Woodbois
Annual Report 2023

Plain-text annual report

Accelerating the transition to a net-zero economy 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Manufacturing capital Assets overview Operations in Gabon Trading Intellectual capital Code of Conduct Forest management in Gabon and Mozambique Relational and social capital Responsible trading & sourcing Due diligence process Traceability and transparency The Open Timber Portal Engaging with local communities Global Event Participation Natural capital Transparency Water and wastewater management Waste management Use of chemicals Minimising the impact of logging roads Partnership with World Forest ID Commitment to sustainable harvesting Certification Reforestation and carbon credit division Our reforestation efforts in Mozambique 90 APPENDIX & REFERENCES 4 6 9 MESSAGE FROM THE CEO ABOUT THIS REPORT Integrated Reporting ABOUT WOODBOIS Company overview Our commitment Materiality Analysis 22 OUR BUSINESS MODEL Vertically integrated value chain Forestry in the Congo Basin Forestry is a crucial resource for Africa Using forests to create a green economy Carbon insetting and offsetting Woodbois’ impact on achieving the UN SDGs Risks and opportunities Creating value Strategic priorities 37 THE CAPITALS Financial capital Human capital Human rights, diversity, inclusion and equal opportunities Employee wages in Gabon and Mozambique Equal opportunities Health and safety Grievances Whistleblowing procedure 3 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 01 MESSAGE FROM THE EXECUTIVE CHAIR & CEO 4 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES We are also investing in our trading team to strengthen our market presence and capitalise on emerging opportunities. By enhancing our trading capabilities, we aim to expand our reach and enhance our competitiveness in the marketplace. Furthermore, we are developing a comprehensive carbon credit business plan, which will serve as a lucrative addition to Woodbois' diverse portfolio. This initiative aligns with our commitment to sustainability while also creating new revenue streams and enhancing our environmental impact. Our overarching goal is to make Woodbois an excellent investment opportunity for our shareholders. Through strategic investments, operational excellence, and a focus on sustainable growth, we are positioning the company for long- term success and value creation. As we look ahead to 2024, we see it as a turning point for Woodbois. With a clear vision, a dedicated team, and a commitment to excellence, we are confident that we will capitalise on opportunities, overcome challenges, and drive Woodbois towards a successful and prosperous future. Thank you for your continued support, Guido Theuns, Executive Chair & CEO Reflecting on the year of 2023, marked by changes in leadership and strategic restructuring, I'm eager to share our vision for the future and the promising prospects ahead. Despite facing unexpected financial challenges throughout 2023, our commitment to growth remains steadfast. The resilience and dedication of our staff have been crucial in navigating these hurdles, and I'm confident that with their continued efforts, we'll overcome any obstacles on our path to success. As we look forward, it's vital that we stay focused on our core principles of sustainable forest management and wood-based product production. These principles not only drive our business but also enable us to have a positive impact on the environment and the communities we serve. Our focus on shareholder value remains paramount. We are committed to enhancing returns and delivering long-term value to our shareholders through strategic initiatives and prudent financial management. In line with this commitment, we are undertaking a comprehensive review of our company's legal structure to streamline costs and optimise operational efficiency. This initiative will ensure that we are well-positioned to capitalise on opportunities and navigate challenges effectively. Additionally, we are prioritising production optimization to maximise wood production and efficiency, including enhancing our production teams and implementing new leadership structures to drive performance and innovation in our operations. 5 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 02 ABOUT THIS REPORT 6 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES INTEGRATED REPORTING Welcome to Woodbois' Integrated Report, a comprehensive overview of our company's strategy, performance, and future outlook across material, financial, economic, social, and governance dimensions. This report serves to provide valuable insights into value creation for our investors and all key stakeholders. Reporting Scope and Framework Disclosure and Regulation For the fiscal year 2023 (ending December 31, 2023), this report delves into our performance and achievements, while setting our strategic direction for the upcoming three-year period (2023-2025). Aligned with the International Integrated Reporting Framework (IIRC), our report integrates both financial and non-financial information to provide a holistic view of our operations. All disclosures in this report comply with the AIM regulation on reporting. However, detailed economic indicators are available in our financial statements, accessible on our website: Woodbois Financial Statements. Currency and Regulatory Framework Feedback and Engagement All financial figures in this report are denominated in USD ($). As of August 2022, the IFRS Foundation (1) has assumed responsibility for the Integrated Reporting Framework, with the International Accounting Standards Board (IASB) (2) and the International Sustainability Standards Board (ISSB) (3) collaborating to integrate the framework into their standard- setting projects and requirements. We value your feedback and invite you to share your thoughts, feedback, and views with us via email at info@woodbois.com. Your insights are essential as we strive for continuous improvement and transparency in our reporting practices. Thank you for your continued support and interest in Woodbois. Updates and Standards The International Integrated Reporting Framework (January 2021) supersedes the previous version (December 2013) and is applicable for reporting periods commencing January 1, 2022. Woodbois' reporting aligns with the United Nations Sustainable Development Goals (SDGs) (4) and adheres to the Global Reporting Initiative (GRI) standards. (5) 7 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES "Forests are not just trees; they are the green lungs of the Earth, essential to our survival. They are vast reservoirs of biodiversity and crucial allies in the fight against climate change. The true value of forests lies not only in their economic worth but in their irreplaceable ecological services, from carbon sequestration to watershed protection, making them priceless assets for humanity's future." This quote is attributed to King Charles III, who has been an outspoken advocate for environmental conservation and sustainable development for many years. He has often emphasised the importance of forests in combating climate change and preserving biodiversity. 8 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 03 ABOUT WOODBOIS 9 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Climate Change Strategy Our climate change carbon strategy is a cornerstone of our commitment to sustainable development. By actively mitigating our environmental impact, we aim to deliver long-term benefits to all stakeholders, including local and Indigenous communities. Woodbois is poised to leverage our expertise and resources to address climate change challenges effectively. In Gabon, we have conditionally allocated land for an afforestation project, which we anticipate will attract dedicated funding for climate change mitigation initiatives in the region. Recent Achievements Woodbois continues to demonstrate leadership in sustainability, with our SPOTT score reaching 72.5% in 2023 (for 2022 reporting) – an increase from 69.2% in 2022 (for 2021 reporting) - maintaining our position as the 8th- ranked company among global timber and pulp producers and traders. Furthermore, we are proud to be recognised as the 2nd-ranked company on the Open Timber Portal (7) for Gabon, underscoring our commitment to transparency and responsible forestry practices. As Woodbois looks to the future, we remain steadfast in our commitment to sustainability, transparency, and stakeholder value. By forging partnerships, leveraging innovation, and embracing best practices, we are poised to drive positive change in the forestry industry while delivering long-term, sustainable growth. COMPANY OVERVIEW Woodbois is a leading manufacturer and distributor of sustainable African hardwoods and hardwood products, serving customers worldwide. With a commitment to responsible forestry practices, in 2023 Woodbois managed a total of 480,482 hectares of natural forest concessions, encompassing 324,005 hectares in Mozambique and 156,477 hectares in Gabon. Operations and Infrastructure Founded in 2004, Woodbois is publicly listed on the AIM section of the London Stock Exchange, a premier platform for small and mid-cap companies. Our operations are strategically located to maximise efficiency and sustainability. In Gabon, we have made significant investments, including the establishment of an expansive 11-hectare sawmill and a 3.5-hectare veneer factory in Mouila, capitalising on the abundant timber resources of the Ngounié region. Additionally, our 5- hectare bushmill in Uape, Mozambique's Zambezia Province, enhances our processing capabilities and supports local economies. Sustainability Commitment Woodbois has developed a robust sustainability strategy, aligning our core priorities and commitments with the UN Sustainable Development Goals (SDGs) and the London Zoological Society’s Sustainability Policy Transparency Toolkit (SPOTT) (6). With a dedication to transparency and accountability, Woodbois has achieved significant recognition, in 2023 ranking eighth among over 100 global timber and pulp producers and traders with a SPOTT score of 72.5%, well above the industry average. 10 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES EMPLOYEE STATISTICS M E N 364 (84.5%) T O T A L 431 W O M E N 62 (14.5%) 100% 100% of our suppliers are legally verified and in compliance with timber regulation 480,482 ha of natural forestry concessions Mozambique - 324,005 ha Gabon - 156,477 ha which includes 8,108 ha 73,469 ha Area with actual harvesting Area dedicated to conservation Shared community, conservation and multi-use 11 WOODBOIS LTD | Integrated Report 2023 PRODUCTS Sustainable hardwood products (lumber, veneer, second transformation product) manufactured at our own facilities or sourced from vetted and compliant third-party suppliers. PREDOMINANT SPECIES - Okoumé INTERNATIONAL PRESENCE UK: Sales and management office Denmark: Documentary administration office Gabon: Natural forest concessions on 20-year renewable licences located within 70km of sawmill and veneer factory Mozambique: Natural forest concessions on 25- to 50-year renewable licences Mauritius: Office (finance function) South Africa: Office (finance function) COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES VISION, MISSION & VALUES OUR APPROACH TO SUSTAINABILITY At Woodbois, our approach to sustainability is rooted in the constant pursuit of balance. We believe in questioning imbalances and proposing solutions to restore equilibrium in both our operations and the world around us. This ethos of 'balance-seeking' is ingrained in our culture and shapes our vision of a sustainable future. OUR VISION By taking meaningful action and seeking solutions internally management system that can serve as an example of best practice. We intend to do this by thoroughly and consistently improving on and implementing the ‘Woodbois Balance Blueprint’. OUR MISSION The world is out of balance, forests are out of balance, and carbon emissions are out of balance. Our mission is to become a role model in forest management by redressing the balance. OUR VALUES › R E S P O N S I B I L I T Y towards our stakeholders, people and planet › PASSION for positive impact › I N T E G R I T Y in our choices › T R A N S P A R E N C Y throughout our operations 12 WOODBOIS LTD | Integrated Report 2023 D E V A S T A T E D F O R E S T S Sustainable approach F L O U R I S H I N G F O R E S T S Woodbois approach COMMITMENT TO SUSTAINABLE FOREST MANAGEMENT Woodbois is proud to sustainably manage 480,482 hectares of natural forest, taking an initiative-taking role in promoting environmental stewardship and community well-being. Our end-to-end operations empower us to exercise meticulous control over every aspect of forest management, exemplifying balanced and responsible forestry practices. INNOVATIVE TECHNIQUES FOR RESILIENT FORESTS Central to our sustainable forest management approach is the utilization of innovative techniques aimed at enhancing forest resilience. These techniques include reducing degradation, implementing selective harvesting practices, enhancing operational efficiency, fostering biodiversity, improving soil health, and engaging in extensive replanting initiatives. P E O P L E E C O N O M I C S W O O D B O I S N A T U R E I N S T I T U T I O N S COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES SCIENCE-LED AND TRANSPARENT OPERATIONS Woodbois adopts a science-led and transparent approach to logging operations, collaborating closely with local communities to promote sustainable practices. By integrating scientific research and community engagement, we ensure that our forestry activities are conducted in a manner that respects environmental integrity and social well-being. THE WOODBOIS BALANCE BLUEPRINT We are committed to achieving a balanced forest management system that serves as a beacon of best practice within the industry. The 'Woodbois Balance Blueprint' guides our journey towards this goal, emphasising continuous improvement and implementation of sustainable forestry practices. REDRESSING THE BALANCE In a world where forests and carbon emissions are out of balance, Woodbois is on a mission to become a role model in forest management. By redressing the balance through responsible stewardship and innovative solutions, we aspire to create a more sustainable and harmonious future for generations to come. At Woodbois, sustainability is not just a goal—it's a fundamental principle that guides every aspect of our business, ensuring that we leave a positive legacy for the environment and communities we serve. 13 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES ORIGINS OF WOODBOIS Obtala listed on the London Stock Exchange (AIM market) 2008 Business refocused on forestry, timber transformation and timber trading 2016 Company name changed from Obtala Ltd to Woodbois Ltd 2019 Installation of the second veneer line in Gabon 2022 2007 Obtala incorporated in the United Kingdom 2008 - 2012 Development of agriculturalsector in Tanzania and forestry in Mozambique 2017 Acquisition of WoodBois International (WBI) 2021 2023 Establishment of new Carbon Division, focused on implementing large scale afforestation and reforestation projects to generate carbon credits for the voluntary carbon market Woodbois awarded a conditional grant of 50,000 hectares of land in Gabon for a afforestation project 14 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 2023 IN BRIEF S A L E S B Y R E G I O N 7.9m Revenues USD 21,777 m3 Volume of logs harvested 11,761 m3 Volume of Woodbois' produced timber traded (logs, veneer, sawn timber) 1,533 m3 Volume of third party timber traded (logs, veneer, sawn timber) 13,295 m3 25% Volume of timber traded including third party and Woodbois (logs, veneer, sawn timber) % women in board positions in 2023 38% % women in senior management positions 32 Clients served in 2023 2 Forest management units #8 Ranked n.8 at Spott’s ESG policy transparency assessments for timber and pulp 15 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES SUBSTANTIAL SHAREHOLDERS ORGANISATIONAL STRUCTURE The Company has been notified that the following have, at the date of this report, an interest in 3% or more of the issued Voting Ordinary share capital of the Company. As of June 2024 shareholders notified as holding more than 3% of the voting share capital of Woodbois Limited were: WOODBOIS LIMITED GUERSNEY 100% 100% 100% 100% C O M P A N Y Holding Percent CARBONARBOR LIMITED UK WOODBOIS TRADING LIMITED (DORMANT) ARGENTO LTD MAURITIUS Morgan Stanley (CHCH Ventures FZ – LLC) Securities Services Nominees (John Scott) 590,000,000 14.9% 392,500,000 9.9% WOODBOIS SERVICES LTD UK 22% 99% 100% 100% 78% ARGENTO MOZAMBIQUE LIMITADA WOODGROUP APS DENMARK SCI YARIM GABON WOODBOIS INTERNATIONAL APS DENMARK 16 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES GOVERNANCE At Woodbois, the Board is deeply committed to upholding the highest standards of corporate governance, integrity, and business ethics. Our governance framework is guided by the Corporate Governance Code produced by the Quoted Companies Alliance (QCA), with a focus on practical application tailored to the size and nature of our operations. The following outlines how Woodbois complies with the QCA Code (8): 1. Strategy and Long-Term Value Creation: Our strategy and business model prioritise long-term value creation for shareholders. Capital allocation decisions are driven by performance and potential, with investment directed towards strategies that offer significant returns over time. 2023 News: The results of the Annual General Meeting held in 2023 affirmed shareholders' support for Woodbois' strategic direction, underscoring confidence in our long-term value creation initiatives. 2. Shareholder Engagement: We actively seek to understand and meet shareholder needs and expectations. Our Annual 4. Risk Management: Effective risk management, considering 8. Corporate Culture and Ethics: Woodbois promotes a corporate both opportunities and threats, is embedded throughout the culture grounded in ethical values and integrity. Compliance organisation. Our approach to risk management is outlined in with laws and governance codes is paramount, reflecting our the Annual Report for the year ending December 31, 2023. commitment to acting responsibly in all operations. 2023 News: Ongoing risk assessments and mitigation efforts in 2023 News: Upholding ethical standards and governance best 2023 have strengthened Woodbois' resilience to market practices remains a cornerstone of Woodbois' corporate culture, volatility and operational challenges, ensuring sustained value with initiatives undertaken in 2023 to reinforce ethical conduct creation for stakeholders. and compliance across the organisation. 5. Board Functioning and Composition: The Board functions as a well-balanced team led by the Non-Executive Chair. It is 9. Governance Structures and Processes: We maintain responsible for setting strategic direction, monitoring trading governance structures and processes that support good performance, and evaluating development and acquisition decision-making by the Board. Both Management and the opportunities. The Board holds regular meetings and ensures that Board are dedicated to implementing best practices as the Directors possess the necessary skills and experience. Company continues to grow. 2023 News: Woodbois remains committed to maintaining a diverse 2023 News: Woodbois' focus on governance excellence in 2023 and effective Board, with strategic initiatives undertaken in 2023 to has led to the implementation of robust structures and enhance governance structures and optimize decision-making processes that support strategic decision-making and processes. sustainable growth objectives. General Meeting provides shareholders with a platform to 6. Director Skills and Capabilities: The Nominations Committee exercise decision-making power, while our Executive Directors oversees Director appointments to ensure that the Board and Investor Relations Officer serve as key points of contact for possesses the requisite experience, skills, and diversity. Succession shareholder updates and engagement. planning is a key focus area. 2023 News: The Board Change and Strategic Initiatives 2023 News: Efforts to enhance Board diversity and succession announced in 2023 reflect our commitment to enhancing planning in 2023 have resulted in strengthened leadership shareholder value and driving sustainable growth. capabilities and governance effectiveness at Woodbois. 10. Stakeholder Communication: Woodbois maintains open and transparent communication with shareholders and relevant stakeholders, ensuring that all communications concerning the Group's activities are clear, fair, and accurate. 2023 News: Enhanced stakeholder communication initiatives in 2023 have fostered greater transparency and engagement, facilitating meaningful dialogue with shareholders and stakeholders on Woodbois' performance and strategic 3. Stakeholder and Social Responsibilities: Woodbois recognises 7. Board Performance Evaluation: Internal evaluations of the initiatives. its wider stakeholder and social responsibilities, aiming to bring Board, Committees, and individual Directors are conducted to a positive impact to Africa's economic transformation, social drive continuous improvement and enhance governance development, and environmental management through our effectiveness. operations. Responsibility for our sustainability strategy rests 2023 News: Woodbois' commitment to ongoing Board with the Board. performance evaluations reflects our dedication to governance 2023 News: Woodbois continues to engage with stakeholders excellence and continuous improvement in 2023. to address social and environmental challenges, aligning our efforts with sustainable development goals and fostering positive change in the communities where we operate. 17 WOODBOIS LTD | Integrated Report 2023 For further details on our corporate governance practices, please refer to the company’s Annual Report for the year ending December 31, 2023, and the news updates from 2023 regarding the Annual General Meeting and Board Change and Strategic Initiatives. