipate a continued reduction in injury rates for the group. It's important to note that the currently reported frequency rate data does not include contractor injuries. However, contractor injuries are recorded and included in the company's safety performance reports at all levels of the business, facilitating comparative analysis and injury trends. Significant efforts are underway to accurately incorporate contractor injuries into the statistical frequency rate reporting. In FY2024, the Company reported a total of ten recordable contractor injuries, an increase from the seven injuries reported in FY2023. Regarding the severity of contractor injuries, there were four Class 2 severity recordable injuries, which were temporarily life-altering, and six Class 3 severity injuries, which were minor non-life-altering injuries. Performance (Australia) The total recordable injury frequency rate (TRIFR) was 7.9 marking an increase from the TRIFR of 7.319 recorded in the preceding year. Due to the rationalisation of the Australian business, there were fewer hours worked. The total number of hours worked decreased by 13.3% in FY2024 compared to the previous year. The number of recordable injuries reported was in line with the previous year. Brickworks is committed to its 2023-30 safety strategy by effectively communicating annual health and safety objectives and targets to all levels of the business, ensuring alignment across the workforce. Key to this strategy is building employee safety knowledge and skills through ongoing training and proactive supervision. Achieving this strategy requires diligent management and accountability and a dedication to developing a generative safety culture across the business. 42 p Brickworks Annual Report 2024 Health and Safety During FY2024, Brickworks achieved significant milestones, including the completion of over 24,928 eLearning safety courses by employees and contractors, and conducting 682 random tests for alcohol, drugs, and other substances. We maintained a roster of over 110 mental health first aiders and conducted 3,229 workplace inspections, all contributing to our comprehensive safety framework. Our rigorous approach to identifying and managing health and safety risks resulted in the control of over 1,777 hazards, along with 7,862 safety device checks to ensure that safety control equipment safeguarding personnel remains fully operational. Brickworks demonstrated a strong near-miss reporting culture, with a near-miss frequency rate (NMFR) of 16.4 in Australian operations for FY2024. At Brickworks, recordable injury severity is classified into three categories: Class 1 (permanent life alteration), Class 2 (temporarily life-altering), and Class 3 (not life-altering). In FY2024, no Class 1 injuries were reported among Brickworks employees. Of the total recordable injuries, 40 percent were Class 2, while the remaining 60 percent were Class 3. For contractors, there were no Class 1 injuries. Of all the contractor recordable injuries, 33 percent were classified as Class 2 severity, while the remaining 66 percent were categorised as Class 3 severity, which did not result in life-altering outcomes. Brickworks Australia Total Recordable Injury Frequency Rate (TRIFR)19 FY14 FY15 FY17 FY18 FY24 FY23 TRI / million hours worked 40 30 20 10 0 FY16 FY19 FY20 FY21 FY22 33.6 19.2 22.2 20.4 17.1 11.8 9.3 12.5 19.6 7.9 7.3 Brickworks Annual Report 2024 p 43 CEO Award for Health and Safety performance The CEO Award for Safety at Brickworks recognizes the operational site that reported no recordable injuries in FY2024 and demonstrated the strongest safety lead indicator performance, based on statistics from the Donesafe reporting platform. This Award encourages Brickworks operational teams to focus on increasing the number of lead safety indicator activities, such as hazard identification and control, safety device checks, safety training, safety contacts, workplace inspections and random fit for work testing, which builds the capacity to be safe in Brickworks. Brickworks North America Total Recordable Injury Frequency Rate (TRIFR)21 FY19 FY20 FY21 FY22 FY24 TRI / million hours worked 30 25 20 15 10 5 0 FY23 26.6 24.3 21.1 11.8 11.6 14.3 Performance (North America) Brickworks North America continued to enhance its health and safety performance in FY2024. The total recordable injury frequency rate (TRIFR) decreased to 11.6, representing an 18.9 percent reduction from the FY2023 rate of 14.321. It is anticipated that the company’s health and safety perfor mance will continue to improve as the integration of Brickworks' systems and processes continues. By streamlining operations and implementing best practices across the North American business, we expect to improve our safety measures, reduce risks, and continue to develop a safer working environment. 20 Contractors working on a fee-for-service arrangement for Brickworks. 21 FY2023 restated to include injuries that occurred in FY2023 but were reclassified during FY2024. Previously stated figures for FY2023 North America - 7 LTI, 21 MTI, LTIFR (3.5), TRIFR (13.8). Respirable Dust and Silica At Brickworks, we have implemented stringent measures to mitigate the risks associated with respirable dust and respirable crystalline silica dust, extending our commitment to worker health beyond governmental regulations. Brickworks’ comprehensive program, maintained across all sites, includes both static and personal exposure monitoring, as well as engineering controls to minimise risks. This nationwide air monitoring program utilises statistically valid exposure data and is closely managed by a qualified internal occupational hygienist. The program focuses on understanding respirable silica dust exposures in the workplace and implementing engineering controls to reduce dust emissions and transmission from various sources. Furthermore, Brickworks prioritises worker health by utilising specialised respirator fit testing equipment to ensure our workforce achieves effective respiratory protection. In FY2024, no silicosis claims were lodged related to workers compensation, with two non-life- threatening claims recorded historically over the past 15 years. Key Highlights FY2024 – Australia ◗ No employee or company contractor20 fatalities have been recorded over the last 5 years. ◗ Alignment of Health and Safety Training and Legal Briefings for Executive and Middle Management. ◗ Systems Integration and Reporting of Health and Safety Management Data in Australian and North American Operations. ◗ Implemented psychosocial health management framework, backed by an internal team of more than 110 Mental Health First Aiders. ◗ The growth of the presence of safety program, driving the capacity to be safe in Brickworks, through visible lead indicator safety activity measures, tracked daily by site. ◗ No employee silicosis claims lodged FY2024. 44 p Brickworks Annual Report 2024 Health and Safety Throughout the year, we achieved notable milestones in our safety efforts, including: ◗ Completion of 31,613 eLearning safety training sessions by our employees. ◗ Execution of 2,969 safety interactions led by our supervision and leadership teams. ◗ Conducting 178 workplace inspections across our nine manufacturing facilities to ensure safety compliance. ◗ Completion of 2,031 toolbox talks throughout all Brickworks North American locations. ◗ Performing peer audits at eight manufacturing locations. ◗ Commenced the implementation of the Presence of Safety lead indicator program to drive activities that build the capacity to be safe. Remarkably, we identified 2,281 hazards and successfully controlled a total of 2,503 hazards across Brickworks North America locations. These accomplishments underscore our commitment to establish a safer and more secure environment for our employees and stakeholders. The ongoing deployment of the Safety Health and Environment Management System (SHEMS) has led to several important initiatives. These include the introduction of a Safety Device Inspection program, the THINK FIRST program, and the Hazard Reporting and Risk Control program. Additionally, enhanced programs for Hot Work, Lockout Tagout, Hearing Conservation, Respiratory Protection, PPE, and Non-DOT Vehicle Safety have been implemented. It is important to highlight that nearly all program documents in the Safety Management System are readily accessible in both English and Spanish, ensuring comprehensive support for our diverse workforce. Additionally, we have developed eLearning courses for all management system programs, which are assigned to employees through Brickworks eLearning platform. These courses are designed to enhance the safety skills and knowledge of the workforce, ensuring all employees are well-informed and equipped to contribute to a safer work environment. THINK FIRST Program The purpose of this program is to identify health, safety, and environmental hazards before starting work to prevent incidents workplace and near misses. Since the program's launch in December 2023, the THINK FIRST forms are used to identify and control potential hazards when: ◗ an employee is to conduct a non-routine task. ◗ there is no JSEA (Job Safety Environmental Analysis) or the JSEA is missing sections or steps. ◗ conditions change in the workplace. Brickworks Annual Report 2024 p 45 Hazard Reporting and Risk Control Brickworks North America has relaunched the Hazard Reporting and Risk Control Program to eliminate or minimize incidents by identifying health and safety hazards. Risk assessments are conducted to determine the likelihood and consequences of these hazards, and the resulting risk ratings are evaluated to develop a plan of action. Risks are either eliminated or reduced to As-Low-As-Reasonably-Practicable rating (ALARP). Respirable Dust and Silica Brickworks North America continues to employ a third-party contractor for respirable silica sampling to ensure accurate and reliable measurements. We have implemented several measures to minimize respirable silica exposure, including enhanced ventilation systems, personal protective equipment, and rigorous monitoring protocols. Additionally, we are actively exploring and evaluating new controls and technologies to further reduce respirable silica exposure. Our efforts are aligned with Brickworks' global standards and best practices to ensure the highest levels of safety and compliance in managing silica risks. Key Highlights FY2024 – North America ◗ No employee or company contractor22 fatalities have been recorded over the last 5 years. ◗ Improved near miss recording. ◗ Further Systems Integration and Reporting of Health and Safety Management Data for North American Operations ◗ No employee silicosis claims lodged FY2024. ◗ A reduction in the Recordable injury frequency rate for the North American business. Safe + Sound week For the third consecutive year, all 40 Brickworks North America locations participated in Safe + Sound Week in August 2023. Safe + Sound week is a nationwide OSHA (Occupational Safety and Health Administration) sponsored event, held each August that recognizes the successes of workplace health and safety programs and offers information and ideas on how to keep America's workers safe. A safety slogan contest was held with the first-place winner’s logo printed on t-shirts provided to all Brickworks North America employees. Micro learnings on Flammable Cabinet Safety, Ladder and Tools Storage and Walkways, Stairs and Exits safety and were provided and distributed throughout the week. Certified Safety Professional® (CSP®) Two members of the Corporate Safety Team met the gold standard of safety, health and environmental credentials and achieved the industry’s most- recognized SH&E certification. A CSP candidate’s professional practice is typically spent implementing safety management systems, making worksite assessments to determine risks, assessing potential hazards and controls, evaluating risks and hazard control measures, investigating incidents, maintaining, and evaluating incident and loss records, and preparing emergency response plans, among other possible duties. The requirements to achieve the certification include the minimum of a bachelor’s degree, a minimum of 4 years of safety experience, a Board of Certified Safety Professionals qualified credential, and successful completion of the CSP exam. This accomplishment underscores our commitment to the professional development of our safety leaders. 22 Contractors working on a fee-for-service arrangement for Brickworks. 46 p Brickworks Annual Report 2024 Overview of Sustainability The built environment is the fabric of our cities and our lives and Brickworks’ products form part of this ever-changing fabric. Brickworks products are integrated into thousands of homes, apartments, commercial buildings, landscapes and infrastructure projects built each year. Build for Living: Towards 2025, Brickworks Sustainability Strategy Brickworks’ sustainability strategy, “Build for Living: Towards 2025”, recognises the substantial environmental and social impacts of the built environment, and the role its products play in creating sustainable developments. Brickworks understands its responsibilities, and the impact and influence it has on the environment, customers, employees, communities, and shareholders. The sustainability strategy focuses on the opportunity to make buildings and cities safe, resilient and sustainable. Design that incorporates sustainability brings greater energy and resource efficiency over the operational lifetime of a building. The sustainability strategy sets a clear pathway from the prior year, with measurable commitments, to ensure Brickworks continues to have a positive environmental and social impact, with strong governance and a culture of care for the community. At the heart of the strategy is Brickworks’ sustainability framework, with three pillars: Responsible Business, Environment and Our People and Community. Within these pillars, Brickworks focuses on three core objectives to deliver positive outcomes for stakeholders: ◗ Responsible Business: Leading Building Design – Safe, Resilient, Sustainable ◗ Environment: Sustainable Manufacturing ◗ Our People and Community: Diversity and Strong Culture of Care for Community Under these objectives, Brickworks is committed to delivering on 15 targets by 2025 with the baseline year of FY2019, except where otherwise noted. Build for Living: Towards 2025 can be downloaded from Brickworks website www.brickworks.com.au Since releasing our strategy Brickworks completed several acquisitions in North America. During FY2023, we completed a mid-strategy target enhancement to include our North American business in our sustainability targets and in FY2024 we are reporting progress against these targets. Sustainability Reporting Brickworks understands its long-term responsibilities, and the impact and influence the business has on the environment, customers, employees, communities and shareholders. Brickworks takes great pride in manufacturing building products in a sustainable way, creating sustainable developments and beautiful products that last forever. Sustainability and innovation are integrated into product design to create greater energy and resource efficiency over the operational lifetime of a building. Brickworks 2024 Sustainability Report provides a chance to cover these issues in depth, informed by international standards such as the Global Reporting Initiative. The Sustainability Report for the year ended 31 July 2024 shares Brickworks sustainability journey with an overview of the progress against targets and case studies. The Sustainability Report can be found at www.brickworks.com.au Brickworks Annual Report 2024 p 47 Target Our Progress Status Life Cycle and Thermal Design and Education We will support design tools, guidance and information to incorporate thermal design and life cycle thinking into building design. 75 continuous professional development and education sessions completed in FY2024. Modelling of 7-star thermal design continuing with University of Newcastle. FY19 FY25 +42 +75 FY23 FY24 Sustainable Products Increase the volume of verified sustainable products to 25%. 21% of product volume was verified as sustainable by third party labels. FY22 FY25 19% FY23 25% 4.5% 21% FY24 Supply Chain Continuing to reduce supply chain risks. Modern Slavery Roadmap completed. FY19 FY25 100% ROADMAP COMPLETE Governance Business Ethics and Whistle-blower Programs. Governance programs formalised. Continued annual training. FY19 FY25 100% PROGRAM COMPLETE Safety Continue reductions in injury rates. Total Recordable Injury Frequency Rates reduced by 54% since FY2019. FY19 FY25 10.69 9.73 FY23 FY24 21.1 Engagement Existing target of 100 community engagement activities annually. 105 community engagement activities, meeting our target of 100 in Australia. FY19 FY25 +109 +105 FY23 FY24 (Aus.) Community Support Supporting charities like the Children’s Cancer Institute. $469,747 contributed to Children’s Cancer institute in 2023 calendar year and over $5.3 million contributed since 2002. FY19 FY25 $4.8m $5.3m 2022 2023 $ 3.5m (Aus.) Diversity and Inclusion Stretch target: 35% female senior executives. Develop and implement a Diversity and Inclusion Strategy. Target met with 41.7% female senior executives in Australia. Further training on advancing diversity continued in FY2024. FY19 FY25 (Aus. 35%) 27% TARGET EXCEEDED 41.7% FY24 Brickworks Building Products Strategy and Targets Significant annual progress against our 2025 targets including our 2030 carbon and energy efficiency targets. 2025 Targets – Build for Living: Towards 2025 During FY2019, Brickworks engaged with internal and external stakeholders to understand what issues matter the most to them. We launched a new sustainability strategy, “Build for Living: Towards 2025” to help us deliver a positive impact for our stakeholders. 2025 Targets – North America Integration Since launching the Build for Living strategy, Brickworks has made several acquisitions in North America. In FY2023, we enhanced targets to include our North American business in our sustainability goals. The sustainability targets for Safety, Lifecycle and Design, Sustainable Products, and Carbon Transition now apply to both our Australian and North American operations. We are continuing efforts to fully integrate the North American business into the remaining targets, with updates planned for future strategy revisions. Target Our Progress Status Carbon Transition Continued investment into developing feasible renewable biomethane opportunities and investment in the transition to the hydrogen fuel economy. Brickworks is assessing the feasibility of a 253 TJ renewable bioenergy facility to be located next to a brick plant at Horsley Park in Western Sydney. The project recently lodged a development application with the NSW Government. Brickworks is assessing the feasibility of LFG cleaning to supply our Queensland Rochedale brick manufacturing site. Approval was received for the trial of organic grape marc, a waste from the wine industry to substitute for natural gas in our South Australian kiln. FY19 FY25 FY24 Plant 2 feasibility study & DA lodged Water Reduce potable water use in water stressed areas. 14% increase in mains water usage in Australia compared to FY2023 due to drier climatic conditions. 6% decrease in usage from FY2020. North America had minimal change in their mains water use compared to FY2023. FY19 FY25 -6% -17% FY24 FY23 (Aus.) Rehabilitation Drive progressive rehabilitation. 19,800 m2 land progressively rehabilitated and 141,276m2 of land progressively rehabilitated in North America in FY2024. FY19 FY25 +2ha FY23 FY24 (Aus.) +5ha Circular Economy Year on year increase in recycled material use. Recycled raw materials increased from 20% in FY2023 to 21% recycled content in FY2024 in Australia. FY19 FY25 20% 21% FY23 FY24 (Aus.) Air Quality Emission Control Over $2 million investment in emission abatement. Over $6 million invested in air quality emission abatement in Australia since FY2019. FY19 FY25 FY24 COMPLETE ONGOING $6m+ FY23 2030 Targets – Progress on the ‘Towards 2030’ Strategy We have set expanded climate objectives as 2030 targets, focusing on carbon reduction, energy efficiency, and product innovation, which will form the core of our upcoming ‘Towards 2030’ strategy update. As we continue to refine this strategy, it will include quantitative targets addressing all key material areas across both our Australian and North American operations. Target Our Progress Status Product Innovation Year on year increase in R&D investment in the next generation of clay brick and concrete block wall systems. $13.3 million R&D spend since FY2022 FY22 FY30 $3m FY23 $22.6m $13.3m FY24 Carbon 15% reduction in Scope 1 and 2 greenhouse gas emissions by 2030 from a FY2022 baseline, across our combined Australian and North American operations. 22% reduction from FY2022 baseline across Australia and North America due to decreased market activity driving temporarily lower production levels FY22 FY30 -6% FY23 -15% TARGET EXCEEDED -22% FY24 Energy Efficiency Stretch target: 10% increase in gas efficiency at Austral Bricks plant by 2030. Total gas efficiency and natural gas efficiency has improved by 8.6% since 2018 FY18 FY30 8.6% 6.7% FY24 FY23 (Aus. 10%) 48 p Brickworks Annual Report 2024 Overview of Sustainability Brickworks Annual Report 2024 p 49 Brickworks is committed to managing our operations in an environmentally sustainable manner, whilst considering economic and social influences. Compliance23 During FY2024, Brickworks’ subsidiary in North America received fines totalling USD 10,800 in September 2023 resulting from two fines from one contractor-related unauthorised stormwater discharge in May 2023 as disclosed to the regulator. To avoid reoccurrence, full corrective action has been taken including a water and waste corrective action plan with revised procedures and retraining. We are reinforcing our commitment to zero environmental fines and continued risk reduction across our operations. Brickworks treats all instances of legal and regulatory non- compliance with the utmost importance. Details of incidents, notices and complaints are raised at the weekly General Managers’ meeting, attended by the Chief Executive Officer. Each non-compliance incident is investigated and tracked to ensure corrective actions are undertaken within deadlines. Incident reporting procedures and training are a central part of the SHEMS, raising awareness and identifying corrective and preventative actions. FY2024 Australia North America Prosecutions 0 0 Penalty Notices 0 2 Directive Notices 0 0 Environmental Improvement Strategy After significant investments in Air and Water Pollution Control Equipment (PCE), our focus is on strengthening PCE maintenance, enhancing procedures and training to boost environmental capabilities. In FY2024, we conducted 2,650 PCE checks, a key indicator of our environmental commitment. Brickworks’ environmental improvement strategy has supported the implementation of enhanced site inspection standard operating procedures (SOPs) at both our Australian and North American locations this year. These improvements aim to maximize hazard identification and strengthen our overall environmental capabilities. Under our environmental improvement strategy, Brickworks implements systematic risk management programs that identify and control impacts to the environment in line with legislation and authorised Brickworks environmental policies. Vegetation and biodiversity were identified as new key risk areas during FY2024, and a management program is under development. Investments are made in upgrading kilns, plant control systems, and emission control technologies. In FY2023, limestone scrubbers were installed at Austral Bricks Horsley Park Plant 1 and Plant 2, with a scrubber relocated to Plant 1 after the closure of Plant 3. The Golden Grove plant completed scrubber refurbishments during a December 2022 shutdown which also saw the scrubber Environment 23 Reported environmental fines and penalties include those received and paid during the reporting year (ending 31 July). Penalties received regarding property notices are excluded. 50 p Brickworks Annual Report 2024 stack extended to improve dispersion of kiln gases and reduce odour at ground level as required by the Environment Protection Authority. These investments into air pollution abatement equipment represent over $6 million invested in air quality emission controls in Australia since FY2019. An investment of USD 3.6 million in upgrades to convert and retrofit the existing North American Adel, Iowa plant from petcoke fuel to natural gas was completed in April 2023. The main fuel conversion was completed to allow the kiln to be re- introduced into the production process utilising a much more efficient and reliable fuel source. Climate related strategies and programs In Australia, carbon emissions have followed a general downward trend, with a 56% decrease compared to FY2006 (Scope 1 and 2). Our progress in this area is supported by product redesign, increased use of recycled materials, utilisation of renewable bioenergy such as sawdust and landfill gas in some of our kilns, and capital investments into modern, fuel- efficient production processes. For example, at Horsley Park we have built the most energy efficient brick plant in the country, and decommissioned two kilns that were both more than 40 years old. Our climate-related strategy, targets and programs build on these achievements, focusing on four key areas, including efficiency, lower carbon energy sources, innovation, the appropriate use of offsets and improving the energy efficiency of homes over lifetime operations. Each focus area has deliverables to drive performance. Last year we announced a new carbon target: to achieve 15% reduction in Scope 1 and 2 greenhouse gas emissions by 2030, from a 2022 baseline, across our combined Australian and North American operations. In response to the subdued market conditions, the Company has taken the opportunity to carry out increased maintenance activities and intermittent plant shutdowns during FY2024, ahead of the anticipated strong demand through the rest of the decade. This has influenced a reduction in greenhouse gas emissions in FY2024 of 22% compared to the FY2022 baseline. Environment AIR QUALITY EMISSION CONTROL Over $2 million investment in air quality emission control FY19 FY25 FY24 COMPLETE ONGOING $6m+ FY23 The carbon target is also underpinned by our stretch target for a 10% increase in gas efficiency at Austral Brick plants by 2030 since FY2018. Since FY2018, which marked the start of a strategic 10-year investment vision to drive energy efficiency, our Austral Bricks business has seen an 8% improvement in gas efficiency. In FY2024, our new Horsley Park Plant 2 state-of- the-art brick manufacturing facility completed commissioning, demonstrating 57% improvement in energy intensity compared to FY2018. Brickworks has added 1.2 MW of rooftop solar across multiple sites, generating 934 MWh annually. Upcoming installations include 3 MW in Western Sydney and 1,460 KW in Melbourne, with the Western Sydney plant set to cover 19% of its electricity needs, equivalent to powering 442 Sydney households annually. We have also made steady progress in North America. Since our entry into this market in 2018, we have achieved a 19% energy efficiency improvement, primarily through our plant rationalisation and upgrade program. For hard-to-abate sectors such as brick manufacturing, effective regulation (such as a whole of life-cycle approach to emissions intensity), along with investment and innovation, is critical to ensure the optimal outcomes. We are working with industry-forums to encourage whole of life-cycle approach to measuring embodied carbon. Brickworks is enhancing our commitment to investing in renewable biomethane and landfill gas opportunities. The Brickworks Bioenergy Transformation Initiative seeks to lead the market in carbon reduction innovation within the Australian brick and building products sector. Our bioenergy transformation strategy includes: 1. Increased use of renewable energy sources, with a focus on bioenergy 2. Best practice manufacturing efficiency, including investment in the latest kiln technology, and 3. Innovation in raw materials and product design – including brick voids, on-board fuels, raw material innovation and production innovation. As an industry leader using 11% bioenergy in manufacturing in Australia, we understand the critical role renewable bioenergy can have in producing low-carbon products. We are assessing the feasibility of renewable bioenergy generation at our brick plants with leading technology providers. If successful, each facility has the potential to provide a significant source of renewable energy. Brickworks Annual Report 2024 p 51 Exploring renewable gas opportunities The gas we use to fire the bricks in our kilns cannot be easily substituted for alternative renewable energy sources and kilns cannot be electrified. However, Brickworks is leading the industry in supporting the development of a nascent renewable gas market as a commercially viable pathway to decarbonise our business operations. Brickworks is undertaking a feasibility study into Australia’s first manufacturing behind-the-meter renewable biomethane gas project. Partnering with Delorean Corporation (ASX:DEL), Brickworks is investigating the feasibility of a Bioenergy Facility at Horsley Park in Western Sydney. The project recently lodged a development application with the NSW Government. If the project proceeds into the construction phase, the facility will supply the co-located brick plant with up to fifty per cent of its gas needs with renewable biomethane gas produced from organic waste. The Horsley Park Bioenergy Facility would reduce the brick plant’s scope 1 emissions by fifty percent by displacing fossil natural gas with renewable biomethane gas. The proposed facility will use anaerobic digestion technology to convert organic waste into renewable natural gas for the brick plant. It is expected to supply 253,000 GJ of renewable gas each year, reducing Brickworks annual Scope 1 direct emissions by 13,012 tCO2-e through the displacement of natural gas. Brickworks is assessing the feasibility of LFG cleaning to supply our Queensland Rochedale brick manufacturing site. As a member of Bioenergy Australia, Brickworks continues to advocate for policy and regulatory changes that recognise the scope 1 emission reductions for buyers of renewable gas. More information about these initiatives is contained in our 2024 Sustainability Report. Understanding Carbon Risks and Opportunities We are incrementally adopting the recommendations of the leading climate-related risk framework, Task Force on Climate- Related Financial Disclosures (TCFD), such as using climate scenarios to identify risks and developing climate-related strategy and programs. Following the release of the ASRS, our TCFD roadmap has been integrated into an ASRS roadmap. Our experience with TCFD reporting since 2022 has equipped us well for aligning with ASRS requirements. We continue to monitor and report on management of climate risks and roadmap in our Sustainability Report. Energy A key strategic focus area is to achieve global leadership in leading manufacturing excellence and efficiency. To achieve this, Brickworks is investing in energy efficiency. Total energy consumption and greenhouse gas emissions across Brickworks in FY2024 was 5.14 PJ, a 16% decrease from FY2023. This reduction is primarily attributed to the subdued market conditions, where the Company has taken the opportunity to carry out increased maintenance activities and intermittent plant shutdowns during FY2024, ahead of the anticipated recovery in demand. In addition to the reduction in absolute energy consumption, these strategic plant shutdowns and maintenance activities have led to an improvement in energy efficiency in brick production. CARBON TRANSITION Continued investment into developing feasible renewable biomethane opportunities and investment in the transition to the hydrogen fuel economy Brickworks Building Products continues to reduce energy intensity across the business. Since FY2013, energy intensity by revenue has improved by 43% to 4.7 TJ per million dollars (AUD) of revenue. Energy intensity decreased by 9% from FY2023, reflecting the improvement in energy efficiency achieved from the commissioning of Plant 2 and the rationalisation of plants across North America. Brickworks Building Products Total Energy Consumption (PJ) FY14 FY13 FY15 FY17 FY18 FY24 8.0 6.0 4.0 2.0 0 FY16 FY19 FY20 FY21 FY22 FY23 Australia North America 52 p Brickworks Annual Report 2024 Environment The majority (78%, 4.03 PJ) of the Company’s energy requirements are fulfilled with natural gas, which is used extensively in brick manufacturing. Gas efficiency is measured at a factory level and results are reported to the organisation including the Chief Executive Officer weekly. ENERGY EFFICIENCY Stretch target: 10% increase in gas efficiency at Austral Bricks plant by 2030 Baseline FY18 FY18 FY30 8.6% 6.7% FY24 FY23 (Aus. 10%) Brickworks Building Products Energy Intensity (TJ/$m Revenue) FY24 FY23 10 6 8 4 0 2 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Brickworks Building Products FY2024 Energy Mix Natural Gas 78% Biofuels 7% Electricity 9% Liquid Fossil Fuels 5% Energy Efficiency Since its inception, Brickworks Building Products has invested in the latest kiln, equipment and manufacturing technologies to improve productivity, product quality and energy efficiency. FY2018 marked the start of a strategic 10-year investment vision to drive energy efficiency across Australia. By 2030, major plant upgrades are expected to improve total gas efficiency across Austral Bricks Australia by a stretch target 10%, based on FY2018 levels. Continued investment into energy efficiency and recovery has improved many Austral Bricks kilns to exceed international leading energy efficiency benchmarks. Natural gas efficiency has improved by 8.6% since FY2018. There was improved performance in the natural gas efficiency in FY2024 compared to FY2023 (2.1%) due to the completion of the new Horsley Park Plant 2 facility in New South Wales and the closure of less efficient plants such as Cardup in Western Australia. Brickworks Building Products Australia Natural Gas Efficiency (GJ/’000 Standard brick equivalent) compared to FY2018 baseline FY24 FY23 100% 95% 90% 80% 85% FY19 FY20 FY21 FY22 FY18 Stretch target Brickworks Annual Report 2024 p 53 The plant rationalisation program in North America has led to an 18.9% improvement in gas efficiency from the 2019 calendar year to FY2024 and a 1.0% improvement compared to FY2023. Renewable Electricity Generation Our Rockhampton (Qld) and Oakdale (NSW) masonry sites continue to generate electricity through 408 kW of onsite solar systems. In addition, our Queensland masonry factories at Cairns, Ayr and Gympie started to generate electricity from the 240 kW solar installations at the end of FY2024. 507 MWh of on site generated solar electricity was used for manufacturing in FY2024, a 12% increase from FY2023 and saving an average of 20% of Scope 2 emissions at these sites. Renewable electricity contracts have been executed for Iberia and Rocky Ridge in North America. It is expected that these sites will commence using renewable electricity in FY2025. Carbon Brickworks continues to reduce greenhouse gas intensity across the business. In 2018 Brickworks acquired businesses within North America and have been working towards reporting full greenhouse gas inventory globally. During FY2023 Brickworks completed the greenhouse gas calculations for the North American operations for historical years from FY2020 through to FY2022 (including fleet emissions) covering all material Scope 1 and Scope 2 greenhouse gas sources. Performance against Carbon Target In FY2023 Brickworks announced its greenhouse gas emissions target to achieve a 15% reduction in Scope 1 and 2 greenhouse gas emissions by 2030, from a 2022 baseline, across our combined Australian and North American operations. In FY2024, Brickworks Building Products total Scope 1 and 2 greenhouse gas emissions was 311 kilotonnes of carbon dioxide equivalent (ktCO2e) for both Australian and North American operations. Of these emissions, 97% are attributed to brick manufacturing operations. Biofuels use in Australia For many years Brickworks has used biogas and sawdust for renewable energy generation. In FY2024, 11% of Building Products Australia’s energy came from renewable or alternative energy sources such as landfill gas or sawdust. These biofuels allow us to avoid the greenhouse gas emissions that would have been released if we used natural gas. Biofuel sources include landfill gas, sawdust and other biomass products. We continue to investigate ways to increase our biofuels content. Brickworks Building Products North America Natural Gas Efficiency (GJ/’000 Standard brick equivalent) compared to 2019 calendar year baseline FY24 FY23 100% 95% 90% 70% 85% 80% 75% FY20 FY21 FY22 CY19 Brickworks Building Products Australia FY2024 Energy Mix Natural Gas 74% Biofuels 11% Electricity 8% Liquid Fossil Fuels 6% Coal 1% CARBON 15% reduction in Scope 1 and 2 greenhouse gas emissions by 2030, from a 2022 baseline, across our combined Australian and North American operations FY22 FY30 -6% FY23 -15% TARGET EXCEEDED -22% FY24 54 p Brickworks Annual Report 2024 Environment 24 *FY2022 and FY2023 have been restated using an updated calcination methodology for North America. See more details in the methodology section of the Sustainability Report FY2024. Greenhouse gas emissions have decreased in FY2024 by 22% compared to FY2022. This reduction is primarily attributed to the subdued market conditions, where the Company has taken the opportunity to carry out increased maintenance activities and intermittent plant shutdowns during FY2024, ahead of the anticipated strong demand through the rest of the decade. These strategic plant shutdowns and maintenance activities have led to an improvement in our scope 1 and 2 greenhouse gas intensity for brick production which puts the Company in a good position to meet the carbon emission target when the demand resumes. Building Products Australia’s long-term performance Carbon emissions have followed a general downward trend, with a 56% decrease compared to the base year 2005/06 (Scope 1 and 2). The decrease is attributed to efficiencies gained from alternate fuels, manufacturing consolidation, equipment upgrades and operational improvements. Greenhouse Gas intensity As Austral Bricks and Glen Gery make up greater than 97% of Brickworks’ Scope 1 and Scope 2 emissions, the relevant greenhouse gas intensity metrics for our operations are emissions per tonne of brick produced. Emissions from concrete products are made up predominantly of Scope 3 emissions largely from the use of cement (refer to our Scope 3 inventory). The following table sets out our Scope 1 and 2 greenhouse gas emissions intensity per tonne from our Brick operations. We have achieved a 5% improvement across the group since FY2022 including a 10% improvement in intensity in our North American Brick operations. This improvement is mainly attributed to the completion of commissioning of the new Horsley Park Plant 2 in Australia and the plant rationalisation across North America. Brickworks Building Products Global Scope 1 and 2 Emissions since FY2022 (ktCO2-e)24 FY2022 FY2023 FY2024 Scope 1 302* 290* 244 Scope 2 (location based) 96 83 68 Total 398* 373* 312 Brickworks Building Products Scope 1 and 2 Greenhouse Gas Emissions (ktCO2-e) FY24 FY23 600 400 0 200 FY22 398 312 373 Carbon target Carbon – Australia Carbon – North America Brickworks Building Products Australia Scope 1 and 2 Greenhouse Gas Emissions Since 2005 (ktCO2-e/$m Revenue) FY24 600 200 300 400 500 100 0 FY06 FY08 FY10 FY12 FY14 FY16 FY18 FY20 FY22 Brickworks Annual Report 2024 p 55 Greenhouse Gas intensity by revenue Since FY2013, greenhouse gas intensity by revenue has improved by 48% in Brickworks Building Products to 0.29 kilotonne CO2-e per million dollars (AUD) of revenue. Carbon intensity was lower (9%) than the previous year, reflecting increased revenue from FY2023 to FY2024 and lower emissions due to plant rationalisations and improved efficiencies. Brickworks Building Products Greenhouse Gas Emissions Intensity for Brick Production (Scope 1 and 2) (tCO2/tonne product)24 FY2022 FY2023 FY2024 Improvement from FY2022 Australia 0.164 0.162 0.157 4% North America 0.187* 0.175* 0.172 8% Consolidated 0.170* 0.166* 0.162 5% Scope 1 and 2 emissions methodology Australian greenhouse gas emissions are reported and audited for the Australian National Greenhouse and Energy Reporting Scheme (NGERS). Scope 1 and Scope 2 carbon emissions are determined using the methodology and factors outlined within NGERS. The Scope 1 and 2 greenhouse gas inventory for our North America operations is reported using the Greenhouse gas protocol and US EPA Emission Factors for Greenhouse Gas Inventories. Scope 1 emissions calculation methodology update A default global factor from the Intergovernmental Panel on Climate Change (IPCC) guidelines was used for North American operations to estimate greenhouse gas emissions from calcination in the absence of detailed data. IPCC’s global default factor assumes 10% carbonaceous material in clay used for producing bricks, with the IPCC guidelines noting it can vary between 0 – 30% – with our assurance provider for FY2023 limited assurance suggesting reviewing the calcination methodology for improved accuracy. This finding did not apply to Australian emissions because locally specific calcination emission factors are available through NGERS. Brickworks Building Products Greenhouse gas emissions intensity for brick production (Scope 1 and 2) (tCO2-e/tonne product) FY24 FY23 0.2 0.1 0 0.05 0.15 FY22 0.17 0.162 0.166 Brickworks Building Products Carbon Intensity (ktCO2-e/$m Revenue) FY24 FY23 0.60 0.40 0.50 0.20 0 0.10 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 56 p Brickworks Annual Report 2024 Environment A sampling and testing regime for inorganic carbon in clay used to produce bricks was implemented in North American operations during FY2024, that integrated with existing raw material testing regime. Clay mixes are now tested quarterly using a new procedure for determining the carbon content of clay/shale samples. It is assumed that all inorganic carbon is emitted as carbon dioxide, as per the 2006 IPCC guidelines. This new methodology is documented in the North America GHG accounting manual. Impact of change in methodology Results revealed inorganic carbon content in raw clay materials is less than 1%, substantially lower than the IPCC global default factor but broadly consistent with some of the state-based factors in Australia. This finding led to a reduction of more than 5% in consolidated Scope 1 emissions calculated for the Company. Consequently, the historical carbon emissions for North America including the target baseline for FY2022 have been restated to ensure comparable emissions performance. Impact on Baseline and Target The restatement of the baseline has led to a 25 ktCO2e reduction in North American and consolidated Scope 1 greenhouse gas emissions for FY2022 – a 5.8% reduction in consolidated Scope 1 greenhouse gas emissions. FY2022 consolidated baseline Scope 1 emissions were