The condensed group financial statements for the year ended September 2024 have been prepared in accordance with the framework concepts and the measurement and recognition requirements of IFRS^® Accounting Standards and the Financial Pronouncements as issued by the Financial Reporting Standards Council and SAICA Financial Reporting Guides as issued by the Accounting Practices Committee (collectively "JSE Listings Requirements"), IAS 34 Interim Financial Reporting and the South African Companies Act. The accounting policies applied in the preparation of the condensed group financial statements are in terms of IFRS and are consistent with those applied in the previous annual financial statements.

The preparation of these condensed group financial statements was supervised by the Chief Financial Officer, GT Pearce, CA(SA) and were authorised for issue on 7 November 2024.

The condensed group financial statements for the year ended September 2024 which includes the condensed group balance sheet, condensed group income statement, condensed group statements of other comprehensive income, changes in equity and cash flows and notes to the condensed group financial statements have been reviewed by KPMG Inc., who expressed an unmodified review conclusion. The auditors report should therefore be read in conjunction with these condensed group financial statements. Shareholders are therefore advised that in order to obtain a full understanding of the nature of the auditor's engagement they should obtain a copy of the auditor's report together with the accompanying financial information from the issuer's registered office.

Reconciliation of Adjusted EBITDA to profit for the period and operating profit excluding special items to operating profit.

The group's financial instruments that are measured at fair value on a recurring basis consist of derivative financial instruments and investment funds. These have been categorised in terms of the fair value measurement hierarchy as established by IFRS 13 Fair Value Measurement per the table below.

There have been no transfers of financial assets or financial liabilities between the categories of the fair value hierarchy.

The fair value of all external over-the-counter derivatives is calculated based on the discount rate adjustment technique. The discount rate used is derived from observable rates of return for comparable assets or liabilities traded in the market. The credit risk of the external counterparty is incorporated into the calculation of fair values of financial assets and own credit risk is incorporated in the measurement of financial liabilities. The change in fair value is therefore impacted by the following inputs, the movement of the interest rate curves, by the volatility of the applied credit spreads, and by any changes to the credit profile of the involved parties.

There are no financial assets and liabilities that have been remeasured to fair value on a non-recurring basis.

The carrying amounts of other financial instruments which include cash and cash equivalents, trade and other receivables, certain investments, trade and other payables and current interest-bearing borrowings approximate their fair values.

Since the 2023 financial year-end, the Euro and the ZAR have strengthened by approximately 5.6% and 9.6% respectively against the US Dollar, the group's presentation currency. This has resulted in an increase of the group's European and South African assets and liabilities, which are held in the aforementioned functional currency, on translation to the presentation currency at period end.

Ordinary shareholders' interest

In March, the group issued 39.5 million ordinary shares amounting to US$59 million to settle the residual ZAR1.2 billion 5.25% convertible bonds issued by Sappi's wholly owned subsidiary, Sappi Southern Africa Limited, on 25 November 2020.

Other non-current assets

All remaining members on the South African defined benefit fund were transferred to the provident fund on 28 February 2024. This resulted in a settlement loss of US$2 million (ZAR37 million).

Provisions

Restructuring costs of US$134 million were raised during the year predominantly relating to the closure of our Stockstadt and Lanaken Mills within our European segment. An amount of US$209 million was paid during the year.

Inventories, trade and other receivables and trade and other payables

The increase in inventories, trade and other receivables and trade and other payables is largely attributable to seasonal working capital movements. Closure costs of US$54 million (€50 million) related to Stockstadt and Lanaken Mills were raised during the year which are included in "fire, flood, storm and other events" disclosed in note 2. An amount of US$71 million was paid during the year.

The assets held for sale relate to items of property, plant and equipment from the closure of our Lanaken Mill in our European segment. An impairment reversal of US$30 million (€28 million) was recognised in valuing the assets at their fair value less costs to sell. Assets to the value of US$44 million (€40 million) were sold post-year-end.

There has been no material change, by nature or amount, in transactions with related parties since the 2023 financial year-end.

On 25 October 2024, the group sold two of its wholly owned subsidiaries namely Sappi Lanaken NV and Sappi Lanaken Press Paper to the UTB group for US$44 million (€40 million).

The directors have resolved to declare a gross cash dividend (number 91) out of income earned for the financial year ended September 2024 of 14 US cents per ordinary share in issue on the record date being 13 January 2025. The dividend is payable in ZAR at an exchange rate (US$1 = ZAR) of 17.62526, being 246.75364 cents per share.

There has been no significant change to management's estimates in respect of new accounting standards, amendments and interpretations to existing standards that have been published which are not yet effective and which have not yet been adopted by the group.