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES THE BOARD AS PER 2024 The Board plays a critical role in overseeing key business risks, reviewing the strategic direction of all trading subsidiaries, and assessing their financial performance. This includes evaluating their annual budgets, performance against those budgets, and capital expenditure. Additionally, the Board reserves decision-making authority on various Group matters, including: Overall strategy Approval of major capital expenditure projects Approval of annual and interim results Annual budgets, Key Performance Indicators (KPIs), and revisions thereto Environmental, Social, and Governance (ESG) matters, encompassing climate change initiatives and actions 18 WOODBOIS LTD | Integrated Report 2023 GUIDO THEUNS Executive Chair & CEO CARNEL GEDDES CFO Guido was appointed as Executive Chair & CEO at the beginning of January 2024. With over 25 years of experience in the international IT and financial sectors, Guido has held various management positions. He has specialised in structuring Alternative Investment Funds and developing international strategies for companies and family offices. Guido resides in France and the Netherlands. Carnel is a dual-qualified chartered accountant in the UK and South Africa, and is also a certified fraud examiner. During a 15-year career at the global audit, tax and advisory group BDO, Carnel served as Director of Forensic Services at BDO London and Partner of BDO Cape Town. She has been a Director and Board Member of one of the largest South African pomegranate farming and export companies, Pomona, since 2008. She was also the Chair of POMASA (2018 to 2023), the Pomegranate Growers Association of South Africa. GRAEME THOMSON Independent Non-Executive Director ADRIAAN ROECOERT Independent Non-Executive Director Graeme is a Fellow of the Institute of Chartered Accountants in England and Wales, and has been a public company director for many decades, as a CEO, CFO/Company Secretary, and as a Non- Executive. He has a wide variety of commercial UK and international experience, including of Audit and Remuneration Committees. Mr Roecoert, joined as a INED as of June 2024, is greatly experienced in financial matters, from running his own successful accountancy practice to advising over many years on large M&A, reorganisations, debt and share transactions. Mr Roecoert is a director of multiple international reputed companies and will be a member of the Audit, Remuneration & Nominations Committees. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES OUR COMMITMENT drive positive change. Woodbois operates with a strong commitment to social and environmental responsibility, striving to make positive contributions to communities at both local and national levels. Recognised as a "citizen company," Woodbois actively OUR STAKEHOLDERS, PARTNERSHIPS AND COLLABORATIONS segment of the supply chain and represents them with a powerful voice. Additionally, the IWPA supports the legal and sustainable harvesting of wood products from around the world, thereby promoting sustainable forest management, benefiting local communities, and generating economic communities, governments, NGOs, and industry experts to International Wood Products Association unites every supports the needs of the communities in which it operates, Woodbois collaborates with initiatives such as the Open growth and quality jobs. promoting sustainable practices and respecting Timber Portal (OTP) to ensure transparency and environmental traditions. Our dedication to environmental accountability in our timber supply chain, combatting illegal The collaboration with NHLA - National Hardwood Lumber sustainability is deeply ingrained, and we take pride in our logging. Additionally, we are proud members of Association is particularly significant as the US market efforts to foster a healthy environment and support the well- organizations such as the Congo Basin Forest Partnership constitutes a vital aspect of Woodbois' trade, and being of the communities we serve. (CBFP), the European Forest Institute (EFI), and the maintaining strong relationships with customers is of Ensuring the safety and protection of all stakeholders is (ATIBT), advocating for sustainable forestry practices and translates to direct on-the-ground action involving ongoing paramount to Woodbois. We uphold a culture of accountability and integrity, valuing the role of promoting the development of tropical timber industries. engagement with our employees to collect their feedback to ensure a positive, safe and healthy working environment that whistleblowers in reporting corruption, misconduct, and Our partnership with World Forest ID enhances traceability provides career development and growth opportunities. Association Technique Internationale des Bois Tropicaux paramount importance. Our stakeholder commitment fraud. Our zero-tolerance policy towards adverse treatment in our timber products, providing scientific confirmation of of employees who raise concerns reinforces our commitment species identity and origin. Engagement with industry Post-Covid we have started to resume physical site visits to to ethical and fair conduct. associations like the International Wood Products suppliers, with whom we seek to align policies and Association (IWPA) and the National Hardwood Lumber commitments towards increased transparency and Woodbois remains steadfast in its pledge to combat Association (NHLA) strengthens our ties with customers and sustainability. The remote communities in which we operate corruption, bribery, and fraud. We adhere to best practices supports sustainable forest management practices. are dependent on forests, as we are on their local knowledge outlined in SPOTT and follow guidelines set by leading and experience. Our mutual exchange of understanding international organisations. Before establishing new business Woodbois remains committed to engaging with employees each other's needs, supporting community development and relationships, we conduct thorough due diligence and communicate our policies to maintain high standards. and suppliers to ensure a positive, safe, and healthy working helping local causes is core to our business, which couldn’t environment. We prioritize ongoing community operate without community knowledge and support. Sustainability lies at the heart of Woodbois' operations as we engagement, recognizing the importance of mutual support strive to lead by example within the industry. Our goal to and collaboration with local communities in achieving our OUR STAKEHOLDERS achieve net-zero CO2 emissions by 2035 underscores our sustainability goals. commitment to environmental stewardship and mitigating climate change. Collaboration with stakeholders across the Woodbois has been a proud member of the IWPA for a value chain is essential in addressing sustainability number of years. As the primary trade association for the challenges, and we actively engage with investors, local global wood products industry in North America. The IWPA - Employees Shareholders Funding providers Local communities Industry experts Suppliers Customers End - consumers International organisations NGO's Local governments 19 18 WOODBOIS LTD | Integrated Report 2023 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES MATERIALITY ANALYSIS In Integrated Reporting, a matter is deemed material if it has the potential to significantly impact the organisation's ability to generate value in the short, medium, and long term. Conducting a materiality analysis is crucial as it helps identify a company's critical Environmental, Social, and Governance (ESG) issues. This analysis involves engaging with both internal and external stakeholders to gain comprehensive insights into organizational issues. These insights are then used to define core business priorities, guiding both strategy and communication. Woodbois conducted a materiality analysis to identify its most critical issues, utilising the SASB Materiality Map. This process allowed us to pinpoint the most important issues that could significantly affect our ability to create value. These key issues are represented in the materiality matrix, ensuring that our strategic decisions and communications are aligned with the organisation's core priorities. 20 WOODBOIS LTD | Integrated Report 2023 Environment Social capital Human capital Business model and innovation Transparent supply chain Leadership and governance Responsible sales & marketing Legal harvesting Developing local economies Health & safety at work Protection of land Climate change mitigation through sustainable forest management I S P H S N O T A L E R I Training & education Wages & benefits Biodiversity Economic value generated & distributed Equal rights & conflict resolution Sustainable & high quality products Efficient use of resources Financial assistance Soil & water safety Energy usage Greenhouse gas emissions WOODBOIS Our analysis followed these steps: 1. 2. 3. 4. 5. 6. Identify and prioritise the relevant issues Identify internal and external stakeholders Design a materiality survey Launch the survey and start collecting insights Identify the critical issues and develop a materiality matrix Define a sustainability strategy based on material priorities 7. Set long- and short-term KPIs and improvement goals As a result of this process, the most important issues have been identified and are represented in the Woodbois 2023 materiality matrix. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 21 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 04 OUR BUSINESS MODEL 22 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES VERTICALLY INTEGRATED VALUE CHAIN FOREST OPERATIONS Woodbois caters to customer specifications, including the last steps of the value chain, by delivering high quality, internally and externally produced timber and timber products. • • • • Inbound logistics Management plan Inventory Harvesting and transportation • Log tracking SAWMILL Mozambique | Gabon • • • Plank production Quality controls Packaging INTERNALLY PRODUCED PRODUCTS • • • Veneer sheets Quality controls Packaging VENEER FACTORY Gabon S T C A R T N O C S T C A R T N O C 100% of the wood harvested is PROCESSED LOCALLY TRANSPARENCY Every single tree has an identification number and can be tracked through a GPS code T N E M E G A N A M E T S A W 100% CARING FOR PROTECTED SPECIES 0% of the trees harvested are listed as protected or endangered 23 WOODBOIS LTD | Integrated Report 2023 EXTERNALLY PRODUCED PRODUCTS TRADING BUSINESS • • • • • • • Quality control Legal documentation Transport to the port Shipping and transport documentation Invoicing Delivery After-sales customer service I N O T U B R T S D I I COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES VALUE CREATION As investors and consumers become increasingly When these interactions, activities, and relationships are concerned about social impact, climate change and material to a company’s ability to create value for itself, they corporate responsibility, companies are facing increasing are included in the Integrated Report. scrutiny and are expected to be held accountable for their business practices. The value creation framework is presented in the appendix. THERE ARE A TRILLION REASONS TO PROTECT THE FORESTS Watch the video from Boston Consulting Group (10) https://www.bcg.com/publications/2020/the- staggering- value-of-forests-and-how-to-save-them There is a growing demand for sustainable and responsible businesses, as today's consumers are increasingly seeking meaningful connections with companies that align with their values and demonstrate a clear sense of purpose. They are no longer satisfied with solely purchasing products or services; they want to support businesses that prioritise sustainability, social responsibility, and ethical practices. A Nielsen study (9) showed that 73% of surveyed consumers expressed a strong desire to spend their money on products and services from companies committed to positive environmental and social impact. Woodbois' incorporation of purpose-driven initiatives into company strategies has never been more important. According to the Integrated Reporting framework, the value a company creates, preserves or erodes has an impact on two levels: on the company itself, which affects capital return for investors; and on society at large. Given this, investors evaluate companies based on these two value streams (i.e. identifying whether a company can create value for a broader range of societal stakeholders while also creating value for itself). For all the profit, there needs to be impact. A wide range of activities, interactions and relationships can have an impact on the interrelation between these two value streams. 24 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES FORESTRY IN GABON: HOW SUSTAINABLE FORESTRY CAN SUPPORT CLIMATE ACTION In the global fight against deforestation, Gabon emerges as a hopeful example. Despite deforestation rates continuing to rise worldwide, Gabon has maintained an impressive 88% forest cover and limited annual deforestation to less than 0.1% over the past three decades. This achievement is largely attributed to the country's reliance on oil revenues to support its economy. However, with dwindling oil reserves, Gabon is now seeking to diversify its economy while preserving its forests through the development of a sustainable forest economy. In a significant milestone, Gabon received the first instalment of $17 million out of a pledged $150 million from Norway for results-based emission reduction payments. This funding, part of the Central African Forest Initiative (CAFI), marks Gabon as the first African country to receive payment for reducing emissions from deforestation and forest degradation (REDD+). The growing global population underscores the urgent need for renewable materials. Sustainable forestry practices and the creation of green value chains hold the key to building sustainable economies while addressing this need in a manner that benefits both people and the planet. Efforts to restore degraded land through afforestation and reforestation present a cost-effective solution to remove significant amounts of carbon dioxide from the atmosphere. By halting deforestation and simultaneously sustaining forests, carbon emissions can be reduced by the 14% needed to prevent the Earth's average temperature from rising by 1.5 °C before 2030. Moreover, advancements in lab-grown meat substitutes utilizing natural products can reduce the land required for agriculture, freeing up vast areas for reforestation efforts and further contributing to carbon emission reduction. For further insights, the video "Gabon: Africa's Rainforest And It's Protectors" delves into the intricate relationship between the people of Gabon and their rainforest, highlighting various efforts to preserve or reconnect with the forest and its cultural significance. Watch the video here https://www.youtube.com/ watch? v=DWtslaGVf_U&feature=youtu.be 25 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES FORESTRY IS A CRUCIAL RESOURCE FOR AFRICA: A RECENT PERSPECTIVE Forestry remains a cornerstone of Africa's environmental, To address these issues, governments must engage local social, and economic landscape, playing a vital role in communities, civil society organisations, and the private biodiversity conservation, carbon sequestration, and sector in conservation and restoration efforts. Promoting sustainable development. Amidst growing concerns over sustainable forest management practices, establishing climate change and biodiversity loss, Africa's forests serve protected areas, and enforcing forest laws are essential as invaluable ecosystems that support diverse flora and steps in this process. fauna, provide essential ecosystem services, and sustain the livelihoods of millions of people across the continent. Investment in research and development of forest areas is crucial for their conservation and sustainable use. Despite ongoing efforts, Africa has lost over 30 million Strengthening community forestry and participatory hectares of forest in the past two decades, equivalent to management systems can empower local communities to the size of the United Kingdom. Recent initiatives aim to manage and benefit from forest resources. restore Africa's degraded landscapes, but progress remains slow. Tropical forests, with their high carbon storage capacity and biodiversity, play a critical role in mitigating climate Forests in Africa are rich in valuable timber species, which change and supporting ecosystem health. Protecting and attracts illegal loggers who engage in unsustainable restoring Africa's forests is not only essential for the logging practices. Combined with the impact of climate continent's ecological balance but also for the well-being change including droughts, floods and wildfires, Africa has of its people. suffered significant loss to forest-cover. Additionally, climate change has altered the distribution and behaviour of some forest- dwelling species, leading to changes in the structure and function of forest ecosystems. Agricultural expansion, driven by population growth and food demand, continues to be a leading cause of deforestation, particularly in West and Central Africa. Illegal logging further exacerbates the issue, threatening valuable timber species and disrupting forest ecosystems. Climate change has compounded these challenges, altered forest ecosystems and increasing the frequency and intensity of extreme weather events such as droughts, floods, and wildfires. 26 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES GABON'S FORESTS AS A MODEL GLOBAL RECOGNITION AND FOR CONSERVATION PARTNERSHIPS At the forefront of Africa's forestry conversation stands Gabon's initiative-taking stance on forest conservation has Gabon, a nation celebrated for its pristine rainforests and earned it international acclaim and support. Collaborative robust conservation efforts. With an impressive 88% forest ventures such as the Central African Forest Initiative (CAFI) cover, Gabon boasts one of the highest percentages of and partnerships with countries like Norway have provided forested land globally, serving as a biodiversity hotspot and Gabon with crucial funding and technical assistance to a vital carbon sink. advance its conservation objectives. Gabon's pioneering efforts in reducing emissions from deforestation and forest Despite facing threats from deforestation and degradation (REDD+) (11) have positioned it as a trailblazer in unsustainable practices, Gabon has demonstrated a climate action, setting an inspiring example for other steadfast commitment to forest conservation, nations to emulate. implementing stringent protection measures and establishing extensive networks of national parks and wildlife reserves. Gabon's success in limiting annual deforestation to less than 0.1% over the past three decades stands as a testament to its dedication to preserving its natural heritage. SUSTAINABLE DEVELOPMENT IN HARMONY WITH CONSERVATION Gabon's approach to forestry exemplifies a harmonious balance between conservation and sustainable development. Recognizing the economic value of its forests beyond traditional extractive industries, Gabon has embarked on a journey to diversify its economy and promote sustainable forestry practices. Initiatives aimed at eco-tourism, value-added processing of forest products, and community-based forest management underscore Gabon's commitment to harnessing the potential of its forests while safeguarding their ecological integrity. EMPOWERING LOCAL COMMUNITIES Central to Gabon's conservation strategy is the active involvement of local communities in forest management and governance. Through participatory approaches and community-based initiatives, Gabon seeks to empower indigenous peoples and local residents as stewards of their ancestral lands, ensuring that conservation efforts are inclusive, equitable, and socially sustainable. In the face of mounting environmental challenges, Gabon's forests stand as a beacon of hope and resilience, embodying the inherent connection between nature conservation, sustainable development, and climate resilience. As Africa's forests continue to face threats from deforestation, climate change, and unsustainable land use practices, the example set by Gabon serves as a rallying call for concerted action to preserve and protect these invaluable ecosystems for generations to come. 27 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES FORESTS: CATALYSTS FOR A GREEN ECONOMY Harnessing the potential of forests to foster economic growth and environmental sustainability is increasingly recognised as a pivotal strategy in the pursuit of a green economy. By developing forest-based industries, countries can unlock new job opportunities, promote sustainable forest management practices, and contribute to biodiversity conservation and carbon sequestration efforts. Promotion of Sustainable Forest Management Practices: Encouraging sustainable forest management practices is crucial for mitigating the negative impacts of deforestation and forest degradation. By implementing certification programs and promoting responsible timber harvesting practices, countries can ensure the long- term viability of their forest resources while fostering Gabon's Exemplary Conservation Efforts: Gabon has economic growth. emerged as a beacon of forest conservation in Africa, pioneering initiatives to safeguard its rich biodiversity and Development of Renewable Energy Sources: natural heritage. Through the establishment of extensive Embracing renewable energy sources, such as national parks and stringent regulations against illegal bioenergy derived from sustainable forest biomass, logging, Gabon has demonstrated a steadfast commitment to offers a promising avenue for reducing reliance on preserving its forests for future generations. The country's fossil fuels and driving sustainable economic focus on sustainable development and eco-tourism further growth. By leveraging forest resources for energy underscores its dedication to balancing conservation with production and supporting the development of economic progress, setting a compelling example for other renewable energy technologies, countries can nations across the continent. KEY STRATEGIES FOR SUSTAINABLE FOREST MANAGEMENT AND ECONOMIC DEVELOPMENT Investment in Conservation and Restoration: By investing in forest conservation and restoration initiatives, countries can reap significant environmental and economic benefits. These include job creation, carbon sequestration, biodiversity preservation, and watershed protection. Collaborative partnerships between governments, the private sector, and local communities are essential for maximizing the impact of such initiatives. transition towards a low-carbon economy while creating new employment opportunities in the green energy sector. Integration of Forests into Climate Change Strategies: Forests play a crucial role in climate change mitigation and adaptation efforts, offering substantial economic benefits in addition to their environmental value. By promoting sustainable land use practices, developing carbon markets, and leveraging international climate finance, countries can harness the potential of forests to combat global climate change while unlocking economic opportunities for forest-dependent communities. 