reduced from 423 to 398 ktCO2e, due to this change in calcination methodology – based on North American Scope 1 emissions for FY2022 reducing from 144 to 120 ktCO2-e. The impact on target modelling and proposed abatement opportunities is minimal, as no opportunities identified were targeted at calcination emissions. Scope 3 carbon emissions Scope 3 emissions are indirect greenhouse gas (GHG) emissions that occur throughout a company’s value chain but are not directly controlled by the company. In line with our commitment to incrementally adopt the recommendations of the TCFD and further maturing our climate related disclosures, we have completed an estimate of our Scope 3 emissions. Life cycle assessments previously conducted include: ◗ Climate Active Carbon Neutral Certification Product Disclosure Statements available on the Climate Active website (https://www.climateactive.org.au/buy-climate- active/certified-members/austral-bricks). ◗ The published Environmental Product Disclosure (EPD) for Austral Masonry Gympie which is available on the EPD Australasia website (https://epd-australasia.com/). ◗ Preliminary life cycle analysis completed for other masonry and brick products as part of further expanding our library of EPDs for our products. Methodology The Scope 3 emissions inventory for Brickworks Building Products was compiled by an external consultant and has estimated the FY2023 inventory using the following guidelines: ◗ The GHG Protocol Corporate Accounting and Reporting Standard (WRI/WBCSD, 2004) ◗ The GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard (WRI/WBCSD, 2011) To calculate Brickworks Building Products scope 3 emissions, the GHG Protocol’s Scope 3 Calculation Guidance (WRI/WBCSD, 2013) for specific categories and boundaries was used. The Scope 3 emissions inventory have been calculated using generic emission factors from various publicly available datasets. Further improvements will be made to Scope 3 emissions reporting as we continue to develop our reporting systems and climate related disclosures. Emissions boundary Recognising that we are early in our Scope 3 reporting, with challenges in sourcing extensive value chain information, our Scope 3 emissions results are based on FY2023 data (1 August 2022 to 31 July 2023) and is currently only available for our Brickworks Building Products Australia and North America Businesses. Joint Ventures and investments are not currently included unless they are a supplier to the Brickworks Building Products businesses (i.e. Southern Cross Cement JV). The 4 of the 15 categories of Scope 3 listed in the GHG protocol were chosen as relevant based on our understanding of our Scope 3 emissions profile gained from various life cycle assessments completed and benchmarking against industry peers. The categories included are: ◗ Category 1: Purchased goods and services ◗ Category 3: Fuel and energy-related activities (not included in scope 1 and scope 2) ◗ Category 4: Upstream transportation and distribution ◗ Category 9: Downstream transportation and distribution The organisational and reporting boundary will be reviewed as we continue to refine our scope 3 reporting systems and requirements. Brickworks Annual Report 2024 p 57 Warwick Brick House Bowral Bricks Embassy Red Brisbane, QLD 58 p Brickworks Annual Report 2024 Environment Exclusions The following categories have been excluded from the scope 3 inventory in this report: ◗ Category 2: Capital goods – In FY2023, the majority of capital expenditure was focused on upgrades and commissioning, particularly for Plant 2, Horsely Park. When emissions from capital expenditure are spread over the capital project’s lifespan, they become immaterial. ◗ Category 13: Downstream leased assets: Downstream leased assets are managed by the Brickworks Property division and is outside the boundary of the current inventory which is focused on Scope 3 emissions for Brickworks Building Products divisions. Scope 3 emissions reporting systems and processes are required to be further developed for our other divisions. ◗ Category 15: Investments: The Brickworks Investment division is excluded due to complex reporting requirements. Further advice and reporting systems are needed to address these. ◗ Categories 5-8, 10-12 and 14 have been determined to be immaterial and validated through industry peer benchmarking. Carbon offsets purchased as part of Brickworks’ Climate Active carbon-neutral product offerings were considered immaterial and therefore excluded from the emissions inventory. Emissions profile analysis The purchase of cement accounts for 59% of category 1 - purchased goods and services and 31% of Brickworks’ total scope 3 emissions inventory. Brickworks is already working on reducing scope 3 emissions relating to cement as part of our innovation strategies to reduce embodied emissions for our concrete products. Many of our suppliers, including the Southern Cross Cement JV, have Environmental Product Declarations (EPDs) which will allow us to further refine our emissions profile. The downstream transport of our products between warehouses and to our customers’ accounts for 27% of our total Scope 3 emissions. To address this, we are actively streamlining our transportation processes and exploring advanced technologies, such as AI-powered route optimization, to reduce emissions and improve efficiency. We are currently finalising Environmental Product Declarations for a wide range of our Australian products. These life cycle analyses will assist us in further refining our Scope 3 emissions. Resources and Waste Brickworks is progressing towards a circular economy by closing the loop, thus minimising production waste and reusing and recovering resources in the value chain. Opportunities for the reuse of waste are a key focus area for the brick and concrete businesses to decrease material costs, increase resource efficiency and drive a circular economy. Brickworks’ 2025 target is for a year-on-year increase in recycled material use. Brickworks Building Products Scope 3 Inventory FY2023 (ktCO2-e) AU NA Total Category 1: Purchased goods and services 142 9.5 151 Category 3: Fuel and energy-related activities (not included in scope 1 and scope 2) 36 17 53 Category 4: Upstream transportation and distribution 4 0.9 5 Category 9: Downstream transportation and distribution 50 28 78 Total 233 55 288 CIRCULAR ECONOMY Year on year increase in recycled material use FY19 FY25 20% 21% FY23 FY24 (Aus.) A total of 368 raw kilo tonnes of recycled materials were used, which is equivalent to 21% of the total weight of our Australian building products produced. This has increased slightly from 20% recycled content in FY2023. We are continuing to further improve our recycled content reporting processes to improve accuracy and auditability. Brickworks Annual Report 2024 p 59 Water Brickworks’ 2025 target is to reduce potable water usage in water stressed areas. Land Rehabilitation Project New Berrima, NSW Brickworks Building Products Australia Recycled Content (tonnes) 500,000 400,000 300,000 200,000 100,000 0 FY2021 FY2022 FY2024 FY2023 WATER Reduced potable water use in water stressed areas FY19 FY25 -6% -17% FY24 FY23 (Aus.) Water resource management is most important in water stressed areas. During FY2024, Brickworks used a total of 173 ML of potable mains water globally, a 9% increase compared to FY2023. Of this, 118ML of potable mains water was used at sites in Australia, a 14% increase in potable mains water use compared to FY2023 and a 6% decrease since the release of 60 p Brickworks Annual Report 2024 Environment our strategy in FY2020. The increase in FY2024 is attributed to the normalisation of water consumption post the higher than average rainfall during FY2023, which reduced water requirements to meet raw material moisture content. Our North American operations consumed 55ML of potable mains water in FY2024, which is no change from FY2023. We will continue to review our processes and exploring opportunities to enhance water efficiency. We remain committed to aligning our operations with sustainability goals and will continue to seek improvements in this area. with Goodman at end of life for final rehabilitation into industrial estates. Where possible, we aim to enhance the local environment through initiatives such as land rehabilitation, water sensitive urban design, green corridors and using native species in landscaping. Brickworks Australia Total Potable Water Use by Water Risk Area (kL) 150,000 100,000 50,000 0 FY2020 FY2021 FY2022 FY2024 FY2023 Water Risk Area Low Medium-High Low-Medium High Rehabilitation Progressive rehabilitation is a key strategy for minimising environmental risk, end-of-life closure costs and achieving increased efficiency by reducing double handling of rehabilitation materials. The area of progressive rehabilitation completed for FY2024 was 19,800 m2 including 400 trees planted in Australia and 141,276 m2 in North America. Progressive rehabilitation is driven across the business by adding available land reviews to annual rehabilitation planning. We have significant experience in rehabilitating our sites. Many of our quarries are located in centralised urban areas and are often transferred into the Property Trust Joint Venture REHABILITATION Drive progressive rehabilitation FY19 FY25 +2ha FY23 FY24 (Aus.) +5ha Community Engagement Brickworks has developed community engagement plans at relevant sites, identifying the socio-political context, community concerns and expectations and when and how to engage. In FY2024, we completed 105 recorded community activities. Engagement activities included stakeholder meetings, site visits, investigating and resolving complaints, donations and other forms of support for community members and projects. These events help us strengthen and maintain community relationships. ENGAGEMENT 100 Community activities each year FY19 FY25 +109 +105 FY23 FY24 (Aus.) Customer focused sustainable product portfolio Today, the world is changing more rapidly than ever before. Architects, builders and customers are increasingly working to address the challenges associated with developing sustainable buildings, reusing waste products, reducing carbon emissions and developing smart, resilient cities. Brickworks Annual Report 2024 p 61 Oakdale East Masonry Plant Horsley Park, NSW FY22 FY30 $3m FY23 $22.6m $13.3m FY24 PRODUCT INNOVATION Year on year increase in R&D investment into the next generation of clay brick and concrete block wall systems. Brickworks’ product development process is customer driven, responding to consumer preferences. Our deep manufacturing capabilities and product knowledge combine with strong architects, builders and customer relationships to identify and optimise new product development. Our bricks and concrete products are manufactured to provide resilience. They are durable, fire-proof, contain thermal mass for energy efficient design, have excellent acoustic properties and no indoor air emissions (VOCs); and our clay bricks hold a 100-year warranty. Bricks are recyclable into products such as roadbase and into the manufacture of new bricks. Our focus is to provide a wide range of thermal mass product options with high recycled content and lower embodied carbon across roofing and walling products. This will be delivered through our sustainable product innovation strategy and targets. Customer expectations for sustainable building products are described through design principles for more sustainable homes including leading standards such the Greenstar Homes Guide by Green Building Council of Australia, LEED for Homes by U.S. Green Building Council, building codes, regulations and planning measures. Brickworks’ Sustainable Home Guide outlines how our products contribute to GreenStar Homes and LEED for Homes. Brickworks offers a range of products that help designers achieve sustainable design ratings, including National Home Energy Rating (NatHERS) used in the NSW Building Sustainability Index BASIX, Green Star Homes and LEED for Homes. Brickworks’ commitment to innovation into manufacturing excellence and raw material optimisation means our products are produced in some of the world’s leading energy efficient kilns. Since FY2022, Brickworks invested $13.3 million into research and development for kiln efficiencies, light weight products and different fuel and raw material types. During FY2024, strategic research and development projects were successfully completed and embedded into production including new products and efficiency gains. These successful projects highlight the continued potential for significant advancements across our five sustainability innovation focus areas, ◗ Thermal mass ◗ Light-weighting, lower cement and higher recycled ◗ Raw material optimisation ◗ Product innovation ◗ Sustainable design elements In FY2024 we increased our sustainable products verified by third party labels from 19% to 21% of our product volume across both Australia and North America. We are continuing to verify our sustainable products and have identified an additional 37% of the product volume in our portfolio of Australia products that will allow our customers to qualify for credits in sustainable building design such as Green star ratings. There are also a range of opportunities across our North American products including recycled content and diversified façade options. Further information of the environmental or social benefits of these products is provided in the Sustainability Report. SUSTAINABLE PRODUCTS Increase the volume of verified sustainable products to 25%. FY22 FY25 19% FY23 25% 4.5% 21% FY24 62 p Brickworks Annual Report 2024 Community Support Brickworks is committed to social responsibility in our communities, and we aim to make a valued contribution to our communities. Children’s Cancer Institute Brickworks is a long-standing partner with Children’s Cancer Institute (CCI), the only independent medical research institute in Australia dedicated to research into the causes, cure and prevention of childhood cancer, so that they can reach their ultimate goal of one day curing every child of cancer. Brickworks became partner of CCI in 2002 with the first pledge made towards the CCI Capital Appeal of $70,000. To date, Brickworks’ total partner value exceeds $5.3 million dollars, comprising of direct and indirect sources of revenue, including corporate and staff donations, state fundraising, sponsorships and supporting CCI events. The reporting period for the CCI partnership for 2023 calendar year saw the team at Brickworks raise $469,747, helping CCI move closer to achieving the vision of curing all children with cancer. Some of our highlights included Brickworks extension of their Diamond Ball partnership from Diamond to Platinum partner and Brickworks also becoming presenting partner for 86 k for a cure. Brickworks have also been ongoing strong contributors with Friday mufti program, Corporate Donation/Matching, webinar incentive program and their state based activities such as their Golf Day successes. 62 p Brickworks Annual Report 2024 COMMUNITY SUPPORT Supporting charities like the Children’s Cancer Institute FY19 FY25 $4.8m $5.3m 2022 2023 $ 3.5m (Aus.) “Every week 20 children are diagnosed with cancer in Australia. At Children’s Cancer Institute, our vision is to save the lives of these children and improve their long-term health through research.” “We don't just hope to cure all children of cancer. We will do it. This vision is only possible with commitment from longstanding partners such as Brickworks. Heartfelt thanks to the entire Brickworks’ team for its generous support of our work.” Anne Johnston Director Marketing & Fundraising Children’s Cancer Institute Brickworks Annual Report 2024 p 63 78 Meserole Columbia Roman Maximus Brooklyn, New York 64 p Brickworks Annual Report 2024 Brickworks Annual Report 2024 p 65 Culture and Values Our “We Are Brickworks” values and behaviours continue to be the foundation of our company. We remain committed to creating an environment where every individual feels valued and respected. This is promoted through various initiatives and events, that recognise and appreciate the contributions of our people. These initiatives include awards, team-building activities, events, and training programs aimed at promoting professional growth. They offer opportunities to appreciate colleagues and collaborate. As the year draws to a close, we look forward to our CEO Excellence Awards and Employee of the Year Awards where we recognise those who have gone above and beyond in their roles. Employee Engagement At Brickworks, maintaining a positive work environment and high employee engagement is essential for the well-being of our people and success of the Company. Our Staff Update Nights provide key progress updates highlighting the camaraderie among staff. Strong turnout across locations shows the connection employees have with Brickworks and its achievements. The quarterly Culture Champion Awards highlight our recognition of our core values. Employees can nominate colleagues who embody our values. Participation and nominations continue to increase, highlighting the growing appreciation for our company culture. These events and activities have further strengthened the bond among our employees and have contributed to creating an inclusive and engaging workplace culture. Our Global Workforce Our Global Workplace Key Employment Data FY2023 FY2024 Total Workforce 2,027 1,852 Total female breakdown 22.8% 22.4% Female Senior Executives 25.0% 30.2% Average age of employees 44.5 44.9 Employees aged 50 and over 38.2% 39.0% Average length of service 9.9 years 10.0 years 66 p Brickworks Annual Report 2024 Our Global Workforce Australia North America Global Workplace Profile Total** Female* ** Total Female* Total Female* Management 14% 26% 23% 22% 18% 23% Professionals 9% 44% 3% 33% 6% 45% Tech/Trades 17% 6% 2% 0% 10% 5% Administration 8% 77% 16% 63% 12% 68% Sales 15% 57% 5% 19% 10% 48% Operators/Labourers 37% 6% 52% 3% 44% 4% * Female % is a fraction of each profile type. ** from WGEA data 2024 Despite organisational changes over the last 12 months, engagement and feedback remain strong. Results from the latest engagement survey helped improve onboarding, offboarding and overall employee experience. A manager’s toolkit was developed to enhance the employee experience from the offer stage through the first 30, 60, and 90-days of employment. Surveying new employees provides feedback to monitor their assimilation. We also created a refreshed culture video to showcase our company during recruitment, onboarding and in promoting our company culture. Managers across the group worked with their teams to develop action plans to address areas for improvement and drive positive change. We have recently launched our Engagement Survey for 2024 to assess our effectiveness with the initiatives that were put in place on the basis of our earlier results. Our Workplace Australia and North America Employee Retention Our employees are our greatest asset, and we value the long tenure of many team members. We regularly recognise and reward staff through awards, company-wide communication, training, remuneration reviews, and opportunities for secondment and promotion. In the later part of 2023, Brickworks restructured its Austral Bricks and Masonry divisions across NSW, VIC, and QLD to enhance the customer experience. The consolidation created a more efficient framework offering both products under one umbrella for a seamless customer experience. It also allowed staff to cross-train across both product ranges, expanding their skills to better serve customers providing a single point of contact. Brickworks Annual Report 2024 p 67 Whilst restructuring the business resulted in some redundancies and impacted involuntary turnover, voluntary turnover in Australia reduced by 2.7% in FY2024. We continue to review exit survey data to improve the employee experience. In North America, overall turnover dropped by 8%, with voluntary turnover down by 7.5%. The closure of the Marseilles facility and a reduction in salaried positions affected overall turnover. However, improvements in voluntary turnover are due to remuneration reviews, training investments, and actions based on engagement and exit survey feedback. Talent Pipelines We provide several pathways for future talent, including work experience for students and structured Cadet and Graduate Programs. Our Industrial Training Program offers a 60-day work placement, helping students gain industry experience and feeds into our Cadet Program. In FY2024, three students joined the program. We promote these opportunities by engaging with local schools and universities through field trips, open days, and Career Expos, and Brickworks networking events. Brickworks also offers apprenticeships in electrical work, fitting, and roof tiling. These are available to external applicants and current employees seeking a career change. In FY2024, we have 17 apprentices nationally. Our biennial Brickworks Mentoring Program supports our employees professional and personal development. We have had great interest and success with this program in prior years and look forward to promoting the 2025 program in the latter part of 2024. We also continue with the North American Emerging Professional Development Program, known as the “Brew Crew,” which helps newer employees (less than 5 years of experience) build professional skills and networks. The program includes monthly 1.5-hour online training on topics like Emotional Intelligence and Workload Management. The program has been expanded to include three levels: Brew Crew, Brew Masters, and Brew Alumni, providing increasing networking, mentoring, and learning opportunities. Currently, 16 participants are currently enrolled. Australia North America Global Employee Turnover FY2023 FY2024 FY2023 FY2024 FY2023 FY2024 Voluntary 19.8% 17.1% 26.0% 17.2% 22.6% 17.2% Total 32.7% 31.5% 38.2% 28.0% 35.2% 29.9% Our Global Workforce Our Technical Academy in North America, offering employees opportunities to further their skills through accredited trade schools and on-the-job training, also continues. Partnerships at each manufacturing plant offer instruction in Millwright, Electrical, and PLC Controllers. Classes for 10 of the 17 employees who expressed interest and completed the assessment began in September 2023. The remaining 7 employees will receive entry-level training to develop their mechanical and electrical skills in preparation for the next cohort. Learning and Development Brickworks is committed to maintaining a safe and respectful environment by ensuring managers allocate time and support for compliance training and toolbox talks. Our monthly ‘Lunch and Learn’ sessions, featuring topics from health and well-being to superannuation benefits and internal updates, have become a key training platform. These sessions are led by our EAP provider, Superannuation Industry Funds, and Brickworks employees. We are developing a Transition to Retirement Program in North America to facilitate knowledge transfer from experienced employees and support their transition into retirement. This program aids succession planning and equips key employees with new skills for future roles. It also ensures retiring employees feel confident that their responsibilities will be managed effectively and provides them access to resources that may assist in this life change. Our people managers regularly discuss ongoing education and training with their teams, supporting both external training courses and our internal e-Learning and instructor-led sessions. 68 p Brickworks Annual Report 2024 Diversity, Equity and Inclusion We are pleased to have exceeded all of our gender representation targets for 2025 in the workforce. Female director representation has increased to 33%, surpassing our target of 30%; our 35% target for female representation at the executive level has been achieved, currently at 41.7%; and women currently comprise 26%25 of the Brickworks total workforce in Australia, exceeding our target of 25% for 2025. DIVERSITY AND INCLUSION Stretch target: 35% female senior executives. Develop and implement a Diversity and Inclusion Strategy. FY19 FY25 (Aus. 35%) 27% TARGET EXCEEDED 41.7% FY24 This year, Brickworks has continued its efforts to foster an inclusive and respectful work environment. We have rolled out nationwide face-to-face Code of Conduct training, and installed posters and banners promoting respectful behaviour in our locations. We remain dedicated to maintaining fair and equitable recruitment practices and regularly review our policies for compliance with legislation and International Labour Organisation (ILO) standards. 25 Measured as at 31 March 2024, consistent with WGEA reporting. Quiet Rooms have been introduced at many sites to provide private spaces for lactation, prayer, meditation, or medication administration. Flexible working arrangements have also increased, supporting work-life balance. In 2024, we participated in the Dress for Success campaign for International Women’s Day, donating 352 items of professional attire to support approximately 80 women entering or re-entering the workforce. Several state-based sites also participated in Harmony Week, sharing heritage foods and learning about each other’s culture. Our culture reflects the diverse experiences of our employees. We established a Diversity and Inclusion Committee in 2023 to promote awareness and engagement. The committee fosters a culture of acceptance and belonging, leveraging diverse backgrounds to drive innovation. In 2024, the D&I Committee launched a Connec+ intranet page to communicate its mission and celebrate differences, providing monthly awareness topics for all employees. Employee Wellness Brickworks supports employee mental and physical well-being through various initiatives. We observe R U OK? Day and Men’s Health Week to raise awareness. Onsite physiotherapy, annual massage days, and flu vaccinations contribute to physical health and stress relief. In addition, we provided manual handling training by a qualified physiotherapist and offer Mental Health First Aider training to help employees support each other’s mental health. Brickworks Annual Report 2024 p 69 Our Employee Assistance Program (EAP) offers resources on personal relationships, financial guidance, and wellness. We also co-host monthly ‘Lunch and Learn’ sessions on wellness topics. These events are a great way to continue to support our employees’ mental health and wellbeing. Our healthcare plan in North America includes preventive services. At-risk employees receive free, confidential in-home test kits from our health insurance partner. We continue to offer competitive healthcare benefits to attract and retain employees, emphasizing preventive care and cancer screenings. 70 p Brickworks Annual Report 2024 Our Global Workforce Workplace Relations At Brickworks, we uphold our employees’ right to Freedom of Association, as mandated by the Fair Work Act 2009 (Cth). Employees can choose whether to join industrial associations (such as unions) and decide on representation. In Australia, we have 15 enterprise agreements covering 292 employees, or 30.6% of our workforce. These agreements typically span two to three years, aligning with current operations and the evolving industrial landscape. Through good faith collective bargaining, we aim for mutually beneficial agreements that support both employees’ well- being and the company’s success. Our collaborative approach ensures fair and equitable employment conditions, supporting sustainable outcomes. North America operates eight manufacturing plants - four union and four non-union. In 2024, we negotiated a collective bargaining agreement (CBA) at the Hanley plant in Pennsylvania and are in discussion for our Mid-Atlantic plant. Brickworks Supply Centres in North America have six CBAs covering 9-yard locations with 38 truck drivers and yard workers. Compliance A number of Fair Work conciliations have resulted in settlements, with no fines or non-monetary sanctions received in FY2024. Percentage of Employees Covered by Collective Bargaining Agreements Australia1 North America2 Global Collective Bargaining Agreement 75.8% 62.4% 68.5% No Agreement 24.2% 37.6% 31.5% Composition of Collective Bargaining Agreements Union Based 60.6% 100% 80.2% Non-Union Based 39.4% 0.0% 19.8% 1 Wages Employees Australia 2 Labour / Distribution Employees North America Brickworks Annual Report 2024 p 71 Brickworks Annual Report 2024 p 71 Bathurst Street Bowral Bricks in Simmental Silver Sydney, NSW 72 p Brickworks Annual Report 2024 17 W Girard Avenue Sunset Flashed Smooth Ironspot Philadelphia, Pennsylvania Brickworks Annual Report 2024 p 73 Board of Directors Robert D. Millner AO FAICD Chairman Mr R. Millner is the non-executive Chairman of the Board. He first joined the Board in 1997 and was appointed Chairman in 1999. Mr Millner brings to the Board broad corporate, investment, portfolio and asset management experience gained across diverse sectors including telecommunications, mining, manufacturing, health, finance, energy, industrial and property investment in Australia and overseas. He is an accomplished company director with an extensive understanding of governance and compliance, reporting, media and investor relations. Mr Millner was awarded an Officer of the Order of Australia in June 2023 for "distinguished service to business, to rugby union as an administrator, and to the community through philanthropic contributions”. He is a member of the Remuneration and Nomination Committee. Mr Millner holds directorships in the following listed companies: ◗ Aeris Resources Limited ◗ Apex Healthcare Berhad ◗ BKI Investment Company Limited ◗ New Hope Corporation Limited ◗ TPG Telecom Limited ◗ Tuas Limited ◗ Washington H Soul Pattinson & Company Limited During the last three years, Mr Millner also held a listed company directorship in Milton Corporation Limited (delisted from ASX October 2021). Lindsay R. Partridge AM BSc. Hons. Ceramic Eng, FAICD, Dip. CD Managing Director Mr Partridge was appointed CEO in 1999, Managing Director in 2000 and retired on 31 July 2024. He is a qualified ceramic engineer and has extensive commercial, manufacturing, marketing, technical and operational experience including numerous senior management positions he has held in the building products manufacturing sector in Australia and the USA. Since his appointment as Managing Director Brickworks has grown significantly in terms of size and profitability and successfully expanded into industrial property development. He is an experienced company director with substantial expertise in governance, human resources, compliance reporting, media, investor relations and mergers and acquisitions. He was awarded the Member of the Order of Australia in 2012 for services to the Building and Construction Industry, particularly in the areas of industry training and career development. In 2018 he was awarded the esteemed “Sir Phillip Lynch Award”, by the Housing Industry Association in recognition of his immense contribution to the Housing Industry. 74 p Brickworks Annual Report 2024 Malcolm P. Bundey B.Bus (Accounting), GAICD Deputy Chair Mr Bundey is the non-executive Deputy Chair. He first joined the Board in October 2019 and was appointed Deputy Chair in June 2024. Mr Bundey has valuable experience as a CEO and Managing Director with particular expertise in managing complex global manufacturing operations including as CEO of Pact Group, CEO of Evergreen Packaging, CEO of Graham Packaging and CEO of Closure Systems International. These companies each operated multi-location and geographical plants across a wide range of regulatory jurisdictions including Australia, North America, Europe, Asia and South America. Mr Bundey also has extensive financial experience having been a CFO at Goodman Fielder and a partner at Deloitte. He has in-depth knowledge of the health, safety and environment risks associated with manufacturing operations and expertise in mergers and acquisitions and asset management. He is Chair of the Remuneration and Nomination Committee, a member of the Audit and Risk Committee and the Independent Board Committee. Mr Bundey has no current listed company directorships and has held no other listed company directorships in the last three years. Deborah R. Page AM B.Ec, FCA, FAICD Non-executive Director Mrs Page was appointed to the Board in July 2014. Mrs Page has extensive financial expertise, having been a partner at Touche Ross/KPMG Peat Marwick, and a senior executive with the Lend Lease Group, Allen Allen and Hemsley and the Commonwealth Bank. She has specific experience in corporate finance, accounting, audit, mergers and acquisitions, capital markets, insurance and joint venture arrangements. Mrs Page also has extensive experience as a company director gained across ASX-listed, private, public sector and regulated entities including in the telecommunications, utilities, insurance, technology, renewables, funds management and infrastructure sectors. As an experienced director and Audit and Risk Committee Chair her skills also include Board leadership, governance, risk management and compliance. Mrs Page is the Lead Independent Director and Chair of the Independent Board Committee, Chair of the Audit and Risk Committee and a member of the Remuneration and Nomination Committee. Mrs Page is a member of Chief Executive Women and was appointed as a member of the Takeovers Panel in March 2022. Mrs Page holds directorships in the following listed companies: ◗ Growthpoint Properties Australia Limited ◗ Magellan Financial Group Limited ◗ The Star Entertainment Group Limited During the last three years, Mrs Page also held listed company directorships with Pendal Group Limited (resigned January 2023) and Service Stream Limited (retired April 2023). Board of Directors Brickworks Annual Report 2024 p 75 The Hon. Joel A. Fitzgibbon GradCertBA, GAICD Non-executive Director Mr Fitzgibbon was appointed to the Board in January 2023. Mr Fitzgibbon has extensive government experience having served in the House of Representatives from 1996 to 2022, representing the New South Wales seat of Hunter. He served as Minister for Defence in 2007–2009, Minister for Agriculture, Fisheries and Forestry in 2013 and was Chief Government Whip in the House of Representatives from 2010 to 2013. Mr Fitzgibbon has considerable expertise in public policy, social and environmental issues. He is a member of the Remuneration and Nomination Committee, the Audit and Risk Committee and the Independent Board Committee. He serves on the Advisory Board of Serco Asia Pacific, and is retained by CMAX Advisory. Mr Fitzgibbon is also an Ambassador for the Australian Saudi Business Forum and the Commando Welfare Trust. He also Co-Chairs the AUKUS Forum, serves on the Board of the Crawford fund and is a Governor with the American Chamber of Commerce in Australia. He is also the sole director of Fitzgibbon Advisory Pty Ltd. Mr Fitzgibbon has no current listed company directorships and has held no other listed company directorships in the last three years. Robyn N. Stubbs B.Bus, M.Sc., GAICD Non-executive Director Ms Stubbs was appointed to the Board in January 2020. Ms Stubbs has valuable operational experience in property leasing, sales and marketing, strategy and new product development having spent more than 25 years in senior sales and marketing roles in the media and property sectors. Most recently Ms Stubbs was General Manager of Retail Leasing at Stockland and prior to this she held property management, sales and marketing roles at Lend Lease, Fairfax, Network Ten and Unilever. Ms Stubbs’ skills also include mergers and acquisitions, capital markets, governance, risk management and compliance. She is a member of the Remuneration and Nomination Committee, the Audit and Risk Committee and the Independent Board Committee. Ms Stubbs is currently a director of HMC Funds Management Limited (as the responsible entity of the HomeCo Daily Needs REIT). During the last three years, Ms Stubbs also held listed company directorships in: ◗ Aventus Group (which merged with HomeCo Daily Needs REIT in March 2022) ◗ Inghams Group Limited (resigned June 2023) Todd J. Barlow B.Bus, LLB(Hons) Non-executive Director Mr Barlow was appointed to the Board on 14 June 2024. Mr Barlow has extensive experience in mergers and acquisitions, equity capital markets and investing. His career has spanned positions in law and investment banking in Sydney and Hong Kong. Mr Barlow has been CEO and Managing Director of Washington H Soul Pattinson & Company Limited (Soul Patts) since 2015, having previously been the Managing Director of Pitt Capital Partners Limited for 5 years. He has extensive listed company experience and has been responsible for numerous Soul Patt’s investments since joining the Soul Patts Group in 2004. Mr Barlow has a Bachelor of Business and Bachelor of Laws (Honours) from the University of Technology, Sydney. He is a member of the Remuneration and Nomination Committee. Mr Barlow holds a listed company directorship in Washington H Soul Pattinson & Company Limited. During the last three years, Mr Barlow also held a listed company directorship with New Hope Corporation Limited (resigned on 30 June 2024). Kaggarabah GB Masonry Wedge Breeze Block and Nubrik Lygon Coffee, Belmore Grey and Domain Terracotta Eight Mile Plains, QLD 76 p Brickworks Annual Report 2024 76 p Brickworks Annual Report 2024 Ace Hotel UrbanStone Australian Granite Pavers Surry Hills, NSW Brickworks Annual Report 2024 p 77 Executive Management Mark Ellenor B.Bus Chief Executive Officer Mr Ellenor was appointed to the position of Chief Executive Officer in April 2024. Mr Ellenor started with Austral Bricks in the graduate program in 1999, progressed through management, and was promoted to General Manager Eureka Tiles in 2006, General Manager Austral Bricks NSW in 2009, General Manager Austral Bricks Australia in 2017 and Group General Manager Austral Bricks and Bristile Roofing in 2018. Mr Ellenor was President of Brickworks North America for five years where he led the successful expansion into North America and extensive plant consolidation program that followed. He assumed the role of Executive General Manager Building Products in August 2022 overseeing all Building Products businesses in Australia and North America. In August 2023, Mr Ellenor returned to Australia and was appointed Chief Operating Officer of the Brickworks Group with responsibility across the Building Products, Property and Development businesses. Mr Ellenor has a Bachelor of Business from the University of Newcastle and has completed the Stanford Executive Program and Wharton Executive Education Program. Grant Douglas Hons BCompt, CA, GAICD Chief Financial Officer Mr Douglas was appointed Chief Financial Officer in August 2022. Mr Douglas is a Chartered Accountant with extensive international experience in both professional services and senior finance leadership roles focussed on listed Australian and international companies. He joined Brickworks in 2011 and has worked across multiple senior finance roles in Australia and as Executive Vice President – Finance for Brickworks Building Products – North America from 2018 to 2022, where he was integral in the establishment and growth of the North American business. He is responsible for all IT and financial operations of the business including group accounting and taxation, treasury, banking and finance and investor relations. Megan Kublins BS (Arch), B Arch Executive General Manager – Property & Development Ms Kublins was appointed General Manager Property in November 2001 and became Executive General Manager Property in 2006. Ms Kublins has over 30 years’ experience in the property industry gained in public and private organisations in the capacity of both landowner and developer. She manages all of Brickworks property assets, including over 5,000 hectares of land. Her primary focus is to identify value creation opportunities within this portfolio. She is responsible for the growth and management of the Goodman/Brickworks JV, which was established and grown under her direction. She has completed the Stanford Executive Program. 