28 WOODBOIS LTD | Integrated Report 2023 IMPACT OPPORTUNITIES FOR THE FOREST SECTOR PEO PLE I N G FO R P R O E S T S NITIE S U M M O C K R O W C I R C U L A R I T Y BIO-ECO N O M Y W T ER A C U R E M E N T E T A M CLI Illustration based on the WBCSD Forest Sector SDG Roadmap COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES CARBON INSETTING AND OFFSETTING Carbon offsetting and insetting are two distinct approaches aimed at reducing greenhouse gas emissions, each with its own set of methodologies and considerations. INSETTING Carbon Offsetting: This approach involves investing in projects that mitigate emissions in one location to compensate for emissions generated elsewhere. These projects typically focus on initiatives such as renewable energy generation, reforestation, and energy efficiency enhancements. Carbon offsetting enables companies to take action on emissions that may be challenging to reduce within their own operations, offering a cost-effective means of achieving emissions reductions. However, it's essential for companies to ensure the credibility and transparency of offset schemes to guarantee their effectiveness in achieving environmental and social outcomes. Insetting: In contrast, insetting involves reducing emissions directly within a company's own operations or supply chain by adopting sustainable practices or implementing energy-efficient measures. While insetting provides companies with more direct control over emissions reductions and may lead to long-term cost savings, it can be challenging to implement, particularly for companies with limited control over their emissions. This is particularly true for industries with high emissions or complex supply chains. Considerations for Climate Action Planning: When developing climate action plans, companies should carefully consider both carbon offsetting and insetting. While carbon offsetting offers a cost-effective means of reducing emissions and supporting environmental and social goals, companies must prioritize schemes with credible and transparent outcomes. On the other hand, insetting provides more direct control over emissions reductions but may pose implementation challenges. By strategically integrating both approaches, companies can effectively manage their emissions and contribute to global climate mitigation efforts while addressing their unique operational contexts and challenges. Reducing CO2 emissions internally OFFSETTING Continually emitting CO2 Buying carbon credits Illustration from Omybag 21 29 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES WOODBOIS’ IMPACT ON ACHIEVING THE UN SDGS Continuing our commitment to the UN Sustainable Development Goals (SDGs), Woodbois recognises the imperative of fostering a circular economy and optimizing the utilisation of renewable resources. We remain steadfast in our dedication to the sustainable management of natural systems, ensuring both global and local communities benefit from our initiatives. OUR SUSTAINABILITY OBJECTIVE As we align with the UN’s SDGs, our focus remains on advancing Africa's sustainable development journey. Embracing the continent's shift towards value-added operations, we are dedicated to creating secure employment opportunities that foster skill development and uphold principles of equality. 30 WOODBOIS LTD | Integrated Report 2023 ENVIRONMENTAL PRESERVATION (SDG 13, 15) Climate Impact and Carbon Sequestration: Sustainable forest management mitigates the direct climate impact of wood procurement and facilitates additional carbon sequestration, benefiting the global community by addressing climate change and preserving terrestrial ecosystems. MARKET DEMAND (SDG 8, 12) Suppliers, consumers, and stakeholders increasingly demand sustainable credentials, promoting responsible consumption and production. Businesses that overlook environmental factors face significant competitive disadvantages, thus encouraging sustainable economic growth. SOCIAL IMPACT (SDG 8, 10) Sustainable practices respect the rights of local FORGING GLOBAL PARTNERSHIPS (SDG 17) Woodbois recognises its pivotal role in partnering with governments and institutions to address sustainability challenges. Our engagements extend beyond our industry, communities, contributing to decent work and economic influencing broader sustainability initiatives. growth, while reducing inequalities by supporting community development and wellbeing. CULTURE OF SUSTAINABILITY (SDG 8, 10) Investing in training and development opportunities for our workforce is pivotal in fostering a culture of ethical practice. By nurturing loyalty and motivation among employees, we aim to promote a broader respect for and protection of forests. LIFE ON LAND (SDG 15) Biodiversity Conservation: Conducting High Conservation Value (HCV) and Biodiversity assessments to protect and enhance the ecological, social, and cultural values of forests. SUSTAINABILITY LEADERSHIP (SDG 17) At the helm of our sustainability efforts is Alain Diounga, a seasoned expert with a master's degree in Tropical Forestry and Biodiversity. Alain spearheads our daily sustainability endeavours, ensuring alignment with global best practices. Eng. Macedo Uachuacho, our Reforestation and Sustainability Manager in Mozambique, brings over 12 years of experience in forestry engineering, collaborating closely with governmental bodies and NGOs. COLLABORATIONS AND INITIATIVES (SDG 17) Partnering with organizations like World Forest ID and participating in the National Traceability System of Wood of Gabon (SNTBG) to enhance transparency and traceability in forestry. Hosting training sessions for government agents to support the implementation of new traceability systems, demonstrating a commitment to collaborative governance and sustainability. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES WOODBOIS’ IMPACT ON ACHIEVING THE UN SDGS DRIVING ECONOMIC SUSTAINABILITY (SDG 8, 9, 12) Recognising the evolving landscape of consumer and INDUSTRY, INNOVATION, AND INFRASTRUCTURE (SDG 9) stakeholder expectations, Woodbois remains committed to Sustainable Infrastructure: Investing in infrastructure that meeting the demand for sustainability. Businesses that supports sustainable forestry practices, such as the veneer overlook environmental considerations risk falling behind factory in Mouila, enhancing local industrial capacity. competitively. Advocating for sustainable forestry practices is Innovation in Forestry: Implementing innovative technologies crucial in diminishing opportunities for unethical operations. and practices to improve efficiency and sustainability in forest management and timber processing. REFORESTATION PROJECTS (SDG 13) Sustainable practices respect the rights of local communities, contributing to decent work and economic growth, while reducing inequalities by supporting community development and wellbeing. DECENT WORK AND ECONOMIC GROWTH (SDG 8) Employment Opportunities: Woodbois provides job opportunities in forest management, sawmilling, and veneer production, contributing to economic growth in local communities. Training and Development: Offering extensive training programs for employees to develop skills and enhance productivity, ensuring decent work and long-term career growth. Safe Working Conditions: Commitment to maintaining high standards of health and safety in all operations, ensuring a safe work environment. RESPONSIBLE CONSUMPTION AND PRODUCTION (SDG 12) Sustainable Forest Management: Implementing best practices in forest management to ensure responsible and sustainable use of forest resources. Waste Reduction: Utilising wood waste as biofuel for the veneer factory and kilning operations, significantly reducing waste and promoting efficient resource use. AFFORDABLE AND CLEAN ENERGY (SDG 7) Biofuel Utilisation: Using wood waste as biofuel, contributing to the generation of clean energy and reducing reliance on fossil fuels. CLEAN WATER AND SANITATION (SDG 6) Watercourse Management: Constructing watercourse crossings without raising water levels, preventing flooding, and protecting water quality and forest ecosystems. 31 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES RISKS AND OPPORTUNITIES Operating concessions in the Congo Basin entails a unique set of challenges and opportunities, given the region's ecological significance and socio-economic dynamics. Woodbois recognises these factors and adopts a comprehensive approach to manage risks while maximising potential benefits. RISKS OPPORTUNITIES Environmental Vulnerability: The fragile ecosystem of the Congo Basin faces threats from deforestation, habitat loss, and climate change, posing risks to long- term sustainability. Regulatory Uncertainty: Evolving regulations and policies in the region can impact concession operations, leading to compliance challenges and operational disruptions. Political Instability: Political unrest and governance issues in certain areas of the Congo Basin may affect operational continuity and investment security. Social Tensions: Disputes with local communities over land use, resource access, and benefit-sharing arrangements can escalate, leading to project delays and reputational damage. Infrastructure Limitations: Inadequate transportation networks and basic infrastructure in remote areas of the Congo Basin pose logistical challenges and increase operational costs. Market Volatility: Fluctuations in global commodity prices, coupled with changing consumer preferences for sustainably sourced products, can affect market demand and revenue streams. Climate Change Impacts: Increasing frequency and intensity of extreme weather events, such as floods and droughts, threaten infrastructure, biodiversity, and community resilience. Biodiversity Conservation: Woodbois has the opportunity to contribute to the preservation of biodiversity in the Congo Basin by implementing sustainable forestry practices and habitat conservation initiatives. Community Engagement: Building strong partnerships with local communities through inclusive decision- making, capacity-building, and socio-economic development projects can foster mutual trust and support. Innovation and Technology: Leveraging innovative technologies for sustainable forest management, monitoring, and value-added processing can enhance operational efficiency and product quality. Certification and Standards: Obtaining certifications such as Forest Stewardship Council (FSC), LegalSource (LS) or Origine et Légalité des Bois (OLB) certification demonstrates Woodbois' commitment to responsible forest management and access to premium markets. Different avenues are currently being explored. Value Addition: Investing in downstream processing facilities within the Congo Basin creates opportunities for job creation, skills development, and value addition, contributing to local economic growth. Climate Resilience: Implementing climate-resilient practices, such as agroforestry and ecosystem restoration, enhances ecosystem resilience, carbon sequestration, and adaptation to climate change impacts. Strategic Partnerships: Collaborating with governments, NGOs, research institutions, and international organizations can facilitate knowledge-sharing, access to funding, and collective action on sustainability goals. 32 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES EUDR IMPLEMENTATION RISKS Regulatory Compliance Challenges present a high impact and likelihood, requiring increased documentation and verification processes. Woodbois is investing in geolocation verification and enhancing administrative resources, with a new documentation system implemented and a Compliance Manager hired. Supply Chain Transparency Requirements also have a high impact and likelihood, necessitating the establishment of transparency and traceability. Woodbois is developing tracking procedures and partnering with local authorities. Advanced tracking technology is currently in the pilot phase. Risk of Non-Compliance Penalties poses high impact and likelihood, leading to legal and reputational risks, fines, and market access restrictions. Woodbois is conducting internal audits and planning third-party assessments. Internal audits are in place, with third-party assessments planned. Note: The full risk assessment table is available in the annex. CLIMATE CHANGE RISK ASSESSMENT SUMMARY OVERVIEW This assessment evaluates the climate change impacts on Woodbois' operations in the Congo Basin and outlines strategies for mitigation and adaptation to ensure sustainability and resilience. CLIMATE CHANGE IMPACTS Extreme Weather Events pose a high impact and likelihood, threatening infrastructure, biodiversity, and community livelihoods. To mitigate these risks, Woodbois is strengthening infrastructure resilience, enhancing ecosystem conservation, and implementing advanced weather monitoring. Progress includes ongoing infrastructure upgrades and initial monitoring systems in place. Precipitation and Temperature Changes have a medium to high impact and likelihood, affecting water availability, forest productivity, and ecosystem dynamics. Woodbois is developing water management strategies, implementing sustainable forest management practices, and adapting operations to changing climate conditions. Progress involves planned water management projects, integrated sustainable practices, and ongoing climate impact assessments. Climate-Related Hazards, such as floods, landslides, and wildfires, present a low impact and likelihood. Mitigation efforts include enhancing ecosystem resilience, implementing risk management plans, and developing evacuation protocols. Woodbois has established risk assessment protocols, planned community evacuation drills, and continues landscape restoration efforts. POTENTIAL BUSINESS IMPACTS Infrastructure Damage has a high impact and likelihood, potentially causing production delays and financial losses. Woodbois is addressing this by strengthening infrastructure, investing in necessary upgrades, and developing contingency plans. Critical upgrades have been identified, and draft contingency plans are in development. Forest Composition Changes carry a medium to high impact and likelihood, affecting timber quality, supply chain resilience, and market competitiveness. To mitigate these changes, Woodbois is exploring new markets, monitoring forest health, diversifying products, and investing in research on resilient timber species. Research on resilient species has been initiated. Regulatory Compliance Costs are expected to increase due to climate change mitigation measures, with a medium to high impact and likelihood. Woodbois is staying updated on regulations, advocating for supportive policies, and investing in compliance infrastructure. Progress includes updated compliance tracking systems and staff training. 33 33 WOODBOIS LTD | Integrated Report 2023 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES INPUT Cash generated by operations, divestments, debts and equity finance 2 sawmills, 7 kilns, 1 veneer factory, 34 suppliers, Trading network Relationship with a broad range of stakeholders: institutions, local communities, regulators, shareholders, investors and suppliers Diverse team Experienced and highly motivated leadership and local teams Property and licenced technologies Skills and experience 156,000 hectares of concessions on 20-year renewable leases in Gabon 324 005 hectares of concessions in Mozambique on 25-50 year leases Third party timber Water and energy used in production and transportation CAPITALS CREATING VALUE O U V R A L U S E IN T E G Y S U R I T B I N E S S A C BA TIVITIE S L A N C E Trading of responsibly sourced hardwood and hardwood products Landscape afforestation Harvesting, production of hardwood and hardwood products through our vertically integrated value chain T R A N S P A R E MATERIAL ISSUES • Economic value generated and distributed • Training and education • Financial assistance • Health and safety at work • Wages and benefits • Efficient use of resources • Equal rights and conflict resolution • Sustainable and high quality products • Legal harvesting • Responsible sales and marketing • Climate change • Developing local economies • Biodiversity N • Protection of land (soil and water safety) C Y • Greenhouse gas emissions • Energy usage E C N E SILI RE RESPONSI B I L I T Y OUTCOMES Revenues Paid taxes Investment in achieving cer tification Investment in facilities and training Wood harvested Logs produced Logs traded SPOTT ranking Traceability project No. of employees Health and safety of employees New hirings Trainings Code of conduct Ha of protected forests Reduction in GHG emissions CO2 stored in our concessions Waste to energy Resources used to power our operations and for our trading business OUTPUT Products Hardwood and hardwood products produced and traded Areas of concessions harvested Resources used to power our operations Emissions Total CO2 emissions SDG S Financial Manufactured Relational Human Intellectual Natural 34 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES STRATEGIC PRIORITIES FOR SUSTAINABLE FORESTRY In alignment with the Forest Sector SDG roadmap(12) and the SPOTT framework, Woodbois is committed to advancing sustainable forestry practices in Africa. Our strategic priorities are designed to manage risks effectively, seize opportunities, and minimise our environmental footprint while maximizing socio-economic benefits. 1. Regulatory Compliance 6. Continuous Monitoring and Reporting Woodbois prioritises strict adherence to national and international regulations governing Woodbois is committed to transparency and accountability in our sustainability efforts. We forest management and timber trading. We invest in robust due diligence processes and regularly monitor and evaluate our environmental, social, and governance (ESG) performance, compliance mechanisms to ensure legal and sustainable sourcing of timber products. using key performance indicators (KPIs) aligned with international standards. We communicate our progress and impact through annual integrated reports, ensuring 2. Resource Management stakeholders are informed and engaged. Efficient and responsible resource management is at the core of our operations. We implement sustainable forestry practices, including selective harvesting, reforestation, and By aligning our strategic priorities with global sustainability frameworks and actively ecosystem restoration, to maintain the ecological integrity of forest ecosystems and safeguard monitoring our performance, Woodbois strives to be a leader in sustainable forestry in Africa. We are dedicated to driving positive change, preserving natural resources, and creating lasting value for society and the environment. biodiversity. 3. Local Production and Trade Woodbois is committed to prioritising local production and promoting internal trade within Africa. By supporting local economies, fostering value-added processing, and enhancing supply chain resilience, we contribute to economic growth, job creation, and regional development. 4. Environmental Impact Reduction Minimising our environmental footprint is a fundamental aspect of our strategy. We continuously seek innovative solutions to reduce energy consumption, mitigate greenhouse gas emissions, and minimise waste generation throughout our operations. 5. Stakeholder Engagement Engaging with stakeholders, including local communities, governments, NGOs, and industry partners, is essential for fostering transparent and collaborative relationships. We prioritize dialogue, consultation, and participatory decision-making to address concerns, build trust, and promote shared value creation. 35 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES CAPITALS MATERIAL ISSUES STRATEGIC PRIORITIES SDGS Financial Manufacturing Relational Human Intellectual Natural - - - - - - - - - - - - - - - - Economic value generated and distributed Financial assistance 1. Maximise value of raw material input through a programme of continuous improvement of efficiency. 2. Seek scale through M&A opportunities. Economic value generated and distributed Financial assistance 1. Improve efficiency to get more value from raw materials 2. Minimise dependency on fossil fuels by using renewable energy and implementing circular solutions. Responsible sales and marketing Developing local economies Wages and benefits Training and education Health and safety at work Equal rights and conflict resolution Legal harvesting Climate change Biodiversity Protection of land (soil and water safety) Greenhouse gas emissions Energy usage 1. Invest in long-term partnerships with selected timber suppliers who like ourselves are committed to achieving third party certification. Invest in services and facilities for local communities. 2. 3. Develop strong relationships with local administration and Government. 4. Strengthen sales efforts with local clients to drive core business development. 1. Make the health and safety of all employees a key priority. 2. 3. Invest in continuous professional and personal development. Ensure fair compensation, diversity and inclusion, and proactively fight any kind of discrimination. Further empower women in employment within local communities. Leverage leadership role-modelling to live up to the value of integrity and transparency. Ensure ethical conduct and anti-corruption best practices are in place. Ensure labour rights are fully met. Protect forests from illegal harvesting. Preserve animal habitats and biodiversity. Employ soil and peat management best practices. Integrate activities to enable transition to net zero emissions. Align forest management practices with FSC standards and achieve full certification in Gabon. 