78 p Brickworks Annual Report 2024 Executive Management David Fitzharris Executive General Manager – Brickworks Australia (Building Products) Mr Fitzharris was employed by Brickworks in 1987 and for the past 37 years has held various senior executive positions. He was promoted from his position as East Coast General Manager Austral Bricks to the role of Group General Manager Brickworks Sales in 2003 and then Group General Manager Austral Bricks in February 2019, and more recently in 2024, promoted to Executive General Manager – Brickworks Australia. He is involved in the strategic direction of building products operations in Australia and has responsibility for all manufacturing, sales, customer service and import/export activities, and has actively developed key customer relationships across all business divisions. Mr Fitzharris also represents Brickworks in a number of industry associations and is currently on the Board of Think Brick Australia and CMMA. Susan Leppinus B.Ec, Llb, Grad Dip App Fin Company Secretary and General Counsel Ms Leppinus was appointed Company Secretary and General Counsel in April 2015. Ms Leppinus is admitted to practice in NSW and has over 19 years’ experience as a company secretary and general counsel. She has worked closely with boards and senior management in ASX 200 companies, and has significant experience in mergers and acquisitions, contract negotiation, corporate governance, corporate and commercial law. She is responsible for the legal governance and company secretarial functions of the Group, including liaising with the ASX, ASIC and other regulatory bodies. Ransom District Library Ebonite Smooth and Velour Plainwell, Michigan Brickworks Annual Report 2024 p 79 Harriet's House Austral Bricks Access in Ash and Yarra in Richmond Launceston, TAS 80 p Brickworks Annual Report 2024 389 Weirfield Ebonite Velour Brooklyn, New York Brickworks Annual Report 2024 p 81 Corporate Governance The Brickworks Limited (Company) Board is committed to developing and maintaining good corporate governance and recognises that this is best achieved through its people and their actions. The Company’s long-term future is best served by ensuring that its employees have the highest levels of honesty and integrity and that these employees are retained and developed through fair remuneration. It is also critical to the success of the Company that an appropriate culture is nurtured and developed, starting from the Board itself. Brickworks full Corporate Governance Statement which provides detailed information about governance at Brickworks is available on Brickworks’ website at www.brickworks.com.au Brickworks Governance Framework Brickworks Board Brickworks senior management ◗Delegated limits of authority to manage the Company other than matters reserved to the Board or as otherwise delegated to a Board Committee Brickworks Managing Director, Chief Executive Officer and Chief Financial Officer ◗Remuneration policies, practices and related disclosure ◗Board and Committee membership and renewal including director nominations ◗Executive succession planning Remuneration & Nomination Committee ◗To consider and make recommendations to the board when circumstances exist or proposals are received when the interests of Soul Patts may differ from the interests of Brickworks and other shareholders in Brickworks Independent Board Committee ◗Financial reporting, internal and external audit ◗Risk management framework and strategy, risk appetite and risk profile ◗Oversight of sustainability and climate related risks and opportunities Audit & Risk Committee Management and oversight The Board The Brickworks Board is responsible for the leadership, oversight, development strategy and long-term success of the Group. The Board works with management to consider specific issues relevant to the overall conduct of our businesses – including strategy, safety, sustainability, annual budget and major acquisitions and disposals. There are six non-executive Directors on the Brickworks Board, 33% of which are women. The independence of non-executive Directors is considered annually and the Board has determined that four non-executive Directors are independent. We ensure the Board has the appropriate blend of skills, knowledge and experience, from a wide range of industries, backgrounds, necessary to lead the Group. In 2024, there were 10 full meetings of the Board. Board Committees The Board has established three permanent Committees to assist in the execution of its responsibilities. The current permanent Committees are the Audit and Risk Committee, the Remuneration and Nomination Committee and the Independent Board Committee. The role of these Committees is to provide strategic direction, oversight and assurance on the specific objectives set for each Committee. The Chairman of each Committee reports to the Board on its deliberations and minutes of Committee meetings are circulated to all Directors. Committee Chairs also attend the Annual General Meeting to answer questions from shareholders. Current membership and terms of reference of each Committee are available on our website. Board renewal, development and evaluation Our Directors are committed to ensuring the Board is diverse and appropriately balanced in terms of business experience, knowledge, skills and gender. All newly appointed Directors receive extensive briefing materials and the Chairman agrees an individually-tailored and comprehensive induction program. A review of Board effectiveness is carried out on an annual basis. This review takes into account the operation and performance of the Board and its Committees, and the effectiveness of Board communications. Compliance We have procedures in place to ensure compliance with our obligations under the applicable rules and regulations, including those issued by the Australian Securities Exchange. Ethical and responsible decision making ◗ The Board aims to ensure the Company continually builds an honest and ethical culture. ◗ Brickworks has an established code of conduct which centres on the Company and all Directors, senior management and employees conducting themselves with integrity in all business dealings. It also has Board policies and conducts training of employees in relation to these policies. ◗ Consistent with our commitment to act fairly, with honesty and integrity Brickworks has a Whistleblower Policy and has implemented Behonest@Brickworks an anonymous whistleblower service delivered by Deloittte. ◗ The Company also has an Anti-Bribery and Corruption Policy, Political Donations Policy, Securities Trading Policy and Modern Slavery Policy. Timely and balanced disclosure ◗ Brickworks is committed to keeping its shareholders informed about the Company’s activities. ◗ The Company aims to provide relevant information to shareholders in a timely manner which is supported by its Continuous Disclosure Policy. Safeguard integrity in financial reporting ◗ Brickworks’ process for verifying the integrity of periodic corporate reports not subject to audit or review by an external auditor is as follows: ◗ reports are prepared by, or under the supervision of, subject-matter experts; ◗ reports are reviewed for material accuracy; and ◗ information in a report that relates to financial projections, statements as to future financial performance or changes to the policy or strategy of the Company (taken as a whole) must be approved by the Board. ◗ The Board through the Audit and Risk Committee: ◗ monitors Company performance; and ◗ ensures the proper external reporting of financial information. 82 p Brickworks Annual Report 2024 Corporate Governance Recognise and manage risk ◗ To ensure robust and effective risk management systems are in place and operating effectively, the Board through the Audit and Risk Committee: ◗ determines the risk profile for the Company; ◗ ensures that business initiatives are consistent with its risk appetite; ◗ reviews the controls and systems in place to continually mitigate risk; ◗ monitors the results of a risk based internal audit program, and timely remediation of issues identified; and ◗ oversees reporting and compliance requirements. ◗ Risk management is a priority for the Board and senior management. Remunerate fairly and responsibly ◗ The Board through the Remuneration and Nomination Committee ensures that remuneration and nomination policies and practices are consistent with strategic goals. ◗ The Company’s remuneration and nomination policy is to: ◗ equitably reward executives with a mix of fixed remuneration, short-term and long-term incentives aimed at attracting and retaining executives who will create value for shareholders; and ◗ ensure appropriate succession planning is in place. ◗ Non-executive directors receive no incentive payments and there are no retirement benefits in place. Contributions to the retirement allowance plan for non-executive Directors were discontinued on 30 June 2003. Under legacy arrangements, non-executive Directors appointed prior to 30 June 2003 were entitled to receive benefits upon their retirement from office. These benefits were frozen with effect from 30 June 2003 and are not indexed. Since 30 June 2003 no new Directors have been entitled to join this plan. Brickworks Annual Report 2024 p 83 GB Masonry GB Veneer Arcadia in Smokey Ash Crows Nest, NSW 84 p Brickworks Annual Report 2024 St Francis Commons Mink Grey Wirecut, Toledo Grey Wirecut, Silver Birch Bronx, New York Brickworks Annual Report 2024 p 85 The Directors of Brickworks Limited present their report and the financial report of Brickworks Limited and its controlled entities (referred to as the Brickworks Group or the Group) for the financial year ended 31 July 2024. Directors The names of the Directors in office at any time during or since the end of the year are: ◗ Robert D. Millner AO FAICD (Chairman) ◗ Malcolm P. Bundey B.Bus (Accounting), GAICD (Deputy Chairman) ◗ Deborah R. Page AM B.Ec, FCA, FAICD ◗ Robyn N. Stubbs B.Bus, M.Sc., GAICD ◗ The Hon. Joel A. Fitzgibbon GradCertBA, GAICD ◗ Todd J. Barlow B.Bus, LLB (Hons) (appointed 14 June 2024) ◗ Michael J. Millner MAICD (retired 21 November 2023) ◗ Lindsay R. Partridge AM BSc. Hons. Ceramic Eng, FAICD, Dip. CD (retired 31 July 2024) Except for Todd Barlow, Michael Millner and Lindsay Partridge, all Directors have been in office for the full financial year and to the date of this Report. Each Director’s experience and special responsibilities are set out on pages 73 to 75 of this Annual Report. Details for each Director’s directorships of other listed companies held at any time in the three years before the end of the financial year and the period of which such directorships are held are: Robert D. Millner AO ◗ Aeris Resources Limited Appointed 2022 ◗ Apex Healthcare Berhad Appointed 2000 ◗ BKI Investment Company Limited Appointed 2003 ◗ New Hope Corporation Limited Appointed 1995 ◗ TPG Telecom Limited Appointed 2000 ◗ Tuas Limited Appointed 2020 ◗ Washington H. Soul Pattinson and Company Limited Appointed 1984 ◗ Milton Corporation Limited Appointed 1998 Delisted from ASX 2021 Deborah R. Page AM ◗ Growthpoint Properties Australia Limited Appointed 2021 ◗ Magellan Financial Group Limited Appointed October 2023 ◗ The Star Entertainment Group Limited Appointed March 2023 ◗ Pendal Group Limited Appointed 2014 Resigned January 2023 ◗ Service Stream Limited Appointed 2010 Retired April 2023 Robyn N. Stubbs ◗ Aventus Group Appointed 2015 (merged with HomeCo Daily Needs REIT) Ceased 2022 ◗ Inghams Group Limited Appointed 2021 Resigned June 2023 Todd. J Barlow ◗ Washington H. Soul Pattinson and Appointed 2015 Company Limited ◗ New Hope Corporation Limited Appointed 2015 Resigned June 2024 Company Secretary ◗ Susan L. Leppinus B.Ec; Llb; Grad Dip App Fin Directors’ Report 86 p Brickworks Annual Report 2024 Principal activities The Brickworks Group manufactures a diverse range of building products throughout Australia and North America, engages in development and investment activities to realise surplus manufacturing property, and participates in diversified investments as an equity holder. Consolidated result of operations The consolidated net loss for the year ended 31 July 2024 of the Brickworks Group after income tax expense, amounted to $118,885,000 compared with net profit of $394,694,000 for the previous year. The loss was primarily due to non-cash asset impairment in the building products business and unrealised property devaluations in the joint venture property operations. Dividends The Directors recommend that the following final dividend be declared: Ordinary shareholders – 43 cents per share (fully franked) The record date for the final ordinary dividend will be 5 November 2024, with payment being made on 27 November 2024. Dividends paid during the financial year ended 31 July 2024 were: (a) Final 2023 ordinary dividend of 42 cents per share (fully franked) paid on 22 November 2023 (2022: 41 cents). (b) Interim 2024 ordinary dividend of 24 cents per share (fully franked) paid on 1 May 2024 (2023: 23 cents). Review and results of operations A review of Brickworks Group operations and the results for the year is set out on pages 5 to 37 and forms part of the Directors’ Report. State of affairs There were no significant changes in the state of affairs of the Brickworks Group during the year, other than those events referred to in the Review of Operations and Financial Performance and the Financial Statements. After balance date events No matter or circumstance has arisen since the end of the financial year that has significantly affected the current financial year, or may significantly affect in subsequent financial years: ◗ the operations of the Brickworks Group; ◗ the results of those operations; or ◗ the state of affairs of the Brickworks Group. Likely developments and expected results of operations The Review of Operations gives an indication of likely developments and the expected results of operations in subsequent financial years. Sustainability We continue to improve our sustainability performance, delivering a positive impact for our stakeholders. In FY2020, the Brickworks Board approved the Sustainability Strategy “Build for Living: Towards 2025”. The strategy sets a clear pathway, with measurable commitments, to promote positive environmental and social impacts, with strong governance and a culture of care for our community. The strategy is available on our website www.brickworks.com.au. During FY2020, Brickworks also finalised a plan to meet the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), publishing our first TCFD Statement in early 2022. This year we have combined our climate related disclosures and sustainability report into one report. Since the initial release of our Towards 2025 strategy in 2020, Brickworks completed several acquisitions in North America. There has been good progress towards our achieving our targets set in 2020 and we are now increasing our sustainability strategy targets to encompass our operations in Australia and North America. Our greenhouse gas reduction strategy roadmap to the recognised standard of the Task Force on Climate-related Financial Disclosures (TCFD) recommendations, includes risk management disclosures, metrics and targets. In FY2023 we announced our carbon target: to achieve a 15% reduction in greenhouse gas emissions by 2030, from a 2022 baseline, across our combined Australian and North American business. Progress against this target is discussed in the 2024 Sustainability Report. Our approach to climate change is integrated into our increased sustainability strategy targets and focuses on: ◗ investment into renewable energy and continued investment into developing feasible renewable biomethane opportunities, ◗ increased sustainable products target to increase volume of verified sustainable products volume, ◗ increased investment into research and development into the next generation clay brick and concrete block wall system. In FY2024 we continued to progress our climate related governance through developing a skills matrix and training schedule for the board, enhancing our risk identification and management, incorporating ESG KPIs into remuneration and advancing our work on Scope 3 emissions for Brickworks Building Products in Australia and North America. The 2024 Sustainability Report, available at www.brickworks.com. au, provides detailed information about environmental, social and governance performance over the last financial year including our North American operations and the increased targets. Environmental performance The Group is subject to various state and federal environmental regulations in Australia and the United States. Many sites also operate under additional requirements issued by local government. There is significant environmental regulation requiring compliance of Brickworks’ building products manufacturing and associated mining and quarry activities with legislation that often differs across and within each state. Due to the scale and diversity of the operation there is a risk of non-compliances occurring. To manage these risks, Brickworks continually improves management systems, compliance registers and procedures, in addition to the continuation of training, audit and assurance programs. Annual returns, performance statements and reports were completed where required for each licence stating the level of compliance with site operating conditions. The Board places a high priority on environmental issues and is satisfied that adequate systems are in place for the management of Brickworks’ compliance with applicable environmental regulations Directors’ Report Brickworks Annual Report 2024 p 87 under the laws of the Commonwealth, States and Territories of Australia, and that development and implementation of equivalent systems is underway to manage compliance with the corresponding regulations under the laws of the United States. During FY2024, Brickworks’ subsidiary in North America received fines totalling USD 10,800 in September 2023 resulting from two fines from one contractor-related unauthorised stormwater discharge in May 2023 as disclosed to the regulator. To avoid reoccurrence, full corrective action has been taken including a water and waste corrective action plan with revised procedures and retraining. Brickworks is not aware of any pending prosecutions relating to environmental issues. The Directors are not aware of any material non-compliance with environmental regulations pertaining to the operations or activities during the period covered by this Report which would materially affect the business as a whole. Further information regarding Brickworks approach to environmental performance, compliance and approach to environmental management and sustainability is set out on pages 46 to 61. Risk Management The Board of Brickworks has adopted a Risk Management framework that identifies Risk Tolerance and Risk Appetite for the Group and then considers how each identified risk is placed within that framework. That framework involves assessment of the likelihood of an event occurring, followed by the consequence of each event. The consequence is considered across six categories, Financial, Health & Safety, Business Disruption, Legal/Compliance, Reputation and Environmental/Sustainability. The significant risks that may impact the achievement of the Group’s business strategies and financial prospects are: Building Products The achievement of business objectives in the Building Products Group may be impacted by the following significant risks: Risk Mitigation Energy Supply – reliability and cost of gas and electricity Energy requirements are managed through retail energy agreements. For the east coast Australian operations, Santos supplies gas under a long-term agreement, and the energy division manages the day-to-day wholesale market risks. The North American operations have long-term gas contracts in place. Insurance coverage mitigates the risk of interruption to electricity and gas supply. Serious Safety Incidents The Group has a strong and evolving safety culture and notwithstanding a well-developed WHS system (refer further “Health and Safety”) the Group actively seeks initiatives to improve and refine health and safety practices. Safety audits, risk assessments and networking channels ensure the Group WHS systems remain up to date and in alignment with regulator and industry standards. Health and safety programs in the North American business are being aligned to the Australian operations establishing a common approach across the business internationally. Brickworks recognises the importance of managing psychosocial health and is committed to providing a supportive, productive, and healthy work environment for all employees. This commitment is clearly stated within the company's health and safety policy statement. The company has implemented mental health awareness programs, provided access to professional counselling services, and established an ongoing Mental Health First Aid program with over 100 qualified Mental Health First Aiders. This program equips employees to support harmonious and productive work environments. Environmental incident The Group has a strong commitment to environmental protection and a comprehensive environmental compliance system. The Group continues to focus on implementing equivalent systems in the expanding North American business. Products – alternative products and product failure The Group has a strong focus on research, development and quality control. The Group monitors market trends and has strategies to diversify its range of building products and its marketing approach including a strong focus on the development of carbon neutral products. Shift in housing trend The Building Products business has significant exposure to the detached housing market. Over the past two decades there has been a trend towards multi-residential construction. The Group has implemented initiatives to increase exposure to the multi- residential segment. This includes expanding the product range (for example masonry products, brick facing systems) and increasing sales and marketing efforts in the commercial and multi-residential segments. New competitor Whilst barriers to entry within the Building Products business are significant, the Group monitors its Australian and North American markets for both domestic manufacturing and import competitors. To defend against the threat of new competitors, the Group has a strategy to invest in its operations to maintain a low-cost position and high quality product, and is focussed on research and development and customer relationship initiatives. 88 p Brickworks Annual Report 2024 Production capacity In both its Australian and North American operations, the Group manages production capacity by adroit management of its manufacturing base to correlate production to cyclical market conditions as they occur. Production capacity is underpinned by a long-term strategy of plant upgrades moving to more efficient plants. In this way the Group is able to meet customer demand at the top of the cycle and pare back capacity through periods of lower demand. Business Interruption – plant failure or underutilisation and raw material supply The business has multiple production facilities across Australia and North America, with products able to be transported long distances if required. No single plant so large as to represent an existential threat to the whole operation. The major facilities have rolling risk reviews and reporting by outside parties. The business also maintains significant insurance policies to manage the risk associated with physical loss of assets and any loss of income from an insurable interruption. Raw materials are generally secured through ownership of raw material reserves and maintaining prudent raw material stockpiles. Asbestos and other respirable dust risk An asbestos management plan is in place. Building cladding is regularly removed and replaced with non-asbestos based materials. Where any friable asbestos is found, either within a plant or during rehabilitation, it is immediately quarantined and removed by qualified reputable contractors, using the most diligent safety standards. Respirable crystalline Silica is deemed carcinogenic, and a crystalline silica management plan is in place. Brickworks employs its own occupational hygienist to manage this important area. This qualified professional ensures that the company adheres to the highest safety standards and regulatory requirements. A rigorous monitoring and testing program has been implemented to regularly assess and manage risks related to asbestos, crystalline silica, and other hazardous materials, in compliance with government regulations. This program includes continuous health monitoring and dust exposure measurements at all operational sites, ensuring the safety and well-being of all employees. Market Risk – deteriorating market conditions The Group closely monitors economic indicators and utilises independent market forecasts for business planning purposes. Investments have been made to expand the product portfolio and geographic exposure, in order to reduce the risks associated with declines in any specific market. Failure to execute North American bricks strategy effectively The Group is currently pursuing growth in North America (following an initial entry in 2019 and a number of subsequent acquisitions). Performance to date is lagging the initial business case, due to the general macroeconomic environment in the wake of the global pandemic that has impacted operations and sales activity. However, underlying progress against the strategy is well advanced, with a significant rationalisation plan now completed and significant investments made in plant upgrades and sales and marketing initiatives. Group The achievement of business objectives in the Group activities may be impacted by the following significant risks: Risk Mitigation Financing Risk The Group maintains conservative gearing levels in recognition of the industry’s cyclical nature. Senior debt facilities are maintained with financial lenders with whom an open and transparent relationship is maintained. Multi-currency facilities (AUD and USD) are maintained over various tenors ranging from 2 to 7 years. Cyber Security Risk The Group has identified its primary cybersecurity threats as phishing attacks aimed at obtaining sensitive company or private information and malicious attacks that compromise the system. In response, investment in premium security platforms and technology has been increased, and risk controls have been implemented, including the uplift of identity management, privileged access and 24/7/365 security anomaly incident response monitoring across all company system environments. Preventative measures include regular system penetration tests, comprehensive employee training and investment in incident response exercises. Additionally, new state-of-the-art endpoint protection software and robust firewall protection have been deployed. A disaster recovery (DRP) and business continuity plan (BCP) are established across the organisation. Climate related risk Brickworks is aligning its greenhouse gas reduction strategy with the recognised standard of the Task Force on Climate- related Financial Disclosures (TCFD) recommendations, including risk management disclosures, metrics and targets. Brickworks undertook a review of climate change risks across both the Australia and North America Building Products operations. The review identified and assessed transitional and physical climate-related risks. The identified risks were then rated in accordance with Brickwork’s risk matrix adopting the TCFD framework and horizons of 2030 and 2050. Focus risks include volatility in fossil fuel availability and prices particularly gas and costs of transitioning to a low carbon future. Opportunities were also incorporated into the review. The Group has developed a new carbon target: to achieve a 15% reduction in Scope 1 and Scope 2 greenhouse gas emissions by 2030, from a 2022 baseline, across the combined Australia and North American businesses. The Sustainable Products program includes the development of products that hold leading sustainable qualities including expanded carbon neutral offerings. These strategic responses are outlined in our Sustainability Report. Directors’ Report Brickworks Annual Report 2024 p 89 Property The achievement of business objectives in Land and Development may be impacted by the following significant risks: Risk Mitigation Market Risk The industrial property cycle may deteriorate, resulting in softening capitalisation rates and lack of growth. The Group manages the risk by monitoring the key economic drivers, employing property professionals who understand the property cycle and undertaking development in joint venture with Goodman Group. Industrial Action Industrial action may delay development projects. The Group manages this risk by working with joint venture partner Goodman to respond appropriately to any action that occurs. Serious Safety Incidents The Group has a strong safety culture and a well-developed WHS system (refer further “Health and Safety”). Property Trust Financing The joint property trusts maintain facilities with multiple lenders with various tenors between 5-10 years. In addition, gearing is maintained at prudent levels through the property cycles. Rezoning Risk The Group takes a long-term approach to achieving the highest and best use for each property. The rezoning process for a property usually commences prior to finalisation of its existing use. Investments The achievement of business objectives in Investment activities may be impacted by the following significant risks: Risk Mitigation Market Risk The Group’s investment in Soul Patts is subject to market movements and the underlying performance of Soul Patts. The Soul Patts investment is diversified across industries other than those in which the balance of Brickworks specialises, which provides a stable stream of dividends over the long term. The Soul Patts group may have significant exposure to the natural resources and telecommunications markets. Meetings of Directors The number of meetings of directors (including meetings of committees of directors) held during the year and the number of meetings attended by each director are set out below. All directors were eligible to attend all director and committee meetings held, excluding the Independent Board Committee. Directors’ Meeting Audit and Risk Committee Remuneration and Nomination Committee Independent Board Committee Number of Meetings held: 10 3 2 1 Number attended: R D Millner 10 N/A 2 N/A D R Page 10 3 2 1 M P Bundey 10 3 2 1 R N Stubbs 10 3 2 1 J A Fitzgibbon 9 2 2 1 T J Barlow (appointed 14 June 2024) 2 N/A 1 N/A M J Millner (retired 21 November 2023) 3 N/A 1 N/A L R Partridge (retired 31 July 2024) 10 N/A N/A 1 Directors Interests As at 31 July 2024, Directors had the following relevant interests in Brickworks shares: Director Ordinary Shares R D Millner 4,817,967 M P Bundey 3,970 D R Page 17,400 R N Stubbs 1,000 J A Fitzgibbon 500 T J Barlow 2,000 L R Partridge 130,406 * In addition, Lindsay Partridge has been allocated 20,558 STI Deferred shares and 141,385 ERP awards on terms subject to performance criteria outlined in the remuneration report. As at 31 July 2024, there were no contracts entered into by Brickworks or a related body corporate to which any Director is party, or under which any Director is entitled to benefit nor were there any contracts which confer any right for any Director to call for or deliver shares in, debentures of, or interests in a registered scheme made available by Brickworks or a related body corporate. 90 p Brickworks Annual Report 2024 90 p Brickworks Annual Report 2024 Point Leo Bowral Bricks in Chillingham White Mornington Peninsula, VIC Brickworks Annual Report 2024 p 91 On behalf of the Board of Directors, I am pleased to provide you with the FY 2024 Remuneration Report for which we are seeking your approval at the upcoming annual general meeting. Our People The safety of our people is always our primary concern and is a key measure of performance at Brickworks. Pleasingly our total recordable injury frequency rate per million hours worked (TRIFR) reduced to 9.71 at 31 July 2024 from 10.7 at 31 July 2023 as we continue to target a reduction of injury rates year on year. Operational and Financial Performance In FY2024 Brickworks continued delivering on several key growth initiatives to support future shareholder value growth. This performance was a direct result of the considerable efforts of our entire Brickworks team in a challenging market environment, led by our senior executives. Operational Operationally the Company achieved a number of key strategic objectives this year including: ◗ Substantial completion of our Oakdale West Estate, which is now one of the most valuable industrial property precincts in Australia. ◗ Securing development approval for our Oakdale East Stage 2 Estate, and the start of construction of the cornerstone facility for Amazon. ◗ An uplift in underlying EBITDA from our building products operations in Australia and North America, despite difficult market conditions. ◗ Substantial completion of our new brick plant in Sydney – the most advanced brick production facility in the country. ◗ Completion of our plant rationalisation program in North America (reducing from 16 operating plants to 8), creating a more efficient and cost-effective network for future operations. ◗ A $263 million increase in the value of the Company’s listed investments in Soul Patts (ASX: SOL) and FBR (ASX: FBR). Chairman of the Remuneration and Nomination Committee Letter 1 The FY2023 TRIFR has been restated to reflect the date of injuries being incurred (rather than the treatment date). 92 p Brickworks Annual Report 2024 Directors’ Report Financial FY2024 results were impacted by significant headwinds caused by global inflation, high interest rates and challenging labour and construction markets: ◗ The annual EBIT from continuing operations (before significant items) generated by Building Products Australia has decreased from $52.8 million in FY2023 to $41.3 million in FY2024 primarily on account of softer market conditions in the building industry. ◗ The annual EBIT (before significant items) generated by Brickworks North America has increased from $12.8 million in FY2023 to $13.7 million in FY2024. This included an EBIT of $0.3 million arising in respect of Property transactions (2023: $6.5 million). Excluding the impact of property transactions, EBIT was significantly up from $6.3 million in FY2023 to $13.4 million in the current year. ◗ The annual EBIT (before significant items) generated by the Property division in Australia has reduced from a profit of $505.5 million in FY2023 to a loss of $110.0 million in FY2024. This was primarily on account of non-cash property devaluation of $215.0 million recognised in the current year compared to the revaluation gains of $112.4 million in FY2023. Furthermore, the prior year EBIT included a gain of $262.6 million recognised in respect of the Oakdale East Stage 2 sale into the JV Property Trust. ◗ The Underlying Shareholder Return on NTA – excluding equity accounted investment in Soul Patts – demonstrated a reduction from 24.7% to a negative of 6.2% compared to the prior year primarily on account of significant property devaluations recognised in the current year. ◗ Statutory Group NPAT (after significant items) in FY2024 amounted to a loss of $118.9 million compared to a profit of $394.7 million in FY2023. This was primarily driven by a significant reduction in Property EBIT, including non-cash devaluation recognised in the current year, as well as impairment losses recognised as at 31 July 2024 in respect of Austral Masonry and Brickworks North America. Capital Management ◗ The Group annual operating cash flow increased from $97.1 million to $104.0 million. The increase was achieved despite the softening market conditions in Australia and the high-interest rate environment in Australia and North America. This increase was primarily driven by an improvement in Building Products cash flow and increased Property distributions, partially offset by increased interest costs. Property sales in Australia and North America contributed an additional cash flow of $120.8 million compared to $28.4 million last year. This included $117.3 million representing the Group’s share of proceeds from the M7 asset sales by the Property Trust. ◗ Brickworks has preserved its strong balance sheet position and conservative debt metrics whilst at the same time continuing to grow the dividends paid to shareholders from 65.0 to 67.0 cents. At 31 July 2024 Brickworks maintained a significant level of headroom in respect of its key debt covenant metric. The Gearing Ratio as calculated in line with debt agreements was at 15.5% which was well below the covenant threshold of 40%. Leverage and the Interest Cover covenants do not apply unless the Gearing Ratio exceeds 22.5%. For the year ended 31 July 2024 the Leverage ratio was at 4.31x (compared to a covenant of <3.5x) and the Interest Cover was 3.32x (compared to a covenant >3.5x) with both ratios reflecting the cyclical low in the building products industry. For more detail on the Company’s operational and performance, please refer to the operational and financial results within the Directors’ report. Remuneration Outcomes in FY2024 We continue to ensure that remuneration outcomes reflect the performance of the Group and are aligned to shareholder’s experience over short and long-term timeframes. The key remuneration outcomes for the 2024 financial year included: Executive Incentives Short Term Incentives (STI) ◗ Recognising the Company’s financial performance in the challenging market environment, as well as leadership and achievement of non-financial KPIs during FY2024, the Board awarded 50% of the maximum annual STI opportunity to the Managing Director, Mr Lindsay Partridge, the Chief Executive Officer, Mr Mark Ellenor, and the Chief Financial Officer, Mr Grant Douglas, noting that financial and non- financial metrics set at the beginning of the year to trigger this, were partially achieved. ◗ Importantly, the Remuneration and Nomination Committee determined that the quality of earnings measure was not met following consideration of the Building Products impairments and the Return on Net Tangible Assets for the Group. As a result, 12.5% of the potential annual STI opportunity for the Managing Director, Chief Executive Officer and Chief Financial Officer was forfeited. ◗ The Executive General Manager Building Products Australia David Fitzharris achieved 72% of the target annual STI opportunity reflecting the Austral Bricks division performance. The Executive General Manager, Property and Development, Mrs Megan Kublins achieved 51% of the target annual STI opportunity based on consideration of divisional performance excluding property devaluations on a consistent basis with prior years. Brickworks Annual Report 2024 p 93 Long term incentives (Current Executive Rights LTI Plan) ◗ In FY2023 after approval from shareholders the Board awarded an LTI of 75% of fixed remuneration to the Managing Director, Mr Lindsay Partridge, and 60% of fixed remuneration to the Chief Operating Officer, Mr Mark Ellenor (subsequently promoted to the Chief Executive Officer role) and the Chief Financial Officer, Mr Grant Douglas, to be tested against absolute and relative TSR measures between 1 August 2023 and 31 July 2026. ◗ The Executive Rights Plan was introduced in 2019 and the second full allocation to the Managing Director under this plan occurred in FY2021 following shareholder approval and was tested on 31 July 2024. Managing Director’s retirement ◗ In April, Brickworks announced the retirement of its Managing Director, Lindsay Partridge. Lindsay’s final day with Brickworks was on 31 July 2024, after 39 years of service with the Company, including 25 years as leader. KMP remuneration disclosures include the final Managing Director’s retirement benefit recognised as an expense in FY2024 and paid in August 2024. ◗ An additional share-based payments expense was recognised in FY2024 in respect of the executive rights granted to the Managing Director in prior years. Lindsay’s outstanding executive rights will remain on foot subject to the existing TSR performance criteria and testing requirements in the future. ◗ Lindsay’s retirement benefit does not exceed the average of his annual base salary for the three years prior to his retirement. Remuneration in FY2024 Brickworks is a diversified international Building Products, Investments and Property company today. Retention of executives and highly skilled staff and pay for performance continues to be a high priority for the Brickworks Board. MD, CEO and CFO Remuneration Structure MD FY2024 CEO FY2024 CFO FY2024 Total Fixed Remuneration (TFR) (including car allowance and superannuation) on an annual basis $ 1,704,580 $ 1,050,000 $ 700,000 Short Term Incentive 75% of TFR at target 90% of TFR at maximum 60% of TFR at target 72% of TFR at maximum 60% of TFR at target 72% of TFR at maximum Long Term Incentive (subject to the relative and absolute TSR performance measures being met over three years) 75% of TFR 60% of TFR 60% of TFR Non-Executive Director Fees Having considered the Group’s Strategy and a benchmarking exercise undertaken by independent consultants in the prior year for non- executive director fees the Board resolved to increase non-executive director fees by 4% (inclusive of the 0.5% increase in the superannuation guarantee levy) taking effect from 1 July 2023. Total non-executive directors fees paid in FY2024 were $1,091,094. The current shareholder approved non-executive director fee pool approved by Shareholders at the 2022 AGM is $1,500,000 per annum. The Board remains committed to a remuneration framework that supports the Company’s strategic objectives, effectively aligns performance and rewards and motivates key executives. We value your support and continue to regularly engage with shareholders and proxy advisors on remuneration matters. I invite you to review the full report and thank you for your ongoing support. Malcolm Bundey Remuneration and Nomination Committee Chair 94 p Brickworks Annual Report 2024 The Remuneration Report has been audited in accordance with s300A of the Corporations Act 2001. 1 Overview 1.1 Executive Summary The Brickworks Board of Directors is committed to ensuring that its remuneration framework is focussed on driving a performance culture that is closely aligned to the achievement of the Company’s strategy and business objectives as well as the retention of key members of the senior management team. The Remuneration Report received overwhelming support from shareholders at the 2023 AGM with 98.86% of votes in favour of the Remuneration Report. During FY2024 Brickworks reviewed the reports of proxy advisors and engaged with major shareholders and proxy advisors in relation to remuneration matters. The Board will continue to review executive remuneration to ensure that it continues to align with Brickworks strategy, motivate management, reflect market best practice and support the delivery of sustainable long-term returns to shareholders. As part of the review process we will continue to engage with major shareholders and proxy advisors. 1.2 Details of Key Management Personnel (KMP) The following persons had authority and responsibility for planning, directing and controlling the activities of the Group, directly or indirectly, including any director (whether executive or otherwise) of that entity during the financial year. Remuneration Report 2 Considered KMP following his appointment to the role of Executive General Manager – Building Products Australia on 1 January 2024. Directors The following persons were directors of Brickworks Ltd during the full financial year: Mr R. Millner AO Non-executive Chair Mr M. Bundey Non-executive Deputy Chair Mrs D. Page AM Non-executive Director Mrs R. Stubbs Non-executive Director The Hon J. Fitzgibbon Non-executive Director Mr T. Barlow Non-executive Director (appointed 14 June 2024) Mr L. Partridge AM Executive Director (Managing Director) (retired 31 July 2024) Mr M. Millner Non-executive Director (retired 21 November 2023) Executive KMP Mr M. Ellenor Chief Executive Officer (from 2 April 2024), formerly Chief Operating Officer Mr G. Douglas Chief Financial Officer Ms M. Kublins Executive General Manager – Property & Development Mr D Fitzharris2 Executive General Manager – Building Products Australia (from 1 January 2024), formerly Group General Manager Austral Bricks and Sales Brickworks Annual Report 2024 p 95 1.3. Remuneration Policy Brickworks remuneration governance framework is set out below. While the Board retains ultimate responsibility, Brickworks’ remuneration policy is implemented through the Remuneration and Nomination Committee. 1.4 Remuneration Committee The Board has an established Remuneration and Nomination Committee which operates under the delegated authority of the Board of Directors. The Remuneration and Nomination Committee charter is included on the Brickworks website (https://investors.brickworks.com.au). All non-executive Directors of Brickworks are members of the Remuneration and Nomination Committee and the membership of Committee is as follows: Mr M Bundey Non-executive Committee Chair Mr R Millner AO Non-executive Director Mrs D Page AM Non-executive Director Mrs R Stubbs Non-executive Director The Hon J Fitzgibbon Non-executive Director Mr T Barlow Non-executive Director The Committee is chaired by Malcolm Bundey, an independent non-executive Director. The Committee is authorised by the Board to obtain external professional advice, and to secure the attendance of advisers with relevant experience and expertise if it considers this necessary. ◗Overall responsibility for the remuneration strategy and outcomes for executives and non-executive Directors ◗Reviews and, as appropriate, approves recommendations from the Remuneration and Nomination Committee Brickworks Board Remuneration and Nomination Committee Monitors, recommends and reports to the Board on: ◗Alignment of remuneration policies and procedures with Brickworks strategic goals and human resource objectives and which enable Brickworks to retain executives and directors who will create value for shareholders ◗Equitably, consistently and responsibly rewarding executives including incentive targets and achievement of the remuneration outcomes having regard to the performance of Brickworks, the performance of the executives and the general pay environment ◗Employee share plans ◗Board remuneration within aggregate approved by shareholders ◗Overseeing induction of new non-executive Directors Developing and implementing a process for the evaluation of the performance of the Board of Directors Provides information to the Remuneration and Nomination Committee for the Committee to recommend on: ◗Incentive targets and outcomes ◗Remuneration policy ◗Long and short-term incentive participation ◗Individual remuneration and contractual arrangements for executives Managing Director, Chief Executive Officer and Human Resources Manager Monitors, recommends and reports to the Board on: ◗Talent pools for senior management succession ◗Assessment of performance against measurable objectives ◗Management development frameworks and individual development progress for key talent ◗Monitoring surveys conducted by the Company in relation to the culture of the organisation ◗Initiatives to improve and drive a strong performance culture Human Resources ◗Provide independent advice, information and recommendations relevant to remuneration decisions ◗Throughout the year, the Remuneration and Nomination Committee and management received information from external providers Aon related to remuneration market data and analysis ◗There were no remuneration recommendations received from external providers during the year External Advisors 96 p Brickworks Annual Report 2024 Remuneration Report 1.5 Use of remuneration consultants Where the Remuneration and Nomination Committee will benefit from external advice, it will engage directly with a remuneration consultant, who reports directly to the Committee. In selecting a suitable consultant, the Committee considers potential conflicts of interest and requires independence from the Group’s KMP as part of their terms of engagement. ◗ In FY2024, the Remuneration and Nomination Committee appointed Aon as the remuneration adviser to provide information regarding remuneration benchmarking. The consideration for the remuneration benchmarking amounted to $12,000 and was paid in August 2024. ◗ Remuneration information was provided to the Committee as an input into decision making only. The Committee considered the information in conjunction with other factors in making its remuneration determinations. ◗ The Committee is satisfied the advice received from Aon is free from undue influence from the executives to whom the remuneration information applies, as Aon were engaged by, and reported to, the Chairman of the Remuneration and Nomination Committee. ◗ During the current year no remuneration recommendations, as defined by the Corporations Act, were provided. 1.6 Board Policies for determining remuneration Remuneration strategy and guiding principles The guiding remuneration principles in Brickworks remuneration structure include: ◗ alignment between executive remuneration outcomes and shareholder outcomes; ◗ driving performance by linking remuneration outcomes to clearly specified targets; and ◗ reflecting market practice by benchmarking remuneration outcomes against relevant peer companies. There are three main parts to the Brickworks business model: 1. the Building Products Group (Australia and North America) – including consolidated Austral Bricks and Masonry operations, Bristile Roofing, and Brickworks North America; 2. the Property Group – exists to maximise the value of surplus land created by the Building Products business, and 3. Investments – includes primarily 26.1% interest in Washington H. Soul Pattinson and Company Limited (‘Soul Patts’) and has provided a stabilizer to the cyclical nature of the Building Products earnings stream. Brickworks uses key performance indicators across the Building Products and Property businesses to ensure that its executives: ◗ ensure that the health and safety of employees has the highest priority; ◗ improve profit, cash flows, production and operational efficiencies; ◗ rationalise non-performing assets; and ◗ retain key employees who have developed specialist skills and expertise in the industries in which the Group operates. Retention of executives and highly skilled staff continues to be a high priority for the Remuneration and Nomination Committee. In our Building Products division it requires at least 5 to 10 years to become totally familiar with the complexities associated with the manufacture of clay and concrete building products. The necessary skills that have been developed internally to deal with these challenges cannot be procured easily outside the Brickworks group. Similarly, the sale and marketing of building products is a function of good client relationships and product excellence developed over many decades. Brickworks retains key executives who have been dealing with clients for 10 – 20 years. The Property Trust established 16 years ago to develop land surplus to operations also requires in depth property and development skills and experience. Brickworks’ short-term performance incentive (STI) and its long-term incentive (LTI) scheme are designed to prioritise these corporate objectives. The STI program contains key performance measures for each executive outlined further in section 2.5. The LTI program is outlined further in section 2.7. Brickworks Annual Report 2024 p 97 Total Executive Remuneration FIXED AT RISK Fixed remuneration Short-term incentive Long-term incentive Fixed remuneration having regard to the market for jobs of comparable size and responsibility Brickworks' executives participate in an STI plan The STI is weighted 75% to relevant business unit financial metrics and 25% to individual performance metrics Refer to 2.5 for further details For the MD, CEO and CFO, the LTI is assessed over three years and linked to: ◗ Relative total shareholder return ◗ Absolute total shareholder return For the other executive KMP grants are made following as assessment of prior year performance Refer to 2.7 for further details ◗ Base salary ◗ Superannuation ◗ Other benefits such as maintained motor vehicles ◗ Other eligible salary sacrifice benefits ◗ 100% cash ◗ For the MD, CEO and CFO 50% deferred into equity for one year ◗ For the MD, CEO and CFO, equity with performance assessed over three years ◗ For other executives 20% of an LTI grant vests annually on 31 July over five years 2.2 Historical performance, shareholder wealth and remuneration Financial Performance vs STI outcome The following table demonstrates strong correlation between business performance and STI outcome over the past five years separately for the Group, Property division and Austral Bricks division. 2 Remuneration Components 2.1. Remuneration structure The core elements of Brickworks remuneration structure for the executive KMP are outlined below: $100m $50m $150m $0 $200m $300m $250m $400m $350m 20% 40% $0 60% 80% 120% 100% Cashflow (as defined in the plan) $m STI % of potential NPAT (as defined in the plan) $m FY2023 FY2024 FY2022 FY2021 FY2020 Business Performance vs STI outcome Group (MD, CEO, CFO) 98 p Brickworks Annual Report 2024 Remuneration Report Total Shareholder Returns (TSR) Our diversified portfolio of assets has translated into consistently strong absolute shareholder returns, including a 10-year return of 10.7% for the year ended 31 July 2024 compared to an 8.3% return delivered by All Ords Accumulation Index over the same period. An investment in Brickworks shares has delivered strong absolute and relative returns over a wide range of time horizons, with a long-term annual shareholder return of 11.7% on a compound basis over the 25-year period. Annual TSR 1 year 3 years 5 years 10 years 15 years 20 years 25 years Brickworks Ltd 14.1% 8.8% 14.8% 10.7% 8.9% 8.7% 11.7% All Ordinaries Accumulation Index 13.4% 7.1% 7.8% 8.3% 8.9% 8.7% 8.5% BKW Relative Performance 0.7% 1.7% 7.0% 2.4% 0.0% 0.0% 3.2% $20m $0 $40m $80m $60m $120m $100m 10% 30% -10% 50% 70% 110% 90% Cashflow (as defined in the plan) $m STI % of potential EBIT (as defined in the plan) $m FY2023 FY2024 FY2022 FY2021 FY2020 Business Performance vs STI outcome Austral Bricks (EGM – BP Australia) $100m $50m $150m $0 $200m $300m $250m $400m $350m 40% 20% 80% 60% $0 100% 120% 160% 140% Cashflow (as defined in the plan) $m STI % of potential EBIT (as defined in the plan) $m FY2023 FY2024 FY2022 FY2021 FY2020 Business Performance vs STI outcome Property (EGM Property & Development) Brickworks Annual Report 2024 p 99 Jan 2023 Apr 2022 -25% Jul 2022 Oct 2022 Apr 2023 Jan 2024 Jul 2023 Oct 2023 Apr 2024 Jul 2024 Jan 2022 Oct 2021 Jul 2021 0% 25% 50% -50% BKW FBU JHX BSL All Ords Accum 2007 800 600 700 500 300 0 100 200 400 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2021 2022 2023 2020 2019 2024 Employee Productivity Brickworks Building Products productivity measures have also improved over time. Australia The following graph shows historical revenue per employee. Despite having grown substantially employee productivity has not been compromised in the process. The reduction in the current year was primarily due to the cyclical low in the residential construction industry in Australia despite the total number of employees reducing from 1,093 last year to 954 as at 31 July 2024. North America In North America, Building Products revenue per employee is consistent compared to FY2023. Overall, a significant improvement in productivity measures was observed over the last 3 years with Building Products revenue per employee increasing from US$189,563 in FY2021 to USD$321,205 in FY2024. This was driven by additional revenue and synergies related to the IBC acquisition in August 2021, continued rationalisation of manufacturing and retail operations and an increase in participation in the detached residential market. 2.3 Potential Remuneration Mix Total remuneration for the MD, CEO, CFO and the other executive KMP’s comprises both fixed remuneration and an at-risk component (STI and LTI). The mix shown in the graph below is the potential remuneration based on the current remuneration at 31 July 2024 with STI and LTI based on maximum opportunities. This structure is designed to retain and pay executives competitively based on their performance. Total Shareholder Return (Cumulative) 3-year comparison Building Products Australia Revenue per Employee ($'000) 100 p Brickworks Annual Report 2024 Remuneration Report Fixed Remuneration 37.7% LTI 28.3% STI – Cash 17.0% STI – Shares (deferred for 1 year) 17.0% Potential MD Remuneration Mix Fixed Remuneration 40.5% LTI 30.3% STI – Cash 14.6% STI – Shares (deferred for 1 year) 14.6% Potential CEO Remuneration Mix Fixed Remuneration 42.2% LTI 27.4% STI – Cash 15.2% STI – Shares (deferred for 1 year) 15.2% Potential CFO Remuneration Mix Fixed Remuneration 50.0% LTI 25.0% STI – Cash 25.0% Potential Executive GM Building Products Remuneration Mix Fixed Remuneration 51.8% LTI 24.1% STI – Cash 24.1% Potential Executive GM Property & Development Remuneration Mix 2.4. Remuneration Component – Fixed Remuneration For the Managing Director, a 4% salary increase came into effect from 1 July 2023 for the FY2024. For the Chief Operating Officer (subsequently promoted to the Chief Executive Officer role), a 5.26% salary increase came into effect from 1 August 2023 for the FY2024. For the Chief Financial Officer, an 8.33% salary increase came into effect from 1 August 2023 for the FY2024. For the GGM Austral Bricks and Sales (subsequently promoted to the EGM Building Products Australia role), a 3.94% increase came into effect from 1 August 2023 for the FY2024. For the EGM Property and Development, a 3.57% salary increase came into effect from 1 August 2023 for the FY2024. A benchmarking exercise was undertaken by Aon dated August 2022 and shows the MD’s target and maximum pay opportunities compared to market median of industry peers as set out below: Brickworks Annual Report 2024 p 101 $1.0m $0 $2.0m $3.0m $5.0m $4.0m Peer Group* Brickworks MD Maximum LTI Opportunity Maximum Total Remuneration Maximum STI Opportunity Target STI Total Fixed Remuneration (TFR) * The industry peer group includes 13 organisations engaged in property, manufacturing of construction materials, building products generally within 50% to 200% of BKW’s one-year average market capitalisation as follows: Abacus, ADBRI, Boral, Charter Hall, Cromwell, CSR, Fletcher Building, Growthpoint Properties, Incitec Pivot, Nufarm, Orica, Orora and Reliance Worldwide Corporation. Comparison of Brickworks MD Remuneration to Industry Peer Group Remuneration 2019 2004 400% 2009 2014 2024 1999 2000 2001 2002 2003 2010 2011 2012 2013 2020 2021 2022 2023 2005 2006 2007 2008 2015 2016 2017 2018 800% 1200% 0% 1600% Total Shareholder Return 25-year comparison All Ords Accumulation Index 8.5% p.a. growth (since July 1999) Brickworks 11.7% p.a. growth (since July 1999) By way of summary: ◗ Brickworks MD’s TFR is positioned within the market with 6% above median and 8% below 75th percentile. ◗ The MD’s Target STI opportunity is 15% above market median whilst the Maximum STI opportunity is between market 25th percentile and market median, similar positioning applies to the LTI of the MD, where the Maximum LTI sit reasonably between market median and market 25th percentile. ◗ Consequently, Brickworks MD’s Target Total Remuneration is positioned at market median, and Maximum Total Remuneration is positioned within the market with 9% below market median of the 2022 comparator group. ◗ The MD’s remuneration is reflective of the value that has been created for shareholders throughout his tenure as outlined below. With the replacement of the MD, following his retirement in FY2024 there will be a benchmarking exercise performed in respect of the FY2025 remuneration for the CEO and CFO. 102 p Brickworks Annual Report 2024 Remuneration Report 2.5. Remuneration Component – Short-Term Incentives (STI) The information below outlines the Company’s STI Plan for FY2024: What is the purpose and objective of the STI? The STI is an annual incentive plan designed to reward executives for meeting or exceeding financial and non-financial objectives over a one-year period. The STI has been designed to foster an organisational culture of collaboration, co- operation and mutual respect which supports the objective of a long-term outperformance in both the financial and non-financial areas of the business, mainly with annual measures linked to the business strategy, set at the beginning of the financial year at levels that are challenging, yet achievable. What is the target and maximum STI opportunity? MD, CEO and CFO The target STI opportunity for the MD is 75% of total fixed remuneration (including base salary, superannuation and car allowance) and maximum opportunity at 90% of fixed remuneration. The STI opportunity for the CEO and CFO is 60% of total fixed remuneration at target and 72% of total fixed remuneration at maximum. Other executive KMP For the Executive General Manager Building Products Australia and the Executive General Manager Property the STI is awarded up to a maximum of 50% of total fixed remuneration (including base salary and superannuation). Any excess STI earned above the maximum opportunity up to a cap of 72% will not be paid as a cash bonus but will be added to the long-term incentive share allocation for that year and will vest over the LTI’s plan vesting period. Is any part of the STI awarded deferred into equity? MD, CEO and CFO Half of any STI awarded to the MD, CEO and CFO will be deferred into shares for one year. Should the employment of either the MD, CEO or CFO be terminated other than for cause, all deferred STI payments will remain on foot and will be subject to a tenure of service requirement in the usual course as if their employment had continued with the Company. Other executive KMP No STI awarded to other executive KMP is deferred into equity. What is the target and maximum STI opportunity? The STI Target Opportunities are set out below: Target STI opportunity Maximum STI opportunity (cash)* MD 75% of total fixed remuneration (including base salary, car allowance and superannuation) 90% of total fixed remuneration CEO/CFO 60% of total fixed remuneration (inc. base salary, car allowance and superannuation) 72% of total fixed remuneration Other executive KMP** *** Between 10% and 50% of fixed remunera tion (inc. base salary and superannuation) 50% of total fixed remuneration * For the MD, CEO and CFO maximum STI is met when the Group NPAT measure (before significant items, excluding equity accounted profit from associates (Soul Patts) and property revaluation gains) is at 110% of the profit target and all the other financial and non-financial KPIs are met. ** STI as a proportion of base salary for an employee increases as that employee gains greater responsibility and has greater capacity to influence the performance of the business as a whole. *** Outperformance against the STI target above the maximum STI opportunity is recognised by the grant of performance rights to vest over the LTI plan’s performance period. Brickworks Annual Report 2024 p 103 How are STI performance measures determined? Each year at the beginning of the year the Remuneration and Nomination Committee sets KPIs for the MD, CEO and CFO for the financial year, with a view to directly aligning the individuals’ annual incentive opportunity to execution of the Group’s business strategy. The MD determines the KPIs which are aligned to the delivery of the strategy and performance of the business for other executive KMP. STI profit targets are determined on an annual basis at the beginning of the financial year after consideration of many complex factors including: ◗ the market outlook having regard to cyclical nature of building and construction industry; ◗ housing trends; ◗ energy supply; ◗ existing and new market competition; ◗ new and alternative products; ◗ interest rates; and ◗ cap rate changes. Payments under the STI are determined by performance against KPIs set at the beginning of the financial year. STI performance measures and weightings vary by executive depending on individual accountabilities. The metrics and their rationale for selection are as follows: Why are the STI measures adopted considered appropriate? Financial measures (MD, CEO and CFO: 75%) Group NPAT (before significant items excluding equity accounted profit from associates (Soul Patts) and property revaluation gains/losses) – 37.5% Focus attention on results and performance for segments for which they have direct responsibility. Property profit will include net property trust income, trust development profit, the sale of trust assets and Brickworks land sales (less Brickworks property admin and other costs). It will not include property revaluations arising from cap rate compression or expansion outside the control of management. Cash generation – 37.5% Managing cash to ensure cash and working capital is available whenever and wherever required by the business. Non-financial measures – (MD, CEO and CFO: 25%) Quality of earnings – 12.5% This measure considers the quality of earnings result including goodwill and asset impairment and windfall gains. Safety and Health – 6.25% This measure incentivises executives to demonstrate leadership in enhancing workplace health and safety and taking a sustainable approach to operations through process innovation. People – 6.25% The success of Brickworks depends on the people that work for the Company. This measure will only reward executives for superior performance and demonstration of effective leadership, talent development, retention, succession planning and gender diversity, which are critical to the success of the business and underpin financial performance. 104 p Brickworks Annual Report 2024 Remuneration Report What is the financial and non-financial component of the STI Award for the MD, CEO and CFO and how is it applied? Percentage of financial component of STI Award payable for the MD, CEO and CFO Profit – 37.5% of total available STI Award Achievement STI Award Below base profit 0% Between base profit and target profit Pro rata award on a straight-line basis between 60% and 100% of target STI Between 100% and 110% of target profit Pro rata award on a straight-line basis between 100% and 120% of target STI being Maximum STI. Setting the Target for Profit Performance In setting the target for profit performance consideration is given to the prior year’s performance. Budget may be set higher or lower than previous years after consideration of the many complex factors outlined above and including, but not limited to, the very cyclical nature of the Building Products operations. Where the budget is greater than the previous year, then 80% of last year’s performance becomes the base profit and the budget becomes the target profit. Where the budget is less than the previous year, 80% of budget profit becomes the base profit and the prior year becomes the target profit. By using both last year’s profit results and budget profit in tandem, the outcome of the bonus paid is properly referenced by the prior year. When the profit increases, the STI for profit performance aligns with improved performance and when the profit is lower than the prior year, any bonus paid will be below the prior year. All property revaluation gains and losses were excluded from the profit measures used to determine the FY2024 incentive amounts payable. Cash flow – 37.5% of total available STI Award Achievement STI Award Below base cash flow 0% Between base profit and target cash flow Pro rata award on a straight-line basis between 60% and 100% of target STI Between 100% and 110% of target cash flow Pro rata award on a straight-line basis between 100% and 120% of target STI being Maximum STI. Setting the Target for Cash Performance In setting the target for cash performance consideration is given to the prior year’s cash performance. Budget may be set higher or lower than previous years after consideration of the many complex factors outlined above and including, but not limited to, the very cyclical nature of the Building Products operations. Where Budget Cash Flow is greater than last year’s Cash Flow, 80% of last year becomes the base cash flow and Budget becomes the target cash flow. Where Budget Cash Flow is less than the prior year, 80% of Budget Cash Flow becomes the base cash flow and last year’s Cash Flow becomes the target cash flow. Cash flow is the Operating cash flow plus Investing cash flows generated from the sale of property assets including through the sale of land via the subscription of units in a trust. Other STI award criteria The remaining 25% of any STI Award is subject to the achievement of challenging non-financial measures with profit performance used to determine the maximum STI award for these components. ◗ 12.5% of potential STI award (up to a maximum of 15%) is paid if all RONTA3/quality of earnings considerations are met (otherwise 12.5% of the STI award is forfeited) ◗ 6.25% of potential STI award (up to a maximum of 7.5%) is paid if all workplace health & safety (“WHS”) initiatives and outcomes are met (otherwise 6.25% of the STI award is forfeited) ◗ 6.25% of potential STI award (up to a maximum of 7.5%) is paid if all succession planning criteria is met (otherwise 6.25% of the STI award is forfeited) 3 Return on Net Tangible Assets. Brickworks Annual Report 2024 p 105 What is the financial and non-financial component of the STI Award for other executive KMP and how is it applied? Percentage of financial component payable for other executive KMP (other than the MD, CEO and CFO) Profit – 37.5% of total STI Award Achievement STI Award Below base profit 0% Between base profit and target profit Pro-rata award on a straight-line basis between 50% and 100% > target profit Pro rata award equal to the percentage over upper target to a maximum of 50% of total fixed remuneration in cash with outperformance against the profit target recognised by the grant of rights or shares over the LTI plans performance period Operating cash flow – 37.5% Achievement STI Award Below Base Cash Flow 0% Between Base Cash Flow and Target Cash Flow. Straight line between 50% and 100% The Cash Base and Target is set in the same manner as for the MD, CEO and CFO. In respect of the Building Products division the cash measure used is based on divisional EBITDA, research & development claim benefits achieved, changes in Days Sales Outstanding (DSO’s) and inventory movements in the year. This KPI considers a strong focus on cash generation through improved cash collections and inventory management required from the senior Building Products executives and the wider management team. The remaining 25% of any STI Award is subject to the achievement of challenging non-financial measures. There is no upside available against cash and non-financial measures. When and how is the STI Award assessed? MD, CEO and CFO At the end of the financial year the Remuneration and Nomination Committee assesses actual performance against their respective KPIs set at the beginning of the financial year and recommends the STI quantum to be paid to the individuals for approval by the Board. These assessment methods have been chosen as they provide the Committee with an objective assessment of each individual’s performance. Other executive KMP At the end of the financial year the CEO assess the executive KMP’s actual performance against their respective KPIs set at the beginning of the financial year and determines the STI quantum to be paid to the executive KMP. The CEO provides these assessments to the Remuneration and Nomination Committee annually for review and approval. Is quality of earnings a relevant factor in assessing STI Awards? The Remuneration and Nomination Committee and the CEO have the discretion to consider the quality of earnings achieved including any significant items, acquisitions and divestments and one-off events/abnormal/non-recurring items in determining whether the financial KPIs have been achieved, wherever and whenever this is considered appropriate for linking remuneration reward to Company performance. The MD, CEO and CFO have 12.5% of their STI at risk in relation to quality of earnings and RONTA. Can the Board clawback STI Awards? The Board and the Remuneration and Nomination Committee have discretion about the remuneration outcomes wherever and whenever this is considered appropriate. This discretion also applies in the event of financial misstatement, reputational damage and/or evidence of misconduct. 2.6. STI outcomes The table below outlines the weighting of financial and non-financial KPIs in relation to each executive KMP for financial year 2024 and the performance achieved. Unless otherwise stated all earnings measures exclude significant items. The Company does not disclose specific financial performance targets and even retrospective disclosure of such targets would put the Company at a potential competitive disadvantage. In setting the target for profit performance consideration is given to the prior year’s performance. Budget may be set higher or lower than previous years after consideration of the many complex factors outlined above and including, but not limited to, the very cyclical nature of the Building Products operations. By using both last year’s profit results and budget profit in tandem, the outcome of the bonus paid is properly referenced by the prior year. When the profit increases, the STI for profit performance aligns with improved performance and when the profit is lower than the prior year, any bonus paid will be below the prior year. 106 p Brickworks Annual Report 2024 Executive KMP Measure(s) Performance Outcome Financial 75% MD, CEO and CFO Group NPAT (before significant items excluding equity accounted profit from associates (Soul Patts) and property revaluation gains/losses). The Group NPAT (before significant items and excluding property revaluation gains/losses and equity accounted profit from Soul Patts) was $75.8 million compared to $269.9 million in the prior financial year. This translated into a partially achieved STI target. 60% achieved Cash flow The Group Cash Flow for the year ended 31 July 2024 was $224.8 million compared to $427.1 million in the prior year. This translated into a partially achieved STI target. FY2024 Cash Flow measure includes: ◗ Group operating cash flow of $104.0 million. ◗ Group share of proceeds from the M7 asset sale by the Property Trust amounting to $117.3 million. ◗ cash proceeds from other property sales in Australia and North America $3.5 million. FY2023 Cash Flow measure included $301.6 million from the sale of Oakdale East Stage 2 land to the Property Trust. 66% achieved EGM Building Products Australia Divisional profit against target for the Austral Bricks4 division The Austral Bricks divisional profit amounted to $78.8 million compared to $98.4 million in the prior financial year. This translated into a partially achieved STI target. 82% achieved Cash flow The Austral Bricks cash measure amounted to $78.1 million compared to $108.5 million in the prior financial year. This translated into a partially achieved STI target. 71% achieved EGM Property & Development Divisional profit against target for Property Property divisional profit (excluding property devaluations and loss on disposal of the M7 assets by the Property Trust, achievement of which represented a separate KPI) amounted to $121.4 million compared to the prior year profit of $393.2 million. This translated into a partially achieved STI target. 55% achieved Cash Flow The Cash Flow measure applicable to the Property division amounted to $46.0 million compared to $348.9 million in the prior financial year. FY2024 amount includes proceeds from property sales in Australia of $3.3 million. Proceeds from the sale of the M7 assets by the Property Trust are excluded given its achievement represented a separate KPI. The prior year amount included the subscription of units in the JV Property Trust ($301.6 million) and proceeds from other property sales in Australia ($11.2 million). This translated into a partially achieved STI target. 52% achieved Remuneration Report 4 DT Fitzharris was Group General Manager Austral Bricks (Australia) and Sales prior to the restructure which occurred during the year. His annual STI targets were therefore set with the reference to the Austral Bricks division. Brickworks Annual Report 2024 p 107 Non-financial 25% MD, CEO and CFO Quality of earnings (12.5%) The Remuneration and Nomination Committee has the discretion to consider the quality of earnings achieved including significant items (e.g. asset impairment losses) The Remuneration and Nomination Committee determined that the quality of earnings measure was not met following consideration of the impairment and the Return on Net Tangible Assets for the Group (excl. investments in Soul Patts) which amounted to a negative 6.2%. 0% achievement of the KPI Safety (6.25%) Key lag target metrics across the Group: ◗ Where the last year’s TRIFR is 5 or less, the TRIFR target is the average TRIFR over the past 3 years. Where the last year’s TRIFR is between 5 and 20 the TRIFR target is +10% of last year’s TRIFR. Where the last year’s TRIFR is above 20, TRIFR target is same or better than last year. Other key lead target metrics: ◗ 10% increase in safety device inspections and workplace inspections (Australia) ◗ Reportable environmental incidents less than last year or nil ◗ Random drug and alcohol testing greater than 25% of workforce (Australia) An improvement in injury frequency rates with the Group Total Recordable Injury Frequency Rate (TRIFR) of 9.7 compared to 10.7 in the prior year. Other key lead target metrics all met, including: ◗ presence of safety indicators met with respect to all required targets (on a like-for-like basis, excluding the impact of restructuring, there were 2,877 workplace inspections, compared to 2,321 in the prior year, and 597 safety device inspections compared to 536 in the prior year) ◗ drug and alcohol testing embedded into the business with approximately 70% of company employees tested in Australia in FY2024. ◗ Group significant incident reporting covers any incident with minor-moderate environmental impact (medium severity) or major to catastrophic impact (high severity). In FY2024, Brickworks had zero high severity incidents across Australia ad North America (FY2023: nil). In FY2024, Brickworks had 5 medium severity environmental incidents across Australia and North America, reducing from 9 medium severity incidents in the prior year. This translated into a fully achieved STI target. 100% achievement of safety KPIs Succession Planning (6.25%) Key Metrics: ◗ Regular talent and succession reviews ◗ Mentoring program for emerging leaders in Australia ◗ Successful appointment of Mark Ellenor to an expanded role of the Chief Executive Officer in April 2024 and succeeding the former Managing Director from 1 August 2024 in full leadership role. ◗ Successful completion of bi-annual succession strategy sessions 100% achievement of succession planning KPIs EGM Building Products Australia Return on Net Tangible Assets Austral Bricks Return on net tangible assets/ quality of earnings considerations Return on Net Tangible Assets for the Austral Bricks division of 18.0% which translated into a fully achieved STI target 100% achievement of the RONTA KPI Safety Key lag target metrics across the Group: ◗ Where the last year’s TRIFR is 5 or less, the TRIFR target is the average TRIFR over the past 3 years. Where the last year’s TRIFR is between 5 and 20 the TRIFR target is +10% of last year’s TRIFR. Where the last year’s TRIFR is above 20, TRIFR target An increase injury frequency rates with the Group Total Recordable Injury Frequency Rate (TRIFR) of 7.64 compared to 6.09 last year which was higher than the target. 0% achievement of the Safety KPI Environmental Reportable environmental incidents less than last year or nil There were two reportable environmental incidents in the Austral Bricks division compared to eight incidents last year. This translated into a fully achieved STI target. 100% achievement of the Environ- mental KPI 108 p Brickworks Annual Report 2024 EGM Building Products Australia continued Gender diversity improvement Gender diversity improvement by 2.5 percentage points compared to the prior year. Female employees as a proportion of total workforce in the Austral Bricks and Austral Masonry divisions decreased from 19.7% to 19.3% which was below the STI target. 0% achievement of the Gender Diversity KPI WA Brick market exit Successful exit from the WA brick market Exit from the WA brick market was successfully completed during the year with majority of the stock sold down 100% achievement of the WA brick market exit KPI EGM Property & Development Property Trust Return on net tangible assets/ quality of earnings considerations Due to non-cash property devaluations return on Net Tangible Assets the Property division achieved a negative return of 5.2%. which was below the STI target. 0% achievement of the RONTA KPI Safety Target Metrics Category 1 safety events in the JV Trust - same or better than last year. Category 2 safety events actioned and closed out within 6 months. Strong safety performance as measured by the number of safety events in the financial year ended 31 July 2024: ◗ No Category 1 events (FY2023: nil) ◗ All Category 2 events actioned and closed within 6 months 100% achievement of other KPIs Mixture of Strategic and Operational relevant to the executive KMP ◗ Managing Property leases (occupancy 97%+) ◗ Successful sale of either Mid Atlantic or M7 estate. ◗ Actual Property Trust vacancy rate at 31 July 2024 (98.45%) ◗ The M7 asset sale was successfully completed by the Property Trust 100% achievement of other KPIs STI achieved The table below outlines the weighting of financial and non-financial KPIs in relation to each executive KMP for 2024 and the performance achieved. The following table outlines the percentage of target STI achieved (and forfeited) in relation to financial and non- financial KPIs, and the total STI awarded, for each executive KMP for 2024. Executive KMP Target STI Opportunity $ Max STI Opportunity $ FINANCIAL NON-FINANCIAL STI awarded** $ STI over performance subject to LTI $ Weighting % Achieved* % Forfeited % Weighting % Achieved* % Forfeited % MD $1,278,435 $1,534,122 75% 63% 37% 25% 50% 50% $764,019 - CEO $630,000 $756,000 75% 63% 37% 25% 50% 50% $376,501 - CFO $420,000 $504,000 75% 63% 37% 25% 50% 50% $251,001 - EGM Building Products Australia $369,000 $369,000 75% 77% 23% 25% 60% 40% $267,075 - EGM Property & Development $290,000 $312,250 75% 53% 47% 25% 60% 40% $159,115 - * Calculated as % of Target STI opportunity. ** 50% of the MD, CEO and CFO’s STI awards deferred into equity, for one year being $382,009 for the MD, $188,250 for the CEO and $125,500 for the CFO. . Remuneration Report Brickworks Annual Report 2024 p 109 2.7. Remuneration Component – Long Term incentives (LTI) for FY2024 What is the LTI? The Group operates an LTI Plan through the Brickworks Deferred Employee Share Plan and Executive Rights Plan in which employees receive Brickworks Limited shares or performance rights. No consideration is payable by participants for shares or performance rights under the terms of the plan. What is the scope of the LTI? The LTI includes: ◗ a broad-based employee share plan with 562 employees participating as at 31 July 2024 via 1,086,925 shares on allocation of which 30.36% remain unvested (and 69.64% vested). In addition, 20,013 shares in the plan were forfeited during the year to 31 July 2024; and ◗ an Executive Rights Plan with 35 employees participating as at 31 July 2024 via 683,798 rights on allocation of which 66.51% remain unvested (and 33.49% vested). 0 rights were forfeited during the year to 31 July 2024. What is the purpose of the LTI? The primary purpose of the LTI is the retention of the Company’s senior executive team. The LTI also provides alignment between executive remuneration and shareholders, as measured by the absolute and relative total shareholder return (TSR). What is the LTI Opportunity for the MD, CEO and CFO? The value of shares or performance rights granted to the MD was a fixed 75% of total fixed remuneration (including superannuation and car allowance) and to the CEO and CFO 60% of total fixed remuneration. This fixed allocation is subject to Brickworks meeting the absolute and relative TSR performance criteria set out below over the ensuing three-year period. What is the LTI Opportunity for other executive KMP? For all other executive KMP, the LTI base entitlement is up to 50% of total fixed remuneration (excluding car allowance) at target. The allocation made is determined following assessment by the Board of the prior year’s performance against STI targets. In years where STI targets are not met in difficult market conditions the Board awards half the LTI opportunity to other executive KMP. What LTI performance measures apply to executive KMP (other than the MD, CEO and CFO)? The vesting of shares/ rights to other executive KMP is undertaken progressively on 31 July for 20% on each anniversary following the allocation date for five years. What LTI performance measures apply to the MD, CEO and CFO? 50% of the award made is subject to Brickworks relative total shareholder return (TSR) vesting condition under which Brickworks’ TSR is compared to the companies in the S&P/ASX 200 Franking Credit Adjusted Annual Total Return Index over a period of three years from 1 August 2023 to 31 July 2026. The share price used at commencement of each tranche for assessing both relative and absolute TSR performance of Brickworks shares is the 90-day Volume Weighted Average Price (VWAP) prior to 31 July 2023. The actual share price used to compare to the TSR target share price is the 90-day VWAP prior to 31 July 2026. The remaining 50% of the award is subject to an absolute TSR p.a. compounding vesting condition also over the same period. 