4. 1. 2. 3. 1. 2. 3. 4. 5. More information on our approach to sustainability can be found in our Sustainable Forestry Policy, available on our website. 36 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 05 THE CAPITALS FINANCIAL CAPITAL MANUFACTURING CAPITAL INTELLECTUAL CAPITAL SOCIAL & RELATIONSHIP CAPITAL HUMAN CAPITAL NATURAL CAPITAL 37 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES FINANCIAL CAPITAL MATERIAL ISSUES STRATEGIC PRIORITIES SDGS - - Economic value generated and distributed Financial assistance 1. 2. Improve efficiency to get more value from raw materials Seek scale through M&A opportunities. The success of responsible businesses is inextricably linked In 2023, the Group demonstrated that conventional Major Investments: to economic growth, which relies on the personal and metrics of business success can be achieved in tandem professional development of employees and providing fair with meaningful action for a sustainable future: wages, thereby contributing to the prosperity of local communities. Furthermore, the growth of African countries represents a significant opportunity for businesses across various industries. Turnover: $7,900,000 Salaries Paid: $2,902,457 Salaries Paid in Africa: $1,635,940 Suppliers Paid: $1,776,860 The communities we work with are often in remote areas Donations to Local Communities: $99,590 and reliant on subsistence economies. Therefore, Investments in Reforestation Projects: $1,854 Woodbois' presence makes a meaningful contribution to their economic growth. As we continue to develop our vertically integrated value chain, our aim is to generate Investment in Management Plans: $214,368 Investment in Environmental Licenses: $189,158 Investment in HSE Equipment: $21,674 more job opportunities and increase skill development. Ultimately, Woodbois' efforts promote the export of locally- Infrastructure Investments and Services Supported: $377,660 Acquisition of harvesting and production plant and machinery ($3.9 million) Final payment for the additional forest acquisition in Gabon ($0.5 million) Settlement of the deferred consideration payment for Woodbois International Aps ($0.3 million) produced products, which boosts international exposure for these countries beyond just raw materials. In 2023, despite financial difficulties, Woodbois restructured and continued to increase its financial capital, demonstrating that conventional business success metrics can be achieved alongside meaningful sustainable action. 38 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES HUMAN CAPITAL MATERIAL ISSUES STRATEGIC PRIORITIES SDGS - - - Wages and benefits Training and education Health and safety at work 1. Make the health and safety of all employees a key priority. 2. 3. Invest in continuous professional and personal development. Ensure fair compensation, diversity and inclusion, and proactively fight any kind of discrimination. We recognise the value of our people. We are committed to their development, and their health and safety is our top priority. We invest in the continued professional and personal development of all of our staff, ensuring fair compensation, diversity and inclusion throughout the organisation, and we are proud to proactively fight any kind of discrimination. 431 Total number of employees Woodbois is committed to: Respecting human rights including the rights of indigenous and local communities Preventing employment and occupation- related discrimination based on gender Gender equality across forestry operations Paying at least the minimum wage Providing essential community services and facilities Ensuring ethical and fair conduct, and fighting corruption Respecting worker and labour rights for both full-time and contracted employees Woodbois' commitment to human rights and occupational health and safety applies to all suppliers. 39 WOODBOIS LTD | Integrated Report 2023 364 Men (84.5%) 62 Women (14.4%) 25% of women in board positions 20% of women in senior management positions 68 Total number of permanent employees working in the production facilities in Gabon and Mozambique 363 Total number of fixed- term and seasonal employees working in the production facilities in Gabon and Mozambique *Please note that apart from in the production facilities, the company does not employ temporary or seasonal workers in other aspects of the operations. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES HUMAN RIGHTS, DIVERSITY, INCLUSION AND EQUAL OPPORTUNITIES Woodbois is dedicated to upholding international best practices in human rights, diversity, inclusion, and equal opportunities across its operations. We align our policies and practices with esteemed standards such as the Fundamental ILO Core Conventions (13), ILO Code of Practice Safety and Health in Forestry Work (14), the UN Declaration on the Rights of Indigenous Peoples (15), and the United Nations Declaration on Human Rights (16). It's imperative for us to extend these principles not only within our organisation but also to our sourcing partners and suppliers. Regular educational training sessions are conducted to ensure our employees are informed and empowered to uphold these standards in their daily activities. EMPLOYEE WAGES IN GABON AND MOZAMBIQUE In Gabon, Woodbois adheres to the Convention Collective Des Industries Du Bois Sciages Et Placages Du Gabon, which provides a structured salary grid for employees. Salaries are determined based on this grid, augmented by additional non-conditional and performance-based bonuses. While the legal minimum wage in Gabon is set at 150,000 FCFA, Woodbois ensures that all employees receive compensation that is at least in line with this standard. As of 2023, the average salary paid to local staff in Gabon was FCFA 249,591, demonstrating our commitment to fair and equitable remuneration practices. In Mozambique, Woodbois has taken initiative-taking steps to ensure fair wages for its employees. In 2022, the company has raised its monthly wage to 7,000 MZN, with an average of 28,000 MZN, exceeding the legal minimum wage requirements(5,800). This initiative reflects our commitment to providing competitive and dignified compensation to our workforce, thereby enhancing their well-being and promoting socio-economic development in the region. By prioritising fair labour practices and equitable compensation structures, Woodbois demonstrates its dedication to fostering a workplace culture that values human rights, diversity, inclusion, and equal opportunities for all employees across its operations in Gabon and Mozambique. 40 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES In 2023, Woodbois paid on average 40% and 79% above the local minimum wage in Gabon and Mozambique respectively. Average salary in Gabon FCFA 249,591 Average salary in Mozambique MT 28,000 Minimum wage in Gabon FCFA 150,000 EQUAL OPPORTUNITIES AND GENDER EQUALITY Woodbois is deeply committed to promoting equal Empowering Women in the Workplace opportunities and gender equality across all its - Women play integral roles in our operations in operations in Gabon and Mozambique. We believe in Mouila, Gabon, overseeing machinery, managing creating a workplace where every employee, production lines, and contributing to administrative regardless of gender, has the opportunity to thrive and office tasks. Woodbois ensures that women feel and contribute to our success. Gender Pay Equity empowered and valued for their contributions, fostering a culture of inclusivity and respect. Minimum wage in Mozambique MT 5,800 - Woodbois ensures gender pay equity by paying Fair Compensation Policy female employees the equivalent of 100% of a male - At Woodbois, pay is based solely on position, employee's salary in both Gabon and Mozambique. ensuring that individuals in the same role receive This commitment aims to reduce the wider industry equal compensation for the same amount of work. gender pay gap and support the inclusion of women This policy eliminates gender-based discrimination across all forestry operations. and ensures fair compensation for all employees, regardless of gender. Legal Reforms in Gabon - We applaud the legal reforms introduced in Gabon Employee Engagement and Communication in September 2021 to promote women's rights and - Woodbois is committed to keeping employees fully economic inclusion. These reforms, including revisions informed about the Group's performance and to the Civil Code and the adoption of a new Labour Code, guarantee equal pay for equal work and grant prospects. We actively seek their views on matters that affect them as employees, fostering a culture of women access to employment in all sectors. Woodbois fully supports these initiatives and strives to implement them in our workplace practices. Diversity and Inclusion Initiatives - Woodbois promotes diversity and inclusivity throughout our organisation by offering equal opportunities in recruitment, training, career development, and promotions. We are committed to eliminating gender-based discrimination in employment and occupation, fostering sustainable and socially responsible economies. transparency, collaboration, and mutual respect. By empowering women, promoting inclusivity, and ensuring fair treatment for all employees, Woodbois is creating a workplace where everyone can thrive and succeed. We remain steadfast in our commitment to advancing gender equality and promoting equal opportunities across our organisation. 41 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES HEALTH AND SAFETY ANNUAL ACTIVITY REPORT - GABON We are pleased to present the annual activity report of our SAFETY Safety remains paramount, and we undertook various ENVIRONMENT Demonstrating our commitment to environmental Quality, Health, Safety, and Environment (QHSE) service for initiatives to enhance our safety standards: sustainability, we took the following steps: the year 2023. This report outlines the strides made by our team in fostering a culture of workplace health, safety, and Continued HSE talks to educate employees about Formed a partnership with a specialized waste sustainability within our organization. Throughout this year, potential risks. our focus has remained on continuous improvement while upholding our commitment to excellence and compliance Updated road signage across our forest site. with QHSE regulations. Installed informative safety instruction panels at both our industrial sites, outlining procedures in management company for the collection and treatment of industrial waste. Ensured effective waste collection and management at all our operational sites. HEALTH In 2023, we continued to prioritize the health and well-being of our workforce. In addition to regular medical assessments, we implemented specialized screenings for employees in high-risk roles, such as chest X-rays and ophthalmological exams. Furthermore, we conducted educational sessions on cervical cancer awareness, particularly targeting our female staff. the event of accidents, fires, or evacuations. Conducted awareness campaigns to emphasize the importance of maintaining a clean environment, particularly within forest areas. Documented and reported all accidents to the appropriate authorities. Strengthened safety protocols for machinery operation. Provided 1,775 pieces of Personal Protective Equipment (PPE) to our employees and contractors. 2,341 Hours of training conducted in 2023 0 Work-related fatalities recorded 28 Reported accidents in total 145 Lost days due to workplaces injuries 42 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES STATISTICS Work-Related Injuries and Fatalities (GRI 403-9 and GRI 403-10) The following table presents detailed statistics on work-related injuries and fatalities in Gabon and Mozambique: Indicator  Description  Measure  TRAINING HOURS (GRI 404-1) Training remains integral to our health and safety strategy. Our commitment to health and safety is unwavering, and we will continue to strive for excellence in our practices, ensuring a safe and healthy workplace for all. GRI 403-9  Work-related injuries (Gabon and Mozambique).  Number: 33  GRI 403-10  Work-related injuries (Gabon and Mozambique). Loss time due to injuries.  Days: 14  GRI 403-9  Work-related fatalities (Gabon and Mozambique).  Number: 1 (Mozambique)  In Gabon, there were 33 reported accidents in 2023, resulting in 14 lost days. Regrettably, one fatality was reported in Mozambique. 43 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES The process comprises: GRIEVANCES Woodbois has an established company-wide grievance framework that is accessible to both internal and external stakeholders. It is our policy to ensure that all employees have access to procedures to help deal with any workplace grievances fairly and without unreasonable delay. This policy applies to all employees regardless of their length of service and can be found on the Woodbois website. Official letter from legally elected community leader A grievance hearing takes place between all representative leaders of the community at a special sitting attended by a senior management representative of our company The grievance is settled and agreed upon, taking stakeholder perspectives into account Local community formulates grievance Community service project created to address grievance and best help the whole community The company conducts a considered follow-up of issues addressed and projects implemented with the community WHISTLEBLOWING PROCEDURE Employee becomes aware of any malpractice and immediately reports it to their Line Manager The Line Manager notifies the Group Compliance Office (the Chief Financial Officer acts as Woodbois’ Group Compliance Officer) The Line Manager is responsible for initially investigating all matters reported to them, in a prompt, confidential and sensitive manner The Line Manager provides formal feedback to the employee and Group Compliance Officer of any investigation conducted and the resulting actions taken If the employee feels the matter has not been resolved to their satisfaction, they can raise their concerns directly with the Group Compliance Officer 44 WOODBOIS LTD | Integrated Report 2023 In instances where the employee does not feel comfortable reporting a potential malpractice to their Line Manager, they are encouraged to raise any concerns directly with the Group Compliance Officer, the Chairperson of the Audit Committee, or the Company Secretary, who will investigate the matter promptly, confidentially and sensitively The whistleblower will usually be invited to attend an investigation meeting to discuss their concerns The Group Compliance Officer will provide formal feedback to the employee and Audit Committee of the investigation, and resulting action will be taken COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES EMPLOYEE SPOTLIGHT An insight into the roles of Woodbois employees positioned in Gabon, Mozambique, South Africa, Denmark and the UK. DORIS SAIZONOU Job Title: Accounting Assistant IRENE IGNANGA Job Title: Veneer Cutter Brief Description of your role: As Assistant Accountant/Cashier Manager at our Brief Description of your role: As a Veneer Cutter, my job involves cutting dried company, my main role is to ensure efficient and accurate cash management. I'm veneer sheets and organising them into parcels based on their dimensions. responsible for daily cash counting, recording transactions and suppliers payments in Libreville as well as reconciling Mouila’s Cash register in accounting. I also check receipts and transaction vouchers to ensure their legitimacy and accuracy. In addition, I am responsible for reconciling cash balances with accounting records, and preparing regular financial reports on the cash flow of the till. By complying with current regulations and internal company procedures, I strive to contribute to sound and transparent financial management. Year you began working at Woodbois: 2023 Favourite thing about Woodbois and/or the timber Industry: Working at Woodbois has enabled me to discover the wood industry, to learn more about my country, its diverse flora and the different timber it contains. I was able to acquire more advanced skills not only in my field but in other domains as well. I was also able to work in a multicultural group with people from different backgrounds with whom I've kept good relations. 45 WOODBOIS LTD | Integrated Report 2023 Year you began working at Woodbois: 2018 Favourite thing about Woodbois and/or the timber Industry: What I appreciate most about Woodbois and the timber industry is the opportunity to engage in various trades within the factory. I find fulfilment in the diverse tasks I undertake daily, from cutting veneer sheets to organizing them meticulously. The versatility of the industry allows me to expand my skills and knowledge continuously, contributing to my personal and professional growth. Woodbois fosters an environment where I can explore different aspects of the woodworking process, enhancing my expertise and job satisfaction. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES SAMUEL IWANGOU NZAMBA Job Title: Dryer Operator BÉATRICE BOUANGA Job Title: Packer Brief Description of your role: As a Dryer Operator, my main responsibility is to receive green wood, dry it appropriately, and then pass it on to the packaging Brief Description of your role: As a Packer, my role involves receiving the finished and dried timber packages, securing them, and preparing them for shipment. department. Year you began working at Woodbois: 2018 Favourite thing about Woodbois and/or the timber Industry: What I appreciate most about Woodbois and the timber industry is the blend of tradition and innovation. Working with wood, an ancient and natural material, while integrating modern techniques and technologies, presents an exciting and enriching experience for me. As a dryer operator, I am constantly faced with new challenges and opportunities to gain experience, allowing me to develop my skills and grow professionally. Additionally, Woodbois' commitment to sustainability and environmental responsibility makes me proud to be part of this company as we actively contribute to forest preservation and promote responsible forestry practices. Year you began working at Woodbois: 2019 Favourite thing about Woodbois and/or the timber Industry: One aspect of Woodbois and the timber industry that I particularly enjoy is working with the Electric Guillotine. This modern equipment enhances efficiency and precision in our operations, allowing us to deliver high-quality products to our customers. Additionally, I appreciate the supportive work environment at Woodbois, where teamwork and collaboration are valued. Collaborating with dedicated colleagues makes each day fulfilling, and I am proud to contribute to Woodbois' success in the timber industry. 46 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES PIERRE MOUSSAVOU Job Title: Veneer Peeler Brief Description of your role: As a Veneer Peeler, my role involves unwinding the logs, programming the thickness, peeling the rounded sections, and sending them for veneering. Year you began working at Woodbois: 2019 Favourite thing about Woodbois and/or the timber Industry: In addition to my primary responsibilities, I also enjoy operating machinery, including forklifts, and participating in log cutting. Woodbois provides opportunities for employees to engage in diverse tasks, allowing us to expand our skills and contribute to various aspects of the production process. This dynamic work environment fosters growth and learning, making every day at Woodbois exciting and fulfilling. Additionally, I appreciate Woodbois' commitment to safety and quality, ensuring that we uphold the highest standards in the timber industry. JEAN NOEL BOUROBOU BOUROBOU Job Title: Evacuation Supervisor Brief Description of your role: As the Evacuation Supervisor, my role involves planning, organizing, and overseeing the execution of evacuation operations, including contract management, loading schedules, packing plans, and monitoring the inflow and outflow of materials from the drying chambers. Year you began working at Woodbois: 2020 Favourite thing about Woodbois and/or the timber Industry: Wood is a recognised renewable material that requires minimal energy for its production and processing. Woodbois Gabon plays a vital role in sustainable forest conservation by contributing to the responsible utilization of our forests. I am proud to be part of an organization that prioritizes environmental sustainability and is committed to making a positive impact on our forests and communities. Working in the timber industry allows me to contribute to the preservation of our natural resources while supporting local economies and promoting sustainable practices. 47 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES DAVID ROGERS Job Title: Group Accountant Brief Description of your role: As the Group Accountant, my primary responsibility is to oversee group financial reporting, ensuring accuracy, compliance, and transparency in our financial statements. Year you began working at Woodbois: 2023 Favourite thing about Woodbois and/or the timber Industry: One of the things I value most about Woodbois is the strong sense of teamwork and collaboration within the finance department and across the entire organization. I enjoy working closely with our CFO and the finance team, as well as other departments, to support the company's financial objectives. Being part of the Woodbois family means always having the opportunity to contribute and assist wherever needed, fostering a supportive and dynamic work environment. Additionally, I find the timber industry fascinating for its unique blend of traditional craftsmanship and modern technology, as well as its vital role in sustainable resource management and environmental conservation. 