110 p Brickworks Annual Report 2024 How does the Relative TSR measure (50% of each award) work? A summary of the Relative TSR measure for the MD, CEO and CFO is as follows. Relative TSR measure Performance Period 3-year performance period Measure Brickworks’ relative TSR inclusive of all grossed dividends measured against the S&P/ASX 200 Franking Credit Adjusted Annual Total Return Index (XJOAI Franked Index) Vesting Below the median – 0% vesting At the median – 50% vesting Between the median and 60th percentile – pro-rata vesting on a straight-line basis between 50% and 100% At the 60th percentile or above – 100% vesting Re-testing No re-testing. Testing to be undertaken once only at end of the 3-year period. Dividends and voting rights No dividends or voting rights on unvested performance rights Compensation for dividends will be provided at the end of the performance period only on those rights that meet the performance criteria. Shareholder approval Yes for allocations made to the Managing Director Brickworks obtained independent advice regarding the distribution of XJOAI returns above the median which is normally referred to as the index to establish what the level of the TSR performance was over the three previous years at the 75th percentile. XJOAI Returns 1 Year to 31 July 2024 1 Year to 31 July 2023 1 Year to 31 July 2022 1 Year to 31 July 2021 At Index Level 7.5% 7.8% (5.9%) 29.0% At 60th percentile 13.8% 13.8% 1.1% 40.1% At 75th Percentile 27.0% 25.1% 9.1% 64.9% BKW 15.3% 28.4% (10.0%) 58.3% We note the difficulty with delivering TSR results in excess of 27.0% in the current macroeconomic climate. More appropriately, Brickworks has adopted the 60th percentile, which requires a very challenging hurdle for 100% vesting. At the 60th percentile the average annual return over a 4-year period ended 31 July 2024 was 17.2% compared to 31.5% at 75th percentile. Overall, the Board’s emphasis is on establishing long term sustainable profit streams. The over-arching objective is to reinvest to deliver sustainable long-term profits, while continually reducing production costs through technical innovation. How does the Absolute TSR measure (50% of each award) work? A summary of the Absolute TSR measure for the MD, CEO and CFO is as follows. Absolute annual compounding TSR measure Performance Period 3-year performance period Vesting Less than 6% – 0% vesting Equal to 6% – 50% vesting Between 6% and 8% – pro-rata vesting on a straight-line basis between 50% and 100% Equal to 8% or greater – 100% vesting Re-testing No re-test. Testing is to be undertaken once only at end of the 3-year period Dividends and voting rights No dividends or voting rights on unvested performance rights Compensation for dividends will be provided at the end of the performance period only on those rights that meet the performance criteria Remuneration Report Brickworks Annual Report 2024 p 111 Why is an absolute TSR measure considered appropriate for LTI Awards to the MD, CEO and CFO? ◗ Brickworks has a diversified portfolio of assets through its investment in Washington H. Soul Pattinson & Company Limited (Soul Patts) ◗ Brickworks’ look through asset exposure shows that, in addition to building products (25%) and property (30%), the Company has exposure to other companies in telecommunications, finance, energy and health through its investment in Soul Patts. Why is an absolute TSR measure combined with a relative TSR measure considered appropriate for LTI Awards to the MD, CEO and CFO? The Board believes that when combined with the STI, the performance criteria for the MD, CEO and CFO under the LTI provides the most suitable link to long-term security holder value creation because: ◗ absolute TSR ensures vesting is commensurate with the Company’s actual TSR, meaning there are no awards when TSR is negative and it also provides a good line of sight for the MD, CEO and CFO; ◗ measuring TSR on a relative basis levels the playing field by removing overall market movements and industry economics for the evaluation of MD, CEO and CFO performance. Relative TSR provides a relative, external market performance measure having regard to a peer group of ASX200 companies with which the Company competes for capital, customers and talent; ◗ the use of relative TSR ensures that the MD, CEO and CFO are motivated to deliver returns that are superior to what a security holder could achieve in the broader market and ensures as the most senior management they maintain a strong focus on security holder outcomes; ◗ Brickworks calculates its after tax TSR incorporating the full value of franking credits. The S&P ASX 200 Franking Credit adjusted annual total return Index also adjusts the total return for the tax effect of franking credits to ensure consistency of calculations; ◗ the use of the S&P/ASX 200 Franking Credit adjusted annual total return Index was chosen as the relative performance target following testing of this group against a range of historical and future share price/payout scenarios to confirm that outcomes align with the Company’s historical notion of superior long-term performance; ◗ having regard to the overall size and market capitalisation of Brickworks, and the diverse nature of the Brickworks Group across Property, Building Products and its investment in Soul Patts, the Board considers the XJOAI Franked Index as the most appropriate Index for relative performance assessment; and ◗ while the Board appreciates that there are at times different views held by different stakeholders, it considers that these measures provide the appropriate balance between market and non-market measures. Are shareholders asked to approve LTI Awards made to the MD? Yes. Performance rights allocated to the MD are put to shareholders for approval at the AGM. Can the Board clawback LTI Awards? Historically clawback clauses have not been applicable for LTI allocations. The Board and the Remuneration and Committee have discretion about the remuneration outcomes wherever and whenever this is considered appropriate. This discretion also applies in the event of financial misstatement, reputational damage and/or evidence of misconduct. What happens to LTI Awards on a Change of Control of Brickworks? If a change of control event occurs in relation to Brickworks Limited then any shares or performance rights held by the employee share plan trust on behalf of a participant will vest. What dividend rights are attached to LTI Awards? Dividends will not be paid on unvested performance rights and will only be granted in proportion to the vested grants at the end of the performance period. How are LTI Awards satisfied? The Board has the discretion to either purchase shares on-market or to issue new shares for participants. During the year rights were granted to the MD, CEO and CFO and executive KMP through the LTI executive rights plan. Shares granted to employees other than the MD, CEO and CFO and executive KMP were issued as new shares. Are executives prohibited from entering financial derivatives in respect of Brickworks shares? Under the Company’s Securities Trading Policy Brickworks shares are not permitted to be used to secure any type of financial product such as margin loans or similar. Options, collars and/or other financial derivatives must not be used in respect of any Brickworks shares. Large caps 21% Private Equity 12% Strategic 51% Emerging companies 9% Credit 6% Property 1% Brickworks Asset Exposure 112 p Brickworks Annual Report 2024 2.8. LTI Outcomes FY2024 MD, CEO and CFO Brickworks TSR is defined as the change in share price plus dividends (grossed up for associated franking credits). This forms part of the criteria used for assessing the vesting of LTI plan shares and performance rights under the absolute TSR test and relative TSR test. The current CEO and CFO have vesting in FY2024 for historical rights plan allocations made when they were in former roles at the Company. ERP Awards Vesting FY2024 CEO 11,094 CFO 4,133 Relative and absolute TSR performance (MD) Rights allocations made to the Managing Director in 2021 were tested at 31 July 2024. During the 3-year period from 1 August 2021 to 31 July 2024, Brickworks generated a compounding TSR of 33.4% (equal to an annual compounding TSR of 10.1%), which would place BKW at the 70th percentile of the S&P/ASX200 constituents. As this ranking is higher than the 60th percentile threshold for 100% vesting, all awards under the Relative TSR test will vest (25,303 rights). During the 3-year period from 1 August 2021 to 31 July 2024, Brickworks generated a compounding TSR of 33.4% (equal to an annual compounding TSR of 10.1%) which was higher than the 8% pa compound measure and 100% of the awards under the absolute TSR test will vest (25,303 rights). 2.9. Other Company wide share plan In addition to the Brickworks Deferred Employee Share Plan referred to above, Brickworks operates the Brickworks Exempt Employee Share Plan as part of the remuneration structure of the Group. All employees of Brickworks with a minimum 3 month’s service are eligible to join the Brickworks Exempt Employee Share Plan, whereby the employee may salary sacrifice an amount toward the purchase of Brickworks ordinary shares and the Company contributes a maximum of $3 per employee per week. The plans are aimed at encouraging employees to share in ownership of their Company and help to align the interests of all employees with that of the shareholders. 2.10. Market purchases In accordance with ASX Listing Rule 10.14, the Company contribution to the Brickworks Exempt Employee Share Plan is unavailable to Directors of Brickworks. An employee’s right to transact shares in a share plan is governed by the trust deeds for those Plans and the Company’s policy regarding trading windows. At 31 July 2024, there were 765 employees participating in the Brickworks Deferred Employee Share Plan and the Brickworks Exempt Employee Share Plan, holding 1,186,984 shares and 35 employees participating in the Executive Rights Plan holding 214,623 shares (0.92% of issued capital). During the year, all monthly share purchases through the Exempt Employee Share Plan were performed on market. Shares granted through the Deferred Employee Share Plan to employees were issued as new shares. 3 KMP Employment Contracts 3.1 Termination payments A payment will be made by the Company to KMP upon termination or bona-fide retirement, equivalent to a proportion (not exceeding 100%) of each executive KMP’s average base pay for the previous 3 years, and any unvested shares or performance rights held on behalf of the executive KMP will remain within the employee share plan and retain their performance/vesting criteria. If an executive KMP resigns, any unvested shares or rights will be forfeited. The Board and the Remuneration and Nomination Committee have discretion about the remuneration outcomes wherever and whenever this is considered appropriate. This discretion also applies in the event of financial misstatement, reputational damage and/or evidence of misconduct. Brickworks does not have fixed term contracts with its executive KMP. It can terminate an executive KMP’s employment on six months’ notice (or payment in lieu of notice). If the MD or any other executive KMP is subject to immediate termination (for cause as defined in their employment contract), Brickworks is not liable for any termination payments to the employee other than any outstanding base pay and accrued leave amounts. All unvested shares or performance rights held on their behalf by the Brickworks Deferred Employee Share Plan or the Brickworks Executive Rights Plan will be forfeited. Remuneration Report Brickworks Annual Report 2024 p 113 3.2. Executive KMP Restraint All executive KMP’s gain strategic business knowledge during their employment. Brickworks will use any means available to it by law to ensure that this information is not used to the detriment of the Company by any employee following termination. To protect the Group’s interests, Brickworks had an enforceable restraint through the executive KMP’s employment contract to prevent executive KMPs from either going to work for a competitor, or inducing other employees to leave the Company, for a specified period. The terms of the restraint to prevent employees from going to work for a competitor, customer or supplier are for commensurate periods of between 6 and 12 months. A breach of the restraint conditions by an employee places at risk a potential monthly restraint payment at the discretion of the Company. The termination payments referred to above, together with the fact that most executive KMP generally will also have unvested shares with a value in excess of the base remuneration for the restraint period at any time, are intended to discourage executive KMP with deep corporate knowledge and significant capacity to contribute to the profitability of the Company from seeking employment with competitors. 4 Non-Executive Directors The remuneration of non-executive Directors is determined by the full Board after consideration of Group performance and market rates for Directors’ remuneration. Non-executive Director fees are fixed each year and are not subject to performance-based incentives. Brickworks’ non-executive Directors are not employed under employment contracts. The maximum aggregate level of fees which may be paid to non-executive Directors is required to be approved by shareholders in a general meeting. This figure is currently $1,500,000 and was approved by shareholders at the 2022 Annual General Meeting. Brickworks’ constitution requires that Directors must own a minimum of 500 shares in the Company within two months of their appointment. All Directors complied with this requirement during the year. The Directors Fees, inclusive of superannuation guarantee charge, for FY2024 and FY2025 are as follows: FY2024 FY2025 Chair $293,857 $305,611 NED Base Fee $146,929 $152,805 Member – Audit & Risk Committee $9,042 $15,000 Member – Remuneration & Nomination Committee $11,302 $11,755 Chair – Audit & Risk Committee $28,934 $40,000 Chair – Remuneration & Nomination Committee $43,345 $45,079 Under legacy arrangements, non-executive Directors appointed prior to 30 June 2003 were entitled to receive benefits upon their retirement from office. These benefits were frozen with effect from 30 June 2003 and are not indexed. The Company has obtained specific independent legal advice regarding the entitlements of the three non-executive Directors referred to below which has confirmed that the amounts listed in the table will be payable, as they have been grandfathered under the previous legislation relating to the retirement benefits of non-executive Directors. These benefits for one participating Director, which have been fully provided for in the Company’s financial statements, are as follows: Name Benefit as at 30 June 2003 R. Millner $300,000 114 p Brickworks Annual Report 2024 5 Remuneration of Key Management Personnel 5.1 Table of Remuneration to KMP The fees payable to non-executive Directors and the remuneration payable to other executive KMP during the financial year ended 31 July 2024 are disclosed in the following table. Year Base fees/ salary Non- monetary benefits Post Employment (Super) Total fixed remuneration Short Term Incentive Long Term Incentive5 Other Total Directors RD Millner 2024 266,414 – 27,547 293,961 – – – 293,961 2023 254,793 – 26,860 281,653 – – – 281,653 MP Bundey 2024 185,465 20,476 205,941 – – – 205,941 2023 163,883 – 17,276 181,159 – – – 181,159 DR Page 2024 187,236 – – 187,236 – – – 187,236 2023 178,993 – – 178,993 – – – 178,993 RN Stubbs 2024 150,696 16,639 167,335 – – – 167,335 2023 145,036 – 15,289 160,325 – – – 160,325 JA Fitzgibbon 2024 150,696 – 16,639 167,335 – – – 167,335 2023 84,907 – 8,976 93,883 – – – 93,883 MJ Millner6 2024 43,561 – 5,227 48,788 – – – 48,788 2023 137,196 – 14,463 151,659 – – – 151,659 TJ Barlow7 2024 18,413 – 2,085 20,498 – – – 20,498 RJ Webster8 2023 47,477 – 4,985 52,462 – – – 52,462 LR Partridge 2024 1,677,181 28,630 27,610 1,733,421 764,019 1,174,762 1,810,6229 5,482,824 2023 1,616,208 7,529 25,468 1,649,205 1,145,128 743,777 – 3,538,110 Total 2024 2,679,662 28,630 116,223 2,824,515 764,019 1,174,762 1,810,622 6,573,918 2023 2,628,493 7,529 113,317 2,749,339 1,145,128 743,777 – 4,638,244 5 Reflects the grant date fair value of the shares/executive rights vested during the financial year. The share-based expense recognised in respect of LR Partridge (including cash-settled share-based payment) amounted to $1,969,613 (2023: $670,852). Current year expense includes the accelerated share-based expense following the MD retirement. Vesting conditions continue to apply. 6 MJ Millner retired on 21 November 2023 and was paid a retirement benefit of $150,000 recognised as an expense in prior years. 7 TJ Barlow was appointed on 14 June 2024. 8 RJ Webster retired on 22 November 2022 and was paid a retirement benefit of $93,750 in FY2023 which had been recognised as an expense in prior years. 9 Represents the final retirement payment recognised as an expense in FY2024 and paid on 2 August 2024. Includes a retirement benefit of $1,646,700, as well as the statutory in lieu of notice entitlement of $163,922. Remuneration Report Brickworks Annual Report 2024 p 115 Year Base fees/ salary Non- monetary benefits Post Employment (Super) Total fixed remuneration Short Term Incentive Long Term Incentive10 Other Total Other Key Management Personnel MA Ellenor11 2024 1,022,601 10,697 27,610 1,060,908 376,501 225,578 – 1,662,987 2023 1,464,045 46,291 25,468 1,535,804 438,825 275,522 – 2,250,151 GS Douglas12 2024 672,601 18,107 27,610 718,318 251,001 81,903 – 1,051,222 2023 582,104 13,901 23,360 619,365 362,757 106,516 – 1,088,638 MM Kublins 2024 597,101 6,759 27,610 631,470 159,115 393,291 – 1,183,876 2023 579,208 7,697 25,468 612,373 271,340 399,307 – 1,283,020 DT Fitzharris13 2024 414,517 40,580 16,194 471,291 267,075 318,640 – 1,057,006 RC Bakewell14 2023 476,996 24,446 14,754 516,196 – 382,809 178,324 1,077,329 Total 2024 2,706,820 76,143 99,024 2,881,987 1,053,692 1,019,412 – 4,955,091 2023 3,102,353 92,335 89,050 3,283,738 1,072,922 1,164,154 178,324 5,699,138 10 Reflects the grant date fair value of the shares/executive rights vested during the financial year. The share-based expense recognized in respect of the KMP listed below (including cash-settled share-based payment) was as follows: – MA Ellenor $294,013 (2023: $298,354) – GS Douglas $294,393 (2023: $136,977) – MM Kublins $372,363 (2023: $444,444) – DT Fitzharris $201,196 – RC Bakewell (2023: $448,417) 11 MA Ellenor was EGM - Building Products from August 2022, Chief Operating Officer from August 2023 and Chief Executive Officer from April 2024. The prior year USD denominated remuneration was translated using an AUD/USD rate of 0.6725 representing an average rate for FY2023. Includes a secondment allowance of AUD 378,781 (USD 254,730) which ceased to be paid on 1 August 2023 on MA Ellenor’s return to Australia. 12 GS Douglas is considered KMP from 29 August 2022 following his appointment to the CFO role in the prior year. 13 DT Fitzharris is considered KMP from 1 January 2024 following his appointment to the role of the Executive GM – Building Products Australia. 14 RC Bakewell ceased employment on 28 February 2023. Other benefits represent a termination benefit of $178,324. Notes: In addition to the total benefits above, these KMPs accrued leave entitlements during the year as follows: ◗ L R Partridge: net decrease of $389,980 in accrued leave entitlements (2023: $210,566 increase) ◗ M A Ellenor: net increase of $163,220 in accrued leave entitlements (2023: $32,067 increase) ◗ G S Douglas: net increase of $32,002 in accrued leave entitlements (2023: $61,795 increase) ◗ M Kublins: net decrease of $3,538 accrued leave entitlements (2023: $21,434 decrease) ◗ D Fitzharris: net decrease of $24,359 accrued leave entitlements ◗ R C Bakewell: Nil in accrued leave entitlements (2023: $70,448 net increase in accrued leave entitlements) 5.2 Director and Key Management Personnel shareholdings and performance rights The number of shares held in Brickworks Limited during the financial year by each director and key management personnel, including their related entities are set out below. Non-Executive Directors Held 31 July 2023 Acquired Shares Disposed Held 31 July 2024 Non-executive Directors RD Millner 4,817,967 – – 4,817,967 MP Bundey 3,970 – – 3,970 DR Page 17,400 – – 17,400 RN Stubbs 1,000 – – 1,000 JA Fitzgibbon 500 500 500 500 TJ Barlow1 N/A 2,000 – 2,000 MJ Millner2 4,797,141 N/A N/A N/A 1 Todd Barlow was appointed to the Board on 14 June 2024. 2. Michael Millner retired as a director on 21 November 2023. This represents the number of shares held as at his retirement date. 116 p Brickworks Annual Report 2024 Executive Key Management Personnel Executive Director and Key Management Personnel shareholdings and performance rights Held 31 July 2023 Granted as Remuneration1 Shares Acquired2 Shares Disposed Held 31 July 2024 FPO DESP ERP STI Def ERP STI Def FPO DESP ERP STI Def LR Partridge 226,000 6,973 82,049 33,182 90,779 20,558 100,644 (196,598) 130,406 0 141,385 20,558 MA Ellenor 14,824 2,955 38,572 N/A 22,789 N/A 15,260 (4,000) 26,084 0 50,270 N/A GS Douglas 1,326 1,459 11,126 N/A 29,299 6,512 6,151 (5,273) 2,204 0 36,296 6,512 MM Kublins 67,525 3,566 57,545 N/A 9,815 N/A 21,938 (28,048) 61,415 0 50,802 N/A DT Fitzharris 95,500 3,216 42,598 N/A 12,013 N/A 16,527 – 112,027 0 42,593 N/A FPO Fully paid ordinary shares DESP Deferred Employee Share Plan ERP Executive Rights Plan STI Deferred Short Term Incentive Deferred Plan – MD and CFO’s 50% of STI awards deferred into equity restricted for one year. 1. Granted as remuneration under the ERP or STI Deferred Plan. 2. Shares acquired through vesting under the DESP, ERP or STI Deferred Plans and FPO shares purchased. No options over unissued shares or interests in Brickworks Limited or a controlled entity were granted or lapsed during or since the end of the financial year and there were no options outstanding at the date of this report. No shares or interests have been issued during or since the end of the year as a result of the exercise of any option over unissued shares or interests in Brickworks or any controlled entity. 5.3 Liabilities recognised in respect of Key Management Personnel Due to a delay in the allocation of shares and executive rights during the year, the Group entered into an arrangement with impacted employees (including KMP) to compensate them for the difference in share price between the scheduled and actual allocation of LTI during the financial year. The Group has recognised a cash settled share-based payment expense, which is recognised as a liability representing Board approved compensation for the difference in the allocation price of: ◗ Shares and executive rights allocated as part of the FY2023 LTI plans. This includes executive rights allocated to the MD/CEO/CFO following the 2023 AGM approval. ◗ Shares allocated to the MD/CFO FY2023 as part of the deferred STI scheme. ◗ Executive rights allocated to the MD/CFO as part of the FY2022 LTI plants following the 2022 AGM approval. The liability, which will be paid in cash, will be paid subject to vesting of the underlying executive rights and deferred STI they are derived from and is subject to annual remeasurement with reference to the share price at the balance date. Cash settled share-based payment expense recognised in the current financial year in respect of each KMP with reference to the vesting period was as follows: ◗ LR Partridge $519,625 ◗ MA Ellenor $21,999 ◗ GS Douglas $103,243 ◗ MM Kublins $5,937 ◗ DT Fitzharris $7,291 Note – a similar compensation arrangement was established for all employees allocated executive rights or shares under the Deferred Employee Share Plan for the FY2023 allocation. End of the Remuneration Report Remuneration Report Brickworks Annual Report 2024 p 117 Auditor’s Independence Declaration Following a mandatory partner rotation, the financial year ended 31 July 2024 is the fourth year with Jodie Inglis as audit partner. The Directors received an independence declaration from the auditor, EY. A copy has been included on page 119 of the report. Provision of non-audit services by external auditor During the year the external auditors, EY, provided non-audit services to the Group, totalling $78,500. The non-audit services were for the provision for tax advisory services, as well as advisory services in relation to sustainability. The Directors are satisfied that the provision of non-audit services is compatible with general standard of independence for auditors imposed by the Corporations Act 2001. The nature and the scope of each type of services provided means that auditor independence was not compromised. The details of total amounts paid to the external auditors are included in note 7.3 to the financial statements. Indemnification of auditors To the extent permitted by law, the Company has agreed to indemnify its auditors, EY, as part of the terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been made to indemnify EY during or since the financial year. Proceedings on behalf of the Company No person has applied for leave of the Court to bring proceedings on behalf of the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The Company was not a party to any such proceedings during the year. Indemnification of Directors and officers The Company’s Rules provide for an indemnity of Directors, executive officers and secretaries where liability is incurred in connection with the performance of their duties in those roles other than as a result of their negligence, default, breach of duty or breach of trust in relation to the Company. The Rules further provide for an indemnity in respect of legal costs incurred by those persons in defending proceedings in which judgment is given in their favour, they are acquitted or the Court grants them relief. Since the end of the previous financial year, the Company has paid insurance premiums in respect of Directors’ and officers’ liability. The insured persons under those policies are defined as all Directors (being the Directors named in this Report), executive officers and any employees who may be deemed to be officers for the purposes of the Corporations Act 2001. Rounding of Amounts The Company has applied the relief available to it under ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 and accordingly, amounts in the financial report and Directors’ report have been rounded off to the nearest $1,000 where allowed under that instrument. Made in accordance with a resolution of the Directors at Sydney. Dated: 26 September 2024 R.D. Millner AO Director 118 p Brickworks Annual Report 2024 Bronte House Bowral Bricks in Chillingham White Bronte, NSW Brickworks Annual Report 2024 p 119 Auditor’s Independence Declaration Auditor’s Independence Declaration to the Directors of Brickworks Limited As lead auditor for the audit of the financial report of Brickworks Limited for the financial year ended 31 July 2024, I declare to the best of my knowledge and belief, there have been: a) No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; b) No contraventions of any applicable code of professional conduct in relation to the audit; and c) No non-audit services provided that contravene any applicable code of professional conduct in relation to the audit. This declaration is in respect of Brickworks Limited and the entities it controlled during the financial year. Ernst & Young Jodie Inglis Partner 26 September 2024 120 p Brickworks Annual Report 2024 Consolidated Financial Statements Consolidated Income Statement 121 Consolidated Statement of Other Comprehensive Income 122 Consolidated Balance Sheet 123 Consolidated Statement of Changes in Equity 124 Consolidated Statement of Cash Flows 125 Notes to the Consolidated Financial Statements 126 1 About this Report 126 2 Financial Performance 128 3 Operating Assets and Liabilities 136 4 Income Tax 145 5 Capital and Risk Management 148 6 Group Structure 157 7 Other Disclosures 168 120 p Brickworks Annual Report 2024 Brickworks Annual Report 2024 p 121 31 July 2024 31 July 2023 Note $000 $000 Continuing operations Revenue 2.2 1,089,414 1,181,859 Cost of sales (758,005) (832,135) Gross profit 331,409 349,724 Loss on deemed disposal of associate – (994) Other income 2.2 6,322 277,834 Distribution expenses (79,437) (94,017) Administration expenses (59,149) (60,920) Selling expenses (147,805) (151,390) Impairment of non-current assets 3.2, 3.3 (189,027) (62,701) Restructuring costs (20,505) (41,033) Loss on sale of investments (16,392) – Other expenses (49,356) (35,952) Loss on derecognition of associate – (11,273) Share of net profits of associates and joint ventures 2.3 60,710 402,729 (Loss)/profit from continuing operations before finance cost and income tax (163,230) 572,007 Finance costs 2.2 (79,395) (59,563) (Loss)/profit from continuing operations before income tax (242,625) 512,444 Income tax benefit/(expense) 4.1 125,390 (107,180) (Loss)/profit from continuing operations after tax (117,235) 405,264 Discontinued operations Loss from discontinued operations, net of income tax benefit 6.5 (1,650) (10,570) (Loss)/profit after tax (118,885) 394,694 (Loss)/profit after tax attributable to: Shareholders of Brickworks Limited (118,885) 394,694 Cents Restated Cents1 Earnings per share attributable to the shareholders of Brickworks Limited Basic (cents per share) 2.4 (88.2) 293.9 Diluted (cents per share) 2.4 (88.2) 292.5 Basic (cents per share) from continuing operations 2.4 (87.0) 301.7 Diluted (cents per share) from continuing operations 2.4 (87.0) 300.4 The above consolidated income statement should be read in conjunction with the accompanying notes. Consolidated Income Statement 1 The prior year Earnings Per Share measure was restated to reflect the adjustments to the weighted average number of shares outstanding during the prior period. Refer note 2.4. 122 p Brickworks Annual Report 2024 31 July 2024 31 July 2023 Note $000 $000 (Loss)/profit after tax (118,885) 394,694 Other comprehensive income, net of tax Items that may be subsequently reclassified to Income Statement Share of decrements in reserves attributable to associates and joint ventures (7,369) (40,632) Foreign currency translation 169 2,344 Income tax benefit relating to these items 4.1 2,211 12,190 Net other comprehensive loss that may be reclassified to Income Statement (4,989) (26,098) Items not to be subsequently reclassified to Income Statement Share of increments in reserves attributable to associates and joint ventures 14,800 17,267 Net fair value gain/(loss) on financial assets at fair value through other comprehensive income 19,953 (2,155) Income tax expense relating to these items 4.1 (10,264) (6,498) Net other comprehensive income not to be reclassified to Income Statement 24,489 8,614 Other comprehensive income/(loss), net of tax 19,500 (17,484) Total comprehensive (loss)/income (99,385) 377,210 Total comprehensive (loss)income, attributable to: Shareholders of Brickworks Limited (99,385) 377,210 The above consolidated statement of other comprehensive income should be read in conjunction with the accompanying notes. Consolidated Statement of Other Comprehensive Income Brickworks Annual Report 2024 p 123 31 July 2024 31 July 2023 Note $000 $000 Cash and cash equivalents 5.2 62,574 69,565 Receivables 3.1 126,572 147,387 Inventories 3.1 355,157 319,122 Prepayments 10,367 12,770 Contract assets 3.1 1,231 1,321 Current income tax asset 4.2 892 1,095 Assets classified as held for sale 6.5 3,033 13,532 Derivative financial assets 5.4, 5.8 828 417 Total current assets 560,654 565,209 Inventories 3.1 6,567 7,180 Financial assets at fair value through other comprehensive income 5.3 35,121 13,107 Investments accounted for using the equity method 6.3 4,224,022 4,397,730 Derivative financial assets 5.4 – 2,446 Property, plant and equipment 3.2 598,589 631,858 Right-of-use assets 3.3 314,747 375,720 Intangible assets 3.2 102,875 144,437 Total non-current assets 5,281,921 5,572,478 TOTAL ASSETS 5,842,575 6,137,687 Payables 3.1 138,102 136,032 Post-employment liabilities 3.5 963 984 Contract liabilities 3.1 5,793 8,465 Lease liabilities 3.3 55,386 46,840 Other financial liabilities 5.5 2,641 2,922 Liabilities directly associated with assets classified as held for sale 6.5 7,127 16,760 Provisions 3.4 77,815 93,226 Total current liabilities 287,827 305,229 Borrowings 5.4 732,077 711,552 Derivative financial liabilities 5.4 459 457 Post-employment liabilities 3.5 17,232 16,165 Lease liabilities 3.3 561,674 561,662 Other financial liabilities 5.5 9,029 10,608 Provisions 3.4 31,288 29,971 Deferred income tax liability 4.2 821,217 941,028 Total non-current liability 2,172,976 2,271,443 TOTAL LIABILITIES 2,460,803 2,576,672 NET ASSETS 3,381,772 3,561,015 Issued capital 5.6 407,015 399,835 Reserves 5.7 190,604 168,829 Retained profits 2,784,153 2,992,351 TOTAL EQUITY 3,381,772 3,561,015 The above consolidated balance sheet should be read in conjunction with the accompanying notes. Consolidated Balance Sheet 124 p Brickworks Annual Report 2024 Issued capital Reserves Retained profits Total Notes $000 $000 $000 $000 For the year ended 31 July 2024 Balance at 1 August 2023 399,835 168,829 2,992,351 3,561,015 Loss after tax – – (118,885) (118,885) Other comprehensive income – net of tax – 19,500 – 19,500 Net dividends paid 2.5 – – (89,313) (89,313) Share issue costs 5.6 (26) – – (26) Issue of shares through employee share plan 5.7 3,600 (3,600) – – Shares vested to employees 5.6 3,366 (3,366) – – Shares purchased under STI scheme 5.6 (754) 754 – – Shares vested under STI scheme 5.6 994 (994) – – Share based payments expense 7.1 – 9,481 – 9,481 Balance at 31 July 2024 407,015 190,604 2,784,153 3,381,772 For the year ended 31 July 2023 Balance at 1 August 2022 392,263 183,615 2,684,116 3,259,994 Profit after tax – – 394,694 394,694 Other comprehensive loss – net of tax – (17,484) – (17,484) Net dividends paid 2.5 – – (86,459) (86,459) Share issue costs 5.6 (23) – – (23) Issue of shares through employee share plan 5.7 2,521 (2,521) – – Shares vested to employees 5.6 5,216 (5,216) – – Shares purchased under STI scheme 5.6 (994) 994 – – Shares vested under STI scheme 5.6 852 (852) – – Share based payments expense 7.1 – 10,293 – 10,293 Balance at 31 July 2023 399,835 168,829 2,992,351 3,561,015 The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes. Consolidated Statement of Changes in Equity Brickworks Annual Report 2024 p 125 31 July 2024 31 July 2023 Note $000 $000 Cash flows from operating activities Receipts from customers 1,175,311 1,265,608 Payments to suppliers and employees (1,124,044) (1,237,135) Interest received 1,370 635 Interest and other finance costs paid (77,121) (55,554) Dividends and distributions received 128,910 124,944 Income tax paid (383) (1,357) Net cash from operating activities 104,043 97,141 Cash flows from investing activities Purchases of property, plant and equipment (73,345) (113,662) Proceeds from sale of property, plant and equipment 4,589 28,809 Purchases of intangible assets (1,527) (2,121) Purchase of investments (11,233) (29,910) Proceeds from sale of investments 117,303 – Purchase of controlled entities, net of cash acquired1 (3,344) (1,903) Net cash from/(used in) investing activities 32,443 (118,787) Cash flows from financing activities Proceeds from borrowings 208,622 285,061 Repayments of borrowings (197,647) (160,000) Payment of principal portion of lease liabilities (53,351) (44,358) Share issue costs (27) (23) Dividends paid (100,633) (97,436) Net cash used in financing activities (143,036) (16,756) Net decrease in cash held (6,550) (38,402) Effects of exchange rate changes on cash (441) 1,884 Cash at the beginning of the financial year 69,565 106,083 Cash at the end of the financial year 5.2 62,574 69,565 Reconciliation of net profit attributable to shareholders of Brickworks Limited to net cash from operating activities (Loss)/Profit after tax (118,885) 394,694 Adjustments for non-cash items Depreciation and amortisation 37,119 36,934 Amortisation of right-of-use assets 53,799 38,523 Non-cash amortisation of borrowing costs (1,975) (5,518) Capitalised borrowing costs on qualifying asset – (310) Net fair value change on derivatives 2,036 (1,388) Impairment of assets held for sale – 5,933 Impairment of non-current assets 189,027 62,701 Loss on deemed disposal of associate – 994 Net gains on disposal of property, plant and equipment (2,330) (297,900) Loss on derecognition of an associate – 11,273 Loss on sale of investments 16,392 – Non-cash share based payment expense 9,481 10,293 Share of net profit/(loss) of investments accounted for using the equity method 68,200 (277,785) Net cash provided by operating activities before changes in assets and liabilities 252,864 (21,556) Changes in assets and liabilities net of effects from business combinations (Increase)/decrease in receivables 25,444 5,811 (Increase)/decrease in inventories (28,217) 19,864 (Increase)/decrease in net contract assets (1,378) 132 Movement in right of use assets and lease liabilities (1,145) 5,513 (Increase)/decrease in prepayments 2,399 (812) (Decrease)/increase in payables (3,151) (12,910) (Decrease)/increase in provisions (16,261) 541 (Decrease)/increase in post-employment liabilities 540 (478) (Decrease)/increase in other financial liabilities 740 406 (Decrease)/increase in current and deferred income tax (127,792) 100,630 Net cash provided by operating activities 104,043 97,141 The above consolidated statement of cash flows should be read in conjunction with the accompanying notes. Consolidated Statement of Cash Flows 1 Includes a deferred consideration payment of $ 3.3 million in the current year (2023: $1.9 million). Refer Note 5.5. 126 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statements 1 All values are rounded to the nearest thousand dollars or in certain cases, the nearest dollar, in accordance with the Australian Securities and Investments Commission (ASIC) Corporations Instrument 2016/191. This section sets out the basis upon which the financial statements are prepared as a whole. Significant and other accounting policies underpinning the recognition and measurement basis of assets and liabilities are summarised throughout the notes to the financial statements. Other accounting policies are outlined in note 7.6. 1 About this report 1.1 Statement of compliance and basis of preparation The financial statements comprise Brickworks Limited and its controlled entities (the “Group”). Brickworks Limited (ABN 17 000 028 526) is a for profit company limited by shares, incorporated and domiciled in Australia whose shares are publicly traded on the Australian Stock Exchange (ASX code: BKW). The nature of the operations and principal activities of the Group are described in note 2.1. The Group’s consolidated financial statements are general purpose financial statements which: ◗ have been prepared in accordance with Australian Accounting Standards (AASBs), other authoritative pronouncements of the Australian Accounting Standards Board (AASB) and the Corporations Act 2001; ◗ comply with International Financial Reporting Standards (IFRS) adopted by the International Accounting Standards Board (IASB); ◗ incorporate the results of each controlled entity from the date Brickworks Limited obtains control and until such time as it ceases to control an entity; ◗ have been prepared on a historical cost basis, except for derivative financial instruments, financial assets at fair value through other comprehensive income and investment property held within the property trusts, which have been measured at fair value. Other financial assets including receivables and borrowings have been measured at amortised cost; ◗ are presented in Australian dollars, which is the Group’s functional currency1; ◗ adopt all new and amended Accounting Standards and Interpretations issued by the AASB that are relevant to the operations of the Group and effective for reporting periods beginning on or after 1 August 2023; ◗ do not early adopt any Accounting Standards and Interpretations that have been issued or amended but are not yet effective as disclosed in Note 7.6. The financial statements were authorised for issue in accordance with a resolution of directors on 26 September 2024. Brickworks Annual Report 2024 p 127 1.2 Key estimates or judgements In the process of applying the Group’s accounting policies, management has made a number of judgements and applied estimates of future events. The areas involving a higher degree of judgement and complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in the following areas: Note Judgement/Estimate 3.2(a) Property, plant and equipment 3.2(c) Non-current assets impairment assessment 3.3 Right-of-use assets and lease liabilities 3.4 Provisions 6.3(b) Equity accounted investments – Fair value of investment property 1.3 Comparative information Certain comparative information was amended in these financial statements to conform to the current year presentation. These amendments do not impact the Group’s financial result and do not have any significant impact on the Group’s statement of financial position. The notes are organised into the following sections: 2 Financial Performance Provides the information that is considered most relevant to understanding the financial performance of the Group. 3 Operating Assets and Liabilities Provides a breakdown of individual line items in the balance sheet that are considered most relevant to users of the financial report. 4 Income Tax Provides the information considered most relevant to understanding the taxation treatment adopted by the Group during the financial year. 5 Capital and Risk Management Provides information about the capital management practices of the Group and its exposure to various financial risks. 6 Group Structure Explains significant aspects of the Brickworks’ group structure, including its controlled entities and equity accounted investments in which the Group has an interest. When applicable, it also provides information on business acquisitions or disposals of subsidiaries made during the year. 7. Other Provides information on items which require disclosure to comply with AASBs and other regulatory pronouncements and any other information that is considered relevant for the users of the financial report which has not been disclosed in other sections. 128 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 2 Financial Performance This section provides the information that is considered most relevant to understanding the financial performance of the Group, including profitability of its operating segments, significant items, nature of its revenues and expenses and dividends paid to the shareholders. 2.1 Segment reporting Management identified the following reportable business segments: Building Products Australia Manufacture and supply of vitrified clay and concrete products used in the building industry. Major product lines include bricks, masonry blocks, pavers, roof tiles and roof battens used in the building industry. Building Products North America Manufacture and supply of vitrified clay and concrete products used in the building industry. Major product lines include bricks, masonry blocks and accessories used in the building industry. Property Utilisation of opportunities associated with land owned by the Group, including the sale of property and investment in Property Trusts. Investments Holds investments in the Australian share market, both for dividend income and capital growth, and includes the investment in Washington H. Soul Pattinson and Company Limited (‘Soul Patts’) and FBR Limited (‘FBR’). Brickworks Annual Report 2024 p 129 1 Included in the income tax expense is tax benefit related to significant items amounting to $51,199,000. 2 Refer to Discontinued operations – Note 6.5. 3 Recognised at a point in time. 4 Recognised over time. 5 Borrowing costs are presented inclusive of fair value change on derivatives $2,036,000 and exclude items disclosed in the “Significant items” line. 31 July 2024 Building Products Australia Building Products North America Property Investments Continuing operations Discontinued operations2 Consolidated $’000 $’000 $’000 $’000 $’000 $’000 $’000 REVENUE Sale of goods3 603,516 439,282 – – 1,042,798 1,318 1,044,116 Revenue from supply and install contracts4 40,316 – – – 40,316 1,293 41,609 Interest received – – – 1,370 1,370 – 1,370 Rental revenue 212 49 57 – 318 – 318 Other operating revenue 1,584 2,996 32 – 4,612 – 4,612 Revenue 645,628 442,327 89 1,370 1,089,414 2,611 1,092,025 RESULT Segment EBITDA 102,473 43,139 (94,651) 137,346 188,307 (2,456) 185,851 Amortisation of right-of-use assets (44,147) (9,652) – – (53,799) – (53,799) Depreciation and amortisation (17,036) (20,083) – – (37,119) – (37,119) Segment EBIT (before gain on sale of land and buildings) 41,290 13,404 (94,651) 137,346 97,389 (2,456) 94,933 Loss on sale of investments – – (16,392) – (16,392) – (16,392) Gain on sale of land and buildings – 322 1,079 – 1,401 – 1,401 Total segment EBIT 41,290 13,726 (109,964) 137,346 82,398 (2,456) 79,942 Unallocated expenses Significant items (229,717) 119 (229,598) Borrowing costs5 (78,650) – (78,650) Other unallocated expenses (16,656) – (16,656) Profit/(loss) before income tax (242,625) (2,337) (244,962) Income tax (expense)/benefit1 125,390 687 126,077 Profit/(loss) after income tax (117,235) (1,650) (118,885) ASSETS Segment assets 997,380 583,030 2,007,140 2,250,269 5,837,819 3,033 5,840,852 Unallocated assets 1,723 – 1,723 Total assets 5,839,542 3,033 5,842,575 LIABILITIES Segment liabilities 725,069 150,192 7,123 481,123 1,363,507 7,127 1,370,634 Borrowings 732,077 – 732,077 Other unallocated liabilities – 358,092 – 358,092 Total liabilities 2,453,676 7,127 2,460,803 OTHER Share of profit of an associate and a joint venture 1,509 – (91,464) 150,665 60,710 – 60,710 Carrying value of investments accounted for by the equity method 20,278 – 2,007,140 2,196,604 4,224,022 – 4,224,022 Acquisition of non-current segment assets 32,569 45,647 9,172 2,061 89,449 – 89,449 Non-cash expenses other than depreciation and amortisation 145,121 142,533 – – 287,654 – 287,654 130 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 2.1 Segment reporting (continued) 1 Included in the income tax expense is tax benefit related to significant items amounting to $43,366,000. 2 Refer to Discontinued operations – Note 6.5. 3 Recognised at a point in time. 4 Recognised over time. 5 Borrowing costs are presented net of fair value change on derivatives ($1,388,000) and exclude items disclosed in the “Significant items” line. 31 July 2023 Building Products Australia Building Products North America Property Investments Continuing operations Discontinued operations2 Consolidated $’000 $’000 $’000 $’000 $’000 $’000 $’000 REVENUE Sale of goods3 682,253 445,283 – – 1,127,536 6,070 1,133,606 Revenue from supply and install contracts4 50,972 – – – 50,972 33,760 84,732 Interest received – – – 635 635 – 635 Rental revenue 182 99 72 – 353 – 353 Other operating revenue 994 1,315 54 – 2,363 – 2,363 Revenue 734,401 446,697 126 635 1,181,859 39,830 1,221,689 RESULT Segment EBITDA 100,479 33,355 236,657 158,707 529,198 (6,112) 523,086 Amortisation of right-of-use assets (29,537) (8,272) – – (37,809) (714) (38,523) Depreciation and amortisation (18,133) (18,801) – – (36,934) – (36,934) Segment EBIT (before gain on sale of land and buildings) 52,809 6,282 236,657 158,707 454,455 (6,826) 447,629 Gain on sale of land and buildings – 6,513 268,860 – 275,373 – 275,373 Total segment EBIT 52,809 12,795 505,517 158,707 729,828 (6,826) 723,002 Unallocated expenses Significant items (143,851) (8,265) (152,116) Borrowing costs5 (53,100) – (53,100) Other unallocated expenses (20,433) – (20,433) Profit/(loss) before income tax 512,444 (15,091) 497,353 Income tax (expense)/benefit1 (107,180) 4,521 (102,659) Profit/(loss) after income tax 405,264 (10,570) 394,694 ASSETS Segment assets 1,117,074 591,096 2,273,675 2,138,352 6,120,197 13,532 6,133,729 Unallocated assets 3,958 – 3,958 Total assets 6,124,155 13,532 6,137,687 LIABILITIES Segment liabilities 720,829 157,696 16,243 454,790 1,349,558 16,760 1,366,318 Borrowings 711,552 – 711,552 Other unallocated liabilities 498,802 – 498,802 Total liabilities 2,559,912 16,760 2,576,672 OTHER Share of profit of an associate and a joint venture 1,959 – 240,171 160,599 402,729 – 402,729 Carrying value of investments accounted for by the equity method 19,620 – 2,273,675 2,104,435 4,397,730 – 4,397,730 Acquisition of non-current segment assets 69,743 44,337 6,762 23,148 143,990 – 143,990 Non-cash expenses other than depreciation and amortisation 102,730 53,597 – – 156,327 5,933 162,260 Brickworks Annual Report 2024 p 131 The Group has a large number of customers to which it provides products, with no individual customers that account for more than 10% of external revenues. Recognition and measurement An operating segment is a component of an entity that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the Group’s Chief Operating Decision Maker (CODM) to effectively allocate Group resources and assess performance and for which discrete financial information is available. Management identifies the Group’s operating segments based on the internal reports that are reviewed and used by the Board of Directors in their role as the CODM. The operating segments are identified based on the consideration of the nature of products sold and services provided. Discrete information about each of these business divisions is presented to the Board of Directors on a recurring basis. A number of operating segments have been aggregated to form the Building Products segment. The accounting policies used by the Group in reporting segments internally are the same as those disclosed in the significant accounting policies, with the exception that significant items (i.e. those items which by their size and nature or incidence are relevant in explaining financial performance) are excluded from trading profits. This approach is consistent with the manner in which results are reported to the CODM. Significant items 31 July 2024 31 July 2023 Note $000 $000 Impairment of non-current assets1 3.2 (189,027) (49,240) Plant relocation and commissioning costs2 (13,553) (25,015) Legal costs3 (11,182) (2,385) Site closures and other restructuring activities – Australia4 (10,952) (5,762) Site closures and other restructuring activities – North America5 (4,914) (13,429) Austral Bricks Western Australia exit costs6 (1,168) (32,265) Other costs including advisory and IT implementation costs7 (13,610) (6,014) Significant items from continuing operations before income tax (excluding associates) (244,406) (134,110) Income tax benefit on other significant items (excluding associates)8 66,779 37,820 Significant items from continuing operations after income tax (excluding associates) (177,627) (96,290) Loss on deemed disposal of associate – (994) Income tax expense arising on deemed disposal – 298 Gain on deemed disposal of associate after income tax – (696) Loss on derecognition of associate – (11,273) Income tax expense arising on derecognition of associate – 1,673 Loss on derecognition of associate after income tax – (9,600) Significant one-off transactions of associate9 14,689 2,526 Income tax expense arising from the carrying value of the investment in the associates (Soul Patts’)8 (15,544) 1,095 Significant items after income tax (associates) (855) 3,621 Significant items from continuing operations after income tax (including associates) (178,482) (102,965) Impairment of assets held for sale10 – (5,933) Gain on disposal of assets held for sale10 – 693 Other significant items10 119 (3,025) Significant items from discontinued operations before income tax 6.5 119 (8,265) Income tax (expense)/benefit10 (36) 2,480 Significant items from discontinued operations after income tax 83 (5,785) 132 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 2.1 Segment reporting (continued) 1 All remaining performance obligations related to supply and install contracts are expected to be recognised within one year. Recognition and measurement Significant items are those which by their size and nature or incidence are relevant in explaining the financial performance of the Group compared to the prior year. 2.2. Revenues and expenses (a) Revenue and other income 31 July 2024 31 July 2023 $000 $000 REVENUE Revenue from contracts with customers Sale of goods 1,042,798 1,127,536 Revenue from supply and install contracts1 40,316 50,972 1,083,114 1,178,508 Other operating revenue Interest received 1,370 635 Rental revenue 318 353 Insurance claim settlement 2,067 – Other 2,545 2,363 Total operating revenue from continuing operations 1,089,414 1,181,859 OTHER INCOME Net gain on disposal of property, plant and equipment 2,330 276,310 Net fair value change on derivatives – 1,388 Lease modification gain 3,131 – Other items 861 136 Total other income from continuing operations 6,322 277,834 1 Disclosed in ‘Impairment of non-current assets’ line on the Income Statement. An assessment was conducted in line with the value- in-use methodology at 31 July 2024 resulting in an impairment loss of $59.9 million in respect of Property, Plant and Equipment, $42.8 million in relation to Intangible assets and $69.7 million in relation to Right-of-use assets. An impairment loss of $16.6 million was also recognised following a review of carrying amounts of assets impacted by site closures undertaken as part of restructure activities. The impairment loss was related to the assets within the Building Products North America ($96.4 million) and Building Products Australia ($92.6) operating segments. 2 Disclosed in 'Cost of Sales' ($9.3 million) and' Other Expenses' ($4.3 million) line on the Income Statement. 3 Disclosed in 'Other Expenses’ line on the Income Statement 4 Disclosed in 'Restructuring costs' ($14.1 million) and in ‘Other Income’ $3.1 million on the Income Statement. 5 Disclosed in 'Restructuring costs' ($4.9 million) line on the Income Statement. 6 Disclosed in 'Restructuring costs" ($1.5 million) and $0.3m in "Other Income" lines on the Income Statement. 7 Disclosed in ‘Other Expenses' ($12.9 million) and 'Finance costs' ($0.7 million) lines on the Income Statement. 8 Disclosed in 'Income tax expense' line on the Income statement. 9 Disclosed in 'Share of net profits of associates and joint ventures' line on the Income Statement. 10 Disclosed in the 'Losses from discontinued operations, net of income tax benefit' line on the Income statement. Brickworks Annual Report 2024 p 133 Current year In the current year the Group sold properties in Australia and North America with a gain of $1.4 million recognised in respect of these transactions. Disposals of other plant and equipment resulted in a gain of $1.2 million recognised in the current financial year. Prior year In the prior year the Group sold the remainder of the Oakdale East land into a newly established JV trust with Goodman Group (BGMG Oakdale East No 2). Consideration for the sale amounted to $301.3 million and represented the Group’s initial investment in this trust (refer Note 6.3). Total profit recognised in respect of the sale amounted to $262.6 million and included $13 million of costs associated with environmental remediation obligations arising from the sale of the land. The Group also sold other properties in Australia during the prior year with the total gain of $6.3 million recognised in respect of these transactions. The gain recognised in respect of the sale and leaseback transaction in North America amounted to $6.5 million. Recognition and measurement Revenue is recognised when control of the asset has passed to the buyer and the amount of revenue can be measured reliably. Revenue is measured at the fair value of the consideration received or receivable net of discounts, allowances and goods and services tax (GST). Trade discounts and volume rebates give rise to variable consideration. The variable consideration is estimated at contract inception and constrained until the associated uncertainty is subsequently resolved. The application of the constraint on variable consideration increases the amount of revenue that will be deferred. The Group’s contracts for the sale of goods and associated freight generally include one performance obligation. The revenue is recognised at the point in time when control of the asset is transferred to the customer, generally on delivery of the products. The performance obligation is satisfied upon delivery of the goods and payment is generally due within 30 to 60 days from delivery. Performance obligations arising from supply and install contracts are satisfied over time. On that basis, the Group recognise revenue from these contracts over time. The performance obligation related to supply and install contracts is satisfied over time and payment is generally due upon completion of installation and acceptance of the customer. In some contracts, short-term advances are required before the installation service is provided. Revenue from the sale of land held for resale is recognised at the point at which any contract of sale in relation to industrial land has become unconditional, and at which settlement has occurred for residential land. Dividend revenue is recognised when the right to receive a dividend has been established. Dividends received from associates and joint ventures are accounted for in accordance with the equity method of accounting. Rental income from investment properties is accounted for on a straight-line basis over the term of the rental contract. Net gain/(loss) on disposal of property, plant and equipment is recognised when the risks and rewards have been transferred and the Group does not retain either continuing managerial involvement to the degree usually associated with ownership, or effective control over the assets sold. The gain is measured as a difference between the amount receivable under the sale contract and the carrying value of the disposed asset. 134 p Brickworks Annual Report 2024 2.2 Revenues and expenses (continued) Notes to the Consolidated Financial Statement (b) Expenses Specific Expense Disclosures 31 July 2024 31 July 2023 $000 $000 Wages and salaries 254,881 264,528 Post-employment benefits expense 16,808 15,743 Share based payments expense 9,481 10,293 Health insurance expense – North America 15,953 15,677 Other 8,616 12,306 Employee benefits expense from continuing operations 305,739 318,547 Depreciation of property, plant and equipment 35,966 35,850 Amortisation of right-of-use assets 53,799 37,809 Amortisation of intangible assets 1,153 1,084 Depreciation and amortisation from continuing operations 90,918 74,743 Interest and finance charges paid/payable 50,316 37,697 Interest on lease liabilities 26,298 21,553 Net fair value change on derivatives 2,036 – Unwind of discounting on deferred consideration – Redland Brick acquisition 745 313 Total finance costs from continuing operations 79,395 59,563 Recognition and measurement Employee benefits expense includes salaries and wages, leave entitlements (refer note 3.4), post-employment benefit (refer note 3.5), share based payments and other employee entitlements. The expense is charged against profit in their respective expense categories when services are provided by employees, except for share based payment expense which is recognised based on the vesting period (refer note 7.1). Finance costs expense relates primarily to the interest on interest bearing liabilities and is recognised in the period in which they are incurred, except when they are included in the costs of qualifying assets in which they are capitalised up to the point that the asset is ready for its intended use. 2.3 Share of net profits of associates and joint ventures 31 July 2024 31 July 2023 Notes $000 $000 Share of net of profits/(losses) of associates 6.3 (a) 150,665 160,599 Share of net profits/(losses) of joint ventures 6.3 (b) (89,955) 242,130 60,710 402,729 Recognition and measurement Share of net profits of associates and joint ventures is accounted for using the equity method. The consolidated income statement reflects the Group’s share of the results of associates and joint ventures. Accounting policies applied with respect to the Group’s investments in associates and joint ventures are further outlined in Note 6.3. Brickworks Annual Report 2024 p 135 2.4 Earnings per share (EPS) 31 July 2024 Restated 31 July 2023 (Loss)/profit after tax attributable to shareholders of Brickworks Limited ($’000) (118,885) 394,694 (Loss)/profit from continuing operations after tax ($’000) (117,235) 405,264 Weighted average number of ordinary shares (thousand) 152,433 152,166 Less: reciprocal interest with Soul Patts (17,152) (17,152) Less: weighted average number of treasury shares (thousand) (504) (699) Weighted average number of ordinary shares used in the calculation of basic EPS (thousand) 134,777 134,315 Weighted average number of ordinary shares used in the calculation of diluted EPS (thousand) 134,777 134,921 Basic EPS (cents per share) (88.2) 293.9 Diluted EPS (cents per share) (88.2) 292.5 Basic EPS (cents per share) from continuing operations (87.0) 301.7 Diluted EPS (cents per share) from continuing operations (87.0) 300.4 The weighted average number of shares used in the EPS in the current year was adjusted to remove the weighted average number of treasury shares outstanding during the year and to account for the reciprocal interest with Washington H. Soul Pattinson Limited (“Soul Patts”). Prior year comparatives have also been restated to reflect this adjustment. The weighted average number of shares during the year includes an adjustment for 17,151,975 shares related to the cross-shareholding between Brickworks and Soul Patts. In the current year Soul Patts held 65,645,140 Brickworks shares. Soul Patts is 26.13% owned by Brickworks and the resulting reciprocal interest is treated as treasury shares (restated 2023: 17,151,975 shares). Recognition and measurement Basic earnings per share (EPS) is calculated by dividing the profit attributable to shareholders of Brickworks Limited, after eliminating the effect of earnings related to the parent entity’s shareholding arrangements and excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the year. Diluted EPS adjusts the figures used in the determination of basic EPS to reflect the after income tax effect of interest and other finance costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to these shares. Diluted earnings per share are shown as being equal to basic earnings per share if potential ordinary shares are non-dilutive to existing ordinary shares. 2.5 Dividends and franking credits Type of dividend (fully franked) Cents per share Total amount $’000 Date paid/ payable 2022 Final 41.0 62,420 23-Nov-22 2023 Interim 23.0 35,016 2-May-23 2023 Final 42.0 64,021 22-Nov-23 2024 Interim 24.0 36,612 1-May-24 2024 Final1 43.0 65,597 27-Nov-24 24 16 8 32 40 48 56 64 72 Final ordinary dividend Interim ordinary dividend 43.0 24.0 2020 39.0 20.0 2024 2023 42.0 23.0 2022 41.0 22.0 2021 40.0 21.0 Dividends declared in each financial year cents per share 1 The final dividend for the 2024 financial year has not been recognised as a liability in this financial report because it was resolved to be paid after 31 July 2024. The amounts disclosed as recognised in 2024 are the final dividend in respect of the 2023 financial year and the interim dividend in respect of the 2024 financial year. 136 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 31 July 2024 31 July 2023 $000 $000 2023 Final ordinary dividend (PY: 2022) 64,021 62,420 2024 Interim ordinary dividend (PY: 2023) 36,612 35,016 Group’s share of dividend received by associated company (11,320) (10,977) 89,313 86,459 Franking account balance on a tax paid basis 150,419 156,608 The impact on the franking account of dividends resolved to be paid after 31 July 2024, but not recognised as a liability, will be a reduction in the franking account of $28.1 million (2023: $27.4 million). 3. Operating Assets and Liabilities 2.5 Dividends and franking credits (continued) This section provides further information about the Group’s operating assets and liabilities, including its working capital, property, plant and equipment, right-of-use assets, intangible assets, lease liabilities and provisions. 3.1. Working Capital (a) Receivables 31 July 2024 31 July 2023 $000 $000 Trade receivables 127,211 148,591 Allowance for expected credit losses (5,005) (6,568) Net trade receivables 122,206 142,023 Other debtors 4,366 5,364 Total 126,572 147,387 Movement in allowance for expected credit losses Opening balance 6,568 2,548 Trade debts provided 2,786 6,048 Trade debts written-off (4,383) (2,057) Foreign currency exchange difference 34 29 Closing balance 5,005 6,568 Receivables past due Past due 0–30 days 6,658 8,853 Past due 30+ days 3,925 13,624 10,583 22,477 (b) Inventories 31 July 2024 31 July 2023 $000 $000 Current Raw materials and stores 62,372 49,560 Work in progress 5,622 5,433 Finished goods 287,163 264,129 Total 355,157 319,122 Non-current Raw materials 6,567 7,180 Write-down of inventories recognised as an expense for the 2024 financial year amounted to $6.8 million (2023: $29.0 million). (c) Current payables Trade payables and accruals 138,102 136,032 Average terms on trade payables are 30 days from statement. As at 31 July 2024 the contract assets amounted to $1.2 million (2023: $1.3 million) and contract liabilities to $5.8 million (2023: $8.5 million). There has been no allowance for expected credit losses recognised related to the contract assets. Brickworks Annual Report 2024 p 137 Recognition and measurement Trade receivables are initially recognised at the value of the invoice issued to the customer and subsequently measured at amortised cost and are subject to impairment. The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original effective interest rate. Inventories are measured at: ◗ Raw materials: the lower of actual cost and net realisable value. ◗ Finished goods and work in progress: the lower of cost and net realisable value. The cost of manufactured products includes direct materials, direct labour and an appropriate portion of variable and fixed overheads. Fixed overheads are applied on the basis of normal production capacity. Net realisable value represents the estimated selling price less all estimated costs of completion and the estimated costs necessary to make the sale. Cost of sales excludes freight costs which are classified as distribution expenses in the Income statement. Contract assets are initially recognised for revenue earned from supply and install contracts as receipt of consideration is conditional on successful completion of installation. Upon completion of installation and acceptance by the customer, the amounts recognised as contract assets are reclassified to trade receivables. Contract liabilities include advances received in relation to supply and install contracts as well as transaction price allocated to customer incentive programs. Trade and other payables are recognised when the Group becomes obliged to make future payments resulting from the purchase of goods and services. Payables are stated at amortised cost. 3.2 Property, plant and equipment and intangible assets (a) Property, plant and equipment Land and buildings Plant and equipment Total 2024 2023 2024 2023 2024 2023 $000 $000 $000 $000 $000 $000 Cost 412,166 322,262 783,989 839,370 1,196,155 1,161,632 Accumulated depreciation and impairment losses (77,450) (48,389) (520,116) (481,385) (597,566) (529,774) Net carrying amount 31 July 334,716 273,873 263,873 357,985 598,589 631,858 Net carrying amount at 1 August 273,873 291,663 357,985 344,350 631,858 636,013 Additions (net of CWIP commissioned)1 85,236 11,508 (11,041) 101,974 74,195 113,482 Acquisitions through business combinations – – – 308 – 308 Disposals (2,149) (26,150) (110) (20,237) (2,259) (46,387) Reclassification of assets 2,492 – (2,492) – – – Impairment losses (19,585) (1,562) (56,913) (45,665) (76,498) (47,227) Foreign currency exchange difference 3,697 6,128 3,562 5,391 7,259 11,519 Depreciation expense (8,848) (7,714) (27,118) (28,136) (35,966) (35,850) Net carrying amount 31 July 334,716 273,873 263,873 357,985 598,589 631,858 As at 31 July 2024 capital works in progress (CWIP), disclosed as part of plant and equipment, amounted to $82.4 million (2023: $134.0 million). Impairment losses of $76.5 million include: ◗ $59.9 million of impairment losses recognised based on an assessment of CGU asset carrying amounts in line with value-in-use methodology and related to Brickworks North America and Austral Masonry assets. (Note 3.2c) ◗ $16.6 million of impairment losses recognised following a review of carrying amounts of assets impacted by site closures undertaken as part of restructure activities and primarily related to the Austral Bricks CGU ($11.6 million), Brickworks North America CGU ($2.1 million), Bristile Roofing CGU ($1.8 million) and Austral Masonry ($1.1 million) (Note 2.1). 1 Additions to plant and equipment include nil (2023: $0.3 million) capitalised borrowing costs in the current year. 138 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement (b) Intangible assets Goodwill Brand names Other Total $’000 $’000 $’000 $’000 Cost 308,280 20,477 26,357 355,114 Accumulated amortisation and impairment losses (236,236) (11,477) (4,526) (252,239) Net carrying amount 31 July 2024 72,044 9,000 21,831 102,875 Net carrying amount 1 August 2023 101,625 20,149 22,663 144,437 Additions – – 1,528 1,528 Acquisitions through business combinations 290 – – 290 Impairment losses (30,276) (11,302) (1,207) (42,785) Foreign currency exchange difference 405 153 – 558 Amortisation expense – – (1,153) (1,153) Net carrying amount 31 July 2024 72,044 9,000 21,831 102,875 Cost 307,114 20,149 24,830 352,093 Accumulated amortisation and impairment losses (205,489) – (2,167) (207,656) Net carrying amount 31 July 2023 101,625 20,149 22,663 144,437 Net carrying amount 1 August 2022 100,252 19,632 21,626 141,510 Additions – – 2,121 2,121 Foreign currency exchange difference 1,373 517 – 1,890 Amortisation expense – – (1,084) (1,084) Net carrying amount 31 July 2023 101,625 20,149 22,663 144,437 Impairment losses of $42.8 million (2023: nil) were recognised in the current year based on an assessment of CGU asset carrying amounts in line with value-in-use methodology and related to Brickworks North America and Austral Masonry assets. (Note 3.2c) Recognition and measurement Property, plant and equipment is measured at cost less depreciation and impairment losses. Subsequent costs are included in the asset’s carrying amount only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the income statement during the reporting period in which they are incurred. Depreciation commences on assets when it is deemed, they are capable of operating in the manner intended by management. Assets are depreciated over their estimated useful lives, except for leasehold improvements which are depreciated over the shorter of their estimated useful life and the remaining lease period. Depreciation is charged to the income statement based on the rates indicated below. Freehold land not depreciated Buildings 2.5%–4.0% prime cost Plant and equipment 4.0%–33.0% prime cost, 7.5%–22.5% diminishing value Carrying amounts are assessed for impairment whenever there is an indication, they may be impaired. If the carrying amount of an asset is greater than its estimated recoverable amount, the carrying amount is written down to its recoverable amount. Significant accounting judgements, estimates and assumptions Estimation of useful lives of assets has been based on historical experience. The condition of assets is assessed at least annually and considered against the remaining useful lives. Adjustments to useful lives are made when considered necessary. Management is required to make significant estimates and judgements in assessing the carrying amount of property, plant and equipment for impairment. This assessment is performed in consideration of impairment indicators at an individual asset level (e.g.site closures or plant relocations) or with reference to valuations supporting the carrying amounts at the Cash Generating Unit (CGU) level – refer to Note 3.2 (c). 3.2 Property, plant and equipment and intangible assets (continued) Brickworks Annual Report 2024 p 139 Recognition and measurement Goodwill represents the excess of the cost of acquisition over the fair value of the identifiable assets and liabilities acquired. Goodwill is not amortised, but tested annually and whenever there is an indicator of impairment. Brand names obtained through acquiring businesses are measured at fair value at the date of acquisition. The brand names have been assessed as having an indefinite useful life, as the brands have been part of the building products industry for a long time and the Group intends to continue trading under these brands. Other intangible assets are valued at cost on acquisition. If the intangible is considered to have an indefinite useful life, it is carried at cost less any impairment write-downs. If the intangible has a definite life, it is amortised on a straight-line basis over the expected future life of that right. Other intangible assets include a newly implemented ERP system which is amortised over an estimated useful life of 20 years on a straight-line basis. Intangible assets with definite useful life are assessed for impairment whenever there is an indication, they may be impaired. If the carrying amount of an asset is greater than its estimated recoverable amount, the carrying amount is written down to its recoverable amount. Goodwill and intangible assets with indefinite useful lives are tested for impairment annually and whenever there is an indicator of impairment. For impairment testing purposes, these assets are allocated to the Group’s Cash Generating Units (‘CGUs’). Impairment is determined by assessing the recoverable amount of the CGU to which the goodwill relates. (c) Impairment assessment (i) Allocation of goodwill and intangible assets with indefinite useful lives to cash generating units Building Products North America and national divisions within the Building Products Australia operating segment are CGUs which represent the lowest level at which the results are monitored for internal reporting purposes. During the year Group’s CGUs consisted of Austral Bricks East Coast, Austral Bricks WA, Austral Masonry and Bristile Roofing in Australia, as well as Brickworks North America with goodwill allocated to CGUs (or a Group of CGUs in respect of Austral Bricks) for impairment testing purposes. At 31 July 2024 the following CGUs representing business operations had allocations of goodwill tested for impairment: ◗ Austral Bricks CGU Group: $72.0 million (2023: $72.0 million); ◗ Building Products North America: $30.3 million (2023: $29.6 million). For the purpose of impairment assessment outlined below brand names with indefinite useful lives with a carrying value of $20.5 million (2023: $20.1 million) have been allocated to the following CGUs, which form part of the Building Products Australia and North America operating segments: ◗ Austral Bricks CGU Group: $9.0 million (2023: $9.0 million); ◗ Building Products North America: $11.3 million (2023: $11.1 million). Each CGU tested for impairment has been valued based on value-in-use methodology, using the assumptions outlined in point (iv) below. Furthermore, impairment indicators have been identified in respect of the Austral Masonry CGU at 31 July 2024. Consequently, this CGU has also been tested for impairment based on value-in-use methodology. The consolidation of Austral Bricks and Austral Masonry into one national operating division was announced in the current year with the integration complete by 31 July 2024. Due to the interdependent nature of cash flows generated by these operations, following the restructure, the consolidated Austral Bricks and Austral Masonry business represents a single Brickworks Australia CGU. For impairment testing purposes, as at 31 July 2024 the new Brickworks Australia CGU represented an aggregation of the existing Austral Bricks and Austal Masonry CGUs with goodwill of $72.0 million and brand names with indefinite useful lives with a carrying amount of $9.0 million have been allocated to this CGU. (ii) Results of impairment assessment – current year An impairment assessment was conducted in line with the value-in-use methodology at 31 July 2024. Based on the assessment, the Group recognised an impairment loss of $172.4 million in respect of the Brickworks North America CGU and Austral Masonry CGUs. The table below summarises key drivers the of impairment loss recognised as at 31 July 2024. Brickworks North America Austral Masonry Following significantly reduced activity during the second half of the current financial year, the short to medium-term outlook for non-residential building in the key markets of the Northeast and Midwest regions of the United States has weakened. Following the completion of a significant plant rationalisation and upgrade program, subdued building activity has resulted in scaled back production output and a delay in realisation of the full benefits of these initiatives. Strong competition, particularly in the single-family housing segment, resulting in pricing and volume pressure in selected regional markets. An accelerated deterioration in multi-residential building activity in the second half of the current financial year, with June 2024 commencements across Australia forecast to be at the lowest level for more than a decade. The decline has been particularly severe in the high-rise segment (4+ storeys) in Sydney and Brisbane representing key markets for Austral Masonry. A delay in realisation of the full benefits from the increased invested capital in Austral Masonry, including the new plant at Oakdale, in Western Sydney, New South Wales, following scaled back production output in response to the decline in market activity. Higher costs across the business, such as land tax and raw materials, yet to be fully recovered by recent price increases. 140 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 3.2 Property, plant and equipment and intangible assets (continued) The loss was allocated as follows: ◗ Brickworks North America: $94.3 million – ($41.6 million allocated to goodwill and brand names resulting in full impairment of their carrying amounts, $12.8 million allocated to Right-of-Use assets and $39.9 million allocated to Property, Plant & Equipment); ◗ Austral Masonry: $78.1 million – ($56.9 million allocated to Right-of-Use assets and $20.0 million allocated to Property, Plant & Equipment and $1.2 million allocated to Intangible Assets with finite useful lives). The impairment loss was recognised within ‘Impairment of non-current assets’ in the consolidated income statement. (iii) Results of impairment assessment – prior year In the prior year an impairment loss was recognised in respect of non-current assets related to the Austral Bricks Western Australia CGU of ($47.6 million) and Bristile Roofing CGU ($1.6 million). The impairment loss was recognised within ‘Impairment of non-current assets’ in the consolidated income statement. (iv) Austral Bricks, Austral Masonry and Building Products North America impairment assessment – key assumptions Significant accounting judgements, estimates and assumptions Management is required to make significant estimates and judgements in assessing the carrying amount of non-financial assets for impairment. The valuations used to support the carrying amounts of each CGU (including goodwill, other intangible assets and property, plant and equipment) are based on forward-looking assumptions that are by their nature uncertain. The nature and basis of the key assumptions used to estimate the future cash flows and discount rates, and on which the Group has based its projections when determining the recoverable value of each CGU, are set out below. The valuations used to support the carrying amounts of the intangible assets are based on forward looking key assumptions that are, by nature, uncertain. Any changes in the assumptions can lead to significant changes in the recoverable amounts of the CGUs. The Group has based its impairment testing upon conditions existing as at 31 July 2024 and what the Management and the Directors believe can reasonably be expected at that date. Calculation method The recoverable amount of each CGU is determined on the basis of value-in-use (VIU), unless there is evidence to support a higher fair value less cost to sell. VIU calculations use cash flows projections, inclusive of working capital movements, and are based on financial projections approved by the Board covering a five-year period. Estimates beyond five years are calculated with a growth rate that reflects the long-term growth rate. Sales volumes Sales volumes are management forecasts reflecting independent external forecasts of underlying economic activity for the market sectors and geographies in which each CGU operates. A major driver of sales volumes is the level of activity in the relevant segment in the building sector. Management has assessed the reported forecast construction activity data in Australia and North America from external sources. Management further assesses sales mix and market share of the relevant CGU. Sales prices Management expects to obtain price growth over the forecast period. The assumed increases differ by CGU and between different states where the CGU operates. Management takes into consideration actual historic price growth achieved when forecasting price growth in the forecast period. Costs Costs are calculated taking into account historical gross margins, known cost increases, and estimated inflation rates over the period that are consistent with the locations in which the CGUs operate. Terminal value earnings For Austral Bricks the terminal value earnings are based on the 7-year average historical earnings moderated to reflect structural changes to the market in which the CGU operates. For Austral Masonry and Brickworks North America, the terminal value earnings are based on the average cashflows forecast over the 3 final years of the forecast period. This takes into account: ◗ the nature of newly acquired businesses and forecast benefits from the plant rationalisation program completed in the current year (North America) ◗ a range of strategic initiatives, including transition to the new manufacturing facility at Oakdale and continued growth of premium products (Austral Masonry). (ii) Results of impairment assessment – current year (continued) Brickworks Annual Report 2024 p 141 Long-term growth rates (LTGR) Long-term growth rates used in cash flow valuation reflect 2.5% (2023: 2.5%). Discount rate For 2024, the post-tax discount rate calculated including the impact of AASB 16 – Leases for the Australian CGUs was 9.84% (2023: 9.31%) and 11.38% (2023: 9.34%) for the North American CGU. (v) Sensitivity to changes in assumptions In respect of Brickworks North America and Austral Masonry, given an impairment was recognised in the year, the carrying value of the CGU’s are held at their recoverable amount. Therefore, any negative change in a key assumption will result in an impairment charge being recognised. The table below illustrates the impact of key assumptions on the non-current assets impairment for the Austral Bricks CGU where the carrying amount approximates the recoverable amount. Austral Bricks The excess of CGUs recoverable amount over its carrying amounts ($ millions) 12.2 Change in the assumption required for the model to break even Reduction in EBIT over the forecast period (5.8%) Reduction in LTGR From 2.50% to 2.26% Increase in post-tax WACC From 9.84% to 10.0% 3.3. Right-of-use assets and lease liabilities Right-of-use assets Property Equipment Vehicles Total Liabilities Note $’000 $’000 $’000 $’000 $’000 As at 1 August 2023 207,350 167,434 936 375,720 (608,502) New and modified leases 23,583 37,571 1,931 63,085 (63,314) Leases terminated (1,373) (149) (302) (1,824) 5,016 Depreciation expense (20,245) (32,543) (1,011) (53,799) – Impairment losses 3.2 (43,324) (26,239) (181) (69,744) – Payment of principal portion of lease liability 51,780 Foreign exchange difference 1,177 126 6 1,309 (2,040) As at 31 July 2024 167,168 146,200 1,379 314,747 (617,060) As at 1 August 2022 197,459 133,484 1,572 332,515 (543,772) New and modified leases 43,101 51,933 642 95,676 (105,525) Leases terminated (263) (222) (194) (679) 1,020 Depreciation expense (20,157) (16,531) (1,121) (37,809) Impairment losses 3.2 (13,868) (1,606) – (15,474) – Payment of principal portion of lease liability 41,562 Foreign exchange difference 1,078 376 37 1,491 (1,787) As at 31 July 2023 207,350 167,434 936 375,720 (608,502) During the year, the Group recognised rent expense of $3.7 million (2023: $5.6 million) from short-term leases and variable lease payments. Impairment losses of $69.7 million (2023: $15.5 million) were recognised in the current year based on an assessment of CGU asset carrying amounts in line with value-in-use methodology and related to Brickworks North America and Austral Masonry assets. (Note 3.2c). 1 $55.4 million (2023: $46.8 million) included in current liabilities and $561.7 million (2023: $561.7 million) in non-current liabilities. 142 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 3.3 Right-of-use assets and lease liabilities (continued) Recognition and measurement The Group recognises right-of-use assets at the commencement of the lease (i.e. the date the underlying asset is available for use). The initial measurement of right-of-use assets includes the amount of liabilities recognised and lease payments made at or before the commencement date, less any incentives received. Where an obligation exists to dismantle, remove, or restore a leased asset or the site it is located on and a provision has been raised, the right of-use asset also includes these restoration costs. Right-of-use assets are subsequently measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any re-measurement of lease liabilities. Unless the Group is reasonably certain to obtain the ownership of the leased asset at the end of the lease term, the right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the lease term. Right-of-use assets are subject to impairment assessments under AASB 136 Impairments of Assets. At the commencement of a lease, the Group recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or rate, and amounts expected to be paid under residual value guarantees. The lease payments also include renewal periods where the Group is reasonably certain to exercise the renewal option. Outgoings and other variable lease payments that do not depend on an index or a rate are recognised as expense as incurred. In calculating the present value of lease payments, the Group uses the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. Sale and leaseback transactions When we sell and lease back the same asset, the accounting treatment depends on whether the control of the asset has been transferred to the buyer: ◗ If yes, the Group measures the right-of-use asset arising from the leaseback at the proportion of the previous carrying amount of the asset that relates to the rights retained by us as a seller lessee. Accordingly, the Group recognises only the amount of any gain or loss that related to the rights transferred to the buyer-lessor. ◗ If not, as a seller-lessee the Group continues to recognise the transferred asset and recognises a financial liability equal to the transfer proceeds. Short-term lease and leases of low-value assets The Group applies a recognition exemption to leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option. It also applies a recognition exemption to leases that are considered of low value. Lease payments on short-term and low-value leases are recognised as expense on a straight-line basis over the lease term. Judgements in determining the lease term of contracts with renewal options The Group determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. After initial recognition, the Group reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise (or not to exercise) the option to renew. 