48 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES MOUDHJIOMBIT NATACHA CHARLIE - DRYER TEAM LEADER A DAY IN THE LIFE OF A DRYER TEAM LEADER MOUDHJIOMBIT Natacha Charlie has been a cornerstone of the Woodbois operations since she took on the role of Dryer Team Leader. Her day begins with a meticulous review of the evening reports from the two shifts, one from 6 a.m. to 2 p.m. and the other from 2 p.m. to 10 p.m. These reports provide essential insights into the previous day’s activities and help her plan for the day ahead. Natacha's first task each morning is to inspect the dryers. She checks both the roller and mat dryers to ensure there are no leftover leaves or packages that need additional drying. This step is crucial for maintaining the continuous flow of the drying process, ensuring that all materials are processed efficiently. Her organizational skills shine as she coordinates the installation of pallets on the dryers. Natacha oversees the entrance of packages to be dried and manages the reception of dry leaves at the exit. This process involves precise timing and attention to detail, ensuring that the dryers operate at maximum efficiency. Temperature control is another critical aspect of Natacha’s role. She monitors the boiler’s temperature, ensuring it stays at 120°C, and the roller dryer at 100°C. Adjusting the speeds of the dryers in relation to the boiler’s temperature is essential to maintaining the quality of the drying process. This careful calibration helps prevent any damage to the materials and ensures they meet the company’s high standards. Natacha also ensures that the different types of finished packages—cores, interiors, and faces—are properly processed and sorted. This involves constant vigilance and a deep understanding of the materials being handled. Her leadership and expertise are vital to the smooth operation of the veneer factory. Natacha’s dedication and meticulous approach ensure that the drying process is not only efficient but also meets the highest quality standards. Her role is a testament to the importance of skilled leadership in maintaining the excellence of Woodbois’ operations. Natacha Charlie's story exemplifies the commitment and expertise that women bring to Woodbois. Her leadership and dedication highlight the company’s support for female workers in pivotal roles, fostering an inclusive and empowering workplace. 49 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES CELEBRATING FEMALE WORKERS AT WOODBOIS OPERATIONS EMPOWERING WOMEN AT WOODBOIS Woodbois takes pride in fostering a supportive and inclusive environment for its female workers. The stories of Isabelle, Lidvine, Candy, Ferla, and Léa highlight the company's dedication to fair wages, job security, and employee well-being. By providing stable employment, salary increases, and permanent contracts, Woodbois ensures that its female employees can thrive both professionally and personally, contributing significantly to their families and communities. INGUESSI FERLA ARNAULDE - CUBING POINTER INGUESSI FERLA ARNAULDE serves as a Cubing Pointer at the sawmill. Her employment at Woodbois has allowed her to meet her financial needs, support her family, and embark on building projects. Employed since 2019, Ferla has also transitioned to a permanent contract, providing her with greater job stability and confidence in her future with the company. MOUNDOUBÉ LÉA - CUBING POINTER Moundoubé Léa, another dedicated Cubing Pointer at the sawmill, shares a similar positive experience. Since joining Woodbois in 2019, she has been able to meet her personal and familial needs, work towards building a home, and secure a permanent contract. Léa's satisfaction with her role and the support she receives from Woodbois underscores the company's commitment to empowering its female workforce. 50 WOODBOIS LTD | Integrated Report 2023 MADAME MASANDE ISABELLE - VENEER SORTER Madame MASANDE ISABELLE is a dedicated Veneer Sorter at the peeling factory. Employed since 2019, Isabelle has seen significant improvements in her salary, initially earning 110,000 CFA francs and receiving a raise to 150,000 CFA francs with additional bonuses for meals and night shifts since June 2023. Her job at Woodbois allows her to meet her personal needs and contribute financially to her household. She takes pride in her position and feels respected at work, expressing satisfaction and contentment with her role. MAVENGA LIDVINE - GUILLOTINE OPERATOR MAVENGA LIDVINE works at the peeling factory as a Guillotine Operator. Since starting with Woodbois in 2019, she has appreciated the consistent working hours from Monday to Friday, which allow her to manage her household responsibilities effectively. Like her colleagues, Lidvine experienced a salary increase from 110,000 CFA francs to 150,000 CFA francs. She also received substantial support from the company during a month- long illness post-marriage, emphasizing Woodbois' commitment to employee welfare. Lidvine feels valued and welcomed back to her role after her recovery, reinforcing her happiness and loyalty to the company. POUNGUI CANDY LAURE - VERSATILE SORTER POUNGUI CANDY LAURE's versatility in sorting at the peeling factory makes her an invaluable asset to Woodbois. Employed since 2019, she has benefited from the salary increase to 150,000 CFA francs and appreciates the work hours that accommodate her responsibilities as a mother. Candy is grateful for her job, which enables her to afford her children's schooling and pursue personal projects, such as building a home. She acknowledges the positive changes brought by the new management, particularly the transition to permanent contracts, enhancing her job security and satisfaction. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES MANUFACTURING CAPITAL MATERIAL ISSUES STRATEGIC PRIORITIES SDGS - - Efficient use of resources Sustainable and high quality products 1. New machinery and equipment investment to drive down manufacturing costs and optimise the use of resources. 2. Minimise dependency on fossil fuels by using renewable energy and implementing circular solutions. We take a proactive approach to investment in energy- efficient equipment in order to drive down both costs and emissions, and we make the most of the plentiful renewable resources available to us. We use wood, for example, to create circular solutions that further meet our energy requirements. 0 chemicals and pesticides 100% of the logs processed in Woodbois sawmills come from company-owned operations North/Central America 9% North Africa 14% Middle East 6% Asia Pacific 40% Europe 31% 51 WOODBOIS LTD | Integrated Report 2023 480,482 ha Total forest land 52,314 ha Area dedicated to conservation 407,661 ha Operational forest land (forest management plans) 73,469 ha Shared community, conservation and multi-use 2.68m3/ha Harvesting intensity ratio per hectare 11,761 m3 Volume of timber produced. (veneer, sawn timber) 1,533 m3 Volume of third party timber traded (logs, veneer, sawn timber) 13,295 m3 Volume of timber traded including third party and Woodbois. (logs, veneer, sawn timber) 8,108 ha Area with actual harvesting 21,777 m3 Volume of logs harvested 11,761 m3 Volume of Woodbois' produced timber traded. (logs, veneer, sawn timber) 8 Sawmills providing third- party timber supplies COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES ASSETS OVERVIEW Woodbois’ Gabon facilities are located in Mouila, a dynamic, developing town 400 km from the capital city. Woodbois is one of the largest formal employers, offering local people skilled jobs with valuable development opportunities. Country Production assets Capacity 2021 Capacity 2022 Gabon Gabon Gabon Sawmill Kiln 2000 m3/month 3000 m3/month 2000 m3/month 2000 m3/month Veneer factory 525 m3/month 1600 m3/month Mozambique Mill 1000 m3/month 300 m3/month Coordinates: 1°52’19.0”S 11°01’22.4”E Woodbois’ operations in Mozambique are located in Gile/Uape. In 2022 18,652 m3 of wood were produced at the sawmill and 5,246 m3 at the veneer factory. Coordinates: 16°09'36’’S 038°05’05’’E 52 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES OPERATIONS IN GABON With more than 156,000 hectares of forest under management, Woodbois has been involved in the Gabonese forestry sector for the last two decades. Within its sawmill operations, Woodbois has invested significantly into its leading sawmill in Mouila, equipping it with the latest European machinery suitable for African hardwoods, and establishing solid training and development programmes to broaden the skillset of the local workforce. For example, a Primultini bandsaw was added to increase our processing capacity, enabling us to simultaneously cut long timbers of multiple sizes. Phase one of the development of our veneer factory was completed in 2019 as part of our expansion plan and is also located in Mouila, just 70km away from our forest concessions. A second line was launched in 2022 enabling us to triple our daily production and offer a wider range of products to our customers. When operating at capacity this will also bring additional employment roles to the Mouila community. Production from the factory – which employs a significant proportion of women – is exported mainly to the Mediterranean region, with key buyers in Italy, Morocco and Turkey. On 6 August 2021, the Group acquired 100% of the shares and voting interests in La Gabonaise des Forêts et de l'Industrie du Bois (LGFIB). Through the acquisition of LGFIB, the Group acquired 71,000 hectares of forest concessions in Gabon, 56,000 of which are currently covered by a management plan. 53 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES TRADING Woodbois responsibly sources and trades products from several international – mainly African – countries. The chart below shows the list of countries sourced from in 2023. 10,554M3 of timber traded from third party supplying mills representing 1/3 of total timber sold by Woodbois (33,351m3). Côte d'Ivoire 6% Cameroon 26% Republic of the Congo (Congo-Brazzaville) 46% Gabon 16% Ghana Angola 3% 3% 54 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES INTELLECTUAL CAPITAL MATERIAL ISSUES STRATEGIC PRIORITIES SDGS - - Equal rights and conflict resolution Legal harvesting 1. 2. 3. Leverage leadership role-modelling to promote values of integrity and transparency. Ensure ethical conduct and anti-corruption best practices are in place. Ensure labour rights are fully met. Any material issues – equal rights, conflict resolution and 2. Environment legal harvesting – can be addressed through the consistent We commit to protecting and respecting the natural application of our three key priorities: leveraging leadership environments in which we operate. role-modelling to promote the values of integrity and transparency; ensuring ethical conduct and anti- We strive to reduce the environmental impact of our corruption best practices are in place; and ensuring labour global operations and to help conserve natural resources rights are fully met. by planning and managing operations with a sustainable CODE OF CONDUCT 1. Safe and healthy working conditions We commit to promoting and protecting the safety and occupational health of our entire workforce, above all other priorities. At Woodbois we are focused on providing a safe workplace by ensuring that tools and equipment are maintained in working good order, and by supplying focus. We monitor and report our environmental impacts, and ensure that all operations comply with environmental laws. Our production team strives for continuous improvement through waste minimisation, efficient resource use and other measures that reduce our environmental footprint. appropriate personal protective equipment in accordance 3. Labour and human rights with international standards and national laws. All We support the United Nations’ Universal Declaration of employees receive training to ensure they are competent Human Rights. We respect each individual's human rights and fit to carry out allocated duties. This includes and follow all employment laws and regulations. We do information about risks and relevant control measures, not tolerate any form of workplace discrimination, procedures for safe evacuations of buildings and harassment or physical assault, or any form of child, forced, workplaces, and correct use of tools and machinery. We or compulsory labour. Employees are paid regular and recognise that all staff have the authority to halt work if competitive wages, and Woodbois regularly invests in they consider an action unsafe. resources and training to assist staff who want to develop their full potential. 55 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 4. Host communities We recognise the importance of employees with an environment where they can bring their Financial Reporting Standards (IFRS) as adopted by the community engagement and shared prosperity. whole self to work regardless of gender, race, sexual European Union (EU). We engage with communities at all stages of project diversity of the regions and communities in which we operate 10. Tax orientation, age, religion or disability. We seek to reflect the planning and development to ensure that local opinions, within our own workforce, and respect the rights of We commit to paying the right taxes. Woodbois strives to feedback, and concerns are properly recorded and employees including the freedom of association and collective understand and comply with the legal and regulatory addressed. bargaining. We believe it is possible to deliver real socio-economic 7. Bribery obligations for taxation arising from its operations. We are committed to full compliance with external and company reporting requirements, including those concerning impact through our regional activities by developing We stand against bribery and corruption. disclosure to tax authorities and reporting on the tax infrastructure, building local skills, and providing payments that we make. development opportunities for people. It is not permitted for any Woodbois employee or representative to give, offer or receive a bribe either directly, 11. Protecting and maintaining assets 5. Suppliers, customers and other business partners indirectly, or through a third-party business in any dealings. We recognise the importance of looking after our assets. We commit to fair and ethical relationships with suppliers, Employees are responsible for looking after company customers and other business partners. 8. Trade controls and sanctions assets including business opportunities, funds, property, We comply with all applicable trade controls and sanctions in proprietary information, and personal equipment. We endeavour to build long-lasting relationships based on the regions where we operate and trade. Employees must take steps to read and understand the fair selection, clear terms of business, and adherence to rules regarding unacceptable use of company IT shared principles set out in our Code. The export of timber goods is subject to a range of regulatory resources and comply with the relevant set of rules. We follow established due-diligence procedures that enable constant dialogue with relevant government and trade bodies permitted by law and as is reasonably necessary to meet requirements in different regions. Woodbois maintains Woodbois only collects and holds personal information as us to select business partners who meet legal requirements to ensure it satisfies registration requirements, export licence business requirements. and internal expectations in regards to product provenance, needs, and all additional legal obligations. supply chain safety and environmental impact. 12. Insider dealing Woodbois is conscious that governments and international We stand against insider dealing. It is illegal to deal in Woodbois is committed to purchasing third-party timber organisations may impose international trade sanctions on Woodbois shares on the basis of inside information or to only where it is possible to ensure legal compliance of countries where the company operates. We are committed to encourage others to do so. During the course of their work suppliers. The company unreservedly condemns illegal complying with all trade sanction conditions. some employees will have access to information which logging and irresponsible trade of endangered species. could influence someone contemplating investing in 6. Equality We commit to publishing accurate and transparent company confidential company information for personal gain, or We commit to creating an inclusive environment where reports. We endeavour to release regular operational, financial from sharing inside information for the same purpose. 9. Accurate records, reporting and financial recordkeeping Woodbois shares. Employees are forbidden from using every colleague is valued. At Woodbois, all employees are and integrated reports for the benefit of company expected to treat each other with care and respect. We strive stakeholders. Financial statements are produced in to provide accordance with International 56 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES FOREST MANAGEMENT IN GABON AND MOZAMBIQUE Woodbois holds fifteen forest permits in central The inventory is recorded by systematic sampling (Aucoumea klaineana), Ilomba (Pycnanthus angolensis), Gabon in the province of Ngounié, north-east and The counting operation consists of: identifying the Ebiara (Berlinia bracteosa), Dabema (Piptadeniastrum south-east of the community of Mouila covering a species of trees; measuring diameter; numbering africanum), and Ovang-Kol (Guibourtia ehie). We are total area of 156,477ha. trees via the placing of a plate; geolocating each also permitted to harvest an area of 3813 from the 2021 The management plans, approved by the tree via GPS; and assessing the quality of all LGFIB (17) management plan. administration in charge of waters and forests, applicable trees that have reached the minimum define the harvesting plan for the areas diameter size for harvesting The inventory plan determines: the stocks of The harvesting plan for 2022 covered a total area of harvestable timber and their location; how to track 4,200 hectares. The most common tree species are and mark trees to be harvested or protected; and Okoumé how to establish the route of potential roads. Geographical location of UFA LYNN-TIMBER permits and management plans. All of Woodbois’ forest management plans have been approved by local governments following preliminary community consultations and approval processes, and are strictly followed. 57 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Tableau 3: Séries d'aménagement de l'UFA WBG. Tableau 4: Découpage de la série de production de l'UFA LYNN-TIMBER en UFG. Allocation of the areas under the management plan The production has been divided into four areas that will be used in different periods as described above. In Mozambique, the company has historically harvested The inventory plan determines the stocks of harvestable small volumes of timber from 8 of its 11 concessions. Six in timber and their location, how to track and mark trees to Zambezia province, communities of Uape-Gile District and be harvested or protected, and how to establish the route Alto-Molocue District, one in Nampula province, community of potential roads. of Niveto, Lalaua district and one in Niassa Province, community of Mississi in the district of Mandimba. The company's management plans, which are approved by the administration in charge of land and environment, This inventory is recorded by systematic sampling, and the counting operation consists of identifying the species of trees, measuring the diameter, numbering trees via the placing of a plate, geolocating each tree via GPS, and define the harvesting plan in concession blocks to be harvested each year. assessing the quality of all applicable trees that have reached the minimum diameter size for harvesting. These plans are valid for three to five years depending on the size and forestry potential of the concession. The most common commercial species include Umbila (Pterocarpus Angolensis), Chanfuta (Afzelia Quanzensis), and Messassa (Brachystegia Spiciformis). 58 WOODBOIS LTD | Integrated Report 2023 The maps of the management plans in Mozambique are available in the Appendix. The management plan is available at this link https://opentimberportal.org/operators/100151/documentation COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES HOW IT WORKS All of Woodbois’ forest management plans have been approved by local governments following preliminary community consultations and approval processes, and are strictly followed. HARVESTING PLANS In Gabon, following a 23-year rotation cycle, Woodbois is permitted to harvest a section of its total concession area using a three to five year management plan. After three years, the same area cannot be touched for 20 years to ensure forest regrowth. Woodbois has complied with having a Higher Level Forestry Technician for each concession who supervises the management plans, makes projections on improvements required and assesses the impact of harvesting operations according to the company harvesting plan. FOREST INVENTORY To ensure selective cutting of commercial species, we carefully quantify and locate appropriate forest resources, with particular emphasis on social aspects as well as protecting natural biodiversity. Each of our trees is tagged and geo-monitored so we can actively track tree species, volume and the quality of what we cut. LOGGING ACTIVITIES PLAN Vital to minimise the impact of roads. FOREST CONSERVATION Woodbois collaborates with local chiefs to safeguard areas not in production from illegal logging activities, agriculture, and other uses, including conservation. 59 WOODBOIS LTD | Integrated Report 2023 Forest management plans allow us to track how many cubic metres of timber have been extracted while monitoring the impact our operations have on the environment, ensuring we operate responsibly. MANAGEMENT PLAN - 4,200HA EACH TREE is individually identified and its location recorded by GPS within the concession area In a single hectare plot, the Company is typically only allowed to cut 6 TREES AFTER 20 YEARS you can re-enter the forest and the exact same exercise is carried out 1 H A This method of forest management is called Continuous Cover Forestry – when taking out an individual tree in an area, you open canopy to allow smaller trees to grow. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES THE SYMPHONY OF THE FOREST: A STORY OF COLLABORATION AND CRAFTSMANSHIP In the heart of the verdant expanse lies a forestry site where nature and human expertise intertwine harmoniously. This story unfolds through the lives and roles of several dedicated teams, each playing a vital part in the intricate ballet of forestry operations. Here, we delve into the lives of the prospectors, fellers, bull drivers, park teams, and transporters, who together ensure the sustainable harvesting and processing of timber. THE PARK TEAMS: CUSTODIANS OF ORDER At the park, a dedicated team takes charge. They organize the logs, ensuring they are properly sorted and accounted for. Each log is meticulously documented, maintaining the traceability established by the prospectors and continued by the fellers and bull drivers. The park team’s role is crucial in maintaining order and efficiency, preparing the logs for transport to the sawmill. THE PROSPECTORS: GUARDIANS OF PRECISION In the early hours of dawn, as the forest begins to wake, the prospectors prepare for their day. These meticulous individuals are responsible for selecting the trees that will be harvested. Each morning, they ensure their essential tools are ready: machetes, maps of the work area, GPS devices with extra batteries, and measuring tapes. Equipped and ready, they venture into the forest, guided by the soft light filtering through the canopy. The prospector’s task is one of precision and care. With the GPS and map in hand, they locate georeferenced trees, assess their diameters, and evaluate the quality of the wood. Assisted by their helpers wielding machetes, they clear paths to the selected trees, marking each with a unique identifier indicating the number of trees to be felled. This meticulous documentation ensures that the fellers who follow know exactly where to find the trees and the precise quantity to be harvested. At the end of their day, prospectors compile detailed reports, including the number of forest species checked, tree diameters, and wood quality. These reports are then submitted to the Development Unit’s office for monitoring, traceability, and archiving, ensuring a seamless transition to the next stage of the forestry process. THE FELLERS: MASTERS OF THE AXE With the prospectors' markers guiding them, the fellers step into the forest, axes and chainsaws at the ready. Their expertise lies in safely and efficiently cutting down the designated trees. Each tree is felled with precision, minimizing damage to the surrounding forest and ensuring the sustainability of the ecosystem. The fellers’ skill and strength are crucial, as they transform marked trees into logs ready for the next phase. THE BULL DRIVERS: STEWARDS OF STRENGTH Once the trees are felled, the bull drivers take over. These skilled handlers manage the powerful bulls that haul the heavy logs from the forest to the park. Navigating through dense undergrowth and rough terrain, the bull drivers rely on their deep bond with the animals and their knowledge of the forest to transport the logs efficiently and safely. This ancient and eco-friendly method minimizes the environmental impact of the logging process. 60 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES THE TRANSPORTERS: NAVIGATORS OF THE FOREST ROADS The final stage of the journey involves transporting the logs from the forest park to the break park at the Mouila Woodwood Sawmill. Skilled drivers navigate the forest roads, ensuring the safe and timely delivery of the timber. Their work marks the culmination of the collaborative efforts of all the teams, bringing the timber to its destination for processing. A HARMONIOUS COLLABORATION This story of the forestry site is a testament to the collaboration and craftsmanship of its diverse teams. From the precision of the prospectors to the strength of the bull drivers and the order maintained by the park teams, each role is integral to the sustainable management of the forest. Together, they form a symphony of human and natural harmony, ensuring the responsible harvesting and processing of timber while preserving the forest for future generations 61 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES RELATIONAL AND SOCIAL CAPITAL MATERIAL ISSUES STRATEGIC PRIORITIES SDGS - - Responsible sales and marketing Developing local economies 1. 2. 3. 4. Invest in long term partnership with selected timber suppliers embracing the same ethical and sustainability principles. Invest in services and facilities for local communities. Develop strong relationships with local administration and Government. Strengthen sales efforts with African clients. In 2023, Woodbois made sales to 30 customers across 14 countries. Consistently providing our customers with the highest level of service and quality of product is one of our highest priorities, and we aim to foster a relationship of mutual trust and security with all of our customers and suppliers. RESPONSIBLE TRADING & SOURCING 11,761 m3 Volume of Woodbois' produced traded. (logs, veneer, sawn timber) 1,533 m3 Volume of third party timber traded. (logs, veneer, sawn timber) 13,295 m3 Volume of timber traded including third party and Woodbois. (logs, veneer, sawn timber) 8 Sawmills providing third- party timber supplies 100% of our suppliers to be third-party certified, or in the process of becoming certified by 2025 62 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES DUE DILIGENCE PROCESS Woodbois has significantly strengthened its due diligence process to ensure 1. Bill of Lading (BL) suppliers' compliance with legal and responsible forest product sourcing. This A vital document issued by the shipping company, providing details of the goods being enhancement includes the recruitment of a dedicated EUTR due diligence transported, the vessel carrying them, and the terms of shipment. compliance manager in 2023, slated to commence duties in 2024. This manager, equipped with industry experience, will tailor a robust system to the company's 2. CITES Certificate (if applicable) operations, specifically focusing on preparing for the upcoming EUDR. In cases where the timber species are listed under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a valid CITES certificate must be obtained In alignment with its commitment to responsible sourcing, Woodbois mandates to ensure compliance with international trade regulations. that all timber suppliers undergo a rigorous due diligence process before collaboration. This process encompasses comprehensive scrutiny of information 3. Movement Certificate and documentation pertaining to the timber's source, including tree species, wood For trade within the European Union, a Movement Certificate (EUR1) is required to certify the origin, and adherence to national laws and regulations. origin of the timber products. For shipments destined for countries outside the EU, a Certificate of Origin is necessary to verify the source of the goods. Since 2013, Woodbois has implemented a due diligence process inspired by EUTR/FLEGT guidelines, featuring a detailed checklist of required documents for 4. Act of Merchandise Transit (Circulation de Merchandise) thorough screening. This process is conducted BI-annually for existing suppliers and This document outlines the details of the goods in transit, including their origin, destination, and initiated at the onset of any collaboration with new suppliers. route of transportation. It serves as evidence of legal trade and ensures transparency in the Woodbois maintains stringent requirements for supplier approval and shipment supply chain. authorization, necessitating the submission of specific documents to ensure compliance with the European Union Timber Regulation (EUTR) and other relevant 5. Phytosanitary Certificate A Phytosanitary certificate is essential for verifying that the timber products meet the regulations. While the exact documentation may vary depending on the country of origin and destination, the following are the standard documents required for supplier approval prior to shipment authorization: phytosanitary requirements of the importing country, confirming that they are free from pests and diseases. 63 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Woodbois conducts thorough assessments of these documents as part of its due diligence process to verify the legality and sustainability of timber products sourced from suppliers. By adhering to these stringent requirements, Woodbois aims to ensure responsible sourcing practices and uphold regulatory compliance throughout its supply chain. SUPPLIERS SHIPMENT BUYERS Buyers sometimes provide their own supply chain mapping to ensure responsible timber purchases. Since 2013, Woodbois has run a Documents required: due diligence process inspired by EUTR/ FLEGT, which includes a checklist of documents required for screening. This process is done at the beginning of each year for existing suppliers and at the start of any collaboration with new suppliers. Bill of Lading (BL) from the shipping company CITES certificate if necessary (created by Woodbois using supplier export codes) Movement certificate (EUR1 for EU trade; Certificate of Origin if shipment is anywhere else in the world) Act of Merchandise Transit (Circulation de Merchandise) Phytosanitary certificate 64 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES STEPS OF EUTR DUE DILIGENCE 1. Setting up Due Diligence Procedures - Organize and implement due diligence procedures. 4. Mitigating Identified Risk - Implement risk-mitigating actions for high-risk ("non-negligible") products. - Define responsibilities and ensure employees are trained/competent in their - Measures must be effective and reduce identified risk to a negligible level. understanding of the EUTR. 2. Collecting Information about Products and Supply Chain - Gather documentation such as harvest permits, invoices, and transport documents. - Actions may include collecting more information, conducting on-site supplier audits, or using independent third-party verification schemes. 5. Evaluating Due Diligence System - Regularly evaluate the due diligence system, preferably at least once a year or - Specific documents will vary according to the supply chain of each product. every time a new supplier is engaged. - Access adequate information to determine if the risk of illegal harvesting is present in your supply chain. 3. Assessing the Risk of Illegally Harvested Material - Conclude whether the risk is low ("negligible") or specified ("non-negligible") for each product. Conduct risk assessment in five areas of focus: - Access to Information - Risk at Origin - Species Risk - Supply Chain Complexity - Risk in Trade and Transport. For more information about the European Commission Guidance Document for the EU Timber Regulation, refer [here](The European Union Deforestation Regulation (EUDR) imposes several requirements on companies like Woodbois that trade in certain commodities, including timber. Here are the key aspects you need to consider:). See the Expert Group on the EUTR Guidance document on Risk Mitigation measures [here](The European Union Deforestation Regulation (EUDR) imposes several requirements on companies like Woodbois that trade in certain commodities, including timber. Here are the key aspects you need to consider:). The European Union Deforestation Regulation (EUDR) imposes several requirements on companies like Woodbois that trade in certain commodities, including timber. Here are the key aspects you need to consider: 65 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES EUDR REQUIREMENTS FOR WOODBOIS DUE DILIGENCE STATEMENT Deforestation-Free Products: Ensure that the timber products do not contribute to The due diligence statement should include: deforestation or forest degradation. Timber should be harvested from land that has not been converted from forest to agricultural use after December 31, 2020. Geolocation GPS Coordinates and Polygon: Geographic coordinates of the plots of land where the relevant commodity was produced. For larger plots of land, specific coordinates of Legal Compliance: Ensure that all timber products comply with relevant applicable laws in its outline are required, while smaller plots can be identified with a single GPS point. the country of production. Due Diligence System: Implement and maintain a due diligence system to identify, conditions that comply with relevant laws in their country of origin, including laws on land prevent, and mitigate the risk that the products could contribute to deforestation or forest use rights, labour rights, human rights, free, prior, and informed consent (FPIC), and anti- degradation. corruption laws. Compliance with Human Rights and Community Rights: Products must be produced in Due Diligence Statement: Provide a due diligence statement to the EU authorities when the products are entering the EU territory. ADDITIONAL DUE DILIGENCE FOR THIRD-PARTY SUPPLIERS Supply Chain Oversight: Monitor and evaluate third-party suppliers to ensure compliance with the EUDR. Risk Management System: Implement a risk management system to identify, prevent, and mitigate the risk associated with third-party suppliers. 66 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES TRACEABILITY PROCESS Traceability Process Open Timber Portal (OTP): We utilise the Open Timber Portal to track products from forest to manufacturing to final export. This platform allows us to demonstrate that none of the wood produced by Woodbois is on the CITES species list. If a CITES species is purchased from a 3rd party- supplier, CITES permit is required as well as the usual due diligence procedures. a CITES species that only traded if has CITES permit. Certificate of Origin: Every timber overseen by Woodbois (produced in own operations or traded from third parties), in any form, requires a certificate of origin. We ensure that all timber has a valid certificate identifying its country of harvest, and we do not send or handle timber without this documentation. As part of our Due diligence process, all timber originating from third-parties are traced back to the forest of origin. 100% of our third-party sourced timber has been traced back to forest of origin, with identifiable Forest Management Unit details specified. Of that percentage, (put here how much own operations and how much they source) 67 WOODBOIS LTD | Integrated Report 2023 TRACEABILITY AND TRANSPARENCY Collaboration with WorkPool Software Development: In collaboration with WorkPool, a South Africa-based company, we have developed software to collect and manage all trading-related data. This software enables us to track and manage documentation throughout our supply chain effectively. Documentation Management: Our software helps us identify suppliers with outdated documentation promptly. If suppliers' paperwork is not up-to-date, we temporarily remove them from our supply chain until their documentation is renewed. Advocating Transparency Voluntary Use of OTP: Woodbois is keen to implement the voluntary use of the Open Timber Portal for our third-party trading business. We encourage the use of OTP by all our suppliers and producers to improve transparency. Encouraging Suppliers: We advocate for our suppliers and producers to address any gaps in their internal processes to enhance their levels of transparency and compliance. Open Timber Portal - Lynn Timber https://opentimberportal.org/operators/100151/documentation COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES ENGAGING WITH LOCAL COMMUNITIES Woodbois Gabon and the Local SOCIAL ACTIONS CONDUCTED BY WOODBOIS GABON UNDER THE LOCAL DEVELOPMENT FUND Development Fund (FDL) IN THE NGOUNIE PROVINCE – COMPLETED IN 2023 Project to renovate the Saint-Martin village infirmary: Project cost: 11,495,000 FCFA Contractor: Tobia Kadia et Fils Company Our teams are actively engaged in community consultations to ensure we respect local customs and our contributions have meaningful value (our FPIC procedure is reported in the report annex). This commitment extends to respecting legal and traditional land rights. For example, our forest concessions are a direct result of community consultations. Local stakeholders help designate and map agricultural land for local use, dedicate areas for specific crops and provide education and information related to the hunting seasons. In some cases, we have established contractual agreements with communities to ensure we respect and align with local needs and customs. Woodbois is also financially contributing to the development of villages Saint-Martin and Mboukou. 68 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Project to renovate the public school in Mighabé village: Project cost: 8,222,204 FCFA Contractor: Maye Ingénierie Company Construction project of two passage huts in Mighabé village: Project cost: 8,650,380 FCFA Contractor: Molvilloise du Bâtiment Company 69 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Solar panel electrification project in Yeno village: Solar panel electrification project in Mamba Evova village: Project cost: 19,799,974 FCFA Contractor: Eco Solaire Company Project cost: 9,940,000 FCFA Contractor: Monoprix SARL Company In addition to these ongoing and completed projects, there are also works that have not yet started and the purchase of equipment in other villages, including: Construction project of 03 housing units in Ebando village: Project cost: 5,989,900 FCFA Contractor: BATIMO Company Purchase project of brush cutters in Mossighé village: Project cost: 524,054 FCFA Contractor: MBAMBA Service Company 70 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES GABON FLAG CEREMONY For several months now, it has become a cherished tradition at our various industrial sites to hold a flag-raising ceremony every Monday morning. This solemn moment, where we sing the national anthem and hoist the flag, is highly appreciated by all workers. This initiative is part of Woodbois Gabon’s efforts to instill values of citizenship, discipline, and cohesion among its employees. By participating in this weekly ceremony, our team members develop a stronger sense of belonging and pride in their work. Every Monday, as the sun begins to rise, employees gather in front of the main building. The flag, neatly folded, is carried out by a team chosen for their exemplary performance. The rest of the staff lines up, standing tall and attentive, their eyes fixed on the flagpole. The ceremony begins with a short speech from one of the managers, emphasizing the importance of unity and dedication. As the first notes of the national anthem fill the air, the flag is slowly unfurled and raised, catching the morning breeze. Voices rise in unison, singing with pride and respect for the nation and for each other. This ritual not only fosters a sense of national pride but also reinforces the spirit of teamwork and mutual respect within our operations. The images attached capture the essence of these moments—faces illuminated by the soft morning light, reflecting determination and solidarity. By integrating this ceremony into our weekly routine, Woodbois Gabon reaffirms its commitment to not only producing quality timber but also nurturing a community of motivated and cohesive workers. This practice strengthens our workplace culture, reminding us all of the shared goals and values that bind us together. 71 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES GLOBAL EVENT PARTICIPATION Woodbois continues to demonstrate its commitment to the global wood and woodworking industry through active participation in key international exhibitions and conventions. These events provide invaluable opportunities for showcasing innovative technologies, engaging with industry leaders, and forging strong business relationships. By attending prominent gatherings such as the International Fair of Wood in Algeria, the Dubai Woodshow, the IWPA Annual Convention, and the NHLA Convention, Woodbois remains at the forefront of industry advancements, connecting with key stakeholders and staying informed about the latest market trends. These strategic engagements highlight our dedication to excellence and international collaboration within the wood and woodworking sector. ALGERIA WOOD TECH DUBAI WOODSHOW Once again, we attended the International Fair of Wood, Woodworking, Equipment, and Technologies, held at the With our strong focus on the growth markets of the Middle East and North Africa, our sales team ensured a visible SAFEX in Algiers (Maritime Pines). The exhibition, under the patronage of the Minister of Industry, brings together key presence at the annual Dubai Woodshow once more. Held at the World Trade Centre in Dubai, this event is the largest in players in the wood and woodworking sector, and Woodbois is delighted to be a part of this important event. the region and is attended by many of the region’s key wood purchasing managers and professionals. 72 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES USA - IWPA USA - NHLA Continuing our tradition of engaging with key industry stakeholders, we participated in the International Wood We also attended the National Hardwood Lumber Association (NHLA) Convention Exhibit and Showcase in Products Association (IWPA) Annual Convention in the USA. This esteemed event brings together leading figures from Kentucky, USA. This prominent event is a cornerstone for professionals in the hardwood industry, featuring the global wood products industry, offering valuable networking opportunities and insights into the latest market comprehensive exhibits and discussions on the latest advancements and challenges in the sector. Our presence at trends. Woodbois is proud to be part of this influential gathering, reinforcing our commitment to international collaboration and industry excellence. the NHLA Convention underscores Woodbois' dedication to staying at the forefront of industry developments and fostering meaningful connections within the hardwood community. 73 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES NATURAL CAPITAL AND FIRE MANAGEMENT MATERIAL ISSUES STRATEGIC PRIORITIES SDGS - - - - - Climate change Biodiversity Protection of land (soil and water safety) Greenhouse gas emissions Energy usage 1. 2. 3. 