3.4 Provisions Employee benefits Remediation and make good Workers compensation Site Closures Other Total $’000 $’000 $’000 $’000 $’000 $’000 Opening balance 1 August 2023 56,949 54,782 4,451 4,885 2,130 123,197 Recognised / (reversed) 82,824 2,960 2,745 3,258 4,662 96,449 Foreign currency exchange difference (3,218) 76 – 78 5 (3,059) Settled (82,529) (11,672) (3,814) (7,090) (2,379) (107,484) Closing balance 31 July 2024 54,026 46,146 3,382 1,131 4,418 109,103 Current 51,608 18,679 3,382 1,131 3,015 77,815 Non-current 2,418 27,467 – – 1,403 31,288 Total 54,026 46,146 3,382 1,131 4,418 109,103 Brickworks Annual Report 2024 p 143 Employee benefits Remediation and make good Workers compensation Site Closures Other Total $’000 $’000 $’000 $’000 $’000 $’000 Opening balance 1 August 2022 58,797 42,921 4,288 14,290 2,155 122,451 Recognised / (reversed) 87,425 16,806 3,499 11,489 2,274 121,493 Foreign currency exchange difference 365 172 – 294 25 856 Settled (89,638) (5,117) (3,336) (21,188) (2,324) (121,603) Closing balance 31 July 2023 56,949 54,782 4,451 4,885 2,130 123,197 Current 53,362 28,398 4,451 4,885 2,130 93,226 Non-current 3,587 26,384 – – – 29,971 Total 56,949 54,782 4,451 4,885 2,130 123,197 Recognition and measurement Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that settlement will be required and the obligation can be reliably measured. The amount recognised as a provision represents the best estimate of the consideration required to settle the present obligation at reporting date and uncertainties surrounding the obligation. Provision for employee benefits is recognised in respect of the benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits. Estimated future payments include related on-costs, reflect assumptions regarding future wage and salary levels, employee departures and periods of service, and have been discounted using market yields on Australian high quality corporate bond rates. Provision for remediation and make good leases is recognised for the estimated costs of restoring operational and quarry sites to their original state in accordance with relevant approvals. Where an obligation exists to dismantle, remove, or restore a leased asset or the site it is located on and a provision has been raised. The settlement of this provision will occur as the operational site nears the end of its useful life, or once the resource allocation within the quarry is exhausted, which varies based on the size of the resource and the usage rate of the extracted material. The landfill opportunities created through the extraction of clay and shale is considered to be a valuable future resource. No provision is made for future rehabilitation costs when the rehabilitation process is expected to be cash flow positive. Provision for workers compensation relates to the Group’s self insurance for workers compensation program. The subsidiaries of the Group are licensed self insurers in New South Wales, Victoria, Western Australia and Australian Capital Territory for workers compensation insurance. The provision is determined with reference to independent actuarial calculations provided annually based on incidents reported before year end. The timing of the future outflows is dependent upon the notification and acceptance of relevant claims, and would be satisfied over a number of future financial periods. Provision for site closures is recognised for the estimated costs of permanently closing manufacturing sites. The timing of the future outflows is expected to occur within the next financial year. 144 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 3.5. Post-employment liabilities Following the acquisition of Glen-Gery in November 2018, the Group participated in two multi-employer defined benefit pension schemes, being Aluminium, Brick and Glass Workers International Union (“AB&GW”) and National Integrated Group Pension Plan (“NIGPP”), which are both held in the United States. In the prior years, Glen-Gery ceased to participate in the NIGPP. As the Group is unable to identify its share of the assets and liabilities for the AB&GW scheme as insufficient information is available on which to calculate this split (as confirmed with the scheme actuaries), it is accounted for on a defined contribution basis. Unfunded vested benefits are allocated among active employer participating groups. This allows the multi-employer plan to assess employers who withdraw from a plan with a share of the plan’s total unfunded vested liability. That share of unfunded liability is not determined with reference to the employer’s participants nor the assets that were accumulated by that employer’s contributions. When an employer withdraws, it may be required to pay the entire withdrawal liability over time, or a lesser amount based on certain limitations related to the period of payments and the net worth of the employer. The minimum contribution requirements for the AB&GW scheme are based on a minimum monthly charge per active employee. In total, the AB&GW plan has a deficit as at 31 July 2024 of $21.43 million (2023: $20.4 million). Management currently does not have any plans on withdrawing from this scheme. The contribution rates agreed to be paid by the Group include an element of rehabilitation funding with respect to the total plan deficit. In respect of the scheme, the arrangement gives rise to a present obligation and as such a liability of $18.2 million (2023: $17.1 million) has been recognised at a present value of future committed contribution amounts required in respect of this scheme. Total expected contributions to the plan, including an element of rehabilitation funding, for the next annual reporting year, being the year ending 31 July 2025, amount to $1.7 million (2023: $1.5 million). Post-employment liabilities $’000 Opening balance 1 August 2023 17,149 Recognised/(reversed) 1,177 Settled (639) Foreign currency exchange difference 508 Closing balance 31 July 2024 18,195 Current 963 Non-current 17,232 Total 18,195 Opening balance 1 August 2022 16,810 Recognised/(reversed) 94 Settled (570) Foreign currency exchange difference 815 Closing balance 31 July 2023 17,149 Current 984 Non-current 16,165 Total 17,149 Recognition and measurement Multi-employer plans are defined contribution plans or defined benefit plans that pool the assets contributed by various entities that are not under common control and use those assets to provide benefits to employees of more than one entity, on the basis that contribution and benefit levels are determined without regard to the identity of the entity that employs the employees concerned. Where a multi-employer plan is a defined benefit plan, an entity shall account for its proportionate share of the defined benefit obligation, plan assets and cost associated with the plan in the same way as for any other defined benefit plan. When sufficient information is not available to use defined benefit accounting for a multi-employer plan that is a defined benefit plan, an entity shall account for the plan as if it were a defined contribution plan. Contributions payable to a defined contribution plan are recognised as a liability, after deducting any contribution already paid. Where contributions to a defined contribution plan do not fall due wholly within twelve months after the end of the period in which the employees render the related service, they shall be discounted using the rate applicable to high quality corporate bonds. Brickworks Annual Report 2024 p 145 4. Income Tax This section provides the information considered most relevant to understanding the taxation treatment adopted by the Group during the financial year. The Group is subject to income taxes in Australia and United States of America. The entities incorporated in the United States of America are not part of the Australian tax consolidated group and therefore taxed separately. Tax consolidation Brickworks Limited and its wholly-owned Australian subsidiaries have formed an income tax consolidated group (Tax Group) under the Australian Tax Consolidation regime. Brickworks Limited is the head entity of that group. The Tax Group has entered into a tax sharing agreement whereby each company in the group contributes to the income tax payable based on the current tax liability (or current tax asset) of the entity. These tax amounts are measured as if each entity in the tax consolidated group continues to be a standalone taxpayer in its own right. Such amounts are reflected in amounts receivable from or payable to other entities in the Tax Group. In addition, the agreement provides for the allocation of income tax liabilities between the entities should the head entity default on its tax payment obligations. At balance date, the possibility of default is considered remote. Tax expense, deferred tax liabilities and deferred tax assets arising from temporary differences of the members of the Tax Group are recognised in the separate financial statements of the members of the group. Any current tax liabilities (or assets) and deferred tax assets arising from unused tax losses and tax credits of the members of the group are recognised by the parent company (as head entity of the Tax Group). 4.1. Income tax expense 31 July 2024 31 July 2023 Notes $000 $000 (Loss)/profit from continuing operations before income tax (242,625) 512,444 Loss from discontinued operations before income tax benefit 6.5 (2,337) (15,091) (Loss)/profit before income tax (244,962) 497,353 Prima facie tax expense calculated at 30% (73,489) 149,206 (Decrease) / increase in income tax expense due to: Franked dividend income (25,748) (26,597) Recoupment of unrecognised capital losses (23,265) – R&D tax incentive (4,167) (2,580) Share of net profits of associates (3,908) (23,186) Non-deductible legal expense 3,351 – (Under)/overprovided in prior years (2,572) 3,255 Tax rate difference in overseas entities 3,049 206 Loss on derecognition of associate – 1,709 Disposal of land – (1,702) Business acquisition costs – 1,437 Other non-allowable items 672 911 Income tax (benefit)/expense attributable to profit (126,077) 102,659 Current tax (benefit)/expense (10,203) (24,258) Deferred tax expense relating to movements in deferred tax balances 4.2 (90,037) 123,662 (Underprovided)/overprovided in prior years (2,572) 3,255 Utilisation of carried forward capital losses (23,265) – Total income tax (benefit)/expense on profit (126,077) 102,659 146 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 4.1 Income tax expense (continued) 31 July 2024 31 July 2023 Notes $000 $000 Income tax expense / (benefit) attributable to: Profit from continuing operations (125,390) 107,180 Loss from discontinued operations 6.5 (687) (4,521) Income tax (benefit)/expense attributable to profit (126,077) 102,659 Income tax expense /(benefit) recognised directly in equity Tax effect on movements in reserves attributable to equity accounted investments 2,067 (7,010) Tax effect on movements in reserves attributable to financial instruments 5,986 1,318 Income tax expense /(benefit) recognised in other comprehensive income 8,053 (5,692) 4.2 Income tax assets and liabilities (a) Current income tax liability/(asset) 31 July 2024 31 July 2023 $000 $000 Current income tax liability – – Current income tax asset (892) (1,095) Recognition and measurement Current tax represents the amount expected to be paid or recovered in relation to taxable income for the financial year measured using rates and tax laws that have been enacted or substantively enacted by reporting date. Current tax for current and prior periods is recognised as a liability (or asset) to the extent it is unpaid (or refundable). Brickworks Annual Report 2024 p 147 (b) Net deferred income tax liability Balance Sheet Movement through Income Statement 31 July 2024 31 July 2023 31 July 2024 31 July 2023 $000 $000 $000 $000 Equity accounted investments in associated and joint ventures 1,029,944 1,084,726 (63,793) 143,744 Property, plant and equipment (69,845) (45,239) (30,385) 582 Provisions (41,187) (52,938) 20,230 (14,095) Tax losses and rebates (82,327) (46,984) (19,258) (10,175) Intangibles (6,187) 3,931 (10,118) 2,009 Other (9,181) (2,468) 13,287 1,597 Net deferred income tax liability 821,217 941,028 (90,037) 123,662 Recognition and measurement Deferred tax is recognised based on the amounts calculated using the balance sheet liability method in respect of temporary differences between the carrying values of assets and liabilities for financial reporting and tax purposes. The tax cost base of assets is determined based on management’s intention for that asset on either use or sale as appropriate. No deferred income tax is recognised for a taxable temporary difference arising from an investment in a subsidiary, associate or a joint venture where the timing of the reversal of the temporary difference can be controlled and it is probable that the difference will not reverse in the foreseeable future. Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset or liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted by reporting date. Deferred income tax assets are recognised to the extent that it is probable that future taxable profits will be available against which deductible temporary differences can be utilised. The amount of benefit brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income tax legislation and the anticipation that the economic entity will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law. The utilisation of tax losses depends on the ability of the Group to generate future taxable profits. The Group considers that it is probable that future taxable profits will be available to utilise those deferred tax assets. The utilisation of the tax losses also depends on the ability of the Group to satisfy certain tests at the time the losses are recouped. Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity. Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. 148 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 5. Capital and Risk Management This section provides information about the Group’s capital management and its exposure to various financial risks. The Group’s activities expose it to a variety of financial risks: liquidity risk, market risk (including interest rate risk and foreign exchange risk) and credit risk. The Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance where the Group’s exposure is material. The Board approves written principles for overall risk management, as well as policies covering specific areas such as interest rate risk, foreign exchange risk, credit risk and the use of derivative financial instruments. The Group does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes. The Group holds the following financial assets and liabilities at balance date: 31 July 2024 31 July 2023 Notes $000 $000 Financial assets Cash and cash equivalents 5.2 62,574 69,565 Receivables 3.1(a) 126,572 147,387 Financial assets at fair value through other comprehensive income 5.3 35,121 13,107 Derivative financial assets 5.4(c), 5.8(a) 828 2,863 Total financial assets 225,095 232,922 Financial liabilities Trade and other payables 3.1(c) 138,102 136,032 Borrowings 5.4(a) 732,077 711,552 Lease liabilities 3.3 617,060 608,502 Other financial liabilities 5.5 11,670 13,530 Derivative financial liabilities 5.4(c) 459 457 Total financial liabilities 1,499,368 1,470,073 Recognition and measurement Assets and liabilities of the Group that are measured at fair value are grouped into Levels 1 to 3 based on the degree to which the fair value is observable. Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs). All assets and liabilities measured at fair value are identified in the relevant notes to the financial statements, and are either categorised as Level 1 or Level 2. There were no transfers between category levels during the current or prior financial year. A financial liability is derecognised when the obligation under the liability has been discharged, cancelled or expires, with any resulting gain recognised in the income statement. Brickworks Annual Report 2024 p 149 5.1. Capital management The Group manages its capital to ensure that all entities in the Group can continue as going concerns while maximising the return to shareholders through an appropriate balance of net debt and total equity. The Group’s capital structure consists of debt disclosed in note 5.4, cash and cash equivalents (refer note 5.2), issued capital (note 5.6), reserves (note 5.7) and retained profits. The capital structure can be influenced by the level of dividends paid, issuance of new shares, returns of capital to shareholders, or adjustments in the level of borrowings through the acquisition or sale of assets. The Group’s capital structure is regularly measured using net debt to equity, calculated as net debt divided by a sum of net debt and total equity. Net debt represents total drawn at the reporting date (refer note 5.4) less cash and cash equivalents (note 5.2) and total equity includes contributed equity (note 5.6), reserves (note 5.7) and retained earnings. The Group’s strategy during the year was to maintain the total debt to capital employed (at a consolidated level) below a loan facilities banking covenant limit of 40% imposed per the syndicated loan facility agreement disclosed in note 5.4 (2023: 40%). 31 July 2024 31 July 2023 $000 $000 Net debt 681,521 652,030 Total equity 3,381,772 3,561,015 Capital employed 4,063,293 4,213,045 Net debt to capital employed 16.8% 15.5% 5.2. Cash and cash equivalents 31 July 2024 31 July 2023 $000 $000 Cash on hand 62,574 69,565 Recognition and measurement Cash and cash equivalents comprise cash at bank and in hand and short-term deposits. For the purpose of the statement of cash flows, cash and cash equivalents is equal to the balance disclosed in the balance sheet. 5.3. Financial assets at fair value through other comprehensive income The Group’s financial assets at fair value through other comprehensive income represent listed equities of FBR Limited, a publicly traded entity on the Australian Stock Exchange. The fair value of these investments is based on quoted market prices, being the last sale price, at the reporting date. These are categorised as “Level 1” in the fair value hierarchy. In the current financial year the Group acquired additional shares in FBR Limited for a consideration of $2.1 million. Market value 31 July 2024 31 July 2023 $000 $000 Equities – Listed 35,121 13,107 Total 35,121 13,107 150 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 5.4. Borrowings (a) Available loan facilities 31 July 2024 31 July 2023 $000 $000 Current Interest-bearing loans – – – – Non-current Interest-bearing loans 744,095 721,595 Unamortised borrowing costs (12,018) (10,043) 732,077 711,552 In November 2023 the Group completed a partial refinancing of its debt, which consisted of the following changes: ◗ Replacement of (Syndicated Facility) SFA tranche B (AUD$175m) with a series of bi-lateral agreements with selected banks from the existing syndication and some new banks at a limit of (AUD$347m) with tenors between 3 – 5 years; ◗ Replacement of (Syndicated Facility) SFA tranche B1 (USD$100m) with a series of bi-lateral agreements with selected banks from the existing syndication and some new banks at a limit of (USD$105m) with tenors between 3 – 5 years; and ◗ Replacement of the existing working capital facility (AUD$75m) with a new bi-lateral agreement with the existing bank. The repayment of debt under the extinguished facilities and the drawdown of debt under the new facilities were settled on a net basis directly between the lenders. The fair value of interest-bearing loans at 31 July 2024 approximated their carrying amount (2023: carrying amount). The Group designated its USD unsecured debt facilities as a hedging instrument to hedge the currency risk associated with translation of the Group’s net investment in the US operations into the Parent entity’s functional currency (AUD). There were no other changes to the Group’s loan facilities in the current year. Recognition and measurement Borrowings are recorded initially at fair value of the consideration received, net of transaction costs. Subsequent to initial recognition, borrowings are measured at amortised cost. Any difference between the proceeds and the redemption amount is recognised in the income statement over the period of the borrowings using the effective interest method. Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. When the Group expects that it will continue to satisfy the criteria under its banking agreement that ensures the financier is not entitled to call on the outstanding borrowings, and the term is greater than 12 months, the borrowings are classified as non-current. Brickworks Annual Report 2024 p 151 (b) Management of liquidity risk The Group manages liquidity risk by maintaining a combination of adequate cash reserves, bank facilities and reserve borrowing facilities, continuously monitored through forecast and actual cash flows, and matching the maturity profiles of financial assets and liabilities. The Group’s approach to managing liquidity is to ensure that it will always have sufficient liquidity to meet its liabilities when due. At 31 July 2024 the Group had AUD 399.0 million and USD 59.0 million of unused bank facilities (2023: AUD 226.0 million and USD 52.0 million). These facilities are subject to various terms and conditions, including various negative pledges regarding the operations of the Group, and covenants that must be satisfied at specific measurement dates. The maturity profile of the Group’s loan facilities at 31 July 2024 is outlined below. Facility Limit Drawn Available Maturity date Currency ($m) ($m) ($m) Tranche C AUD 104 40 64 December 2026 Tranche E AUD 100 – 100 August 2027 Syndicated loan facility (AUD) 204 40 164 Tranche E1 USD 100 43 57 August 2027 Tranche D USD 55 55 – June 2028 Syndicated loan facility (USD) 155 98 57 Facility A-ITL AUD 25 25 – February 2028 Facility B-ITL AUD 35 35 – February 2026 Facility C-ITL AUD 40 40 – February 2026 Syndicated ITL facility (AUD) 100 100 – Facility D-ITL USD 60 60 – December 2031 Syndicated ITL facility (USD) 60 60 – Bi-Lateral Facilities AUD 181 100 81 November 2028 Bi-Lateral Facilities AUD 144 20 124 November 2027 Bi-Lateral Facilities AUD 112 82 30 November 2026 Bi-Lateral Facilities (AUD) 437 202 235 Bi-Lateral Facilities USD 67 65 2 November 2028 Bi-Lateral Facilities USD 20 20 – November 2027 Bi-Lateral Facilities USD 18 18 – November 2026 Bi-Lateral Facilities (USD) 105 103 2 152 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 5.4 Borrowings (continued) The table below analyses the undiscounted value of the Group’s financial liabilities and derivatives based on the remaining period at the reporting date to maturity. For bank facilities the cash flows have been estimated using interest rates applicable at the end of the reporting period. 1 year or less 1 to 5 years 5 to 10 years Total $’000 $’000 $’000 $’000 31 July 2024 Trade and other payables 138,102 – – 138,102 Borrowings 48,311 773,597 97,988 919,896 Lease liabilities 78,903 321,759 389,943 790,605 Other financial liabilities 2,641 8,473 2,311 13,425 Derivatives (828) 459 – (369) 267,129 1,104,288 490,242 1,861,659 31 July 2023 Trade and other payables 136,032 – – 136,032 Borrowings 44,920 719,885 98,994 863,799 Lease liabilities 70,584 301,264 414,970 786,818 Other financial liabilities 2,922 8,589 4,490 16,001 Derivatives (417) (1,989) – (2,406) 254,041 1,027,749 518,454 1,800,244 (c) Management of interest rate risk The Group’s main interest rate risk arises from fluctuations in the BBSY bid rate and Term SOFR relating to bank borrowings. Where appropriate, the Group uses interest rate derivatives to eliminate some of the risk of movements in interest rates on borrowings, and increase certainty around the cost of borrowed funds. Interest rate swaps The Group has entered into interest rate swaps contracts which allow the Group to swap floating rates into an average fixed rate of 3.41% (2023: 3.33%). The contracts require settlement of net interest receivable or payable usually around every 90 days. The settlement dates are aligned with the dates on which interest is payable on the underlying bank borrowings and are brought to account as an adjustment to borrowing costs. The fair value of interest rate swaps is outlined below. During the financial year ended 31 July 2024 the Group did not enter into new interest rate swap arrangements. Notional Principal Amount Average Interest Rate Fair value 2024 2023 2024 2023 2024 2023 $000 $000 % % $000 $000 Less than 1 year 75,000 25,000 2.38 2.77 828 417 1 to 3 years 100,000 175,000 4.19 3.41 (459) 1,989 3 to 5 years – – – – – – Total asset / (liability) 175,000 200,000 3.41 3.33 369 2,406 The fair value of these derivatives is calculated using market observable inputs, including projected forward interest rates for the period of the derivative. These are categorised as “Level 2” in the fair value hierarchy. (b) Management of liquidity risk (continued) Brickworks Annual Report 2024 p 153 Recognition and measurement Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at each reporting date. The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument and the nature of the item being hedged. The Group designates certain derivatives as either fair value or cash flow hedges. Changes in the fair value of derivatives that are designated as qualifying as fair value hedges are recorded in the income statement, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in equity reserves. The gain or loss relating to the ineffective portion is recognised immediately in the income statement. Amounts deferred in equity are recycled in the income statement when the hedged item is recognised in the income statement. Changes in the fair value of derivatives which do not qualify for hedge accounting are recognised immediately in the income statement. Sensitivity analysis At 31 July 2024, if interest rates had been +/- 1% per annum throughout the year, with all other variables being held constant, the profit after income tax for the year would have been $3.8 million higher/lower respectively (2023: $4.0 million higher/lower). There would not have been any other significant impacts on equity. 5.5. Other financial liabilities 31 July 2024 31 July 2023 $’000 $’000 Deferred consideration related to business combinations: Current 2,641 2,922 Non-current 9,029 10,608 Total 11,670 13,530 Recognition and measurement Deferred consideration resulting from business combinations, is valued at fair value at the acquisition date as part of the business combination. The deferred consideration liability represents present value of future payments. 154 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 5.6 Contributed equity 2024 2023 2024 2023 Number of shares Number of shares $’000 $’000 Contributed equity Ordinary shares, fully paid 152,550,751 152,244,695 416,493 410,150 Treasury shares (413,991) (517,193) (9,478) (10,315) 407,015 399,835 Movement in ordinary issued capital Opening balance 1 August 152,244,695 151,775,663 410,150 401,090 Issue of shares through employee share plan 306,056 469,032 6,369 9,083 Share issue costs (26) (23) Closing balance 31 July 152,550,751 152,244,695 416,493 410,150 Movement in treasury shares Opening balance 1 August (517,193) (445,339) (10,315) (8,827) Bonus shares through employee share plan (100,158) (309,412) (2,769) (6,562) Shares purchased under Short-term incentive (STI) scheme (27,070) (46,822) (754) (994) Shares vested under STI scheme 46,822 32,692 994 852 Shares vested to employees 183,608 251,688 3,366 5,216 Closing balance 31 July (413,991) (517,193) (9,478) (10,315) Recognition and measurement Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds. Treasury shares represent own equity instruments which are issued or acquired for later payment as part of employee share-based payment arrangements and deducted from equity. These shares are held in trust by the trustee of the Brickworks Deferred Employee Share Plan and vest in accordance with the conditions attached to the granting of the shares. The accounting policy applied in respect of share-based payments is disclosed in Note 7.1. Brickworks Annual Report 2024 p 155 5.7 Reserves Capital Profits Reserve Equity Adjust- ments Reserve General Reserve Foreign Currency Reserve Share- based Payments Reserve Investment revaluation reserve Associates and JVs Reserve Total Notes $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Balance at 1 August 2023 88,102 23,290 36,125 3,660 12,878 1,510 3,264 168,829 Other comprehensive income for the year – (8,053) – 169 – 19,953 7,431 19,500 Issue of shares through employee share plan – – – – (3,600) – – (3,600) Shares purchased under Short-term incentive (STI) scheme – – – – 754 – – 754 Shares vested under Short-term incentive (STI) scheme – – – – (994) – – (994) Shares vested to employees 7.1 – – – – (3,366) – – (3,366) Share based payments expense 7.1 – – – – 9,481 – – 9,481 Balance at 31 July 2024 88,102 15,237 36,125 3,829 15,153 21,463 10,695 190,604 Balance at 1 August 2022 88,102 17,598 36,125 1,316 10,180 3,665 26,629 183,615 Other comprehensive income for the year – 5,692 – 2,344 – (2,155) (23,365) (17,484) Issue of shares through employee share plan – – – – (2,521) – – (2,521) Shares purchased under Short-term incentive (STI) scheme – – – – 994 – – 994 Shares vested under Short-term incentive (STI) scheme – – – – (852) – – (852) Shares vested to employees 7.1 – – – – (5,216) – – (5,216) Share based payments expense 7.1 – – – – 10,293 – – 10,293 Balance at 31 July 2023 88,102 23,290 36,125 3,660 12,878 1,510 3,264 168,829 Nature and purpose of reserves Capital profits reserve represents amounts allocated from Retained Profits that were profits of a capital nature. Equity adjustments reserve includes amounts for tax adjustments posted directly to equity. General reserve represents amounts for the future general needs of the operations of the entity. Foreign currency translation reserve represents differences on translation of foreign entity financial statements. Share-based payments reserve represents the value of bonus shares and rights granted to employees that have been recognised as an expense in the income statement but are yet to vest to employees. Investment revaluation reserve represents amounts arising on the remeasurements of financial assets at fair value through other comprehensive income. Associates and JVs reserve represents the Group’s share of its associates and joint ventures reserves balances. The Company is unable to control this reserve in any way, and does not have any ability or entitlement to distribute this reserve, unless it is received from its associates or joint ventures in the form of dividends or trust distributions. 156 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 5.8. Management of other risks (a) Foreign exchange risk Translation risk The Group is exposed to fluctuations in US dollars (USD) related to translation of investments in overseas subsidiaries. Foreign currency translation risk is the risk that upon consolidation for financial reporting the value of investment in foreign domiciled entities will fluctuate due to changes in foreign currency rates. The Group uses USD denominated borrowings to hedge the Group’s net investment in overseas subsidiaries. The related exchange gains/ losses on foreign currency movements are recognised in the Foreign Currency Translation Reserve. As at 31 July 2024 the net investment in the US subsidiaries of the Group of USD 276.9 million (2023: USD 297.9 million) was hedged with USD denominated borrowings of USD 261.0 million (2023: USD 263.0 million). Transaction risk The Group does not have any material exposure to unhedged foreign currency receivables. Export sales are all made through Australian agents or direct to overseas customers using Australian dollars or letters of credit denominated in Australian dollars. The trading of the Group’s NZ joint venture entity, which is in New Zealand dollars (NZD) is not material to the Group as a whole. Accordingly, any reasonably foreseeable fluctuation in the exchange rate of NZD would not have a material impact on either profit after tax or equity of the Group. The Group has a limited exposure to foreign currency fluctuations due to its importation of goods. The main exposure is to USD and Euros (EUR). It is the policy of the Group to enter into forward foreign exchange contracts to cover specific currency payments, as well as covering anticipated purchases for up to 12 months in advance. As at 31 July 2024 the Group had no outstanding foreign currency forward contracts (2023: nil). The overall level of exposure to foreign currency purchases is not material to the Group. Accordingly, any reasonably foreseeable fluctuation in the exchange rate of the USD and EUR resulting in changes to foreign currency receivables and payables would not have a material impact on either profit after tax or equity of the Group. (b) Credit risk Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties. The credit risk on liquid funds and derivative financial instruments is considered low because these assets are held with banks with high credit ratings assigned by international credit-rating agencies. The maximum exposure to trade credit risk at balance date to recognised financial assets is the carrying amount net of provision for doubtful debts, as disclosed in the statement of financial position and notes to the financial statements. The Group’s debtors are based in the building and construction industry; however, the Group minimises its concentration of credit risk by undertaking transactions with a large number of customers. The Group ensures there is not a material credit risk exposure to any single debtor. The Group holds no significant collateral as security, and there are no significant credit enhancements in respect of these financial assets. The credit quality of financial assets that are neither past due nor impaired is appropriate and is reviewed regularly to identify any potential deterioration in the credit quality. There are no significant financial assets that would otherwise be past due or impaired whose terms have been renegotiated. (c) Equity price risk The Group’s listed equity investments are susceptible to market price risk arising from uncertainties about future values of the investment securities. At 31 July 2024, the exposure to equity investments at fair value listed on the Australian Stock Exchange was $35.1 million (2023: $13.1 million). The Group has determined that an increase/decrease of 10% in the share price could have an impact of approximately $3.5 million (2023: $1.3 million) increase/decrease on the other comprehensive income and equity attributable to the Group on pre-tax basis. The Group has significant indirect exposure to equity price risk through its investment in Washington H Soul Pattinson Co Ltd (Soul Patts). This investment is accounted for as an equity accounted investment. Soul Patts has a significant listed investment portfolio which is accounted for at fair value through profit and loss or other comprehensive income. As a result, fluctuations in equity prices would potentially impact both the Group’s net profit after tax and equity reflecting the Group’s share of fair value movements recognised by Soul Patts. At the time of preparing this report, there was no publicly available information regarding the effects of any reasonably foreseeable fluctuations in equity values on net profit or equity of Soul Patts at 31 July 2024 or subsequently. Brickworks Annual Report 2024 p 157 6. Group structure This section explains significant aspects of Brickworks’ group structure, including equity accounted investments that the Group has an interest in and its controlled entities. When applicable, it also provides information on business acquisitions made during the financial year. Associated company Note 6.3(a) Parent entity Note 6.1 Controlled entities Note 6.2 Controlled entities Industrial Property Trusts Manufacturing Property Trust NZ Brick Distributors Southern Cross Cement Jointly controlled entities Note 6.3(b) 43.03% 33.33% 50% 100% 50.1% 50% 50% 50% 49.9% 66.66% 26.13% JV Partners 6.1 Parent entity disclosures 31 July 2024 31 July 2023 $000 $000 Statement of financial position Current assets 19,667 21,402 Non-current assets 1,044,756 1,084,888 Current liabilities (6,531) (2,455) Non-current liabilities (23,662) (73,284) Net assets 1,034,230 1,030,551 Equity Issued capital 407,015 399,835 Reserves 76,132 86,139 Retained earnings 551,083 544,577 Total equity 1,034,230 1,030,551 Statement of financial performance Profit after tax 90,018 72,506 Total comprehensive income 90,018 72,506 The parent entity’s contingent liabilities of $28.7 million (2023: $26.8 million) were associated with a shareholder guarantee provided as part of joint venture arrangements and bank guarantees issued in the ordinary course of business. There are no contractual commitments for the acquisition of property, plant and equipment of the parent entity (2023: nil). 158 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 6.2 Controlled entities Details of wholly owned entities within the Brickworks Group of companies are as follows. % Group’s interest Entity 2024 2023 Incorporated in Australia A.C.N. 000 012 340 Pty Ltd1 100 100 A.C.N. 074 202 592 Pty Ltd1 100 100 AP Installations (NSW) Pty Ltd1 100 100 AP Installations (Qld) Pty Ltd1 100 100 Austral Bricks (NSW) Pty Ltd1 100 100 Austral Bricks (Qld) Pty Ltd1 100 100 Austral Bricks (SA) Pty Ltd1 100 100 Austral Bricks (Tas) Pty Ltd1 100 100 Austral Bricks (Tasmania) Pty Ltd1 100 100 Austral Bricks (Vic) Pty Ltd1 100 100 Austral Bricks (WA) Pty Ltd1 100 100 Austral Bricks Holdings Pty Ltd1 100 100 Austral Masonry (NSW) Pty Ltd1 100 100 Austral Masonry (Qld) Pty Ltd1 100 100 Austral Masonry (Vic) Pty Ltd1 100 100 Austral Masonry Holdings Pty Ltd1 100 100 Austral Precast (NSW) Pty Ltd1 100 100 Austral Precast (Qld) Pty Ltd1 100 100 Austral Precast (Vic) Pty Ltd1 100 100 Austral Precast (WA) Pty Ltd1 100 100 Austral Precast Holdings Pty Ltd1 100 100 Austral Roof Tiles Pty Ltd1 100 100 Austral Cement Pty Ltd1 100 100 Auswest Timbers Holdings Pty Ltd1 100 100 Bowral Brickworks Pty Ltd1 100 100 Brickworks Bioenergy Pty Ltd2 100 – Brickworks Building Products Pty Ltd1 100 100 Brickworks Building Products (NZ) Pty Ltd1 100 100 Brickworks Building Products North America Pty Ltd1 100 100 Brickworks Cement Pty Limited1 100 100 Brickworks Construction Materials Pty Limited1 100 100 Brickworks Finance Pty Ltd1 100 100 Brickworks Supercentres Pty Ltd1 100 100 Brickworks Head Holding Co Pty Ltd1 100 100 Building Products Head Tenant Pty Ltd1 100 100 Brickworks Industrial Developments Pty Ltd1 100 100 Brickworks Properties Pty Ltd1 100 100 Brickworks Property Finance Co Pty Ltd 100 100 Brickworks Specialised Building Systems Pty Ltd1 100 100 Brickworks Sub Holding Co No. 1 Pty Ltd1 100 100 Brickworks Sub Holding Co No. 2 Pty Ltd1 100 100 Brickworks Sub Holding Co No. 3 Pty Ltd1 100 100 % Group’s interest Entity 2024 2023 Incorporated in Australia Brickworks Sub Holding Co No. 4 Pty Ltd1 100 100 Brickworks Sub Holding Co No. 5 Pty Ltd1 100 100 Brickworks Sub Holding Co No. 6 Pty Ltd1 100 100 Brickworks Sub Holding Co No. 7 Pty Ltd1 100 100 Brickworks Sub Holding Co No. 8 Pty Ltd1 100 100 Bristile Guardians Pty Ltd1 100 100 Bristile Holdings Pty Ltd1 100 100 Bristile Pty Ltd1 100 100 Bristile Roofing (East Coast) Pty Ltd1 100 100 Bristile Roofing Holdings Pty Ltd1 100 100 Capital Battens Pty Ltd1 100 100 Christies Sands Pty Ltd1 100 100 Clifton Brick Holdings Pty Ltd1 100 100 Clifton Brick Manufacturers Pty Ltd1 100 100 Daniel Robertson Australia Pty Ltd1 100 100 Davman Builders Pty Ltd1 100 100 Hallett Brick Pty Ltd1 100 100 Hallett Roofing Services Pty Ltd1 100 100 Horsley Park Holdings Pty Ltd1 100 100 International Brick & Tile Pty Ltd1 100 100 J. Hallett & Son Pty Ltd1 100 100 Lumetum Pty Ltd1 100 100 Metropolitan Brick Company Pty Ltd1 100 100 Nubrik Concrete Masonry Pty Ltd1 100 100 Nubrik Pty Ltd1 100 100 Pilsley Investments Pty Ltd1 100 100 Prestige Equipment Pty Ltd1 100 100 Southern Bricks Pty Ltd1 100 100 The Austral Brick Co Pty Ltd1 100 100 The Warren Brick Co Pty Ltd1 100 100 Visigoth Pty Ltd1 100 100 Incorporated in New Zealand Brickworks NZ Limited2 100 – Incorporated in the United States of America Brickworks North America Corporation 100 100 Brickworks Eddie Acquisition Corporation 100 100 Brickworks Supply LLC 100 100 Glen-Gery Corporation 100 100 Landmark Stone Products, LLC 100 100 Sioux City Brick & Tile Company 100 100 Recognition and measurement Control is achieved when the Group is exposed to, or has rights to, variable returns from its involvement with an entity and has the ability to affect those returns through its power to direct the activities of the entity. The financial statements have been prepared by consolidating the financial statements of Brickworks Limited and its controlled entities. All inter-entity balances and transactions are eliminated. All wholly owned entities within the Group have been consolidated in these financial statements. 1 The entity is part of a deed of cross guarantee (refer note 6.4.). 2 The entity was incorporated in the current year. Brickworks Annual Report 2024 p 159 1 At 31 July 2024 the Group’s investment in FBR was classified as Fair Value Through Other Comprehensive Income (FVOCI) (refer note 5.3). 6.3 Investments accounted for using the equity method 31 July 2024 31 July 2023 Notes $000 $000 Associated companies 6.3(a) 2,196,604 2,104,435 Joint ventures 6.3(b) 2,027,418 2,293,295 Total investments accounted for using the equity method 4,224,022 4,397,730 Recognition and measurement Under the equity method, the investments are carried in the consolidated balance sheet at cost plus post acquisition changes in the Group’s share of net assets of an associate or a joint venture. After applying the equity method of accounting, the Group determines whether it is necessary to recognise an additional impairment loss with respect to its investment in an associate or joint venture. At each reporting date, the Group determines whether there is objective evidence that the investment is impaired. If there is such evidence, the Group calculates the amount of impairment as a difference between the recoverable amount of the associate or joint venture and its carrying amount, and the recognises the loss as ‘Share of net profits of associates and joint ventures’ in the income statement. The consolidated income statement reflects the Group’s share of the results of operations of the associate/jointly controlled entity. (a) Associated company Group’s interest Contribution to Group profit before tax Carrying value Market value of shares 2024 2023 2024 2023 2024 2023 2024 2023 % % $’000 $’000 $’000 $’000 $’000 $’000 Washington H. Soul Pattinson and Company Limited 26.13 26.13 150,665 162,295 2,196,604 2,104,435 3,348,177 3,107,674 FBR Limited1 – – (1,696) – – – – Total 150,665 160,599 2,196,604 2,104,435 3,348,177 3,107,674 Washington H. Soul Pattinson and Company Limited’s (“Soul Patts”) shares are publicly traded on the Australian Stock Exchange (ASX code: SOL). The nature of Soul Patts’s activities is outlined below: Strategic Portfolio Significant investments in listed companies with low correlations, the majority held over the long-term, generally with board representation. Large Caps Actively managed investments focused on Australian listed companies that deliver earnings growth and dividends over the long-term. Private Equity Investments in unlisted companies with strategic merger and acquisition opportunities. Emerging Companies Actively managed equity and equity-like investments in ASX ex-100 companies and unlisted companies. Credit Actively managed credit investments – comprising loans, bonds, and structured instruments – aimed at achieving strong risk-adjusted returns. Property Actively managed direct property investments and equity accounted joint ventures, largely positioned towards infrastructure development. 160 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 6.3 Investments accounted for using the equity method (continued) (a) Associated company (continued) In addition to the Group owning 26.13% (2023: 26.13%) of issued ordinary shares of Soul Patts, at 31 July 2024, Soul Patts owned 43.03% (2023: 43.12%) of issued ordinary shares of Brickworks Limited. The information disclosed below reflects the total amounts reported in the financial statements of Soul Patts amended to reflect adjustments made by the Group in applying the equity method of accounting. 