4. Protect forests from illegal harvesting. Preserve animal habitats and biodiversity. Employ soil and peat management best practice. Integrate activities to enable transition to net zero emissions. NATURAL CAPITAL AND ETHICAL FORESTRY FIRE MANAGEMENT Natural capital remains at the forefront of our business operations, At Woodbois, we adopt an initiative-taking approach to minimise shaping our material issues and key priorities. These include the risk of wildfires. Our three-pronged strategy focuses on effective addressing climate change, protecting biodiversity, ensuring soil weed control, constructing firebreaks, and ring-hoed trees to and water safety, minimising greenhouse gas emissions, and reduce fuel loads before the onset of the dry season. Engaging local optimising energy usage. At Woodbois, responsible and ethical communities in identifying potential hot spots allows us to mitigate forestry forms the cornerstone of our operations, guiding our efforts fire risks effectively. in safeguarding forests from illegal harvesting, preserving animal habitats and biodiversity, implementing soil management best practices, and facilitating a transition to net-zero emissions. In 2023, we continued our commitment to environmental stewardship, leveraging tools like Global Forest Watch to monitor forests in real-time, enabling initiative-taking measures to protect against deforestation and forest fires. In 2023, Woodbois recorded zero fires in its Forest Management Units (FMUs), a testament to the efficacy of our preventative measures. Given our operations primarily in evergreen wet-dense forests where fires are rare, if not non-existent, our focus remains on vigilance and initiative-taking fire management strategies. 74 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES CONSERVATION AND COMMUNITY PREVENTING ILLEGAL LOGGING AND ENGAGEMENT WILDLIFE AWARENESS Collaborative Efforts with Forestry Administration Woodbois is dedicated to preventing illegal logging and promoting wildlife conservation within our operational areas. We have established a Memorandum of Understanding (MoU) with the forestry administration to conduct joint missions aimed at raising awareness and monitoring the territory for illegal activities. These missions, held quarterly, are integral to our commitment to responsible forest management. During these joint missions, representatives from Woodbois and the forestry administration collaborate closely to identify and address potential instances of illegal logging. Through field inspections and community engagement, we strive to foster a culture of compliance with forestry regulations and respect for wildlife habitats. Awareness and Monitoring At Woodbois, we recognise the importance of raising awareness among local communities about the significance of wildlife conservation and the consequences of illegal logging. To this end, we organise educational initiatives and distribute informational materials to villages located near our operational sites. Furthermore, we collaborate with water and forest agents to implement control barriers and enhance wildlife awareness at construction sites. By incorporating wildlife protection measures into our operational practices, we aim to minimize human-wildlife conflicts and preserve biodiversity. Memorandum of Understanding The MoU with the forestry administration outlines the framework for our collaborative efforts in preventing illegal logging and promoting wildlife conservation. Under this agreement, joint missions are conducted quarterly, with each mission typically lasting three days. At the conclusion of each mission, a comprehensive joint report is generated to document findings and recommendations. Woodbois is committed to conserving natural habitats and engaging with local communities. Our efforts include dedicating areas for conservation within our concessions, monitoring forest management plan implementation, and raising awareness among employees and local stakeholders on wildlife protection and illegal activity prevention. Furthermore, we invest significantly in community development projects, in accordance with Gabonese forestry laws. In 2023, Woodbois allocated over 60,000,000 FCFA to finance community- selected projects, ranging from electrification initiatives to healthcare and educational infrastructure upgrades. Projects undergo rigorous validation by a management committee comprising villagers, local authorities, forestry officials, and company representatives, ensuring alignment with community needs and sustainable development goals. COMMITMENT TO ENVIRONMENTAL SUSTAINABILITY Woodbois reaffirms its commitment to environmental sustainability by adhering to strict principles, including a pledge not to plant on peatlands and to minimise the use of inorganic fertilisers. While peatlands are not present in our operational areas, we remain steadfast in our commitment to preserving these vital ecosystems. Additionally, we do not use fertilisers in our logging activities, aligning with our goal of minimising negative environmental impacts and promoting sustainable forest management practices. 75 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Woodbois is committed to financing these joint missions in accordance with the agreements outlined in the MoU. Moreover, we ensure that the MoU is renewed annually, underscoring our long-term commitment to sustainable forest management practices and wildlife conservation. 76 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Tonne Equivalent Conversion: Additionally, we have ensured consistency in unit conversions by converting kilograms to metric tons using the standard conversion factor of 0.001. This ensures that emissions data are reported in a standardised format for ease of interpretation and comparison.10 Transparency and Reliability: By adopting conversion factors from reputable sources such as the BP Statistical Review of World Energy and the IEA, we aim to enhance the transparency and reliability of our emissions reporting. These sources are considered authoritative in the field of energy statistics and are widely used in industry and academia for energy-related research and analysis. While this methodological change may result in variations in reported figures, it enables us to provide more accurate and consistent data to stakeholders. We have carefully reviewed and incorporated the latest conversion factors from these reputable sources into our reporting process, ensuring that our emissions data are based on the most reliable and up-to-date information available. Energy Consumption and Greenhouse Gas Emissions Energy Consumption (2019-2023) Year  Diesel Consumption (litres)  Diesel Consumption (GJ)  Petrol Consumption (GJ)  Total Energy Consumption from Fuels (GJ)  Volume of Logs Harvested (m³)  Energy Intensity (GJ/m³ logs)  2019  839,836  30,150  281  30,431  34,361  0.89  2020  682,631  24,506  201  24,708  18,810  2021  991,496  33,314  52  33,367  28,000  1.31  1.19  2022  1,502,240  54,081  174  54,255  59,471  0.91  2023  1,002,281  176,361 152 176,413 21,777  0.25 METHODOLOGICAL CHANGE IN EMISSIONS CALCULATION Explanation: In our 2023 integrated report, you may notice variations in reported emissions data compared to previous years. This discrepancy arises from a methodological change in how emissions are calculated. We have transitioned to using recognized conversion factors from reputable sources to enhance the accuracy and reliability of our emissions reporting. Diesel and Petrol Conversion: Previously, we converted diesel and petrol consumption from liters to gigajoules using conversion factors derived from reliable sources, including the BP Statistical Review of World Energy9 and the International Energy Agency (IEA). Upon further review and analysis, we have updated these conversion factors to better reflect industry standards. According to the latest data, 1 litre of diesel oil is equivalent to approximately 0.17596 gigajoules, while 1 litre of gasoline (petrol) is equivalent to 0.0342 gigajoules. 77 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Emission Analysis  2020  2021  2022  2023  reflecting adjustments in calculation methodologies and operational factors. The emissions analysis for 2023 reveals notable changes compared to previous years, GRI 305-1 Direct (Scope 1) GHG emissions for use of fuels. (tCO2e)  Biomass converted into energy. (tonnes)  GRI 305-1 Other indirect (Scope 1) GHG emissions: on-site biomass incineration. (tCO2e)  Volume of logs harvested. (m³)  GRI 305-4 Total GHG emissions intensity. (tCO2e/m³ logs)  Volume of Woodbois' produced timber (logs, veneer, sawn timber). (m³)  GRI 305-4 Total GHG emissions intensity. (tCO2e/m³ timber)  1,849  2,664.93  4,048.86  5,417.00  1,250  1,840.00  2,024  2,625  72.94  88.30  118.11  104.44  Firstly, our transition to using recognised conversion factors for diesel and petrol consumption has led to a significant increase in total energy consumption from fuels, reaching 176,284.47 GJ in 2023. This change is primarily attributed to the updated conversion factors, with 1 litre of diesel oil now equating to approximately 0.17596 gigajoules and 1 litre of gasoline (petrol) to 0.0342 gigajoules. As a result, direct (Scope 1) GHG emissions for fuel use surged to 5,417 tCO2e, reflecting the higher energy content calculated under the revised methodology. Moreover, our biomass conversion initiatives saw a slight increase, with 2,625 tonnes converted into energy in 2023. This figure incorporates an assumption of an average timber density of 750 kg/m³, ensuring accurate assessments of biofuel yield from our timber resources. In terms of emissions intensity, we observed a notable increase to 0.25 tCO2e/m³ logs in 2023, reflecting the combined impact of increased energy consumption and a decrease in the volume of logs harvested. This underscores the need for continued efforts to optimise energy 18,810.00  28,000.00  59,471  21,777  efficiency throughout our operations. 0.098  0.095  0.07  0.25  highlights a significant rise rather than a reduction. While we remain committed to mitigating Despite our concerted efforts to enhance energy efficiency, the observed increase in emissions intensity from 0.17 tCO2e/m³ timber in 2022 to 0.77 tCO2e/m³ timber in 2023 9,357.00  16,964.00  24,349  7,148  0.20  0.16  0.17  0.77  our carbon footprint, it's essential to recognise the complex interplay of factors influencing these metrics. Methodological changes in emissions calculation, alongside potential fluctuations in energy consumption per unit of timber produced due to operational variables, have contributed to this uptick. As we continue to refine our sustainability practices, we prioritise a thorough examination of these changes to ensure informed decision-making and ongoing progress towards our environmental goals. Despite our concerted efforts to enhance energy efficiency, the observed increase in emissions intensity from 0.17 tCO2e/m³ timber in 2022 to 0.77 tCO2e/m³ timber in 2023 highlights a significant rise rather than a reduction. While we remain committed to mitigating our carbon footprint, it's essential to recognise the complex interplay of factors influencing these metrics. Methodological changes in emissions calculation, alongside potential fluctuations in energy consumption per unit of timber produced due to operational variables, have contributed to this uptick. As we continue to refine our sustainability practices, we prioritise a thorough examination of these changes to ensure informed decision-making and ongoing progress towards our environmental goals. 78 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES TRANSPARENCY In 2023, Woodbois demonstrated unwavering commitment to transparency and Key features of the SNTBG include its Android mobile application, which facilitates the sustainability, maintaining its position among the top-ranking companies in the ZSL SPOTT creation of digital records detailing every stage of the timber supply chain, from tree inventory companies' transparency assessment, securing 8th place out of 100 timber and pulp firms. to processing and export. Moreover, the SNTBG Web Application and Geoportal enable Our dedication to responsible forestry practices persisted, with a continued emphasis on offers flexibility by allowing forest sector operators to continue using third-party traceability forest management and ethical sourcing. These efforts directly contribute to Sustainable systems, provided they meet the necessary data collection and transmission requirements. Development Goal 15, reinforcing our mission to preserve forest ecosystems while ensuring a Gabon's traceability system sets a new global standard for forest governance, enabling sustainable supply of wood and wood products. consumers worldwide to trace timber products back to their forest of origin along a verifiable efficient oversight of operations by company managers and government officials. The system Understanding the pivotal role of effective forest management in mitigating deforestation digital supply chain. and degradation, we implement stringent measures to combat these threats. From adhering In light of the recent EU Deforestation Regulation (EUDR), which mandates extensive due to management plans to collaborating with local communities and governments, we strive to diligence on international timber supply chains, Gabon's adoption of this traceability and protect forests and optimise their productivity sustainably. transparency system is particularly timely. Not only does it support the country's forestry Complying with national and international regulations, such as CITES and IUCN standards, Gabon's commitment to promoting sustainability and accountability in forestry practices. industry, but it also addresses endemic corruption within the sector. This initiative underscores underscores our commitment to flora and fauna protection and the preservation of natural habitats. Furthermore, Woodbois actively participates in training initiatives related to traceability within the government system, collaborating with government authorities to implement this new Additionally, our practice of donating timber to local communities serves to prevent traceability system in Gabon. As part of this initiative, we host training sessions for government unsustainable resource use while promoting community welfare. By responsibly sourcing and agents within our company premises, demonstrating our proactive approach to embracing manufacturing wood products, we offer environmentally friendly alternatives to less new systems and technologies aimed at improving sustainability and accountability within sustainable materials. Woodbois extends its commitment to zero deforestation and zero conversion of natural ecosystems to all suppliers, reinforcing our dedication to sustainability across our supply chain. Through these initiatives, we aim not only to preserve healthy forests the forestry sector. We eagerly anticipate the second phase of training for all agents involved in traceability, conducted by representatives from the Ministry of Water and Forestry. but also to mitigate the adverse effects of climate change on forest ecosystems and the communities reliant upon them. In 2023, our dedication to compliance with forest regulations remained steadfast. Should any instances of non-compliant deforestation or conversion arise in the future, our commitment to Furthermore, it is noteworthy that Woodbois currently holds the second top position on the Open Timber Portal Transparency Ranking in Gabon and ranks 11th overall among its peers in restoring affected areas remains unwavering. We continued our collaboration with the Gabonese government, aiming to ensure that by 2025, zero tolerance would be shown toward any form of deforestation. This collaborative endeavour seeks to promote sustainable forest the timber sector. This recognition underscores our leading efforts in promoting transparency and accountability within the timber industry. management while safeguarding biodiversity. Through investigations, we identified five types of illegal activities posing threats to forest preservation, with a directive concentrating on The National Traceability System of Wood of Gabon (SNTBG) stands as a significant initiative by the Gabonese government, aimed at enhancing transparency and traceability within the forestry sector. Developed through a collaborative effort involving the Gabonese government, the Environmental Investigation Agency (EIA), and Code4Nature, this system represents a pivotal transition from traditional paper-based permits to a modern digital framework. 79 WOODBOIS LTD | Integrated Report 2023 combating poaching and illegal logging. Our goals encompassed identifying risk areas, devising strategies to counter illegal activities, fostering collaborative partnerships with stakeholders, and assessing the relevance of our actions. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES To bolster wildlife protection efforts, plans were underway to establish a functional wildlife unit tasked with overseeing measures outlined in the wildlife protection plan. These measures included installing entrance gates, conducting awareness campaigns, implementing internal regulations for game hunting, and prohibiting the transport of meat in company vehicles. Concurrently, our proactive monitoring of climate change impacts persisted, with a focus on tracking temperature fluctuations and rainfall changes to mitigate potential risks to local flora and fauna dynamics, such as flooding and soil saturation. Renewing our commitment to upholding our pledge to protect fauna, flora, and biodiversity, we continued implementing our Environmental Policy. Specifically, Point 7 of the Social Policy signed on October 10, 2006, which underscores our dedication to preserving biological diversity in forest titles, remained central to our practices. Our management remains fully committed to adhering to these policies. Furthermore, we reaffirmed our commitments to best management practices for soils and peat, reduced-impact logging, zero forest burning, and the protection of natural waterways with buffer zones. Additionally, we emphasised the importance of developing a comprehensive climate change risk assessment and a Natural Capital Assessment. While these initiatives faced challenges due to restructuring and budgetary concerns in 2023, they remain top priorities for the coming years. We are committed to completing them by 2025, underscoring our ongoing dedication to environmental stewardship and sustainability. Our commitments extend to our suppliers, as we ensure they have the same comprehensive policies. 80 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES WATER AND WASTEWATER MANAGEMENT In October 2021, Woodbois commissioned SEEG, the state-run water and electricity utilities company in Gabon, to carry out a study of the well at its sawmill in Gabon. The objective was to verify that the well was not being polluted with waste, oil, or biohazards. According to results provided by an independent third-party lab, following WHO guidelines for drinkable water, the water was found to be drinkable, with a pH level comparable to that of Perrier water (i.e., 5.5). Given Gabon's reputation for its two heavy rainy seasons, our facilities are equipped with drainage systems and gutters designed to handle significant amounts of water. The collected water is directed away from the operation and process areas using gravity, ensuring efficient evacuation. In 2023, we have further enhanced our wastewater management system by adding more decanters near our garage area. These decanters capture additional waste, allowing us to repurpose part of this water as “grey water” for various commodities. Woodbois continues to apply stringent environmental rules and has established written procedures to mitigate pollution risks across all areas of our operations, including forest activities, to prevent water and soil contamination. Details of these procedures are available upon request. 81 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES WASTE MANAGEMENT AND MINIMISING THE IMPACT OF LOGGING ROADS USE OF CHEMICALS Woodbois continues its commitment to environmental sustainability by not using chemicals or pesticides to manage waste. Instead, wood waste is utilized as biofuel for the veneer factory and kilning operations, with 2,024 tonnes repurposed in 2022. To minimise the environmental impact of logging roads, Woodbois strategically bases main tracks on existing roads and traditional trails wherever possible. Our forest management plan ensures that new roads are created efficiently and carefully, keeping infrastructure dimensions as small as possible while adhering to safety and sunlight requirements. Watercourse crossings are designed and constructed to avoid raising water levels, which could lead to upstream flooding and forest destruction. All bridges and structures are planned and built considering the seasonal flow variations. Woodbois does not use chemicals in any of its forestry, sawmill, or veneer operations. This includes the avoidance of chlorine or chlorine compounds, pesticides, and chemical fertilizers such as those classified under WHO Class 1A and 1B, as well as chemicals listed under the Stockholm and Rotterdam Conventions. Instead, we use an integrated management approach with non-chemical devices to capture and dispose of pests. Crucially, harvesting is conducted along carefully planned skid trails. Post- harvesting, these trails are rehabilitated to prevent permanent soil compaction, and roads are closed to deter poaching and illegal settlements. Within a few months, skid trails and harvesting gaps are naturally covered by tree regeneration, and within a few years, roads disappear due to the natural regrowth of pioneer tree species. Woodbois remains dedicated to using best-in-class practices to minimise the impact of logging on the surrounding environment. 82 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES PARTNERSHIP WITH WORLD FOREST ID In May 2022, Woodbois entered into a partnership with World Forest ID, which is building an extensive global library of reference samples from various forest regions for cross verification. This partnership enhances the traceability and identification of timber originating from our forest concessions in Gabon. In May 2022, Woodbois entered into a partnership with World Forest ID, which is building an extensive global library of reference samples from various forest regions for cross verification. This partnership enhances the traceability and identification of timber originating from our forest concessions in Gabon. Furthermore, the National Traceability System of Wood of Gabon (SNTBG) stands as a significant initiative by the Gabonese government, aimed at enhancing transparency and traceability within the forestry sector. Developed through a collaborative effort involving the Gabonese government, the Environmental Investigation Agency (EIA), and Code4Nature, this system represents a pivotal transition from traditional paper-based permits to a modern digital framework. In 2023, Woodbois actively participated in training initiatives related to traceability within the government system. We collaborate with government authorities to implement this new traceability system in Gabon, hosting training sessions for government agents within our company premises. This demonstrates our proactive approach to embracing new systems and technologies aimed at improving sustainability and accountability within the forestry sector. We eagerly anticipate the second phase of training for all agents involved in traceability, conducted by representatives from the Ministry of Water and Forestry. According to Interpol, the illegal timber industry is valued at $152 billion annually and ranks as the world's third largest criminal for origin of verification and traceability. Forest Id collector taking a sample of a woodbois’ concession tree sector after drugs and counterfeit goods. As the global wood trade has expanded, so has the awareness of its illegal component. The WWF estimates that 16 to 19 percent of the European Union's wood imports are sourced illegally. At Woodbois, we ensure the selective cutting of commercial species by carefully quantifying and locating appropriate forest resources. We place a particular emphasis on social aspects and protecting natural biodiversity. To track our operations, we tag and geo-monitor each tree, enabling us to actively monitor tree species, volume, and quality. We also protect non-production areas from illegal logging activities. We believe that sustainability requires balance. As such, we strive to achieve equilibrium between our economic objectives and our environmental and social responsibilities. 83 WOODBOIS LTD | Integrated Report 2023 Alain Diounga, Woodbois’ ESG Manager invited to the blessing ceremony in the Mossighe community temple. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES IMPROVING WORKING CONDITIONS FOR EMPLOYEES In 2023, Woodbois has also focused on improving working conditions for our employees. A notable example is the reconstruction of the forest guard vigilant post using wood, now in superb condition. This initiative underscores our commitment to ensuring a safe and supportive working environment for our team members. BLESSINGS FROM LOCAL COMMUNITIES IN GABON As a company, we are committed to protecting and respecting the natural environments in which we operate. We understand that the forest is sacred to the local community, and we recognize the importance of community engagement and shared prosperity. In 2022, we were honoured to receive a blessing from the dignitaries of Mossighe village for our new concession. This blessing is confirmation of our efforts to foster sustainable relationships and create mutual benefits for all stakeholders while striving to reduce the environmental impact of our global operations. Alain Diounga, Woodbois’ ESG Manager, attended the blessing ceremony in the Mossighe community temple, further cementing our commitment to community collaboration. In 2023, we have continued our engagement and awareness efforts with the Mossighe village as we are still operating in the same Annual Allowable Cut (AAC) area. Maintaining this ongoing relationship is crucial to ensuring that our operations align with the needs and values of the local community, reinforcing our dedication to sustainable and responsible forestry practices. TREE NURSERY AND REFORESTATION PROJECT AT GABON MOUILA SAWMILL LOCATION In 2023, Woodbois has made significant strides in reforestation efforts. Serge Anthony Ngouessi, a student intern at Woodbois Gabon (WBG), under the guidance of Alain Diounga, Forestry Manager in the Planning Department, has been involved in developing a sustainable forest regeneration system. The research focuses on the reforestation of Okoumé (Aucoumea klaineana Pierre), a flagship species of WBG logging. More than 600 Okoumé plants were placed in the nursery during this research period. This promising initiative, supervised by Mr. Alain, is now bearing fruit. This operation highlights the need for further subsidies to expand forest tree regeneration capacities within WBG on a larger scale. 84 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES WOODBOIS’ APPROACH TO ENHANCING ECONOMIC AND NATURE CAPITAL IMPACT 1 . C E R T I F I C A T I O N O F N A T U R A L F O R E S T S The Company is currently working with Sylvafrica on the process of FSC certification. 5 . E X P A N D P R O D U C T I O N C A P A C I T Y A N D H E C T A R E S O F F O R E S T U N D E R M A N A G E M E N T Woodbois wishes to increase its hectares under management to further enhance the benefits to all 1 5 2 stakeholders. 4 3 2 . R E F O R E S T A T I O N I N T H E F O R M O F P L A N T A T I O N O R N A T U R A L F O R E S T A L O N G S I D E P A R T N E R S Woodbois is exploring reforestation solutions for available degraded land to identify carbon credit / offsetting opportunities. 4 . R E D U C E T I M B E R W A S T E In moving along the value chain, Woodbois seeks to reduce its waste. 3 . C A P I T A L E X P E N D I T U R E T O M O V E F U R T H E R A L O N G T I M B E R V A L U E C H A I N Woodbois has extensively expanded its sawmill and has built a veneer factory in Mouila. The Company has committed to investing more capital to move along the value chain providing more skilled work for the local community. 85 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Woodbois is dedicated to promoting sustainable forestry practices in Gabon and has made significant progress towards achieving full forest certification by streamlining procedures. The Ngounié and Nyanga Forests Programme exemplifies the company's commitment to balancing economic growth with social and environmental responsibility. As part of this effort, the company is working towards merging all of its concessions in Gabon into a single, FSC-certified concession area. This consolidation will not only improve environmental, social, and economic performance but also enhance management oversight of forest activities. Additionally, Woodbois has taken further steps to ensure responsible forestry practices through the commissioning of High Conservation Value (HCV) and Biodiversity reports. These reports will provide a comprehensive assessment of the forest's ecological, social, and cultural values, further informing our management practices. However, the completion of these reports has been delayed due to the same financial and restructuring challenges mentioned earlier. Woodbois is actively procuring experts to conduct these assessments and aims to resume this process in the near future. We are confident that the results of these reports will contribute significantly to our 2024/5 forest certification process and that many of the positive outcomes highlighted in future Integrated Reports will be a direct result of the implementation of recommendations from these reports. 1. CERTIFICATION OF NATURAL FORESTS The Company is currently working with Sylvafrica on the process of FSC certification. However, FSC certification was not possible this year due to the high costs associated with the certification process. Additionally, the company has been undergoing restructuring and building investment for future growth. As an alternative, Woodbois is exploring other certification schemes in Africa that are less expensive, such as OLB Bureau Veritas. 2. REFORESTATION IN THE FORM OF PLANTATION OR NATURAL FOREST ALONGSIDE PARTNERS Woodbois is exploring reforestation solutions for available degraded land to identify carbon credit/offsetting opportunities. The company's commitment to reforestation is aimed at enhancing carbon sequestration and contributing to global climate change mitigation efforts. 3. CAPITAL EXPENDITURE TO MOVE FURTHER ALONG THE TIMBER VALUE CHAIN Woodbois has extensively expanded its sawmill and has built a veneer factory in Mouila. The Company has committed to investing more capital to move along the value chain, providing more skilled work for the local community. This investment aims to increase value addition within Gabon, thereby creating local employment opportunities and boosting economic growth. 4. REDUCE TIMBER WASTE In moving along the value chain, Woodbois seeks to reduce its waste. The company's initiatives in waste reduction are focused on maximising the utilization of timber resources and minimising the environmental footprint of its operations. 5. EXPAND PRODUCTION CAPACITY AND HECTARES OF FOREST UNDER MANAGEMENT Woodbois aims to increase its hectares under management to further enhance the benefits to all stakeholders. By expanding its forest management areas, the company intends to improve sustainable forestry practices and ensure long-term ecological balance. 86 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES REFORESTATION AND CARBON CREDIT DIVISION In 2022, the Voluntary Carbon Markets (VCM) continued to demonstrate their ability to provide near-term climate solutions, as the notional value traded in the market surpassed $1 billion for the second consecutive year. This achievement marks a continued trend of growing confidence in the VCM among investors and businesses seeking to take meaningful action on climate change. COP27's agenda prioritised the role of nature-based solutions (NbS) in both climate mitigation and adaptation, and recognised the importance of sustainable forestry management in combating climate change. The private sector is expected to propose dual strategies for managing risks associated with both climate change and biodiversity loss, which could include commitments to using NbS. NbS have been shown to have the practical potential to deliver significant emission reductions, equivalent to one- third of the global target set in Paris. Furthermore, NbS, including sustainable forestry management practices, can deliver significant environmental and social co-benefits at lower cost than technological solutions. Capitalising on this potential will require a coherent effort between governments, the financial sector, and business actors to deliver projects at a new pace and scale while prioritising sustainable forestry management practices. 87 WOODBOIS LTD | Integrated Report 2023 Woodbois established its carbon division in 2021 with the aim of developing a project implementation model that can simultaneously deliver environmental, social and economic value. In Q2 2023 Woodbois was awarded more than 50,000 hectares of unutilised land in Gabon to undertake a voluntary carbon credit afforestation project. The company plans to start a four-year pilot on a 2,000-hectare portion of the area, and in total the project is estimated to generate the growth of up to 50 million trees, mainly of the indigenous okoumé species. The project could potentially sequester more than 30 million tonnes of CO2 during the first 40 years and the first carbon credits are expected to be issued in 2028. We are excited to have been awarded in principle our first Afforestation/Carbon Sequestration project from the Government of Gabon. The project aims to regenerate Okoume in savannah areas, which are contiguous to forests, by introducing local pioneer species and preventing fires. This approach will create a forest rich in Okoume, an important tree species in the economy of Gabon and the daily life of rural populations. The afforestation project will also have significant positive impacts on biodiversity and water resources services. The new forest will increase the diversity of ecosystems in southern Gabon and have a root network that improves soil structure, increases water absorption, storage and filtration, and reduces surface runoff. Forests also stabilise soils, reduce erosion, and infiltration into groundwater, thereby benefiting downstream users who depend on the water. Moreover, forests ‘consume’ more water than most other types of vegetation, thereby reducing runoff and promoting better water infiltration to rivers and/or aquifers. COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES The afforestation project will create approximately 1,000 As a company, we believe in the importance of sustainable permanent jobs on average over the first ten years of forestry and environmental protection, and we are planting and 250 over the 40 years of the project, not committed to playing our part in building a more including the jobs that will be created for the exploitation sustainable future for all. and processing of wood. This project will benefit small businesses and service providers in Ndende and Tchibanga, Extensive due-diligence carried out as part of the project and supply contracts will be concluded with farmers for the feasibility process confirmed the attractiveness of Gabon as supply of bananas, cassava, and other staple foods. The a project jurisdiction. Well-aligned development objectives, transfer of technical skills to local people is also a major supportive policy, and prime environmental conditions all positive effect of the establishment of plantations. Initial and contribute to a unique project development setting. continuing training in planting and maintenance techniques is one aspect of this as well as training in nursery techniques, and eventually the creation of village nurseries. We are excited to be at the forefront of landscape afforestation and will seek to work with other African governments to replicate projects of this kind across the region. The economic advantages were recognised in a recent OECD paper that compared 166 countries based on the cost efficiency of forest carbon sequestration; Gabon ranked first in the afforestation category30. 88 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES Photosynthetic carbon capture is the most reliable and cost- effective method available today for restricting the rise of atmospheric CO2 concentrations. The Intergovernmental Panel on Climate Change (IPCC) suggests new forest projects could sequester 25% of the CO2 required to maintain the 2°C temperature goal. Our reforestation project also serves as a crucial element of our community engagement efforts. We are committed to making a positive contribution to social progress and the regional economy by creating jobs, providing training, and empowering employees to lead initiatives for local action. OUR REFORESTATION EFFORTS IN MOZAMBIQUE In 2023 we maintained our established planted areas of Woodbois’ reforestation project in Mozambique, which began in 2017 with 35 hectares in Madeiras and now cover a total of 107 hectares. The project is managed by Eng. Macedo Uachuacho and supported by Woodbois’ head office in Maputo, with 10 employees currently working on the project. We have a permanent nursery in place to support seedling irrigation, and we only plant species that are native to each concession and their surrounding communities. Since the project began in 2017, we have planted over 14,000 trees of different species, and the first seedlings are now between five and six metres tall. We submit a comprehensive report on our activities and progress to the Ministry of Forestry authorities at the end of each month. REFORESTATION PROJECT PROCESS Project developer coordinates with the Government to secure long term concession Native species used to restore efficient ecological system CO-BENEFIT Positive environmental impact on biodiversity, soil and water quality, and CO2 sequestration Poverty alleviation, skilling and stable employment for local communities Capability building and educating in sustainable practices Reduced migration from project geographies Gabon is one of the world’s most densely-forested countries, with a unique bioclimate suited to rapid tree growth and optimal CO2 sequestration. The Gabonese Government has demonstrated a keen appreciation for the environment, addressing deforestation, investing in green industries, and engaging with international sustainability programmes. 89 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES APPENDIX I MANAGEMENT PLAN FOR MOZAMBIQUE Management Plan https://www.woodbois.com/wp- content/uploads/Gabon-management-plan.pdf 90 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 91 WOODBOIS LTD | Integrated Report 2023 APPENDIX II MANAGEMENT PLAN FOR GABON 92 WOODBOIS LTD | Integrated Report 2023 Management Plan https://www.woodbois.com/wp- content/uploads/Gabon-management-plan.pdf 93 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES APPENDIX III - THE VALUE CREATION PROCESS AS PER THE INTEGRATED REPORTING FRAMEWORK EXTERNAL ENVIRONMENT PURPOSE, MISSION, VISION RN G OVE ANCE RISKS AND OPPORTUNITIES STRATEGY AND RESOURCE ALLOCATION BUSINESS MODEL BUSINESS ACTIVITIES OUTPUTS OUTCOMES (POSITIVE AND NEGATIVE OVER THE SHORT, MEDIUM AND LONG TERM) INPUTS PERFORMANCE OUTLOOK FINANCIAL MANUFACTURED INTELLECTUAL HUMAN SOCIAL AND RELATIONSHIP NATURAL FINANCIAL MANUFACTURED INTELLECTUAL HUMAN SOCIAL AND RELATIONSHIP NATURAL 94 WOODBOIS LTD | Integrated Report 2023 VALUE CREATION, PRESERVATION OR EROSION OVER TIME APPENDIX IIII CLIMATE CHANGE RISK ASSESSMENT This risk assessment evaluates the potential impacts of climate change on Woodbois' operations and outlines strategies for mitigation and adaptation. As climate change intensifies, it poses significant risks to infrastructure, biodiversity, and community livelihoods. Understanding and addressing these risks are crucial for ensuring the sustainability and resilience of Woodbois' business activities in the Congo Basin. This assessment identifies key climate- related hazards and business impacts, providing a structured approach to managing these challenges effectively. 95 WOODBOIS LTD | Integrated Report 2023 96 WOODBOIS LTD | Integrated Report 2023 APPENDIX V DEFORESTATION MONITORING Gabon, a country with 93% of its land covered by natural forests as of 2010, has been experiencing notable deforestation. By 2023, Gabon lost approximately 19.7 thousand hectares (kha) of natural forest. This deforestation is significant not only for its impact on biodiversity but also for its contribution to carbon emissions, which in 2023 alone were equivalent to 13.5 million metric tons of CO₂ (Global Forest Watch) (Global Forest Watch) . The causes of deforestation in Gabon are multifaceted, including logging, agricultural expansion, and infrastructure development. Despite these challenges, Gabon has managed to maintain a relatively low deforestation rate compared to other tropical countries, thanks to stringent conservation policies and sustainable forest management practices (Global Forest Watch) . For a detailed analysis and interactive maps showing forest cover changes in Gabon, you can visit the Global Forest Watch dashboard on Gabon (Global Forest Watch) (Global Forest Watch) . FOR AN OVERVIEW OF DEFORESTATION MONITORED WITH WOODBOIS’ MANAGED CONCESSIONS, PLEASE CLICK BELOW 97 WOODBOIS LTD | Integrated Report 2023 Global Forest Watch Map & Dashboard https://www.globalforestwatch.org/map/country/GAB/ https://www.globalforestwatch.org/dashboards/global/ COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES ESG INDICATORS This report follows the The Global Reporting Initiative (GRI) 2021 Standards 98 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 99 WOODBOIS LTD | Integrated Report 2023 100 WOODBOIS LTD | Integrated Report 2023 COVER MESSAGE FROM THE CEO ABOUT THIS REPORT ABOUT WOODBOIS OUR BUSINESS MODEL THE CAPITALS APPENDIX & REFERENCES 13. National Traceability System of Wood of Gabon (SNTBG) https://www.gabonreview.com/tracabilite-du-bois-maurice-ntossui-allogho-donne-six- mois-aux-entreprises-pour-adopter-le-sntbg/ 14. Traceability and Transparency in Gabon - EIA US https://forestlegality.org/sites/default/files/2024- 05/EIA%20national%20transparent%20traceability%20systems.pdf 15. Interpol clamps down on illegal logging - BBC News https://www.bbc.co.uk/news/business-19541718 16. World Forest ID www.wri.org/initiatives/world-forest-id 17. Environmental Investigation Agency (EIA) https://www.eia.org/ 18. Code4Nature http://code4nature.org/ 19. OECD Paper on Forest Carbon Sequestration https://www.oecd.org/environment/a-global-analysis-of-the-cost-efficiency-of-forest- carbon-sequestration-e4d45973-en.htm 20. Woodboi’s Forest Management Plans https://www.woodbois.com/sustainability/ REFERENCES 1. IFRS Foundation https://www.ifrs.org/ 2. International Accounting Standards Board (IASB) https://www.ifrs.org/groups/international-accounting-standards-board/ 3. International Sustainability Standards Board (ISSB) https://www.ifrs.org/groups/international-sustainability-standards-board/ 4. United Nations SDGs https://sdgs.un.org/goals 5. GRI - Standards (globalreporting.org) https://www.globalreporting.org/standards 6. Global Forest Watch https://www.globalforestwatch.org/ 7. Open Timber Portal - Lynn Timber (IFRS) https://opentimberportal.org/operators/lynn-timber-woodbois- gabon/documentation 8. Boston Consulting Group - Value of Forests https://www.bcg.com/publications/2020/the-staggering-value-of-forests-and-how- to-save-them 9 Nielsen Study https://nielseniq.com/global/en/insights/analysis/2019/a-natural-rise-in-sustainability- around-the-world/ 10. BP Statistical Review of World Energy https://www.bp.com/content/dam/bp/business- sites/en/global/corporate/pdfs/energy-economics/statistical-review/bp-stats-review- 2021-approximate-conversion-factors.pdf 11. International Energy Agency (IEA) https://www.iea.org/ 12. Forest Stewardship Council ® (FSC®) https://fsc.org/en 101 WOODBOIS LTD | Integrated Report 2023 CBP00019082504183028 The paper used in the report is Forest Stewardship Council® (FSC®) certified paper from sustainably managed forest and other controlled sources. This ensures that there is an audited chain of custody from the tree in the well-managed forest through to the finished document in the printing factory. Printed in the UK by Pureprint a CarbonNeutral® company. Both the manufacturing mill and printer are registered to the Environmental Management System ISO 14001 and are Forest Stewardship Council® (FSC®) chain-of-custody certified. Woodbois Ltd Registered Address: P.O. Box 161, Dixcart House, Sir William Place, St Peter Port, Guernsey GY1 1GX Tel: +44 (0)20 7099 1940 https://twitter.com/WoodboisLtd https://www.linkedin.com/company/woodbois-ltd www.woodbois.com 

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