31 July 2024 31 July 2023 $000 $000 Current assets 1,159,816 1,717,298 Non-current assets 8,505,012 7,253,879 Current liabilities (350,058) (375,241) Non-current liabilities (898,724) (529,081) Outside equity interest (OEI) (9,603) (13,141) Net assets 8,406,443 8,053,714 Equity accounted carrying value 2,196,604 2,104,435 Revenue 831,993 629,465 Profit after tax attributable to members 576,637 621,145 Other comprehensive income 61,275 (70,187) Total comprehensive income 637,912 550,958 Dividends received by Brickworks Limited from the associate 85,827 88,657 Soul Patts’ lease commitments and contractual commitments for the acquisition of property, plant and equipment were not publicly available at the time of preparation of this report (2023: nil and $27 million, respectively). The Group has no legal liability for any expenditure commitments incurred by associates. Recognition and measurement Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for in the parent entity financial statements using the cost method and in the consolidated financial statements using the equity method of accounting, after initially being recognised at cost. The associate’s accounting policies conform to those used by the Group for like transactions and events in similar circumstances. The consolidated financial statements include eliminations related to the cross share-holding arrangement between the Group and the associate. Brickworks Annual Report 2024 p 161 (b) Joint ventures Information relating to joint ventures is outlined below. Group’s interest Contribution to Group profit before tax Carrying value Principal activity 2024 2023 2024 2023 2024 2023 % % $’000 $’000 $’000 $’000 Domiciled in Australia BGAI Erskine Trust 50.0 50.0 13,010 37,472 231,692 236,856 Property development, management and leasing BGAI1 Capicure Trust – 50.0 (378) 7,201 – 27,407 BGAI1 Heritage Trust – 50.0 (18) 16,348 – 75,542 BGAI1 Oakdale Trust 50.0 50.0 (32,212) 33,559 287,446 348,915 BGAI1 Oakdale East Trust 50.0 50.0 (356) 5,319 68,398 70,649 BGAI1 Oakdale South Trust 50.0 50.0 (25,666) 51,065 244,841 277,567 BGAI2 Rochedale BT Trust 50.0 50.0 (1,873) 1,122 12,591 15,725 BGAI2 Rochedale Trust 50.0 50.0 (9,234) (1,070) 77,459 90,179 BGAI2 Rochedale North Trust 50.0 50.0 (9,325) 947 18,240 28,308 BGMG1 Oakdale West Trust 50.0 50.0 (13,185) 82,339 561,126 585,476 BGMG Oakdale East Stage 2 Trust 50.0 50.0 – – 302,094 301,275 Brickworks Goodman Manufacturing Trust (BGMT) 50.1 50.1 (12,227) 5,869 203,253 215,776 Property trusts (91,464) 240,171 2,007,140 2,273,675 Southern Cross Cement 33.33 33.33 797 826 12,068 11,272 Import of cement Domiciled in New Zealand NZ Brick Distributors 50.00 50.00 712 1,133 8,210 8,348 Import and distribution of building products Total (89,955) 242,130 2,027,418 2,293,295 Property Trusts and Southern Cross Cement have balance dates of 30 June. The balance date for NZ Brick Distributors is 31 March. Current year During the current year, the Group sold its 50% interest in BGAI Capicure Trust and BGAI Heritage Trust to Goodman Group. Consideration for the sale amounted to $117.3 million resulting in a loss before tax of $16.4 million. The capital tax gain of $23.4 million arising on the sale was offset against capital tax losses giving rise to an additional tax benefit to the Group (refer note 4.1). Prior year In the prior year the Group sold the remainder of the Oakdale East land into a newly established JV trust with Goodman Group (BGMG Oakdale East No 2). Consideration for the sale amounted to $301.3 million and represented the Group’s initial investment in this trust (refer Note 2.2). 162 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 6.3 Investments accounted for using the equity method (continued) Contribution to Group profit before tax from Property Trusts is set out below. 31 July 2024 31 July 2023 $000 $000 Share of fair value adjustment of properties held by joint venture (140,460) 190,621 Share of joint venture property rental profits 48,996 49,550 Total equity accounted (loss)/profit from Property Trusts (91,464) 240,171 The information disclosed below reflects the total amounts reported in the financial statements of joint ventures amended to reflect adjustments made by the Group in applying the equity method of accounting. This information has been aggregated due to the similarity of the risk and return characteristics. 31 July 2024 31 July 2023 $000 $000 Current assets 233,799 169,841 Non-current assets 5,284,985 5,757,595 Current liabilities (61,065) (87,619) Non-current liabilities (1,399,595) (1,233,581) Net assets 4,058,124 4,606,236 Equity accounted carrying value 2,027,418 2,293,295 Other balance sheet disclosures Cash and cash equivalents 27,327 19,552 Current financial liabilities (29,175) (30,765) Non-current financial liabilities (1,406,386) (1,231,655) Revenue 255,432 232,198 Depreciation and amortisation (5,135) (4,077) Interest income 1,097 509 Interest expense (85,474) (56,267) Profit after tax (179,065) 485,062 Other comprehensive income – – Total comprehensive income (179,065) 485,062 Distributions received by Brickworks Limited from the joint ventures 43,083 36,287 Joint ventures’ expenditure commitments Capital commitments 196,370 236,680 Contingent liabilities of joint ventures Contingent liabilities incurred jointly with other investors – – The entity has no legal liability for any contingent liabilities incurred by joint ventures. (b) Joint ventures (continued) Brickworks Annual Report 2024 p 163 Recognition and measurement A joint venture is a type of arrangement whereby the parties that have joint control of the arrangement have rights to net assets of the joint venture. Joint control is the contractually agreed sharing of control arrangement, which exists only when the decisions about relevant activities require unanimous consent of the parties sharing control. The joint venture’s accounting policies conform to those used by the Group. When reporting dates of joint ventures are not identical to the Group and the joint venture is not a disclosing entity, the financial information used is internal management reports for the same period as the Group’s financial year. Profits or losses on transactions with the joint venture are deferred to the extent of the Group’s ownership interest where properties remain classified as inventory by the joint venture until such time as they realised by the joint venture on sale. There were no unrealised eliminated profits as at 31 July 2024 (2023: nil). Investment property held by the joint venture, which is property held to earn rentals and/or for capital appreciation, is measured initially at cost, including transaction costs. Subsequent to initial recognition, investment property is measured at fair value. Gains or losses arising from changes in fair value of investment property are included in the equity accounted share of the joint venture’s profit and recognised in the income statement of the Group in the period in which they arise. Significant accounting judgements, estimates and assumptions Management is required to make significant estimates and judgements in assessing the fair value of investment property. An independent valuation specialist was engaged to assess the fair value of investment properties held by the joint venture. The fair value of investment properties is determined using recognised valuation techniques such as the capitalisation of net income method and discounted cash flow method. The assessment of fair value of each development property that meets the definition of an investment property, takes into account the expected costs to complete, the stage of completion and associated profit and risk adjustments, capitalisation rates, expected rental income, letting up periods and incentives. External valuations are typically performed when the development property reaches practical completion. From time to time, an independent valuation of the development property may be commissioned. A profit and risk adjustment was reflected by the Group to derive an adjusted end value which is then compared to the forecast costs to complete to determine the fair value increase in the period. The profit and risk adjustment of 20% was determined based on the location, size and status of the development at the valuation date. 164 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 6.4. Deed of cross guarantee Brickworks Limited and a number of its subsidiaries (“Closed Group”) are parties to a deed of cross guarantee under which each company, including Brickworks Limited, supports liabilities and obligations of other members of the Closed Group. By entering into the deed, the wholly owned entities have been relieved from the requirement to prepare a financial report and directors’ report under ASIC Corporations (Wholly- owned companies) Instrument 2016/785. The entities covered in the deed are listed in Note 6.2. Members of the Closed Group and parties to the deed of cross guarantee are identical. Set out below is a consolidated balance sheet, consolidated income statement and a summary of movements in consolidated retained profits of the Closed Group. 31 July 2024 31 July 2023 $000 $000 Consolidated Balance Sheet Current assets Cash and cash equivalents 40,975 55,437 Receivables 71,342 91,072 Inventories 177,575 154,897 Other assets 6,143 8,334 Contract assets 1,081 920 Assets classified as held for sale 3,033 13,532 Total current assets 300,149 324,192 Non-current assets Receivables 778,051 835,011 Other financial assets 373,717 354,149 Inventories 6,567 7,180 Investments accounted for using the equity method 2,216,882 2,124,055 Property, plant and equipment 349,914 374,478 Right-of-use assets 269,504 315,124 Intangibles 102,874 103,705 Total non-current assets 4,097,509 4,113,702 Total assets 4,397,658 4,437,894 Current liabilities Trade and other payables 373,588 373,201 Lease liabilities 45,368 39,682 Income tax payable 6,305 5,240 Contract liabilities 188 661 Liabilities directly associated with assets classified as held for sale 7,127 16,760 Provisions 70,241 82,855 Total current liabilities 502,817 518,399 Non-current liabilities Borrowings 732,077 711,552 Derivative financial liabilities 459 457 Lease liabilities 498,713 496,312 Provisions 29,518 28,175 Deferred income tax liabilities 292,437 307,555 Total non-current liabilities 1,553,204 1,544,051 Total liabilities 2,056,021 2,062,450 Net assets 2,341,637 2,375,444 Brickworks Annual Report 2024 p 165 31 July 2024 31 July 2023 $000 $000 Equity Contributed equity 407,015 399,835 Reserves 143,693 128,699 Retained profits 1,790,929 1,846,910 Total equity 2,341,637 2,375,444 Consolidated Income Statement (Loss)/profit before income tax (32,741) 267,073 Income tax benefit/(expense) 66,073 (31,965) Profit after income tax expense 33,332 235,108 Movement in Consolidated Retained Earnings Retained profits at the beginning of the year 1,846,910 1,698,261 Profit after income tax expense 33,332 235,108 Dividends paid (89,313) (86,459) Retained profits at the end of the year 1,790,929 1,846,910 166 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 6.5. Discontinued operations In the previous year, following a strategic review, the Group decided to exit the concrete precast panels operations and initiated an active program to locate a buyer for its Austral Precast division or parts thereof. In the current period, the Austral Precast division continued to wind down its operations following the asset sales in the previous year with the remaining assets available for sale. The operations are expected to be fully wound down by 31 January 2025. The results for the period ended 31 July 2024 and the prior period have been presented as discontinued operations (net of tax). (a) Financial performance and cashflow information 31 July 2024 31 July 2023 $000 $000 Results of discontinued operations Revenue 2,611 39,830 Expenses (5,067) (46,656) Operating loss (2,456) (6,826) Impairment loss recognised on the measurement to fair value less costs to sell – (5,933) Gain on disposal of assets held for sale – 693 Other significant items 119 (3,025) Loss before tax (2,337) (15,091) Income tax benefit/(expense) 687 4,521 Loss after tax (1,650) (10,570) Cash flows from discontinued operations Net cash used in operating activities (473) (2,906) Net cash from/(used) in investing activities – 107 Net cash from financing activities (999) (1,541) Net cash inflow/(outflow) (1,472) (4,340) Basic (cents per share) from discontinued operations (1.2) (7.9) Diluted (cents per share) from discontinued operations (1.2) (7.9) The prior year Earnings Per Share measure was restated to reflect the adjustments to the weighted average number of shares outstanding during the prior period. Refer note 2.4. Brickworks Annual Report 2024 p 167 31 July 2024 31 July 2023 $000 $000 Assets and liabilities classified as held for sale Receivables 2,856 6,698 Inventories – 2,479 Contract assets – 4,325 Other assets 177 30 Assets classified as held for sale 3,033 13,532 Payables 1,227 4,967 Provisions 2,300 4,147 Contract liabilities – 2,894 Lease liabilities 3,600 4,752 Liabilities held for sale 7,127 16,760 Net assets/(liabilities) held for sale (4,094) (3,228) Recognition and measurement A discontinued operation is component of the entity that has been disposed of or is classified as held for sale and that represents a cash-generating unit or a group of cash-generating units and is part of a single co-ordinated plan to dispose of such line of business or area of operations. The results of discontinued operations are presented separately in the consolidated income statement. Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and sales is considered highly probable. They are measured at the lower of the their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, assets arising from the employee benefits and financial assets. An impairment loss is recognised for any initial or subsequent write down of the asset (or disposal group) to fair value less costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of an asset (or disposal group), but not in the excess of any cumulative impairment loss previously recognised. A gain or loss not previously recognised by the date of the sale of the non- current asset (or disposal group) is recognised at the date of derecognition. Non-current assets classified as held for sale (including those that are part of a disposal group) are not depreciated or amortised while they are classified as held for sale. Non-current assets classified as held for sale are presented separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held for sale are presented separately from other liabilities in the balance sheet. A discontinued operation is component of the entity that has been disposed of or is classified as held for sale and that represents a cash-generating unit or a group of cash-generating units and is part of a single co-ordinated plan to dispose of such line of business or area of operations. The results of discontinued operations are presented separately in the consolidated income statement. Significant accounting judgements, estimates and assumptions Management is required to make significant estimates and judgements in assessing the fair value of assets held for sale. The fair value of these assets is determined based on management’s assessment on the values that would be recovered through a sale rather than through continuing use of assets. 168 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 7. Other Disclosures This section provides information on items which require disclosure to comply with AASBs and other regulatory pronouncements and any other information that is considered relevant for the users of the financial report which has not been disclosed in other sections. 7.1. Share based payments At 31 July 2024, there were 765 employees participating in the Brickworks Deferred Employee Share Plan and the Brickworks Exempt Employee Share Plan, holding 1,186,984 shares (0.78% of issued capital). (a) Salary sacrifice arrangements Brickworks Limited has an employee share ownership plan, which allows all employees who have achieved 3 months service with the Group to purchase Brickworks Limited shares, using their own funds plus a contribution of up to $156 per annum from the Group. All shares acquired under salary sacrifice arrangements are fully paid ordinary shares, purchased on-market under an independent trust deed. (b) Equity-based compensation plans Deferred Employee Share Plan The following table shows the number of fully paid ordinary shares held by the Brickworks Deferred Employee Share Plan that had been granted as remuneration. This table does not include any shares held in the plan that were purchased by the employee under the salary sacrifice arrangements described above. Unvested Vested Total No. of shares No. of shares No. of shares Opening balance 383,702 785,361 1,169,063 Granted 162,158 – 162,158 Vested (183,608) 183,608 – Forfeited / withdrawn (32,262) (212,035) (244,297) Closing balance 329,990 756,934 1,086,924 The unvested shares vest to employees at 20% per year for each of the following 5 years, provided ongoing employment is maintained. All shares granted to employees provide dividend and voting rights to the employee. Executive Rights Plan The rights vest at 20% per year for each of the following 5 years, provided ongoing employment is maintained. In addition, a performance hurdle related to the Group’s Total Shareholder Return (TSR) is applicable to rights granted to the Managing Director, Chief Executive Officer and Chief Financial Officer. 250,819 rights were allocated in the current year (2023: 218,059). 229,001 rights vested on 31 July 2024 (2023: 185,370). There were no rights forfeited in the current year (2023: nil). A fair value of rights with a TSR performance hurdle has been determined with reference to an independent valuation. A summary of key valuation assumptions is outlined below. 2024 Grant date 23-Nov-23 Valuation method Monte-Carlo simulation Performance period 3 years Grant date share price $25.70 Estimated volatility 23.08% Risk free rate (2.69-yr rate) 3.97% Brickworks Annual Report 2024 p 169 2024 2023 $ $ Expense arising from share-based payment transactions 9,481,021 10,292,819 Fair value of vested shares held by the plan at the end of the year (based on 31 July share price) 21,814,838 20,348,704 Fair value of shares granted during the year 6,933,751 8,457,457 Fair value of executive rights granted during the year 3,957,176 5,835,149 More information regarding the Brickworks Employee Share Plans is outlined in the Remuneration Report included in the Directors’ Report. Recognition and measurement The fair value determined at the grant date of the equity-settled share based payments is expensed over the vesting period, with a corresponding increase to the employee share reserve. Unvested shares are included in the Contributed Equity as Treasury Shares (refer note 5.6). 7.2. Related party transactions and compensation of key management personnel (“KMP”) (a) Related party transactions During the year material transactions took place with the following related parties: ◗ Property transactions with various trusts (listed in note 6.3) which are jointly owned by Group and Goodman Australia Industrial Fund, an unlisted property trust. There were no related party transactions this year. During the prior year, the Group sold the Oakdale East Stage 2 land into the Property trust for a consideration of $301.3 million and realising a profit of $262.6 million. All transactions with the property trust are at arm’s length value. ◗ Directors and their direct-related entities are able, with all staff members, to purchase goods produced by the Group on terms and conditions no more favourable than those available to other customers. ◗ There were no other transactions with KMP during the year (2023: nil). (b) Compensation paid to KMP 2024 2023 $ $ Short-term benefits 7,086,311 8,402,201 Post-employment benefits 215,247 202,367 Termination benefits 1,810,622 178,324 Share-based payment 3,131,579 1,999,044 Total compensation paid to KMP 12,243,759 10,781,936 The amounts disclosed in the table are the amounts recognised as an expense during the year related to KMP of the Group. 7.3. Auditor’s remuneration 2024 2023 $ $ Fees for auditing the statutory financial report of the parent covering the group 1,292,990 1,279,715 Other assurance services 15,500 – Taxation services 63,000 119,952 Other services (Climate change and sustainability services) – 5,450 Fees for other services 78,500 125,402 Total fees 1,371,490 1,405,117 The financial statements of the Group are audited by EY. Details of non-audit services provided by EY are outlined in the Directors’ Report. 170 p Brickworks Annual Report 2024 Notes to the Consolidated Financial Statement 7.4 Commitments and contingencies (a) Commitments 31 July 2024 31 July 2023 $000 $000 Contracted capital expenditure Within one year 12,006 21,509 Contracted capital expenditure relates to contracts to supply or construct buildings or various items of plant and equipment for use in the Building Products operating segment. These have not been provided for at balance date. (b) Contingencies 31 July 2024 31 July 2023 $000 $000 Shareholder guarantee provided as part of joint venture arrangements and bank guarantees issued in the ordinary course of business 60,577 59,461 The Group does not anticipate that any of the bank guarantees issued on its behalf will be called upon. The entities forming the Group are parties to various legal actions against them that are not provided for in the financial statements. These actions are being defended and the Group does not anticipate that any of these actions will result in material adverse consequences for the Group. 7.5. Events occurring after balance date There have been no events subsequent to balance date that could materially affect the financial position and performance of Brickworks Limited or any of its controlled entities. 7.6. Other accounting policies (a) Other accounting policies Foreign exchange differences arising on the translation of monetary items are recognised in the income statement, except when deferred in equity as a qualifying cash flow or net investment hedge. Revenues, expenses and assets are recognised net of goods and services tax (GST), except where the amount of GST incurred is not recoverable from the taxation authority. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable or payable to the taxation authority is included as a current asset or liability. Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing cash flows which are classified as operating cash flows. (b) New accounting standards, interpretations and amendments adopted by the Group There were no other new accounting standards, interpretations and amendments significantly impacting the Group in the year ended 31 July 2024. (c) New standard not yet applicable Certain new accounting standards, amendments and interpretations have been issued that are not effective for the financial year ended 31 July 2024. However, the Group intends to adopt the following new or amended standards and interpretations, if applicable, when they become effective with no significant impact being expected on the Consolidated Financial Statements of the Group: ◗ Amendments to AASB 101 Classification of Liabilities as Current or Non-current ◗ AASB 18 Presentation and disclosure in Financial Statements Brickworks Annual Report 2024 p 171 Body Corporate Entity Name Note Entity Type Country of Incorporation % of Share Capital Held Country of tax residence Brickworks Limited Body Corporate Australia Australia A.C.N. 000 012 340 Pty Ltd Body Corporate Australia 100 Australia A.C.N. 074 202 592 Pty Ltd Body Corporate Australia 100 Australia AP Installations (NSW) Pty Ltd Body Corporate Australia 100 Australia AP Installations (QLD) Pty Ltd Body Corporate Australia 100 Australia Austral Bricks (NSW) Pty Ltd Body Corporate Australia 100 Australia Austral Bricks (QLD) Pty Ltd Body Corporate Australia 100 Australia Austral Bricks (SA) Pty Ltd Body Corporate Australia 100 Australia Austral Bricks (TAS) Pty Ltd Body Corporate Australia 100 Australia Austral Bricks (Tasmania) Pty Ltd Body Corporate Australia 100 Australia Austral Bricks (VIC) Pty Ltd Body Corporate Australia 100 Australia Austral Bricks (WA) Pty Ltd Body Corporate Australia 100 Australia Austral Bricks Holdings Pty Ltd Body Corporate Australia 100 Australia Austral Cement Pty Ltd Body Corporate Australia 100 Australia Austral Masonry (NSW) Pty Ltd Body Corporate Australia 100 Australia Austral Masonry (QLD) Pty Ltd Body Corporate Australia 100 Australia Austral Masonry (VIC) Pty Ltd Body Corporate Australia 100 Australia Austral Masonry Holdings Pty Ltd Body Corporate Australia 100 Australia Austral Precast (NSW) Pty Ltd Body Corporate Australia 100 Australia Austral Precast (QLD) Pty Ltd Body Corporate Australia 100 Australia Austral Precast (VIC) Pty Ltd Body Corporate Australia 100 Australia Austral Precast (WA) Pty Ltd Body Corporate Australia 100 Australia Austral Precast Holdings Pty Ltd Body Corporate Australia 100 Australia Austral Roof Tiles Pty Ltd Body Corporate Australia 100 Australia Consolidated Entity Disclosure Statement Below is the Group consolidated entity disclosure statement as at 31 July 2024 as required by the Corporations Act 2001 (section 295(3A)). 172 p Brickworks Annual Report 2024 Body Corporate Entity Name Note Entity Type Country of Incorporation % of Share Capital Held Country of tax residence Auswest Timbers Holdings Pty Ltd Body Corporate Australia 100 Australia Bowral Brickworks Pty Ltd Body Corporate Australia 100 Australia Brickworks Bioenergy Pty Ltd Body Corporate Australia 100 Australia Brickworks Building Products (NZ) Pty Ltd 1 Body Corporate Australia 100 Australia Brickworks Building Products North America Pty Ltd Body Corporate Australia 100 Australia Brickworks Building Products Pty Ltd Body Corporate Australia 100 Australia Brickworks Cement Pty Ltd Body Corporate Australia 100 Australia Brickworks Construction Materials Pty Ltd Body Corporate Australia 100 Australia Brickworks Finance Pty Ltd Body Corporate Australia 100 Australia Brickworks Head Holding Co Pty Ltd 2 Body Corporate Australia 100 Australia Brickworks Industrial Developments Pty Ltd Body Corporate Australia 100 Australia Brickworks Properties Pty Ltd Body Corporate Australia 100 Australia Brickworks Property Finance Co Pty Ltd Body Corporate Australia 100 Australia Brickworks Specialised Building Systems Pty Ltd Body Corporate Australia 100 Australia Brickworks Sub Holding Co No. 1 Pty Ltd 2 Body Corporate Australia 100 Australia Brickworks Sub Holding Co No. 2 Pty Ltd 2 Body Corporate Australia 100 Australia Brickworks Sub Holding Co No. 3 Pty Ltd 2 Body Corporate Australia 100 Australia Brickworks Sub Holding Co No. 4 Pty Ltd 2 Body Corporate Australia 100 Australia Brickworks Sub Holding Co No. 5 Pty Ltd 2 Body Corporate Australia 100 Australia Brickworks Sub Holding Co No. 6 Pty Ltd 2 Body Corporate Australia 100 Australia Brickworks Sub Holding Co No. 7 Pty Ltd 2 Body Corporate Australia 100 Australia Brickworks Sub Holding Co No. 8 Pty Ltd 2 Body Corporate Australia 100 Australia Brickworks Supercentres Pty Ltd Body Corporate Australia 100 Australia Bristile Guardians Pty Ltd 2 Body Corporate Australia 100 Australia Bristile Holdings Pty. Ltd. Body Corporate Australia 100 Australia Bristile Pty Ltd Body Corporate Australia 100 Australia Bristile Roofing (East Coast) Pty Ltd Body Corporate Australia 100 Australia Bristile Roofing Holdings Pty Ltd Body Corporate Australia 100 Australia Building Products Head Tenant Pty Ltd Body Corporate Australia 100 Australia Capital Battens Pty Ltd Body Corporate Australia 100 Australia Christies Sands Proprietary Limited Body Corporate Australia 100 Australia Clifton Brick Holdings Pty. Ltd. Body Corporate Australia 100 Australia Clifton Brick Manufacturers Pty. Ltd. Body Corporate Australia 100 Australia Daniel Robertson Australia Pty Ltd Body Corporate Australia 100 Australia Davman Builders Proprietary Limited Body Corporate Australia 100 Australia Hallett Brick Pty Ltd Body Corporate Australia 100 Australia Hallett Roofing Services Pty. Ltd. Body Corporate Australia 100 Australia Horsley Park Holdings Pty Ltd Body Corporate Australia 100 Australia International Brick & Tile Pty Ltd Body Corporate Australia 100 Australia J. Hallett & Son Pty. Ltd. Body Corporate Australia 100 Australia Lumetum Pty Ltd Body Corporate Australia 100 Australia Metropolitan Brick Company Pty Limited Body Corporate Australia 100 Australia Nubrik Concrete Masonry Pty. Ltd. Body Corporate Australia 100 Australia Nubrik Pty Ltd Body Corporate Australia 100 Australia Pilsley Investments Pty Ltd Body Corporate Australia 100 Australia Consolidated Entity Disclosure Statement Brickworks Annual Report 2024 p 173 Body Corporate Entity Name Note Entity Type Country of Incorporation % of Share Capital Held Country of tax residence Prestige Equipment Pty Ltd Body Corporate Australia 100 Australia Southern Bricks Pty. Ltd. Body Corporate Australia 100 Australia The Austral Brick Co Pty Ltd Body Corporate Australia 100 Australia The Warren Brick Co Pty Limited Body Corporate Australia 100 Australia Visigoth Pty Limited Body Corporate Australia 100 Australia Brickworks NZ Limited Body Corporate New Zealand 100 New Zealand Brickworks Eddie Acquisition Corporation Body Corporate USA 100 USA Brickworks North America Corporation Body Corporate USA 100 USA Brickworks Supply LLC LLC Type Entity USA 100 USA Glen-Gery Corporation Body Corporate USA 100 USA Sioux City Brick & Tile LLC LLC Type Entity USA 100 USA Landmark Stone Products, LLC LLC Type Entity USA 100 USA Brickworks Holding Trust No. 1 Trust N / A N / A Australia Brickworks Holding Trust No. 2 Trust N / A N / A Australia Brickworks Holding Trust No. 3 Trust N / A N / A Australia Brickworks Holding Trust No. 4 Trust N / A N / A Australia Brickworks Holding Trust No. 5 Trust N / A N / A Australia Brickworks Holding Trust No. 6 Trust N / A N / A Australia Brickworks Sub Trust No.1 Trust N / A N / A Australia Brickworks Sub Trust No.2 Trust N / A N / A Australia Brickworks Sub Trust No.3 Trust N / A N / A Australia Brickworks Sub Trust No.4 Trust N / A N / A Australia Brickworks Sub Trust No.5 Trust N / A N / A Australia Brickworks Sub Trust No.6 Trust N / A N / A Australia Brickworks Sub Trust No.7 Trust N / A N / A Australia Brickworks Sub Trust No.8 Trust N / A N / A Australia The Clay Tile Trust Trust N / A N / A Australia 1. Brickworks Building Products (NZ) Pty Ltd is incorporated in and operates in Australia and has a registered branch in New Zealand. The branch operations have tax obligations in New Zealand under the New Zealand Income Tax Act 2007. 2. Trustee of a trust in the consolidated entity 174 p Brickworks Annual Report 2024 174 p Brickworks Annual Report 2024 Stamford Media Village Olde London Stamford, Connecticut Brickworks Annual Report 2024 p 175 Directors’ Declaration In the opinion of the Directors: 1. the complete set of the financial statements and notes of the consolidated entity, as set out on pages 68 to 114, and the additional disclosures included in the Remuneration Report section of the Directors’ Report designated as audited, are in accordance with the Corporations Act 2001: (a) comply with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001; and (b) give a true and fair view of the financial position as at 31 July 2024 and of the performance for the year ended on that date of the consolidated entity; 2. the financial report also complies with International Financial Reporting Standards as issued by the International Accounting Standards Board; 3. the consolidated entity disclosure statement required by section 295(3A) of the Corporations Act 2001, as set out on pages 171 to 173, is true and correct; 4. there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable; and 5. as at the date of this declaration, there are reasonable grounds to believe that the members of the Closed Group identified in note 6.4 will be able to meet any obligations or liabilities to which they are or may become subject to, by virtue of the Deed of Cross Guarantee. This declaration is made after receiving the declaration required to be made to the Directors in accordance with s295A of the Corporations Act 2001 for the financial year ended 31 July 2024. This declaration is made in accordance with a resolution of the Board of Directors. R.D. Millner AO Chairman Dated: 26 September 2024 176 p Brickworks Annual Report 2024 Harriet's House Austral Bricks Access in Ash and Yarra in Richmond Launceston, TAS Brickworks Annual Report 2024 p 177 Independent Auditor’s Report Independent Auditor’s Report to the Members of Brickworks Limited Report on the Audit of the Financial Report Opinion We have audited the financial report of Brickworks Limited (the Company) and its subsidiaries (collectively the Group), which comprises the consolidated balance sheet as at 31 July 2024, the consolidated income statement, consolidated statement of other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, notes to the financial statements, including material accounting policy information, the consolidated entity disclosure statement and the directors’ declaration. In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including: a) Giving a true and fair view of the consolidated financial position of the Group as at 31 July 2024 and of its consolidated financial performance for the year ended on that date; and b) Complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key Audit Matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial report of the current year. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context. We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial report section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial report. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial report. Valuation of investment properties held within joint venture property trusts Why significant How our audit addressed the key audit matter At 31 July 2024, the Group’s total assets include interests in joint venture property trusts that are equity accounted with a carrying value of $2,007.1 million. The primary assets of these joint venture property trusts are investment properties that are carried at fair value. Fair value was addressed by the directors with reference to independent property valuations obtained during the year. As disclosed in Not 6.3(b) to the financial report, the Group recognised a loss of $91.5 million for its share of changes in fair value of investment properties held within the joint venture property trusts. As also disclosed in Note 6.3(b) to the financial report, the valuation of investment properties is inherently judgemental. The valuations are highly sensitive to changes in key inputs such as the expected development costs to complete, the stage of completion and associated profit and risk adjustments, capitalisation rates, expected rental income, letting up periods and incentives. This was considered a key audit matter due to the significance of the judgements required in determining the fair value of investment properties which impacts the share of profits recognised from the joint venture property trusts. Our audit procedures included the following: ◗ Discussed with management the following matters related to the investment properties held within the joint venture property trusts: ◗ movements in the investment property portfolio; ◗ changes in the condition of each property; ◗ controls in place relevant to the investment property valuation process; and ◗ the status of investment properties under development. ◗ Performed the following procedures on the independent valuations of selected properties: ◗ Assessed the reasonableness of key valuation assumptions and inputs adopted, including expected development costs to complete, stage of completion and associated profit and risk adjustments, capitalisation rates, expected rental income, letting up periods and incentives, and other valuation adjustments; ◗ Involved our real estate valuation specialists to assist with the assessment of the valuation assumptions and methodologies; ◗ Recalculated property valuations calculated using the Capitalisation Approach; and ◗ Assessed the qualifications, competence, and objectivity of the Group’s external independent property valuation specialists. ◗ Evaluated that the Group’s assessment that property valuations conducted during the year appropriately reflect the fair value as at the Balance Sheet date by reviewing available market data and assessing whether there are any material changes in the key inputs to the valuation calculation since the date of the external independent property valuations. ◗ Assessed the adequacy of the disclosures contained in Note 6.3(b) to the financial report. 178 p Brickworks Annual Report 2024 Independent Auditor's Report Brickworks Annual Report 2024 p 179 Impairment assessment of goodwill and other non-current assets Why significant How our audit addressed the key audit matter At 31 July 2024, the Group’s consolidated balance sheet includes goodwill and other intangible assets totalling $102.9 million, and property plant and equipment and right of use assets totalling $913.3 million. The Directors have assessed goodwill and other intangible and tangible assets for impairment at 31 July 2024 and have recognised a total impairment of goodwill, other intangible and tangible assets of $172.4 million. Impairment expense of $16.6 million was also recognised in respect of specific asset impairments in the year. The Group has therefore recognised total impairment expenses of $189.0 million. As disclosed in Note 3.2(c) to the financial report, the impairment assessment incorporated significant judgements and estimates, specifically concerning factors such as forecast cashflows, discount rates and terminal growth rates. The estimates and assumptions relate to future performance, market, and economic conditions. This was considered a key audit matter due to the level of judgement and estimation exercised in the impairment assessment. Our audit procedures included the following: ◗ Assessed the Group’s determination of the Cash Generating Units used in the impairment models, based on our understanding of the Group’s businesses and cash inflows. ◗ Assessed whether the impairment testing methodology used by the Group met the requirements of Australian Accounting Standards. ◗ Assessed the mathematical accuracy of the value in use cash flow models including the consistency of the cashflow forecasts with Board approved business forecasts. ◗ Assessed the reasonableness of future cash flow forecasts used by the Group by considering our knowledge of the business, historical forecasting accuracy and corroborating data with external information where possible. ◗ Evaluated the appropriateness of discount and terminal growth rates applied with involvement from our valuation specialists. ◗ Performed sensitivity analysis on key assumptions including discount rates and terminal value growth rates. ◗ Assessed the adequacy of the disclosures relating to goodwill and other intangible assets in Note 3.2(c) to the financial report including those made with respect to judgments and estimates. Information other than the financial report and auditor’s report thereon The directors are responsible for the other information. The other information comprises the information included in the Company’s 2024 annual report, but does not include the financial report and our auditor’s report thereon. Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the directors for the financial report The directors of the Company are responsible for the preparation of: a. The financial report (other than the consolidated entity disclosure statement) that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001; and b. The consolidated entity disclosure statement that is true and correct in accordance with the Corporations Act 2001, and for such internal control as the directors determine is necessary to enable the preparation of: i. The financial report (other than the consolidated entity disclosure statement) that gives a true and fair view and is free from material misstatement, whether due to fraud or error; and ii. The consolidated entity disclosure statement that is true and correct and is free of misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the financial report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: ◗ Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. ◗ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. ◗ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. ◗ Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. ◗ Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation. ◗ Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion. We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated to the directors, we determine those matters that were of most significance in the audit of the financial report of the current year and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. 180 p Brickworks Annual Report 2024 Independent Auditor's Report Brickworks Annual Report 2024 p 181 Report on the Audit of the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in pages 94 to 116 of the directors' report for the year ended 31 July 2024. In our opinion, the Remuneration Report of Brickworks Limited for the year ended 31 July 2024, complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. Ernst & Young Jodie Inglis Partner 26 September 2024 182 p Brickworks Annual Report 2024 182 p Brickworks Annual Report 2024 1148 Frankford Avenue Silver City Wirecut, Belgian Gray Wirecut Fishtown, Pennsylvania Brickworks Annual Report 2024 p 183 Ordinary Shares as at 31 August 2024 Shareholders Number of holders 27,558 Voting entitlement is one vote per fully paid ordinary share % of total holdings by or on behalf of 20 largest shareholders 68.02% Distribution of shareholdings: 1 – 1,000 19,217 1,001 – 5,000 6,717 5,001 – 10,000 934 10,001 – 100,000 632 100,001 and over 58 27,558 Holdings of less than marketable parcel of 19 shares 712 Substantial Shareholders The names of the substantial shareholders as disclosed in the shareholder notices received by the Company: Shareholder Number of Shares Washington H Soul Pattinson and Company Limited 65,645,140 Statement of Shareholders 20 Largest Shareholders as disclosed on the Share Register as at 31 August 2024 Number of Shares % 1 WASHINGTON H SOUL PATTINSON & COMPANY LIMITED 65,645,140 43.03 2 CITICORP NOMINEES PTY LIMITED 9,721,620 6.37 3 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 9,470,354 6.21 4 J P MORGAN NOMINEES AUSTRALIA PTY LIMITED 8,112,854 5.32 5 J S MILLNER HOLDINGS PTY LIMITED 3,018,836 1.98 6 WILDESMEADOW PTY LTD 828,000 0.54 7 NATIONAL NOMINEES LIMITED 824,633 0.54 8 BNP PARIBAS NOMS PTY LTD 801,850 0.53 9 T G MILLNER HOLDINGS PTY LIMITED 698,509 0.46 10 ARGO INVESTMENTS LIMITED 584,009 0.38 11 MUTUAL TRUST PTY LTD 496,999 0.33 12 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2 484,377 0.32 13 BKI INVESTMENT COMPANY LTD 436,209 0.29 14 NETWEALTH INVESTMENTS LIMITED 413,124 0.27 15 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 398,329 0.26 16 BNP PARIBAS NOMINEES PTY LTD 380,013 0.25 17 MR GREGORY JAMES STONIER 374,686 0.25 18 MR JAMES WILLIAM STONIER 369,685 0.24 19 MRS KATHRYN ELIZABETH HOZACK 360,886 0.24 20 MILLANE PTY LIMITED 341,349 0.22 103,761,462 68.03 Corporate Information Registered Office 738–780 Wallgrove Road Horsley Park NSW 2175 Telephone: (02) 9830 7800 Website: www.brickworks.com.au Email: info@brickworks.com.au Auditors Ernst & Young Bankers National Australia Bank Share Register Computershare Investor Services Pty Limited GPO Box 2975 Melbourne Victoria 3001 Telephone: 1300 855 080 (within Australia) +61 3 9415 4000 (International) Principal Administrative Office 738–780 Wallgrove Road Horsley Park NSW 2175 Telephone: (02) 9830 7800 Email: info@brickworks.com.au 184 p Brickworks Annual Report 2024 Important Dates 2024 annual result released 26 September 2024 Record date for final ordinary dividend 5 November 2024 Annual General Meeting 26 November 2024 Payment date for final ordinary dividend 27 November 2024 2025 half-year end 31 January 2025 2025 half-year result announced 20 March 2025 Record date for interim ordinary dividend 9 April 2025 Payment date for interim ordinary dividend 1 May 2025 2025 financial year end 31 July 2025 2025 annual result released 25 September 2025 The above dates are indicative only and are subject to change Malvern House Bowral Bricks Simmental Silver Melbourne, VIC Produced by APM Graphics.com.au > 1800 806 930